Business Process Management (BPM) - Types, Lifecycle, Importance, Benefits
Business Process Management (BPM) is a discipline in which people use several methods to analyze, optimize, automate, and standardize business processes. BPM brings forward a consistent and automated approach. It helps reduce the businesses’ operational costs and increase the overall efficiency of the team and business processes. Business organizations and companies that are involved with Business Process Management (BPM) usually follow one of the several BPM methodologies including Six Sigma or Lean.
Different organizations and companies have different business needs. However, large business organizations have business processes that cannot be manually managed without the help of
some automated tools. This is why BPM software tools were designed to aid large-scale businesses.
Why Is Business Process Management Important?
Business Process Management is quite significant because only the effectual business processes are vital to the success of the firms. All important business operations involve the use of IT systems, hence most of them need business process management tools. A carefully crafted business process with the help of Business Process Management breaks tasks into structured steps for workers. Poor business processes can take a toll on the company’s success and overall proficiency. Nevertheless, Business Process Management helps you to avoid that. Furthermore, BPM aids businesses deliver all the products and services proficiently and at lower prices.
Three Types of Business Process Management Systems
The categorization of the BPM systems is based on their purpose. The three types of BPM systems are mentioned below:
System-Centric BPM
System-Centric Business Process Management or Integration-Centric BPM deals with processes that mainly depend on the existing business systems which don’t necessarily have much human interference or involvement. They focus on repetitive transitions and workflows that are automated. Additionally, Integration-centric BPMs primarily depend on APIs and mechanisms that assimilate data across systems like HRM, CRM, etc.
Human-Centric BPM
Human-Centric Business Process Management is backed up by several automation functions. It considers people first and emphasizes the relationship between people and their tasks. In this way, the Human-centric BPM can promote effective collaboration. Human-Centric BPMs help with tasks like reviewing data, handling complaints, creating repeatable documents like contracts, etc. These tasks are mainly executed by people and are not certainly replaced by automation.
Document-Centric BPM
When documents such as contracts or agreements have a central place, document-centric business process management solutions are needed. The documents are usually retrieved and the appropriate software required to deal with them is automatically called. These processes describe procedures for distributing, reviewing, and verifying documents. Before reaching the final stage, a document goes through several parties until it is processed.
Life Cycle of Business Process Management (BPM)
Design
In this stage, a team of business analysts will go through all the existing business rules and discuss the desired outcomes with management. Business analysts here interview employees, review Design Model Execute Monitor Optimize documents and understand the business rules and actions. The main goal at this stage is to understand the business rules to ensure organizational goals are aligned with the outcomes.
Model
The goal of this stage is to visualize the phases in the process. Visualizing the process phases makes it easier for everyone to understand things and it increases the overall efficiency of the process. Besides, you have an opportunity to show your creative spark while making various adjustments in the process. If you want, you can model the process in the form of a flow chart too. Information such as deadlines to provide a comprehensive idea of how the events are sequenced can be fixed to represent the flow of data during the whole process.
Execute
The third step in Business Process Management (BPM) is called “execute.” In this stage, the designed model is put to the test so that new processes can be carried out and the model can be seen in action. You can also test the process with a few users or a small group first and see how things go. If all goes well, you can make the new model available to all users. However, make sure you limit access to sensitive information.
Monitor
Once the process is designed, modeled, and executed, it is important to keep an eye on it and monitor it to evaluate its progress and efficiency. You will have to set some Key Performance Indicators (KPIs) to monitor the efficiency of the process. Gathering data will help you develop KPIs and metrics to evaluate the efficiency of the process.
Optimize
The next step is to optimize the process, no matter how great your process might be or how well it performs, there is always room for improvement. Optimizing your business process is the last stage in the lifecycle and you will have to make improvements in the process based on the data you have collected during the monitoring phase. You can make all the necessary changes to your business process to make it more efficient. Effective optimization of processes results in less wasted labor and enhanced output quality.
Why Should You Implement Business Process Management?
The next step is to optimize the process, no matter how great your process might be or how well it performs, there is always room for improvement. Optimizing your business process is the last stage in the lifecycle and you will have to make improvements in the process based on the data you have collected during the monitoring phase. You can make all the necessary changes to your business process to make it more efficient. Effective optimization of processes results in less wasted labor and enhanced output quality.
There are several benefits of using Business Process Management in your business:
Enhanced Business Agility
If you want your business to stay afloat in the ever-changing corporate world, you will have to change and optimize your business processes. Sometimes, your existing processes may not be working well for your business, which is why you can pause your current processes, make adjustments, and execute them again to get the desired results. Apart from that, making changes to workflows, customizing, and using them again provides an opportunity for businesses to become more responsive and provides the organization with detailed and valuable insights.
Generate better ROI
An effective business management tool helps you significantly reduce costs over time. With the help of BPM solutions, you can track resources to decrease waste, and doing so will also reduce costs and help you gain more profits.
Higher Efficiency
Another key benefit of business processes is that your business will yield higher efficiency. Manually doing several repetitive and recurring tasks take a lot of time while using automation for all these recurring tasks will yield higher efficiency in the business process.
Enhanced Visibility
As BPM software tools provide you with automation while efficiently monitoring Key Performance Indicators (KPIs). This is much-needed transparency that leads to effective business management and helps in efficiently modifying structures while tracking favorable outcomes.
Compliance with the standards, Safety & Security
An in-depth BPM ensures that businesses comply with the standards and meet the requirements of the law. It fosters safety and security practices by carefully documenting processes to facilitate compliance. In this way, organizations can also encourage their staff to protect the assets of the organization including sensitive and private information and all the physical resources from misuse, loss, or theft.
The Difference between Business Process Management (BPM) and Business Process Automation (BPA)
Many people think BPM and BPA are the same but despite them being so related, they are not the same. The difference lies in the fact that Business Process Automation (BPA) is all about automating business processes while Business Process Management (BPM) deals with managing processes that may or may not be related to automation. Moreover, all BPA can be taken as a form of BPM, but not all BPM can be considered as BPA.