How to Build a Business Case for Process Mining
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A well defined business case is the first step towards introducing process mining software into an organization. A business case is the detailed justification for why a project is worthy of execution, both in terms of financial benefit and human resources.
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When introducing new technology into a complex web of event logs, IT systems, and workflows, a mutual understanding of end goals, use cases and ROI must be established.
Elements of a strong business case
A strong business case should be detailed enough to preempt risks, build confidence in the project and provide a financial forecast which estimates the cost of implementation vs potential cost savings or revenue growth. At the same time, a business case should include a persuasive, executive summary which explicitly states why the project is worthy of pursuit.
If you can’t convince yourself in simple terms of why process mining software is the answer to operational shortcomings or a conduit towards process excellence — you’ve lost your case. Detailed aspects of the business case should be referred to as a navigational tool throughout the project, but a straightforward answer for “why process mining?” should be stated upfront.
Understanding process mining use cases
Before diving into the detailed elements of a process mining business case (template below), let’s step back to take a sharp look at process mining use cases. The most common uses cases of process mining software include process discovery, conformance checking, resource optimization and cycle time optimization.
The importance of defining a use case is not to settle on just one, but rather to understand the scope of application upfront. For example, process discovery may be the strongest and primary use case defined in the business case. In that discovery, conformance checking or process optimization may become secondary uses cases. Prepare for this possibility in the business case.
1. Process discovery
Understand and manage the flow perspective of a process. This use case is valuable when processes are unknown or have deviated from original process architecture.
Process discovery puts control back into the hands of users and enables decision makers to redesign ineffective or outdated processes.
Process discovery also helps determine routing probabilities, path distribution and decision points. To understand the root cause of process outcomes, look back at circumstances which influence decision points. Are there ways in which a decision point can be affected in order to lead to a more desirable choice? Process discovery will aid in this deeper understanding of routing outcomes.
2. Conformance checking
Laws and regulations exert various amounts of pressure depending upon which industry an organization operates. From privacy regulations such as GDPR to food safety laws established by the FDA or EMA, organizations — and the processes upon which they are built — must comply with such laws.
Conformance checking is a primary process mining use case which compares process execution with process design. To which degree do processes comply with self governing rules and legally binding regulations? Are there process outliers and how do they come about?
Highly regulated industries and those which manufacture consumer goods rely on airtight conformance checking procedures. However, in the era of GDPR and increasing pressure from customers for organizations to self-govern, conformance checking is expanding in importance. Failure to comply with such laws and regulations may result in loss of customers, serious fines or business closure.
3. Resource optimization
This use case is highly relevant for those in pursuit of operational excellence. An organization which identifies process excellence as a means towards a further defined value proposition may use process mining for resource optimization.
Resource optimization, by way of process mining, helps decision makers understand the real distribution of resources per task. Identifying how resources are used in a process — and how work is transferred among resources — leads to a better understanding of output quality and cycle time. This use case can highlight top performing employees, highly effective processes and reveal ways in which resources are getting gobbled up with little results.
4. Cycle time optimization
Similar to the resource optimization use case, cycle time optimization relates to operational excellence. This use case identifies slow activities, long wait times, process bottlenecks and throughput time (amount of time needed in manufacturing to convert raw materials into a final product).
Cycle time optimization varies slightly from resource optimization in that the primary focus here is on reduction, rather than enhancement. Resources optimization may focus on retraining staff or introducing more effective work methods. While cycle time optimization looks to cut out white space without sacrificing output quality.
It’s the difference between effective work (resource optimization) vs efficient work (cycle time optimization).
Process mining business case template
With primary and secondary use cases established, now is the time to dig into the details of a business case. Start with a solid executive summary, followed by specific details relating to project background, goals, use case, limitations, scope and financial impact.
- Briefly state ‘why process mining’
- Impactful summary to justify process mining
- Why now? What changed to bring about this need?
- Was there a significant process rupture?
- Have process been neglected for sometime?
- Are competitors benefiting from process mining? Is this more than just a market trend? Explain how PM specifically relates to your organization and situation (go beyond trending technology, but included process excellence as competitive advantage in background section).
- What is the end goal of implementing process mining?
- Improve customer experience?
- Avoid fines or penalties?
- Attract new suppliers or partners?
- Reduce operational cost?
- Seize new opportunities?
- For which purpose(s) will process mining be primarily used?
- Process discovery?
- Conformance checking?
- Enhancement of resources?
- Enhancement of cycle time?
- What won’t process mining solve?
- Set expectations and identify technology limitations
- How does process mining compare to other potential solutions?
- Is manual / non-technical process optimization an option?
- Remember: “do nothing” is an option to be explored (along with risks and benefits of such)
- Who’s involved?
- Consider all phases of a process mining project including: selecting a vendor, preparing in-house systems, day-to-day project management, strategic direction, etc.
- Who will be impacted?
- Which specific elements of business or departments will be impacted?
- How will day-to-day operations change?
- Who will decide how internal resources will be allocated to this project?
Timeline / Schedule
- Outline project implementation (must be time sensitive!)
- Who does what, when and how?
- Include decisions and/or goals to be reached during each phase
- What happens if we fail?
- What happens if we do nothing?
- Are we on the brink of non-compliance?
- What happens if regulations change?
- How will process mining software save money?
- Include specific costs related to wrong product shipment, lost leads or cost of non-compliance. Consider how poor process performance relates to employee churn.
- Consider cost benefits of RPA (identified via process mining)
- How will process mining software increase revenue?
- Estimate the value of new clients or improved customer experience.
- Consider revenue increase from better use of resources or reduced cycle time.
- What is the cost of process mining implementation?
- Is it a one-off or are there ongoing costs?
- What is the purchasing strategy?
- Do we own the technology or do we lease?
- What is the human resource cost?
- Can we implement this technology in-house or do we need consultants?
- What is the cost of doing nothing?
- ROI summary
- Drive home the benefits of process mining with an ROI summary which can be understood at a glance (ie: one number).
Take action with Minit process mining software
Do you see value in the above but need help building a business case relevant to your specific industry? Checkout our industry review of process mining applications in Healthcare, Banks & Insurance, Retail, Manufacturing, High Tech & IT, Telecommunications, Logistics & Transport, Energy & Hydro, and the Public Sector.
Next, book a demo with our team of process mining experts to discuss the specific needs of your organization.