Global cement, aggregates, concrete, and other building products company
Critical Business Issue
A key component of the organization’s strategy was growth through acquisition. The speed and quality of assimilation was insufficient and greatly affected the ROI of each acquisition.
Critical Process Issues
The assimilation efforts suffered endless and expensive stabilization phases because of the narrow focus on the IT systems integration without understanding and addressing the work processes. The organization leadership had made a decision to take a process approach to this work but lacked a common framework for making critical decisions regarding the scope and phases of ERP (Enterprise Resource Planning) and process practices migration.
- Existing process lists, business line definitions, and process domain views that already existed were gathered and synthesized into a single draft Business Process Framework (BPF).
- A group of Processes & IT representatives with significant business understanding were assembled to validate and adjust the Business Process Framework (BPF) in a series of sessions.
- Teams of Processes & IT staff were assigned to create profiles of each Value Creation, Management System, and Contributing System process identified in the BPF. The profiles included:
- Process mission statement
- Process scope (inputs, outputs, and sub-processes)
- Key performance indicators
- Operating functions involved in executing the process
- Related ERP and other IT systems and applications that supported the process globally
- Global process variations
- Standardized and harmonized process components
- The process profiles were shared across teams and cross- referenced to minimize potential for process overlap and gaps.
- The BPF and supporting process profiles were reviewed and endorsed by senior Processes & IT managers
- The BPF was used as a framework for ERP migration planning by creating customized views highlighting those processes that were directly and indirectly supported by each ERP module and the desired staging of the module migration in acquired operations.
- The BPF was used a framework for identifying standardized and harmonized process components to be migrated into acquired operations. Interim process actions for processes supported by ERP modules that would not be migrated immediately were identified.
Key Points About This Case
- Mature global organizations operate a platform of standardized processes and information technology. These platforms are interdependent but unique. Both present opportunities for optimizing the cost and effectiveness of doing business globally.
- Without a view of the work system (the business processes and IT systems) and its relationship to the value created for customers, the organization had no valid criteria for making tradeoffs between desired requirements/functionalities and potential performance efficiencies. This created great debates among all stakeholders (the acquired operations, business management and the Processes & IT Department) that tended to center around the responsiveness of Processes & IT instead of the impact on organization performance. This was a no-win situation for Processes & IT, which typically defaulted to accepting an “order taker” position. The resulting organization impact was complex systems that accommodated every requirement/functionality but were expensive to maintain and costly and slow to evolve.
- The BPF effort was one of four key components of their process approach. It was supported by the other three components: Process Improvement Methodology, a process-oriented Project Portfolio Management System, and common tools, conventions, and repository for capturing process documentation.
To read an article on the subject of the Business Process Framework (which we also refer to as a Business Process Architecture), click here.
For a presentation on the topic of the Business Process Architecture, click here.
For information about PDL’s consulting service, where we assist organizations in defining their Business Process Architecture, click here.