The Complete Guide to Business Process Management in the Digital Age

This guide explores business process management from top to bottom.

Among other things, we will look at:

  • A definition of business process management (BPM)
  • How business process management compares to related disciplines
  • Frequently asked questions about business process management
  • The business process management life cycle
  • Tips, strategies, and best practices 

…and much more.

To start with, let’s define a few important terms, starting with business process management itself.

Business Process Management (BPM): Important Definitions and Differences

Here are some important concepts that can help us better understand how business process management fits into the organization.

Business Process Management: A Definition

Business process management is a business discipline designed to organize and optimize individual employees’ workflows.

It does this through a complex life cycle aimed at assessing needs, designing an optimal workflow, then testing and improving that workflow over time.

The purpose of this approach is to:

  • Understand how business processes are operating 
  • Increase efficiency, effectiveness, and productivity
  • Improve organizational performance
  • Lower error rates
  • Save costs

Effective business process management can also carry a number of other positive side effects. 

When business processes are made more efficient, for instance, employee engagement can also increase alongside productivity.

Workflow Management vs. Business Process Management

Though workflow management and business process management both tackle the same area – business processes – they each take a different approach.

Business process management takes a big-picture view of a process in the context of an organization. Its purpose is to coordinate various processes and improve the efficiency of organization-wide procedures, programs, and processes.

Workflow management, on the other hand, takes a local view of the same topic, focusing on people, instructions, and tasks. The aim is to improve the efficiency of individual processes.

As we will see later, there are software applications that exist for both discipline.

Business Process Analysis vs. Business Process Management

Business process analysis is the process of analyzing business processes to find and address problems with business processes.

According to some, business process analysis is a specialization within business process management, which includes four steps:

  • Identify the process
  • Collect key data
  • Analyze the process as it is 
  • Design what the process should look like

From this perspective, business process analysis is clearly an important step in business process management – but it is clearly only one step and not the same as business process management itself.

Project Management vs. Business Process Management

Project management is a management discipline dedicated to coordinating, organizing, and managing a discrete business project.

For example, a business may choose to adopt a new CRM platform

This project would have…

  • A start date, a timeline, and an end date
  • Specific goals and objectives related to adoption, such as employee performance and time-to-competency
  • Roles and responsibilities, such as super users who would coach team members

Among other aims.

Business projects are certainly related to a business, but unlike business processes, they are not ongoing. And they may or may not be related to core business functions.

Service Management vs. Business Process Management

Service management is often used as shorthand for IT Service Management.

IT service management is a specific IT function designed to perform tasks such as:

  • Manage changes to IT services
  • Minimize service impacts
  • Mitigate risk
  • Increase efficiency of service changes

This discipline is a specific function within IT and although it shares certain characteristics with business process management, they are two separate functions.

Program Management vs. Process Management

In business, programs are composed of multiple projects. Each program has an aim, goals, and objectives.

For example, an organization may choose to undertake a digital transformation initiative.

Digital transformation initiatives are complex programs that can involve many aspects, such as:

  • The adoption of new technology
  • Employee training efforts
  • Restructuring
  • New business processes, products, or services
  • Organizational culture change

Naturally, project would be far too limiting a term to apply to such a scenario.

Instead, an organization would execute a complete program – a portfolio of interdependent change projects designed to transform the organization.

Frequently Asked Questions (FAQ) About Business Process Management

To better understand business process management, let’s explore some of the most frequently asked questions about this topic.

Why does business process management matter?

As mentioned earlier, effective business process management offers a number of benefits for the organization, such as:

  • Improved process outcomes
  • Increased business process efficiency
  • Better organizational performance

It can also have a number of indirect – yet positive – effects on the workplace.

When business processes are made more efficient, for example:

  • Processes tend to operate more smoothly, which can improve worker engagement and satisfaction
  • Decreased complexity benefits the workplace by simplifying the employee experience
  • Organizations that operate more efficiently tend to be more agile

Ultimately, business process management is a way to improve organizational effectiveness and performance.

And those gains, in turn, have a positive impact on the organization’s bottom line.

How do you measure the value of business process management?

Any time an organization sets out to improve a business process, it will set goals and objectives.

One of the best ways to measure business process management efforts is by comparing those goals against process improvement efforts.

That is, process improvement objectives should be measured against costs, such as:

  • Financial costs
  • The time it takes to achieve specific objectives
  • The actual outcomes of the improvement efforts

This type of data can be quantified and compiled, then distilled into bottom-line profitability metrics.

Who is in charge of business process management?

The larger the organization, the more likely it is to have resources specifically dedicated to business process management.

In these cases, business process managers and specialists will most likely be in charge.

However, smaller organizations may delegate the same duties to a cross-functional team or to another department, such as operations.

Outsourcing is yet another option.

Business process management consultants are firms that help organizations streamline business processes, align resources, and improve organizational effectiveness.

Naturally, a business should weigh the pros and cons of outsourcing against insourcing. 

A high-growth firm, for instance, may choose to develop its own business process management function rather than hiring outside help.

An organization that has no such aspirations, however, may choose to hire a consultancy.

What are the main software tools used in business process management?

Business process management platforms are one-stop solutions that offer a range of important functionality.

According to a Forrester report, these solutions are essential to driving successful digital transformation in business. 

Forrester claims that the effective use of these platforms can:

  • Fuel customer-centric innovation
  • Increase organizational agility 
  • Encompass both the front and the back-office

Some of the most heavily weighed aspects of these platforms included:

  • Low-code development
  • Process data virtualization
  • Guiderails and governance
  • Mobile engagement
  • User interface integration

Today, there are plenty of vendors operating in this space, including Oracle, IBM, Appian, and Red Hat.

These platforms are becoming more and more critical for scaling organizations.

However, to be successful, it pays to remember that business process management is first and foremost a business discipline and a method.

The Business Process Management Life Cycle

The business process management life cycle is a way to categories the activities of business process management.

Here are a few stages that are commonly included in this cycle:

Strategy

The business process strategy should, among other things…

  • Align with the organization’s goals
  • Be designed to achieve specific aims, such as targeted organizational improvements
  • Outline the necessary processes that should be implemented or altered, including primary, secondary, and management processes
  • Define an organizational change plan 

Once a strategy is in place, an analysis is required to provide more insight into the current state of the business.

Analysis

There are a number of techniques that can aid the business process manager, such as a value-added analysis, a gap analysis, a process simulation, and so forth.

Objectives to business process analysis include:

  • Understanding the current state of targeted business processes
  • Identifying weak points and growth opportunities
  • Gaining insight into how existing processes impact organizational performance and the designated areas of change

The information gained in the business process analysis is necessary for the next step – designing improved or restructured business processes.

Design

The information gathered earlier will be incorporated into the design stage, helping professionals understand whether or not existing processes are sufficient.

During this phase, business managers will…

  • Optimize existing processes
  • Redesign when necessary
  • Design new ones

Going hand-in-hand with the designs are models, which represent those designs in a concrete form.

Modeling

As mentioned earlier, business processes and workflows are closely connected.

Modeling accomplishes several objectives, such as:

  • Introducing multiple variables into the design to model how the design might change under different circumstances
  • Documenting the design as a representation that can be easily grasped
  • Providing a reference for use by employees and stakeholders
  • Defining steps, stages, roles, responsibilities, and timelines 

In short, modeling provides a roadmap, or a concrete structure, that transforms the design into a solid action plan.

Execution

Inevitably, the implementation of new business processes involves change.

For that reason, it pays to:

  • Carefully monitor and manage the change program
  • Stay agile
  • Tackle obstacles to change
  • Take a systematic approach to implementing the new processes

As we cover elsewhere on this blog, change management is important in order to successfully implement change.

Monitoring

Throughout the implementation of the process change, managers should:

  • Continuously track KPIs and metrics
  • Analyze the performance of the process
  • Stay agile, adaptable, and data-centric

Regular reviews of performance metrics is essential to maintaining an objective perspective on process improvements.

Optimization

No organizational change project is perfect at the outset, so business process managers should expect to spend time optimizing their new process.

This means:

  • Collecting and monitoring data, as mentioned above
  • Using those insights to develop new solutions
  • Make course corrections as necessary
  • Repeat

There are several purposes to monitoring and optimizing process changes – they help managers determine whether a process is working as intended, what may need changing, and how to make course corrections.

Reengineering

If a new process is not operating efficiently enough or as expected, business process managers may elect to reengineer the process completely.

Business process reengineering is a holistic cycle that follows several steps:

  • Identifying problems
  • Review, update, and analyze as-is
  • Design “to-be” processes
  • Test and implement to-be processes

Like business process management, business process reengineering is a discipline unto itself.

However, since reengineering is not always a necessity, many organizations choose to start with business process management, an approach that is less risky and more economical.

How Technology Is Changing Business Process Management

Digital innovation and disruption are driving digital transformation across every industry in the world, including business process management.

Here are a few technology trends that are impacting the way business process

The Internet of Things (IoT)

The Internet of Things integrates the internet with physical devices. 

Alongside the increase in sensors, chips, and electronics comes an increase in business process complexity.

Business process analysis, management, and reengineering can all lead to the simplification of business processes. 

Arguably, such simplification is a necessity, since too much complexity in business processes and work environments can lead to disorganization, inefficiencies, or worse.

Cloud Computing

Cloud computing is another technology trend that is affecting the way business process managers do their jobs.

Oracle says that business process management combined with cloud computing means several things:

  • With cloud-based business process management solutions, processes can be managed anywhere, anytime
  • Cloud-based management flexibility adds more resourcing options, such as outsourcing
  • Process optimization options should be as rich in the cloud as in the enterprise
  • Distributed systems offer several advantages, but also require greater security

…to name just a few.

In short, by using cloud- and web-based software, organizations can achieve a number of advantages over platforms that strictly operate from within the enterprise.

Artificial Intelligence (AI)

AI is another technology that shows promise when it comes to business process automation.

Machine learning algorithms allow computers to automatically recognize patterns and “learn” from data. 

By combining AI with business process automation, organizations can tap into business data to increase efficiency across many areas of the organization.

For instance, if a marketing team has to frequently parse and analyze a customer data set in order to identify potential sales opportunities, AI can be taught to automatically perform the same process.

This type of automation draws closer to cognitive automation, which, in the coming years, will become yet another important tool in the business process manager’s toolbox.

Digital Transformation

Digital transformation is the process by which an organization leverages technology to improve business processes, services, products, or other areas of the business.

Whether an organization intends to become more digitally mature or overhaul its customer experience program, business process management plays an important role in digital transformation efforts.

After all:

  • Digital transformation programs entail organizational change
  • Organizational change typically requires the introduction of new processes, process reengineering, or process optimization – or all of the above
  • Managing that change requires the management of people, processes, and more

The more that a business undertakes digital transformation, the more it will need to design, manage, and optimize its business processes.

Business Process Management Software

Business process management software is, as the name suggests, designed to assist with the management and optimization of business processes.

According to a report by Forrester, these platforms “innovate, modernize, and continuously improve a process.”

They also point out that business process management platforms are now called “DPA-deep” – that is, Digital Process Automation platforms that target deep, complex processes.

However, given the fast-paced nature of technology, not all vendors and experts use the same definitions.

Many still refer to business process management platforms as “BPM platforms.” 

This array of terminology can be complex and difficult to navigate at times, which is perhaps why Forrester makes a distinction between different types of business process management tools.

Below, we will explore a few of these platforms in depth.

Business Process Management Software

As mentioned above, business process management platforms vary in terms of their complexity and scope.

To make matters even more complicated, many people conflate different terms.

For instance, certain websites put project management tools and business project management platforms under the same umbrella. These are then included in the same category as low-code app development platforms.

Since each platform offers different types of functionality – and will have different capabilities – it pays to investigate these options thoroughly.

Here are a few examples:

Business Process Management Tools

Business process management tools, generally speaking, are designed to help business process managers analyze, design, and optimize workflows.

As mentioned above, Forrester categorizes these platforms into:

  • Robotic process automation (RPA)
  • Digital process automation (DPA)-deep
  • Digital process automation (DPA)-wide

The question most enterprise architects are asking themselves, says Forrester, is which types of platforms can enable which types of functionality.

Workflow Management Tools

Workflow management tools take a tactical approach to managing workflows, or sequences of tasks. 

Common features include:

  • Task automation
  • Low-code design capabilities
  • Integration with other enterprise tools
  • Data and analytics
  • Mobile access

These workflow tools can be extremely useful for improving workflow efficiency. 

However, organizations that need to automate more complex tasks or organize multiple business processes should examine some of the other tools listed here.

Project Management Tools

Project management tools are specifically designed to manage business projects, not processes. 

Wrike, Freedcamp, and similar project management tools include functions that are perfectly suited to project management, such as calendars, kanban boards, and collaboration tools. 

However, it is important not to confuse these tools with business process management tools, since they are very different.

Project management tools are designed to help project managers…

  • Collaborate more effectively with their teams
  • Keep projects organized 
  • Set goals, milestones, and deadlines
  • Track project performance and progress

It is important to note that these tools differ considerably from other business process management tools.

However, since certain sources include them under the same category as business process management platforms, they have been included in this list.

Robotic Process Automation

Robotic process automation (RPA) is, as the name suggests, specifically designed to automate business processes and workflows.

Credit: www.zenesys.com

Compared to other process automation solutions, robotic process automation focuses on low-level, tactical workflows.

Data entry and other tasks that require little cognitive effort can all be automated with these solutions.

There are a number of benefits to using robotic process automation tools, including:

  • Improved business process efficiency
  • Decreased costs for a specific process or workflow
  • Increased turnaround time
  • Lower error rates
  • Scalability

Implementing robotic process automation can result in significant performance gains across the entire organization.

However, there are other forms of automation that can be used to improve business process efficiency.

Digital Process Automation 

Forrester and others point out that business process management (BPM) tools have shifted to digital process automation (DPA) tools.

And, as mentioned above, this next generation of tools are evolving into:

  • Digital process automation-deep, which is designed to transform and improve narrow, deep business processes
  • Digital process automation-wide, which are oriented more towards the everyday business user
  • Dynamic case management, or solutions that are specifically designed to help case workers customize workflows easily and efficiently

For the large-scale enterprise, it may be necessary to implement all of these tools – or it may not.

As mentioned earlier, since these tools’ functionality overlaps to a certain extent, organizations may be able to achieve the same objectives with a smaller technology stack.

Digital Adoption Platforms (DAPs)

Digital adoption platforms (DAPs) are specifically designed to automate product onboarding, training, and workflows.

Leading platforms include features such as:

  • In-app walkthroughs. Product walkthroughs take users through a series of actions – that is, through a workflow. These are ideal training mechanisms and very useful for business process managers. After all, whenever a new business process is introduced, users must learn that process. And unless training is delivered effectively, productivity will fall behind.
  • Contextualized guidance. Interactive, context-based guidance outperforms traditional training approaches. In the digital workplace, this is especially valuable – not only is automated contextual guidance more scalable than human-led training, users will be much more likely to retain what they have learned when they actually experience it.
  • Software analytics. Software analytics monitor users’ interactions with a software tool or a set of tools. That behavior can then be analyzed in order to identify training needs, common errors, and behavior patterns. Over time, this information can help organizations create more robust training program – which in turn helps them adopt new business processes more effectively.
  • Automation. Automation, as we saw earlier, is an essential facet of the modern workplace. Since software and bots can perform many tasks better than humans – and at a lower cost – effective automation can grant a competitive advantage.

These solutions mesh seamlessly with the digital workplace, augmenting employees’ day-to-day workflows with automated tasks, interactive training, and in-software assistance.

The result: a platform that improves efficiency and productivity by combining employee training with low-code automation tools.

5 Tips and Strategies for Better Business Process Management

Business process management is a continually evolving business discipline. 

Staying competitive and relevant requires more than just the right software – it requires the right mindset, strategies, and tactics.

Here are five tips that can help business process managers keep up in today’s evolving digital landscape:

1. Build a digitally mature business

Digital transformation cannot succeed without business process management.

Becoming digitally mature requires effective business process management – and at the same time, effective process management requires a degree of digital maturity.

MITSMR-Deloitte-Digital-Maturity-Infographic-2017

There are several reasons for this, many of which we have covered above:

  • Modern-day business process management makes heavy use of digital technology
  • The ability to use digital software, especially business process management tools, is fundamental to successful organizational change and business process improvement
  • Digitally mature businesses will be more successful in general, which should naturally be one of the overriding concerns of any business manager

The link between digital maturity and business process effectiveness demonstrate the clear value of digital transformation.

Business process managers should work closely with leadership to design and implement changes that prioritize the organization’s digital growth.

2. Take a structured approach to change management

Technology does not operate in a vacuum.

In fact, digital transformation and technological change are more about people than about the tools themselves.

Therefore, when implementing new business processes, it is critical to focus on change at the individual level.

An effective change management strategy focuses on the human side of the equation.

For instance, most change management frameworks emphasize the need to:

  • Communicate clearly and effectively with employees
  • Build awareness of the need for change
  • Generate desire for change
  • Provide employees with the necessary skills and tools they need to change
  • Maintain accountability
  • Reinforce change to ensure that it remains permanent

Change management is a discipline unto itself, so if necessary organizations should hire or outsource the required expertise.

3. Create a unified technology stack

As we saw above, a single business process management platform is not enough.

To enable effective process management in a large-scale enterprise, it is necessary to employ multiple tools.

These should include an appropriate mixture of:

  • Business process management platforms
  • Digital process automation solutions
  • Robotic process automation tools
  • Digital adoption platforms

It is important to implement the right tools and the right functionality. 

However, it is just as crucial to ensure that those tools operated as a seamless, integrated stack.

For that reason, business process managers should ensure that they fuel transformation efforts with a comprehensive digital adoption strategy.

4. Stay data-driven

Data can help managers make decisions that are based on real-world information and data. Decisions, designs, and models will be more objective, more efficient, and more effective.

Business process managers will need to access and utilize a breadth of data from across the organization.

For this reason, efforts should be made to:

  • Democratize data
  • Collaborate closely with other departments
  • Work to instill data-driven practices into the organization
  • Cultivate a data culture

In short, the effective use of data can help companies earn far more from their business process improvements.

5. Take a lean, agile approach to process implementation

In the digital era, speed is a weapon.

The faster organizations can innovate, produce, and transform, the more quickly they will be able to capitalize on growth opportunities.

Here are a few tips for staying agile and lean:

  • Stay user-centered. User-centered design means deriving designs from user feedback, input, and data. This approach helps to keep process designs more relevant and useful – and, as a result, more effective.
  • Be agile and adaptable. Agility means focusing on responsiveness rather than static processes. Change and fluidity should be a standard part of business process management, but this isn’t always the case. Staying responsive means not only reengineering processes when necessary, it also means being willing to adapt one’s own approach to business process management.
  • Collaborate with stakeholders frequently. Frequent collaboration is a hallmark of both agile and lean. Agile software developers, for instance, will meet on a regular basis to ensure that teams are in sync. And lean practitioners will constantly tap user input to learn and adjust their services.
  • Make frequent incremental improvements. Optimization, as discussed above, is one of the key stages in the business process management life cycle. Business process managers that are willing and able to continually optimize processes will have a better chance of keeping up with the dynamic and fast-paced digital economy.

In most cases, these business approaches require new mindsets.

Rethinking organizational strategy and business practices may be difficult, but the benefits are well worth it.

Implementing these ideas can result in greater organizational agility, better organizational performance, and more effective, efficient business processes.

Chris is the Lead Author & Editor of Change Blog. Chris established the Change blog to create a source for news and discussion about some of the issues, challenges, news, and ideas relating to Change Management.