Introduction

The identification, documentation and analysis of business process is the foundation of business process management. Although this work is highly valuable in and of itself, it also is necessary to be able to effectively implement other key elements of Business Process Management, including the generating and managing KPI sets, implementing internal controls and In this book we cover:

Process Maps; the development of visual maps which document processes at levels 0,1, and 2 of the business, including techniques for the identification of processes
Process Documentation; the development of process documentation and its storage is discussed in this section.
Documentation of Work Instructions; at the lowest level of process identification, the process documents are, effectively, work instructions for the employees executing the processes.
Process Risk Analysis, Segmentation and Treatment; a key concern of businesses today is the management of risk, in particular the risk which the execution of the business of an organisation implies for that organisation. This section deals with how to evaluate the risk of each process and then how to segment the set of business processes according to their risks. Finally we turn our attention to the appropriate risk management treatment for each segment of processes.
ISO 9000; this topic deals with the use of Process Documentation in the achievement and retention of ISO9000 qualification.
RACI analysis; Responsible, Accountable, Consulted and Informed (RACI) analysis delivers us an excellent way to deal with responsibilities of parties for the operation of processes and, indirectly, throws up a number of related measures which are helpful in managing the aggregate of the business processes.

For each topic, we include an "In Practice" section, which describes how to implement the theory.

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The Level 0 Process Map

The starting point for the Level 0 Process Map is the organisation's business objectives. These should be accessed and understood. Where they are absent, at least an informal set will need to be developed. By interview with the most senior managers of the organisation, agreement on these business objectives then leads to the question "What activities are performed in pursuit of those objectives?". You could equally ask "What processes..." or "What tasks..."; the emphasis at this stage is not on semantic niceties, but on ensuring that the dialog concentrates on process rather than organisation. Thus the project team has a responsibility to keep the discourse tracking what activities seek to fulfil the organisation's business objectives, rather then getting mired in the secondary topic of how the organisation has been arranged to perform these activities.

By this process, any existing map, formal or informal, prose-form or graphical will soon be discovered.

To supplement the discovery of existing process maps, we can also check whether the organisation operates processes which are standard for like organisations. Most organisations will operate certain standard processes, which, dependent on the fundamental nature of their business, may or may not be core processes. For example, most organisations will operate financial processes, human resources processes and product distribution processes. For financial institutions, banks, building societies and the like, some of the financial processes will be core processes and are likely to be strongly represented at Level 0. For construction businesses, financial processes will doubtless be an important part of doing business but will not be core processes and therefore will not be Level 0 processes.

In addition to determining what the principal activities are, any input/output relationship between the activities should also be sought out.

The opportunity should be taken to determine how standard support activities are performed and how they are seen in relationship to the principal business activities.

The development of the Level 0 Process Map provides the foundation for subsequent work and, as such, should be carefully validated with the organisation's senior managers, preferably at board level. Any omissions, misunderstandings or imbalance of emphasis at this level will be reflected throughout the subsequent work, so it pays to be diligent when developing this model.

As you build the Level 0 model, there are a number of "sanity" checks you should undertake, viz:

is the number of Level 0 processes reasonable? For a general organisation, something like 20 Level 0 processes, of which about half are core business processes is a reasonable number. Where the organisation features extensive vertical integration, a larger number may be encountered; in this case some thought should be given to whether it might be more appropriate to segment the organisation to a degree where there is a coherent business focus. Where the objectives of the organisation are limited (e.g. in clubs and associations), there may be fewer than 10 Level 0 processes. There is no magic, correct number, but there should be an understanding of the reasons when the number of Level 0 processes is outside the 10-20 range.
do the Level 0 processes roughly align with the organisation diagram? Whilst there are many examples where organisations are poorly organised to deliver the organisations objectives, a misalignment between the organisation diagram and the Level 0 process map is a signal that something is awry.
do the Level 0 processes align with the distribution of the number of employees in the organisation? There ought to be a rough alignment between the bulk of employees and the processes that are considered to be the organisations main efforts. This relationship can be altered by technology and intensive capitalisation, but once again the reasons why there is misalignment should be understood.
do the Level 0 processes directly contribute to the organisations primary objectives? The need for this may seem self-evident, but it is also a sine-qua-non.

In Practice

In practice, the Level 0 Process Map is best drawn as a physical map and, like a geographic map, some colouring can help distinguish the main areas. The diagram below shows the Level 0 Process Map for a Customs organisation. The core Level 0 processes are shown in light green, whilst the "support" Level 0 processes are shown in yellow. The "1. Vision & Objectives" process is shown in a darker green as it is distinguished by being an annual or semi-annual process, conducted at board level and negotiated with the government.

The size of the map segments is a rough indicator of the relative importance of each process to the organisation's objectives. The process "8. Reconcile & Audit" is drawn across the top of processes 2. to 7., since reconciliation and auditing is an over-arching process for all of these other processes. In reality, the relationship between this process and the other Level 0 process is key to the way in which this organisation performs and the way it was drawn helped to highlight the importance of this relationship.

Obviously, the best way to draw up the Level 0 process map will have to be determined for each individual organisation, but the general principles carry over from organisation to organisation.

The Level 1 & 2 Process Maps

The Level 1 and Level 2 Process Maps represent Departmental and Operational processes. Documenting these processes is the heart of the process documentation work; their expression is farm more concrete than that of Level 0 processes, but they still concern themselves with how the organisations goals are achieved rather than with the minutiae of Level 3 work instructions.

We believe that the Level 1 & 2 process documentation is best realised in the following manner:

identify and name the processes by interview with the process Accountable, Responsible and Consulted parties
for each identified process, conduct in-depth interviews at the workplace with the process Accountable and Responsible parties
from these interview notes and using a strict template, draft the process documentation
refer the draft to the process Accountable and Responsible parties for their review.

Using team members for this task should result in high-quality, consistent and structured documentation in a reasonably short period of time; at this level of documentation the issue of ownership of the text (which we address later in the task of documenting Work Instructions) is not as critical as achieving a high-quality result with minimal effort.

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Where Next?

The complete series of Business Process Management e-books is as follows:

"Business Process Management Overview" (the grey book)
"Generating & Selecting KPI Sets" (the blue book)
"Implementation Guide for Service Level Agreements" (the plum book)
"Identifying, Documenting & Analysing Business Processes" (the teal book)
"Selecting & Implementing Internal Controls" (the red book)
"Good Practice for Commercial Website Design" (the saffron book)

The series is available at the following websites:
http://www.changefactory.com.au/
and
http://www.modulus.com.au/

Change Factory is a change management company, specialised in Business Process Management and Training. Change Factory can provide your company with support in implementing business process management, documenting business processes, RACI analysis, KPI management and target setting, Service Level Agreement implementations and Internal Control implementation. Additionally Change Factory offers a range of training programs directly aligned with this Business Process Management. For more information contact Kevin Dwyer, kevin.dwyer@changefactory.com.au.

Modulus provides tools, applications and services to consultancies and website developers. For more information contact Peter Hill, peter.hill@modulus.com.au.