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Processes Tuning Master Class

It costs time and, consequently, money to carry out Business Processes, it is important that they are both effective and efficient.  Consequently, a vital stage in building any Process is to ensure that it is fully tuned and optimized.

When tuning a Process the business analysts and business experts work closely together in order to make the Process as effective and efficient as possible.  The analysts bring their analysis and tuning expertise.  The business personnel, who are the business experts, provide the pragmatic and detailed business knowledge that ensures that the tuning will not breach any business policies, standards or legal requirements.

Effectiveness and Efficiency

An effective Process is one that is capable of achieving the Preferred Outcome time after time in a structured and consistent manner that generates maximum revenue at minimum cost.

An efficient Process is an effective Process that reaches the desired Outcome in the fewest possible steps.  But that is only half the story.  A really efficient Process is one that also reaches all Non-Preferred Outcomes in the fewest possible steps.

This means that, if the Process is going to be stopped short of the Preferred Outcome, this should happen as soon as possible in the execution of the Process.  This is counter-intuitive to many people, especially to those involved in sales, whose natural inclination is to keep the Process heading toward the Preferred Outcome for as long as possible in the hope that they will be able to ‘close the deal’.

This is a very inefficient approach. The fact is that, if a condition exists that is going to stop the Process, then, like it or not, the Process is going to stop!  It is far better to stop it sooner rather than later as each unnecessary step taken is wasted effort and incurred costs.

It is also a bad approach from the point of view of customer service because, if the Process is not going to get to the Preferred Outcome, the customer should be made aware of this as soon as possible. To do anything else would be misleading and could jeopardize customer good will.

Ranking Non-Preferred Outcomes

Making Non-Preferred Outcomes happen as soon as possible is a very powerful, structured and repeatable technique for tuning Processes.  The steps in this technique are:

  • Identify all possible conditions in which a Process would be terminated at a Non-Preferred Outcome.
  • Rank these conditions – least desirable first.
  • Test for each condition as early as possible in the Process.
  • If the condition applies, test to see if there is an alternative option.
  • If there is no alternative then stop the Process at that point.
  • Have a Non-Preferred Outcome at which to stop the Process.

Tuning Example

Let us look at the Process below and assess whether or not is is tuned and, if not, how we might tune it.

Business process for handling customer orders - untuned.

Click on this image to see it full size.

Firstly we must identify and list all of the conditions under which the Process could be halted and result in a Non-Preferred Outcome.  If we look at the process we will see that it already tests five conditions that could result in the Process terminating at an Non-Preferred Outcome.  These are:

  • Step 1: Tests to to see if the ‘order’ is actually a valid order.
  • Step 2: Test to see if the person placing the order is a Registered Customer.
  • Step 3: Test to see if the enterprise sells the product being ordered.
  • Step 4: Test to see if the product is in stock.
  • Step 5: Tests to see if the Customer has a good credit rating with the enterprise.

We must now rank these conditions that could stop the Process, ‘least desirable’ first.  There are two categories of ‘least desirable’:

  • Category 1: The enterprise would not want to proceed.
  • Category 2: The customer might not want to proceed.

We should always look for Category 1 conditions first as these are essential in minimizing risk to the enterprise.

So we ask the question, “Are there any conditions under which the enterprise might not want to proceed with this order?” In our example there are three conditions that fall into this category:

  1. The order is not actually a valid order.
  2. The person placing the order is not a Registered Customer.
  3. The person placing the order is a Registered Customer but has a bad credit rating.

Which of these should we check for first?

If the order is not a valid order, then there is no point in proceeding from either the enterprise or customer point of view, so this condition should be tested for first.

If the person placing the order is not a Registered Customer then the enterprise would not want to proceed, so there would be no need to check on the credit rating.  This means that the check to see if they are a registered customer should come before the check for credit rating.

This means that the ranking for our Category 1 occurrences is the 1,2, 3 order in which they were listed above.

We then look for Category 2 conditions by asking the question, “Are there any conditions under which the customer might not want to proceed with a sale?”

In our example there are two conditions in this category:

  1. The enterprise does not sell a product that would meet the customer’s needs.
  2. There is no stock of the required product.

Which of these conditions should we test for first?

Well there would be little point of checking to see if we had stock of a product if the enterprise did not sell a suitable product, so we should test for the existence of a suitable product first.

So we have now identified and ranked all conditions that could lead to our Process being terminated at a Non-Preferred Outcome and they are, in the order in which they should be tested for:

  • Order is not a valid order.
  • Requestor is not a Registered Customer.
  • Registered Customer has a bad debt record.
  • The enterprise does not sell a product to meet the customer’s needs.
  • There is currently no stock of the required product

Let’s look at the Chosen Process and see if it:

  • Has a Process Step that tests for all of these conditions listed above.
  • Test for the conditions in the order in which they have been ranked.
  • Has a Process Step that ends the Process.
  • Has a Non-Preferred Outcome at which to safely terminate the Process.
Business process for handling customer orders - untuned.

Click on this image to see it full size.

The above diagram does indeed test for all of the conditions listed, Steps 1 through 5. Process Step 8 ends the Process at a clearly defined Non-Preferred Outcome, “Customer order rejected”.

However, the Process does not test for all of the terminating conditions in the order in which they were ranked, following our ranking criteria.

The test at Step 5 should be carried out before the test at Step 3.  So let’s change the sequence of the steps and make this happen.

Business process for handling customer orders - tuned.

Click on this image to see it full size.

In the diagram above, all of the terminating conditions are tested for in the order defined by the tuning ranking criteria. ‘Verify Customer Credit Rating’ is now Step 3 in the Process as opposed to Step 5, where it previously was.

Optimizing Processes

Although the Chosen Process has been tuned, it has not yet been optimized.  What do I mean by this?

When we tuned our process we achieved three main objectives:

  • We minimized risk to the enterprise by terminating it if a risk existed.
  • We minimized the cost of carrying out the Process by terminating it as soon as possible.
  • We minimized any irritation for customers by not unnecessarily prolonging a Process that could not be completed.

What we did not do was to maximise the chances of having the Process proceed to the Preferred Outcome, without in any way presenting any increased risk to the enterprise.

Maximising the chances of a successful outcome for a Process is called Optimizing the Process and is achieved quite easily.  Essentially, each time that a condition exists that would call for the Process to be terminated, we test to see if an alternative path to the Preferred Outcome can be achieved. Let’s look at our tuned Chosen Process and see how this is done.

We will build a list of the terminating conditions and, for each one, identify a test for an alternative condition or action that would help the Process to proceed towards the Preferred Outcome.

Terminating Condition Function to Find an Alternative Condition Description
Invalid Order None There is no alternative that will move the Process nearer to the Preferred Outcome of ‘Customer order accepted’ as the contacting party does not want to purchase anything, so the Process should be terminated immediately.
Requestor is not a registered customer. Submit Application for Registration Having established that the party placing the order is not currently a registered customer, they are asked if they would like to be registered.  If they would, then this function is initiated and an Application for Registration submitted. If the application is accepted, then the Process can be resumed at the next step, ‘Verify Customer Credit Rating’.
Customer has bad debt record. Request Payment of Outstanding Balance. If the Customer currently has a bad credit rating with the enterprise, then they can be asked to pay off the outstanding balance of their account, plus a payment in advance, if appropriate, before dispatching their order. If they agree to do so, then the Process can continue to check that the enterprise sells the product that they are requesting.
No suitable product. Check for Alternative Product If the enterprise does not sell the exact product that the customer is ordering, then every effort should be made to see if it sells an alternative.  If one exists and the customer would be willing to purchase it, then the process can continue and check to see if there is a product in stock.
No stock. Check to see if Customer Can Wait for Stock to Arrive. If there is no stock of the selected product then a check should be made to see if the customer can wait for stock to arrive. If they can wait, then the Process can continue to the next step of Confirm Acceptance of Order. If they cannot wait, then the Process is terminated.

Adding all of these extra steps to the Process for handling customer orders gives us the Process diagram shown below.

Click on this image to see it full size

Click on this image to see it full size

Using this approach of looking for an action that can reverse or mitigate the terminating condition, enables the Process to always move forward to the Preferred Outcome.

When Process Steps have been added in this way that check for all possible alternative conditions, then the Process is both tuned and fully optimized.

Process Modeling eBook

This Process Tuning Master Class was based on an extract from the eBook IMM Business Process Modeling by John Owens, the creator of the Integrated Modeling Method.

This book is available from the IMM Online Store, together with a whole set of other resources that will enable you to take your business modeling knowledge and techniques to a whole new level.

2 Responses to “Processes Tuning Master Class”

  1. Richard Ordowich July 3, 2013 11:28 am #

    Process modeling is an effective technique for discovering various aspects of how a business functions. When you include the human tasks and decisions into the business process model, it seldom looks linear or as organized as depicted in many diagrams we see. There are numerous exceptions and alternative paths that are applied in day-to-day work, sometimes not evident to the managers overseeing the work and sometimes these human tasks have become so ingrained that even those performing the work become unaware of how human factors and variances affect the linear flow.

    Including the information and data flow in the business process model, helps to expose many of the data related issues such as quality that affect the workflow.

    Using a socio technical approach we also see the interfaces between the technical systems and people. These models also help to expose the social fabric of an organization such as what institutional knowledge is necessary to complete a process (tribal knowledge) and how people interact to perform the tasks in a business process.

    Once you have the systems, people and information depicted in the business process model you can see the entire picture from within the organization. Add to this model the customer experience view and you have a rich mosaic of people, technology and activities as they exist (the as-is model). With this picture you can examine how changes can be made to improve efficiency and effectiveness but most importantly you can see how the changes could affect the people and customers as well as the process. In some instances improvement in efficiency may negatively affect the employee and/or customer experience (such as customer relations). Before embarking on improving efficiency or fine tuning, a complete picture is needed.

    • John Owens July 3, 2013 11:39 pm #

      Hi Richard

      Thank you for you comments.

      I agree that all of the elements that you listed are relevant to painting the overall picture of a Process and Process performance. However, not all of them should appear on the same model. Also, when you include all of the the elements you listed, you would actually be down at level of Procedure rather than Process.

      Tuning As-Is Procedures is never a good idea!!! This is because they are riddled with so many errors, bad structures and bad practices that have grown over the years that it is only what you call the ‘tribal’ knowledge and fire fighting skills of dedicated teams that keeps them going.

      To many analysts, tuning these presents a wonderfully challenging intellectual challenge. To an enterprise such structures are crippling. I have seen many enterprises brought to their knees because of them.

      The only effective Business Processes are those define what ought to be done and the most effective sequence for doing it. Good Processes are tuned before they are implemented. Read my Tuning Processes is a Waste of Time , which explains why this is so.

      Again, thanks for you input.

      Regards
      John

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