The Definition of Business Process Management
For the purpose of this paper, it is essential to provide a definition of business process management (BPM) along with the explanation of its key components. It is possible to characterize BPM in the following way: it is a branch of management that is concerned with the use of business processes as a means of achieving strategic goals of a particular organization through the continuous improvement, ongoing performance management, and governance of essential business processes. There are several principal components of this definition that require additional explanation in order to put them in the proper context.
First of all, “branch of management” (or management discipline) implies that BPM is an integral part of achieving business success through the improvement of “business processes,” which are essential constituents of any company’s performance. “Organization” might refer to a whole company or its parts; particularly, BPM largely focuses on end-to-end business processes that are related to relationships between suppliers and customers. “Strategic goals” are objectives of any organization that refer to distinct conditions desired to be achieved. “Improvement” is a continuous process of making business processes more efficient, and it also could be applied to “performance management,” which is preoccupied with organizing all the essential components and subcomponents of business processes involved.
Driving Factors for the Implementation of BPM
AutoNation, which is ranked 138 on the Fortune 500 website and has $21,534 total revenues as of the end of 2017 fiscal year, is chosen as an example of the organization that successfully implemented BPM approach in order to improve its performance (AutoNation 2018). In 2014, AutoNation decided to seek support from PNM Soft, a BPM software provider that helped numerous American companies to implement BPM approach (Large US Companies Prioritize Agility for BPM 2014). According to the detailed case study of AutoNation, which is also retrieved from PNM Soft website, it was identified that the company has “a lack of structure in certain company processes and the need for simplified applications that end-users could easily pick up and use across their hundreds of stores” (AutoNation Transforms Business Processes 2017, p. 1). Therefore, it is possible to state that the primary driver that triggered the decision to make a change was the insufficient level of end-to-end performance of the company.
BPM House Metaphor in the Context of the Selected Organization
As it is stated on PNM Soft website, AutoNation is the largest automotive retailer in the United States and recently sold its 10 millionth vehicle” (AutoNation Case Study 2017, para. 1). However, despite the company has been considerably successful throughout the time (as it is represented by the information on Fortune 500 website), in recent decade the organization has shown a slight decline in the efficiency of its performance (AutoNation 2018). The reason for seeking business process managerial support is discussed in the previous section. The purpose of this section is to elaborate on how the company has implemented BPM in the context of BPM house metaphor.
The house metaphor is one of the most popular ways of explaining how BPM works and how its components are related to each other. The primary aspect of this metaphor is that a house should have a solid foundation in order to support all other constituents of a house. BPM is organized in a similar manner. As a foundation, there is a set of principal business guidelines that drive business processes: strategy, process, organizational design, performance management, people, governance, and technology. It is possible to state that AutoNation is a relatively successful company with clearly established strategic objectives; however, the outcomes of the company show that it lacked excellence in such fundamental aspects as processes, organizational design, and performance management.
Further, the “first floor” of the house metaphor is Process Change (or business process improvement) and Operation Manage Sustain. These aspects were critical to the implementation of BPM within AutoNation as they focus primarily on such aspects as process-focused project management, methodology improvement, and people change management. As it could be understood from the AutoNation Case study, the company was in considerable need of such policies in order to facilitate its overall performance results (AutoNation Case Study 2017). The “second floor” of the BPM house metaphor is divided into two “rooms,” which are management processes and operational processes.
Considering management process, AutoNation had to implement the following: simplification of supplier-customer relationships, business innovation (as the company decided to employ automized IT system in order to decrease the waiting time for purchasing products and canceling operations of the customers to three days), and formalized learning (AutoNation Transforms Business Processes 2017). In terms of operational processes improvement, it is possible to mention that the company had to improve the efficiency of its supporting operational processes that include such aspects as finance, human resources, and IT sphere. Thus, the company has achieved a sustainable growth through the implementation of BPM approach, particularly, AutoNation has facilitated its organizational culture, performance management, process governance, and organizational process asset (which are essential parts of the “roof” part of the BPM house metaphor).
AutoNation 2018, Web.
AutoNation Case Study 2017, Web.
AutoNation Transforms Business Processes for its Shared Services Center and franchise stores 2017, Web.
Large US Companies Prioritize Agility for BPM 2014, Web.