The Evolution of Organizational ProcessBy Diana Mirakaj | Posted 2009-12-08 Email Print
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For as long as formalized management studies have existed, organizational processes have needed improvement.
Despite a multidecade focus, business-technology processes in many companies are unmanaged, invisible and unmeasured.
Consequently, they are executed haphazardly and inconsistently. This results in delays, errors, low quality and high overhead costs. Such unmanaged processes cannot detect and adapt to changing market conditions—and that can be fatal in today’s business environment.
There are countless reasons for this continuing breakdown. Principal among them is that many processes cross an enterprise’s internal and external boundaries as part of business networks and, therefore, they become the province of no one.
In most cases, there are no single point-of-responsibility process owners. Although there are some recent exceptions to this state of affairs in best-practice companies, surprisingly few enterprises currently have managers for their key processes.
These realizations have led to a new perspective on business processes and their technology enablement. This perspective is based on new business-technology capabilities, the increasing need for real-time metrics, and the adoption of an external orientation that is customer-focused and interorganizational.
Terms used to describe this state include “the real-time enterprise,” “the on-demand organization,” “business-process fusion” and the “service-oriented enterprise.” The basic requirements of this perspective include the following:
1. A service and customer emphasis: All processes have a customer for what is produced, whether that is an internal (employee) or external (market) customer. From a customer’s perspective, the delivery end of a process chain is a service. To view a process as a service requires asking what solution it provides or what problem it solves, rather than asking how it does what it does (which is a process viewpoint).
2. Rule-based business process management: A rule-based approach establishes guidelines that coordinate the relationship among activities and tasks along an entire process chain. A rule-based approach helps prevent the processes that collectively produce customer services from becoming fragmented.
These processes are typically a mixture of digitized and manual activities that span many functional areas and their associated automated applications. Moreover, the processes that deliver value to the end customer will generally extend beyond the firm into the business network.
3. Event-spawned metrics: Process orchestration makes it possible to monitor event data across the entire process chain. With this potential for fine-grained event and status visibility comes a new set of issues to be reconciled. These include determining what metrics are appropriate, at what level of aggregation, and to whom they are delivered and in what form.
At the same time, compliance issues such as the Sarbanes-Oxley Act increasingly focus on, if not demand, the reporting of noncompliant events and deviations from prescribed operating rules. Finally, having real-time, end- to-end process status information permits continuous business optimization.