Short Tutorial on Business Processes, Patterns and Modeling

Business Processes

A business process is “a set of logically related tasks performed to achieve a defined business outcome" [Davenport & Short 1990] – it is a business activity that supports the goals of an enterprise.  Examples of business processes include purchasing raw materials, paying an employee, handling customer requests, establishing an inventory management system,  developing new products and services, administering the delivery of furniture to customers, initiating a new line of software products, constructing a new office building, etc. There are different levels, interests, and responsibilities in an organization; consequently there are different kinds of business processes (BPs). Figure 1 presents a common way to depict the different types of BPs at different levels in an organization. In this illustration, the organization is horizontally divided into strategic management, knowledge (middle) management, and operational levels.  It is further divided into vertical functional areas such as sales and marketing, finance and accounting, human resources, and product-service development.

For example, the sales function generally has a sales process at the operational level to record daily sales figures and to process orders. A knowledge/management-level process tracks monthly sales figures by sales territory and reports on territories where sales exceed or fall below anticipated levels. A process to forecast sales trends over a five-year period serves sales at the strategic management level.

Figure 1: Different types of Business Processes in an Organization

Broadly speaking, three main types of business processes serve different organizational levels:

• Operational-level processes support day-to-day activities and transactions of the organization, such as sales, payroll, and the flow of materials in a factory.  

• Management/knowledge-level processes serve the middle managers and the specialists in a firm.  

• Strategic-level processes help senior management address strategic issues and long-term trends, with special focus on the external environment.    

A business process can be naturally decomposed into several sub-processes, which have their own attributes, but also contribute to achieving the goal of the parent process. Business process analysis typically includes the mapping of processes and sub-processes to several levels of granularity.  

Business Process Patterns to Represent Business Architectures

There are different ways of representing business processes in an enterprise. A powerful way of representing this information is through a Business Process Pattern (BPP), shown in Figure 2, that captures an overall view of enterprise functional areas (e.g., sales, corporate management, back-office operations), the major business processes in each functional area (e.g., purchasing and payment within procurement) and the key interactions between these processes. A BPP can be used to identify what BPs are automated by different types of enterprise applications. For example, a purchasing application system, sometime also referred to as a purchasing application package, automates the purchasing business process.

A BPP can be used to represent an enterprise business architecture (EBA) because it can be used to represent various business processes and their interrelationships and interactions. In addition, the critical business processes can be identified to represent a business strategy.  BPPs can be used to conduct quick sensitivity analysis such as the following: a) if one BP is eliminated, then what other BPs will be impacted, b) if an application package that supports a BP is replaced with another application, what other applications/BPs will be impacted, c) which application, if replaced, will have the most impact in terms of integration, d) which application, if replaced, will have the least impact in terms of integration. We will use business process patterns and other types of patterns throughout this book. A more detailed discussion of patterns is given in the next chapter.     

Figure 2: Business Process Pattern for a Retail Store