Business Process Analysis versus Business Process Management
Written By: Hans Mercx
Published On: October 9 2006
Talking to end users reveals that there is confusion in the market regarding business process analysis (BPA) and business process management (BPM) suites. Vendors use the term BPM in a very broad way, but what are really the differences between BPA and BPM, and where does BPM come from?
BPM in the Early Stages
In the 1980s, organizations used business process redesign (BPR) to improve productivity, quality of service, and cost effectiveness by making drastic changes within the processes of their organizations. Information technology (IT) solutions for these major redesigns were viewed as often resulting in major employee cuts, due to the fact that many businesses used BPR to restructure their company. Because of this, many organizations today are hesitant about implementing business process changes. This is particularly true when it comes to current BPM solutions, which focus mainly on lowering cost and increasing productivity, just as the focal points of these solutions in the 1980s were on drastic organizational changes.
In retrospect, the BPR approach of trying to change everything at once seems a bit extreme. Therefore, current BPM solution providers market a more subtle approach, in which changes are incremental and less drastic than with the old BPR tactics. Nonetheless, there are times when a more radical approach to process modeling and redesign is called for in order for an organization to position itself differently in the market. Moreover, businesses have a tendency to change certain processes rapidly. This is not a problem, as the new BPM solutions are capable of adjusting the process design accordingly, without having a huge impact on the company structure. Thus, even though the BPM strategy operates through incremental changes, businesses will notice the positive impact these changes effect within an organization.
Another huge difference between the BPR of the 1980s and the BPM of the present is the fact that BPR involved hard-coded process changes. Organizations not only needed programmers instead of business users to implement these changes, but they were time-consuming. Technologies for process automation, document management, etc., were independent of each other, and could only be integrated through coding. This made integration more difficult than it is now, resulting in it often not being used at all.
When pure-play BPM vendors arrived on the scene, they created a product whose components were already integrated with each other to form one cohesive solution. These vendors focus on the business side of the organization, creating a user-friendly interface, and involving business analysts in the entire cycle of process modeling and implementation—not just in requirements gathering and user acceptance testing. This means that business users can apply changes more efficiently without relying on the IT department, because changes are not hard-coded and usually do not require programming skills.
What Is Business Process Modeling and Design?
Before an organization starts the design or modeling process, it needs to understand what its business processes are. In general, a business process is a set of logically related business activities that combine to deliver something of value. A business process can be seen as different steps within a business cycle, but also as a set of steps or activities that run throughout the organization, and which are often built to the requirements of the customer. In this case, the customer is a different department, the actual end user, or a product in the next process within the workflow.
When it comes to specific business processes within an organization, business analysts should look beyond departments. Departments are often divisions or silos within an organization, but business processes lie on top of these departments. For example, selling to a customer is typically viewed as a single business process, but several departments, from the sales department to the distribution and finance departments, are involved in this single process.
There is a good reason why BPM solutions handle processes in this way, as horizontal rather than vertical or "functional" processes. If an organization views its processes vertically based on functions, the process is isolated. This can cause delays, increased costs, and duplication of tasks, as well as loss of quality control. Horizontal processes, on the other hand, cross the boundaries of departments. They focus more on human-centric processes ("who does what," in other words) than on task-centric processes (which take things step by step).
In terms of modeling and designing these processes, the main drivers for most organizations are optimization, effectiveness, organizational growth, and customer satisfaction. In fact, the most common ideas behind business process modeling and design are as follows:
- performance improvement
- cost reduction
- business process automation
- business process integration
- business opportunity creation
Business process modeling and design is more than just another project for an organization. Organizations should see business process modeling and design as an actual business change that will help it to meet or redirect its scope, and to continuously meet its customers' requirements and expectations. Business process modeling can include organizational changes, technical changes, or frequently a combination of both.
BPA as a Stand-alone Solution
Besides vendors that provide full business process management suites (BPMS) as discussed below, there are vendors that focus more on the modeling and analysis than the actual execution of the processes. Their solutions are called BPA tools. BPA solutions concentrate on process design and the associated business model analysis. Integration, performance, support, and ease of use are important for BPA solutions, as are the two modules described below.
The business model designer is a module that enables business users to visualize the business processes within an organization. This permits the identification of bottlenecks, tasks, and opportunities, so that business users can automate these processes. Module features such as graphical process design, validation of processes through checkpoints, and the inclusion of icons in the processes, improve process visibility for business users. Moreover, with the business model designer, it is possible to take a top-down approach to process modeling by starting with a high-level business process and drilling down to more detailed processes within the organization. This module also provides a communication method for business users to talk to people in more technical departments, such as system integrators.
The business process analysis module enables business users to perform more sophisticated analysis than is possible through visual analysis of graphical designs alone. Unlike BPM suites, this module can carry out financial, risk, and value chain analyses. In addition, this module lets business users execute static analyses, dynamic simulations, and resource utilization analyses. Through these analyses, business users can track the ongoing process, analyze bottlenecks, optimize the process, and even push these actions through into the running process.
In order to conduct these analyses, a BPA solution integrates with a variety of different solutions. For instance, business users often will start by creating models in a solution such as Microsoft Visio, since the BPA tool needs to be able to import the resulting diagrams. Then, to perform the business process analyses, the tool will integrate with a business activity monitoring (BAM) solution that monitors the running processes. The BPA solution also needs to integrate with business rules engines, execution models, or pure-play BPM solutions, as the BPA tools themselves don't execute the processes.
A BPA solution should come with a solid methodology to ensure business users are as efficient as possible. The solution will likely come with a standard business process methodology, and support international standards such as Six Sigma and Rummler-Brache (for diagrams). Often, best practices are built in as well.
BPM suites are more fully integrated solutions. They combine key technologies into one offering to enable business users and management to control and manage business processes, without heavily relying on the IT department. These technologies include business process modeling, BAM, a business rules engine, business process optimization, and application integration. Such technologies, as well as the functions and controls incorporated in BPM suites, can be used to complete the BPM life cycle (to view the life cycle, see figure 1 or Gartner's November 18, 2005 article Business Process Management Suites Enhance the Control and Management of Business Processes).
Figure 1. BPM Life Cycle
Several pure-play BPM vendors have acquired specialized niche solutions and integrated them into their own solution in order to expand their suite's functionality and offer a full BPMS. The challenge with this approach is in integrating the different solutions into one offering and in repositioning the solution in the rapidly emerging market. Vendors such as Appian, Savvion, Metastorm (after acquiring CommerceQuest), Ultimus, Lombardi, and BEA (with its acquisition of Fuego) are fighting over who is going to be the market leader in the BPMS space. Vendors coming from the enterprise content management (ECM) corner, such as FileNet, and smaller vendors that are expanding their solutions, such as Vision and DynaFlow, are also making their presence felt in the BPM market.
BPA vendors are expanding their capabilities without touching the execution part of BPM suites. BPA vendors, such as Proactivity, IDS Scheer, and Proforma, are developing and delivering best-of-breed solutions. These vendors focus on the user market where business rules or execution models are already in place. Through integration with other best-of-breed products, these vendors offer a full BPM solution.
The challenge for BPA vendors is to clearly bring their solution message to the user market. There is currently too much confusion in the market among end users regarding the difference between BPA and BPM. BPA vendors should clearly state the benefit for the organization of pure business process analysis without workflow or execution modules.
BPM suites, on the other hand, are conquering the market with an approach that focuses on integration between functionalities and technologies that are already in place, and on offering organizations a broad, fully integrated solution. The better BPMS vendors provide pre-defined, industry-specific models and frameworks to support the vertical market, supplying a solid base as well as customization to an organization's specific needs.
The challenge for BPM suites will be to change processes, and the metadata included with these processes, without interrupting the deployment of current processes. This metadata-driven approach is something that not all vendors have mastered as of yet. Organizations looking for a BPM suite should make sure they take into consideration the future plans of BPM vendors in order to ensure that a vendor's strategy matches the needs of the organization.