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Measuring the Business World

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by Helge Hess in ARIS BPM Blog posted on 2008-04-13

Information obtained from analyzing and evaluating live business processes provides an important leading indicator for a company’s performance and value creation activities. Collecting KPIs on a data-driven basis without linking them to processes does not boost business performance, however. Process-oriented performance management tools are required that seamlessly support day-to-day business management at the strategic, tactical, and operational level.

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ARIS Business Performance Edition from IDS Scheer gives organizations the tool environment they need to optimize business processes, thereby enabling them to boost their efficiency and overall performance. ARIS Process Performance Manager (ARIS PPM) lies at the heart of this process-driven performance management, measuring IT-supported corporate processes and analyzing underlying process flows and organizational structures. Companies thus obtain a comprehensive view of their organization’s performance that documents their business workflows by way of objective process indicators, seamlessly linked with actual process structures.

Business processes are typically supported by an array of disparate application systems. By combining the process-relevant data of the SAP application and associated systems (e.g., third-party, legacy, etc.), ARIS PPM can reconstruct the execution of each transaction, from start to finish. The KPIs are compiled using conventional BI technology called ETL (extract, transform, and load), whereby data is extracted via adaptors from the source systems (e.g., SAP solutions), transformed, and stored in a process warehouse. This makes it possible to display individual transactions as process chains, as well as calculate KPIs for throughput times, deadline compliance, supply capacity, response times, process costs, change frequency, etc. By continuously comparing the values actually achieved in process flows with target values, the company can respond to deviations at any time.

Long-term “ECG monitoring” of company and process activities can now be augmented by real-time process analysis options—the equivalent of taking the process pulse—and broken down into seconds, minutes, and hours. Operational process monitoring is performed using ARIS Process Event Monitor (ARIS PEM), which allows companies to analyze current transactions and respond to critical events in real time. Such events can, for example, affect time-critical aspects of operational sales logistics. Assume that the warehouse has given a guarantee that goods will be shipped on the same day for all delivery notes created by 1:00 p.m. If goods shipments have not been posted yet or no invoice has been issued because of billing blocks, it will clearly prove difficult to keep this promise. This must be flagged up promptly to allow time for appropriate corrective action to be taken.

ARIS PEM’s high-performance tracking functionality continuously monitors incoming, process-related events and proactively identifies critical situations, freeing the user to concentrate on the most important exceptions and take immediate action. In some cases, ad hoc information regarding excessive response/throughput times in business processes can be derived from the status of operational IT applications. In addition, the inclusion of a correlation engine enables critical situations, such as SLA violations or breaches of compliance rules (dual-control principle in approval procedures), to be “fished out” from the continuous event flow. By correlating input data (including data from different sources), new events can be generated and users informed promptly of any problems via a dashboard, e-mail, or SMS, or automatic responses triggered.

Read more about Process Intelligence: www.aris.com/intelligence

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Shirish Sharma posted on 2008-04-29

I think the product is great to have in any organization, but lets be a bit practical and try to figure out in numbers what should be projected ROIs for a 5 Billion company (Market Cap), 10 billion 15..20 so on and so forth ???

Joerg Klueckmann posted on 2008-05-01

It’s sometimes hard to calculate the ROI because not only process controlling helps to improve business performance but also the transformation of the lessons learned into operation. In a project we had with a major bank in Germany the ROI was already reached after one year. They did a great job in monitoring and continuously improving processes.