View source for Finance:Business process modeling

{{Short description|Activity of representing processes of an enterprise}}
[[File:BPMN-AProcessWithNormalFlow.svg|alt=|thumb|400x400px|Example of business process modeling of a process with a normal flow with the [[Business Process Model and Notation|Business Process Model and Notation]]]]
'''Business process modeling''' ('''BPM''') in [[Business process management|business process management]] and [[Engineering:Systems engineering|systems engineering]] is the activity of [[Finance:Process modeling|representing processes]] of an enterprise, so that the current business processes may be analyzed, improved, and automated. BPM is typically performed by business analysts, who provide expertise in the modeling discipline; by subject matter experts, who have specialized knowledge of the processes being modeled; or more commonly by a team comprising both.  Alternatively, the process model can be derived directly from events' logs using process mining tools.

The business objective is often to increase process speed or reduce cycle time; to increase quality; or to reduce costs, such as labor, materials, scrap, or capital costs. In practice, a management decision to invest in business process modeling is often motivated by the need to document requirements for an [[Engineering:Information technology|information technology]] project.

[[Social:Change management|Change management]] programs are typically involved to put any improved business processes into practice. With advances in software design, the vision of BPM models becoming fully executable (and capable of simulations and round-trip engineering) is coming closer to reality.

== History ==
Techniques to model business process such as the flow chart, [[Functional flow block diagram|functional flow block diagram]], [[Control flow diagram|control flow diagram]], [[Gantt chart]], PERT diagram, and [[IDEF]] have emerged since the beginning of the 20th century. The Gantt charts were among the first to arrive around 1899, the flow charts in the 1920s, Functional Flow Block Diagram and PERT in the 1950s, Data Flow Diagrams and IDEF in the 1970s. Among the modern methods are [[Unified Modeling Language]] and [[Business Process Model and Notation]]. Still, these represent just a fraction of the methodologies used over the years to document business processes.<ref name="TD03">Thomas Dufresne & James Martin (2003). [https://web.archive.org/web/20061220024049/http://mason.gmu.edu/~tdufresn/paper.doc "Process Modeling for E-Business"]. INFS 770 Methods for Information Systems Engineering: Knowledge Management and E-Business. Spring 2003 {{dead link|date=October 2010}}</ref> The term 'business process modeling' was coined in the 1960s in the field of [[Engineering:Systems engineering|systems engineering]] by S. Williams in his 1967 article 'Business Process Modelling Improves Administrative Control'.<ref>Williams, S. (1967) "Business Process Modeling Improves Administrative Control," In: ''Automation''. December, 1967, pp. 44 - 50.</ref> His idea was that techniques for obtaining a better understanding of physical control systems could be used in a similar way for [[Finance:Business process|business process]]es. It was not until the 1990s that the term became popular.

In the 1990s the term '[[Finance:Business process|process]]' became a new productivity paradigm.<ref name="Rol95">Asbjørn Rolstadås (1995). "Business process modeling and re-engineering". in: ''Performance Management: A Business Process Benchmarking Approach''. p. 148-150.</ref> Companies were encouraged to think in ''processes'' instead of ''functions'' and ''procedures''. Process thinking looks at the chain of events in the company from purchase to supply, from order retrieval to sales, etc. The traditional modeling tools were developed to illustrate time and cost, while modern tools focus on cross-functional activities. These cross-functional activities have increased significantly in number and importance, due to the growth of complexity and dependence. New methodologies include business process redesign, business process innovation, [[Business process management|business process management]], [[Integrated business planning|integrated business planning]], among others, all "aiming at improving processes across the traditional functions that comprise a company".<ref name="Rol95"/>

In the field of [[Software engineering|software engineering]], the term 'business process modeling' opposed the common software process modeling, aiming to focus more on the state of the practice during [[Software development|software development]].<ref>Brian C. Warboys (1994). ''Software Process Technology: Third European Workshop EWSPT'94, Villard de Lans, France, February 7–9, 1994: Proceedings. p. 252.</ref> In that time (the early 1990s) all existing and new modeling techniques to illustrate business processes were consolidated as 'business process [[Modeling language|modeling language]]s'{{Citation needed|date = April 2014}}. In the Object Oriented approach, it was considered to be an essential step in the specification of business application systems. Business process modeling became the base of new methodologies, for instance, those that supported [[Data collection|data collection]], data flow analysis, process flow diagrams, and reporting facilities. Around 1995, the first visually oriented tools for business process modeling and implementation were being presented.

== Topics ==
=== Business model ===
A [[Social:Business model|business model]] is a framework for creating economic, social, and/or other forms of value. The term 'business model' is thus used for a broad range of informal and formal descriptions to represent core aspects of a business, including purpose, offerings, strategies, infrastructure, organizational structures, trading practices, and operational processes and policies.

In the most basic sense, a business model is a method of doing business by which a company can sustain itself. That is, generate revenue. The business model spells-out how a company makes money by specifying where it is positioned in the [[Social:Value chain|value chain]].

=== Business process ===
A [[Finance:Business process|business process]] is a collection of related, structured activities or tasks that produce a specific service or product (serve a particular goal) for a particular customer or customers. There are three main types of business processes:
# Management processes, that govern the operation of a system. Typical management processes include [[Finance:Corporate governance|corporate governance]] and [[Strategic management|strategic management]].
# Operational processes, that constitute the core business and create the primary value stream. Typical operational processes are [[Finance:Purchasing|purchasing]], manufacturing, [[Finance:Marketing|marketing]], and [[Finance:Sales|sales]].
# Supporting processes, that support the core processes. Examples include [[Finance:Accounting|accounting]], recruitment, and [[Technical support|technical support]].

A business process can be decomposed into several sub-processes, which have their own attributes but also contribute to achieving the goal of the super-process. The analysis of business processes typically includes the mapping of processes and sub-processes down to activity level. A business process model is a model of one or more business processes and defines the ways in which operations are carried out to accomplish the intended objectives of an organization. Such a model remains an abstraction and depends on the intended use of the model. It can describe the workflow or the integration between business processes. It can be constructed in multiple levels.

A [[Workflow|workflow]] is a depiction of a sequence of operations, declared as work of a person, of a simple or complex mechanism, of a group of persons,<ref>[http://www.iso.org See e.g., ISO 12052:2006]</ref> of an organization of staff, or of machines. The workflow may be seen as any abstraction of real work, segregated into workshare, work split or other types of ordering. For control purposes, the workflow may be a view of real work under a chosen aspect.

=== Artifact-centric business process ===
The [[Finance:Artifact-centric business process model|artifact-centric business process model]] has emerged as a holistic approach for modeling business processes, as it provides a highly flexible solution to capture operational specifications of business processes. It particularly focuses on describing the data of business processes, known as "artifacts", by characterizing business-relevant data objects, their life-cycles, and related services. The artifact-centric process modelling approach fosters the automation of the business operations and supports the flexibility of the workflow enactment and evolution.<ref>{{cite journal|last1=Yongchareon|first1=Sira|title=A View Framework for Modelling and Change Validation of Artifact-Centric Inter-Organizational Business Processes|journal=Information Systems|year=2015|volume=47|pages=51–81|doi=10.1016/j.is.2014.07.004}}</ref>

== Tools ==
Business process modelling tools provide business users with the ability to model their business processes, implement and execute those models, and refine the models based on as-executed data. As a result, business process modelling tools can provide transparency into business processes, as well as the centralization of corporate business process models and execution metrics.<ref name="NIH07">[http://enterprisearchitecture.nih.gov/ArchLib/AT/TA/WorkflowServicePattern.htm Workflow/Business Process Management (BPM) Service Pattern] {{webarchive|url=https://web.archive.org/web/20090113184950/http://enterprisearchitecture.nih.gov/ArchLib/AT/TA/WorkflowServicePattern.htm |date=2009-01-13 }} June 27, 2007. Accessed 29 nov 2008.</ref> Modelling tools may also enable collaborate modelling of complex processes by users working in teams, where users can share and simulate models collaboratively.<ref>Christensen, Lars Rune & Thomas Hildebrandt (2017) [https://pure.itu.dk/portal/files/83457483/Christensen_Hildebrandt_2017.pdf Modelling Cooperative Work at a Medical Department]. Proceedings of the 8th International Conference on Communities and Technologies. Troyes, France. ACM.
</ref> Business process modelling tools should not be confused with business process automation systems - both practices have modeling the process as the same initial step and the difference is that process automation gives you an ‘executable diagram’ and that is drastically different from traditional graphical business process modelling tools.{{citation needed|date=November 2017}}

=== Modelling and simulation ===
Modelling and simulation functionality allows for pre-execution "what-if" modelling and simulation. Post-execution optimization is available based on the analysis of actual as-performed metrics.<ref name="NIH07" />
* [[Use case diagram]]s created by [[Biography:Ivar Jacobson|Ivar Jacobson]], 1992 (integrated in UML)
* [[Activity diagram]]s (also adopted by UML)

==== Modelling techniques ====
Some business process modelling techniques are:
* [[Business Process Model and Notation]] (BPMN)
* [[Lifecycle Modeling Language]] (LML)
* [[Subject-oriented business process management]] (S-BPM)
* [[Cognition enhanced Natural language Information Analysis Method]] (CogNIAM)
* Extended Business Modelling Language (xBML)
* [[Event-driven process chain]] (EPC)
* [[IDEF|ICAM DEFinition]] ([[IDEF0]])
* Unified Modelling Language (UML), extensions for business process
* [[Social:Formalized Administrative Notation (FAN)|Formalized Administrative Notation (FAN)]]
* [[Finance:Harbarian process modeling|Harbarian process modeling]] (HPM)

=====Business Process Model and Notation (BPMN)=====
{{Excerpt|Business Process Model and Notation}}

=====Lifecycle Modeling Language (LML)=====
{{Excerpt|Lifecycle Modeling Language}}

=====Subject-oriented business process management=====
{{Excerpt|Subject-oriented business process management}}

=====Cognition enhanced Natural language Information Analysis Method=====
{{Excerpt|Cognition enhanced Natural language Information Analysis Method}}

=====Event-driven process chain (EPC)=====
{{Excerpt|Event-driven process chain}}

=====Integration Definition (IDEF)=====
{{Excerpt|IDEF}}

=====Unified Modelling Language (UML)=====
{{Excerpt|Unified Modelling Language}}

=====Formalized Administrative Notation (FAN)=====
{{Excerpt|Formalized Administrative Notation}}

=====Harbarian process modeling (HPM)=====
{{Excerpt|Harbarian process modeling}}

=== Programming language tools ===
BPM suite software provides programming interfaces (web services, application program interfaces (APIs)) which allow enterprise applications to be built to leverage the BPM engine.<ref name="NIH07"/> This component is often referenced as the ''engine'' of the BPM suite.

Programming languages that are being introduced for BPM include:<ref name="bpmfaq">{{cite web |title=Business Process Modelling FAQ |url=http://www.BPModeling.com/faq/ |access-date=2008-11-02 |url-status=dead |archive-url=https://web.archive.org/web/20081109082206/http://www.bpmodeling.com/faq/ |archive-date=2008-11-09 }}</ref>
* [[Business Process Execution Language]] (BPEL),
* Web Services Choreography Description Language (WS-CDL).
* XML Process Definition Language ([[XPDL]]),
Some vendor-specific languages:
* Architecture of Integrated Information Systems (ARIS) supports EPC,
* Java Process Definition Language ([[Software:JBPM|JBPM]]),
Other technologies related to business process modelling include [[Model-driven architecture|model-driven architecture]] and [[Service-oriented architecture|service-oriented architecture]].

== Related concepts ==
=== Business reference model ===
[[File:Government Business Reference Model.svg|thumb|360px|Example of the US Federal Government Business Reference Model<ref>FEA (2005) [https://www.archives.gov/records-mgmt/pdf/rm-profile.pdf FEA Records Management Profile, Version 1.0]. December 15, 2005.</ref>]]
A [[Finance:Business reference model|business reference model]] is a reference model, concentrating on the functional and organizational aspects of an enterprise, [[Finance:Tertiary sector of the economy|service organization]] or government agency. In general a [[Reference model|reference model]] is a model of something that embodies the basic goal or idea of something and can then be looked at as a reference for various purposes. A business reference model is a means to describe the business operations of an organization, independent of the organizational structure that perform them. Other types of business reference model can also depict the relationship between the business processes, business functions, and the business area's business reference model. These [[Reference model|reference model]]s can be constructed in layers, and offer a foundation for the analysis of service components, technology, data, and performance.

The most familiar business reference model is the Business Reference Model of the US federal government. That model is a [[Function model|function-driven]] framework for describing the business operations of the federal government independent of the agencies that perform them. The Business Reference Model provides an organized, hierarchical construct for describing the day-to-day business operations of the federal government. While many models exist for describing organizations – [[Organization:Organizational chart|organizational chart]]s, location maps, etc. – this model presents the business using a functionally driven approach.<ref>[https://obamawhitehouse.archives.gov/sites/default/files/omb/assets/fea_docs/FEA_CRM_v23_Final_Oct_2007_Revised.pdf FEA Consolidated Reference Model Document] {{Webarchive|url=https://web.archive.org/web/20101011082020/http://www.whitehouse.gov/sites/default/files/omb/assets/fea_docs/FEA_CRM_v23_Final_Oct_2007_Revised.pdf |date=2010-10-11 }}. Oct 2007.</ref>

=== Business process integration ===
[[File:Process and data modeling.svg|thumb|320px|Example of the interaction between business process and data models<ref name="SS93"/>]]
A [[Social:Business model|business model]], which may be considered an elaboration of a business process model, typically shows business data and business organizations as well as business processes. By showing business processes and their information flows, a business model allows business stakeholders to define, understand, and validate their business enterprise. The [[Data model|data model]] part of the business model shows how business information is stored, which is useful for developing software code. See the figure on the right for an example of the interaction between business process models and data models.<ref name="SS93">Paul R. Smith & Richard Sarfaty (1993). [http://www.osti.gov/energycitations/servlets/purl/10160331-YhIRrY/ Creating a strategic plan for configuration management using Computer Aided Software Engineering (CASE) tools.] Paper For 1993 National DOE/Contractors and Facilities CAD/CAE User's Group.</ref>

Usually a business model is created after conducting an interview, which is part of the [[Social:Business analysis|business analysis]] process. The interview consists of a facilitator asking a series of questions to extract information about the subject business process. The interviewer is referred to as a facilitator to emphasize that it is the participants, not the facilitator, who provide the business process information. Although the facilitator should have some knowledge of the subject business process, but this is not as important as the mastery of a pragmatic and rigorous method interviewing business experts. The method is important because for most enterprises a team of facilitators is needed to collect information across the enterprise, and the findings of all the interviewers must be compiled and integrated once completed.<ref name="SS93"/>

Business models are developed as defining either the current state of the process, in which case the final product is called the "as is" snapshot model, or a concept of what the process should become, resulting in a "to be" model. By comparing and contrasting "as is" and "to be" models the business analysts can determine if the existing business processes and information systems are sound and only need minor modifications, or if reengineering is required to correct problems or improve efficiency. Consequently, business process modeling and subsequent analysis can be used to fundamentally reshape the way an enterprise conducts its operations.<ref name="SS93"/>

=== Business process re-engineering ===
[[File:Business Process Reengineering Cycle.svg|thumb|Diagram of the business process reengineering cycle]]

[[Finance:Business process reengineering|Business process reengineering]] (BPR) aims to improve the efficiency and effectiveness of the [[Finance:Business process|processes]] that exist within and across organizations. It examines business processes from a "clean slate" perspective to determine how best to construct them.

Business process re-engineering (BPR) began as a private sector technique to help organizations fundamentally rethink how they do their work. A key stimulus for re-engineering has been the development and deployment of sophisticated information systems and networks. Leading organizations use this technology to support innovative business processes, rather than refining current ways of doing work.<ref name="GAO97">[https://govinfo.library.unt.edu/npr/library/gao/bprag.pdf Business Process Reengineering Assessment Guide] {{Webarchive|url=https://web.archive.org/web/20170218131136/http://www.gao.gov/special.pubs/bprag/bprag.pdf |date=2017-02-18 }}, United States General Accounting Office, May 1997.</ref>

===Business process management===
{{Excerpt|Business process management|only=paragraphs}}

== See also ==
* [[Finance:Artifact-centric business process model|Artifact-centric business process model]]
* [[Finance:Business architecture|Business architecture]]
* [[Social:Business Model Canvas|Business Model Canvas]]
* [[Social:Business plan|Business plan]]
* [[Finance:Business process mapping|Business process mapping]]
* [[Business Process Model and Notation]]
* [[Capability Maturity Model Integration]]
* [[DRAKON|Drakon-chart]]
* Generalised Enterprise Reference Architecture and Methodology
* Model Driven Engineering
* [[Biology:Outline of consulting|Outline of consulting]]
* Value Stream Mapping

== References ==
{{Reflist}}

== Further reading ==
<!-- This section should only contain notable publications about BPM in general, and not about specialized BPM methodologies.-->
* Aguilar-Saven, Ruth Sara. "[http://secure.com.sg/courses/ICT353/Session_Collateral/TOP_04_ART_03_ARTICLE_AGUILAR_Biz_Proc_Modelling.pdf Business process modelling: Review and framework]." ''International Journal of production economics'' 90.2 (2004): 129–149.
* {{cite journal|doi=10.1016/j.scico.2008.01.002 |title=The importance of business process modeling in software systems design |journal=Science of Computer Programming |volume=71 |pages=73–87 |year=2008 |last1=Barjis |first1=Joseph |doi-access=free }}
* Becker, Jörg, Michael Rosemann, and Christoph von Uthmann. "[https://web.archive.org/web/20130903223457/http://udoo.uni-muenster.de/downloads/publications/1717.pdf Guidelines of business process modelling]." ''Business Process Management.'' Springer Berlin Heidelberg, 2000. 30–49.
* Hommes, L.J. ''[https://repository.tudelft.nl/islandora/object/uuid%3A1d209c45-4b2a-41f2-9e94-a54b8ee76d78 The Evaluation of Business Process Modelling Techniques]''. Doctoral thesis. Technische Universiteit Delft.
* Håvard D. Jørgensen (2004). [https://www.researchgate.net/publication/228733384_Interactive_Process_Models ''Interactive Process Models'']{{|bot=InternetArchiveBot |fix-attempted=yes }}. Thesis Norwegian University of Science and Technology Trondheim, Norway.
* Manuel Laguna, Johan Marklund (2004). ''Business Process Modeling, Simulation, and Design''. Pearson/Prentice Hall, 2004.
* Ovidiu S. Noran (2000). [https://www.scitepress.org/Papers/2004/26293/26293.pdf Business Modelling: UML vs. IDEF] Paper Griffh University
* Jan Recker (2005). [http://www.bptrends.com/publicationfiles/05-06-ART-ProcessModeling21stCent-Recker1.pdf "Process Modelling in the 21st Century"]. In: BP Trends, May 2005.
* Ryan K. L. Ko, Stephen S. G. Lee, Eng Wah Lee (2009) [https://wayback.archive-it.org/all/20120917072604/http://ryanko.files.wordpress.com/2008/03/bpm-journal-koleelee-bpms-survey.pdf ''Business Process Management (BPM) Standards: A Survey'']. In: Business Process Management Journal, Emerald Group Publishing Limited. Volume 15 Issue 5. ISSN 1463-7154.
* Jan Vanthienen, S. Goedertier and R. Haesen (2007). [https://lirias.kuleuven.be/bitstream/123456789/162944/1/KBI_0728.pdf "EM-BrA2CE v0.1: A vocabulary and execution model for declarative business process modelling"].  DTEW - KBI_0728.

== External links ==

{{Software engineering}}

{{DEFAULTSORT:Business Process Modelling}}
[[Category:Business process modelling| ]]

{{Sourceattribution|Business process modeling}}