-Business processes are critical, complex, and dynamic in structure, well managed organizations practice business process management
-BPM is the systematic process of creating, accessing, and altering business processes
-process begins by creating a model of the business process
- as-in model documents the current situation and then change that model to make adjustments necessary to solve process problems-well managed organizations create policy, procedures, and committees to continually assess business process effectiveness
-the nature and difficulty of business process management varies with the scope of the business process
-functional processes involve activities within a single department or function
-BPM is easier to accomplish with functional processes
-functional processes lead to islands of automation that work in isolation from one another
-purchasing influences inventory, which influences production, which influences customer satisfaction, which influences future sales
-Cross-functional processing involve activities among several or even many business departments
-process management is more difficult for cross-functional systems because no manager has authority over all of the activities and the resources assigned to them
Interorganizational process includes activities at the company that processes your credit card transactions
BPM for interorganizational processes is much more difficult than for functional or cross functional systems
-a problem is a perceived difference between what is and what ought to be
-teams must be able to discuss the current and proposed processes
-business process is a network of activities, resources, facilities, and data that interact to achieve a function or purpose
-data records facts and figures
-Object management group (OMG) created a standard a standard set of terms and graphical notations for documenting business processes
-Swim lane layout roles are shown in its own horizontal rectangle. They are used to simplify process diagrams and to draw attention to interactions among components of the diagram
-Three ways of changing business processes
-add or remove resources to an even process without changing its structure
-designers can change the structure of a process without changing resource allocations
-change the structure of a process without changing resource allocations
-if change is particularly effective, it can result in greater performance at no additional cost
-information systems and database information systems can play an important role in implementing activities that link other ativities
-business processes are resigned to take advantage of information systems and cheaper, more powerful computer networks and communications
-functional application is a computer program that supports or possibly automates the major activities in a functional process
-to reduce costs and risks, most license functional application software from a vendor and then adapt
-adaption is necessary because organizations differ in the way they structure their functional process
-the primary purpose of the sales process is to find prospects and transform them into customers by selling them something
-sales process manages a customer which is a euphemism for selling existing customers more products
-processes exist to manage products and brands companies use such process to assess the effectiveness of marketing messages, advertisement, and promotions and to determine product demand
-operations applications are prominent for nonmanufacturers. For manufacturing companies, many of the operations functions are merged into manufacturing systems
-Order-entry applications record customer purchases
-Order-management-applications track the order through the fulfillment process
-finished goods inventory applications are operated by nonmanufacturing organizations
-inventory applications support inventory control and inventory management
-Just-in-time inventory policy seeks to have production inputs delivered to the manufacturing site just as they are needed
-manufacturing planning applications help businesses allocate inventory and equipment to manufacturing processes
-a bill of materials (BOM) is a list of the materials that comprise a product
-companies may augment BOM to show labor and equipment requirements
-Materials requirements planning (MRP) is an application that plans the need for materials and inventories of materials used in the manufacturing process
-manufacturing resource planning is a follow up to MRP that includes the planning of materials, personnel, and machinery
-Master production schedule (MPS) is a plan for producing products
-Push manufacturing process pushes the product into sales according to the MPS
-Pull manufacturing process are pulled through manufacturing by demand
Customer service applications include order tracking, accounting tracking and customer support and training
-human resources applications support recruitment, compensation, assessment, development and training, and planning
-cost accounting applications determine the marginal cost and relative profitability of products and product families
-budgeting applications allocate and schedule revenues and expenses and are compared to actual financial results to the plan
-cash management is the process of a scheduling payments and receivables and planning the use of cash so as to balance the organizations cash needs against cash availability
-customer relationships management (CRM) is a cross functional application that tracks all interactions with the customer from prospect through follow-up service and support
-CRM applications integrate all of the primary business activities
-customer life cycle:
-marketing
-customer acquisition
-relationship management
-loss/churn
-CRM applications store data in a single database
-customer support has an important linkage to product marketing and development
-enterprise resource planning applications provide even more integration than CRM
-ERP integrates the primary value chain activities with human resources and accounting
-SAP is the first and most successful vendor of ERP software
-with ERP systems, organizational data are processed in a centralized database. Such centralization makes it easy for authorized users to obtain needed information from a single source
-Inherent processes are effective and often very efficient (business blueprint have been tried and tested over hundreds of organizations
