How Process Mining helps modern businesses
The economic environment is changing rapidly. Modern businesses are adopting “process-based” approach to ensure they are achieving their business goals. Companies rely on business process modelling and BPM tools to solve the process integration, but they inevitably fail to deliver business process optimisation because they lack operational excellence. Process Mining technology can help modern businesses manage socio-cultural challenges ignored by BPM.
Challenges modern businesses face
- Economic and Competitive Pressure
- Expectations & Demands of Customers and Employees
- New Technology Disrupting the Market and IT Silo
- Economic Fluctuation and other instabilities, e.g. currency rates, energy costs etc.
- Governance, Compliance, Audit & Security
In these circumstances, businesses need to optimise business processes continuously. The challenges in continuous business process optimisation are twofold:
Business Process Management can provide answers to challenges created by the continuous change from the technology and business model point of view, by concentrating on:
But the socio-cultural challenge remains mostly ignored, even though information behaviour changes much faster than information systems. These behavioural factors have a severe impact on the success of business process optimisation.
There are many factors preventing businesses from achieving continual business process optimisation:
- IT is considered a cost centre.
- There are conflicts between departments.
- Slow decision making from management.
- Approval of processes is complicated.
- The process owner is present, but ownership is not – there is lack of accountability, responsibility and credibility.
- An aversion of large companies to risk-taking and fear of change.
- Knowledge gap.
- There is an absence of an innovative person with sufficient decision-making authority.
- IT exists as a silo within the company.
- There is a general absence of collaboration between IT and business.
Common approaches to continuous business process optimisation:
Business Process Re-Engineering (BPR)BPR aims to redesign processes with the company to achieve dramatic improvements in performance. BPR introduces radical changes in operational strategy for the enterprise, seeking to bring competitive advantages.
Business Process Optimization (BPO)
BPO looks for ways to improve the processes in the existing structure. BPO monitors processes and evaluates how they align with business objectives. The focus is on controlling and optimising operations, making sure necessary resources are allocated, prioritising work and selecting the best-performing suppliers and services providers.
Best Practice Examples from BPO and BPR
Shorter throughput time and increased quality by implementing new guidelines to reduce the number of contacts: Ford’s accounts payable departments decreased the number of clerks from 500 to 125 –by going from three points of contacts to two.
Baxter Healthcare adopted a just-in-time provision of hospital equipment, which lead to higher flexibility and reduced costs.
An electronic company compressed responsibilities for the various steps in the order fulfilment process resulting in tasks combined into one activity executed at the same time by customer service representative.
At IBM credit specialist jobs such as credit checker and pricer were combined into a single position “deal-structurer” resulting in reduced human resources costs.
The path to optimum outcomes: Process Mining
Process Mining software can deliver tangible value in your BPO and BPR initiatives, in the form of actionable insights, and data-driven business process measurement and analysis.
Process Mining enables discovery, monitoring, and improvement of real processes by extracting knowledge from event logs and can be used to speed up the delivery and increase the accuracy of initiatives, while also mitigating many of the socio-cultural/behavioural challenges. This tool for automated analysis visualises comprehensive, detailed maps of what was and is currently happening, enabling continuous process analysis.
What can be achieved:
- Cost reduction, reduction of throughput times, elimination of defects or waste or resource constraints
- Integration, Automation, Collaboration
- Flexibility, Response speed, Availability, Scalability, Traceability, Maintainability
- Mitigation of Threats and Risks
- Removal of Process Conflicts/Deadlock
- Continuous Improvement: evaluate improvement > identify shortcomings > improve again
- Enhance customer satisfaction
- Asses real-time data
To achieve the best outcomes, analyse processes form two perspectives:
Quantitative analysis: Objective Approach
Process performance and Behaviour Analysis to improve performance bottlenecks.
Qualitative analysis: Subjective Approach (Structured process improvement)
Developing an existing process to a better version by elimination non-value-added activities (e.g. redundant, rework and supervisory activities) simplifying and combining tasks, and increasing their concurrency.
Wins for the organisation:
- IT as a Profit Centre
- Integration and collaboration to reduce conflicts between departments.
- Informed decision making from management through 100% transparency within processes.
- Simplify approval of business processes.
- Promoted business process ownership culture with accountability, responsibility and credibility.
- Promote innovation and changes within processes – measure improvements and continually improve.
- Introduced compatible disruptive technology with the lowest costs.
23. 04. 2018