Business Process Reference Models

Table of Contents:

3.3.1 What Is a Business Process Reference Model?

The term business process reference model has not been consistently defined and there is still a lively discussion which aspects this term comprises. This discussion shall not be comprehensively recapitulated in this contribution. In general, business process reference models can be understood as business process models which should fulfil certain criteria and offer certain features. These criteria are still under discussion, e.g. in (vom Brocke 2003; Thomas 2006; Fettke and Loos 2007). Referring to Fettke and Loos (2007) and Ardalani et al. (2013), we consider the following features as important:

1. Reusability: Business process reference models represent business process blueprints for the development of process-oriented IS which can be reused in different IS development projects (vom Brocke 2007).

2. Exemplary practices: Business process reference models can provide common, good or even best practices describing how business processes are actually designed in practice or how they could or should be designed and executed in order to reach certain goals. In this context, a descriptive as well as a prescriptive or even normative connotation of business process reference models becomes apparent depending on their interpretation.

3. Universal applicability: Business process reference models do not only represent business processes of one particular organization but aim at providing universally applicable business process representations which are valuable for different organizations in a certain domain.

Reference models can provide benefits for both theory and practice. Besides the provision of general descriptions of enterprises, which is especially interesting from a theoretical point of view, practice profits, e.g. from decreases in modeling costs, modeling time and modeling risk as reference models can represent proven solutions (Becker and Meise 2011). Moreover, increases in model quality based on the reuse and adaption of already validated process models can be expected.

Prominent examples for reference models which have been extensively used in practice in order to profit from these advantages are, e.g. the Y-CIM Model by Scheer for industrial enterprises (Scheer 1994) or the SAP reference model as a basis for the SAP R/3 system which has been partly published in (Keller and Teufel 1998). An overview of a collection of reference models is provided by the Reference Modeling Catalogue hosted by the Institute for Information Systems (IWi) at the DFKI and Saarland University, Saarbru¨cken.[1] In the following, we present a selection of relevant Business Process Frameworks in the sense of business process reference models: the SCOR Model, ITIL, eTOM and the APQC Process Classification FrameworkSM (PCF).

3.3.2 Supply Chain Operations Reference (SCOR) Model

The Supply Chain Operations Reference (SCOR) Model is a process-oriented reference model for supply chain management which has been introduced in 1996 and further developed by the Supply Chain Council.[2] After several revisions, the SCOR model has been available in version 10 since August 2011. While at first only the 69 founding members were part of the Supply Chain Council, the Council now comprises almost 1,000 companies and research institutions.[3]

The SCOR model defines five different types of processes in organizations. Their relationship is visualized by means of a multi-stage supply chain in Fig. 3:

1. Plan: includes the planning and management of supply and demand for goods.

2. Source: comprises the purchase of goods, the goods receipt, pre-delivery check, storage and method of payment for any goods.

3. Make: covers all stages of production processing.

4. Deliver: comprises all the steps of the ordering and delivery of goods to the customers.

5. Return: includes all the steps for handling returned goods, both repairs and maintenance are taken into account.

In the study of Fettke (2008) the real world effects of using the SCOR model have been investigated based on different theoretical perspectives, such as the market-based view, the resource-based view and network theory. Moreover, the hypothesis saying that the application of the SCOR model comes with positive effects on typical supply chain management goals is supported by an empirical

Fig. 3 SCOR model process types in a supply chain (According to: supply-chain.org/)

study which has addressed all members of the Supply Chain Council. Furthermore, Bolstorff et al. (2007, p. 27) report on additional experiences with the SCOR model:

1. Increase of total income by three per cent after a SCOR project through the reduction of costs and the improvement of customer services;

2. Two to six fold return on capital within 12 months after completion of the SCOR project;

3. Lower operating costs for information technology;

4. One to three per cent increase in annual operating profit.

Besides these findings, a recent survey identified positive impacts of using the SCOR model on customer-facing supply chain quality performance and internalfacing business performance (Li et al. 2011). Another survey could also confirm several positive influences of using the SCOR model on supply chain management performance (Zhou et al. 2011).

3.3.3 Information Technology Infrastructure Library (ITIL)

The Information Technology Infrastructure Library (ITIL) represents a business process framework for IT service management (ITSM) which is widely accepted and applied in professional IT service organizations.[4] The current version ITILv3 has been published in 2007 and updated in 2011. ITIL is considered a de-facto standard for ITSM and describes standardized key processes, key concepts and principles, key roles and responsibilities as well as according KPIs and checklists in five different areas of ITSM. Concerning ITILv3, for each of these areas one separate volume with detailed process descriptions in the following areas has been published: (1) ITIL Service Strategy which supports the definition of an

Fig. 4 ITILv3 core processes

adequate IT service strategy in the sense of a longer term development of IT service skills under special consideration of the customer requirements, (2) ITIL Service Design which supports the development of new IT services and solutions as well as the further development of existing services based on the service strategy, (3) ITIL Service Transition which supports the coordination of the IT services' development and deployment, (4) ITIL Service Operation which supports an effective and efficient IT service fulfillment and (5) ITIL Continual Service Improvement (CSI) which uses methods of quality management in order to continuously learn from success and failure to improve IT services. Figure 4 visualizes these five areas of the ITILv3 and the according core processes within these areas.

As ITIL represents the de-facto standard for ITSM, a large amount of experience with the usage of ITIL in practice exists. Furthermore, there is quite an amount of empirical studies conducted by scholars reporting on the positive effects of ITIL usage on IT service organizations' performance, e.g. Henson and Geray (2010) or Meziani and Saleh (2010) in the context of service management in public administration settings or Lapa˜o et al. (2009) in the context healthcare environments.

Fig. 5 eTOM architecture (Level 0 and 1) (According to: tmforum.org/Overview/ 13763/home.html)

Furthermore, there are some recent studies on factors influencing ITIL adoption, e.g. the contribution of Cater-Steel et al. (2009) or the comprehensive international survey by Marrone and Kolbe (2011) which reports on the ever-increasing ITIL adoption and the increasing realized operational benefits caused by the usage of ITIL.

3.3.4 Enhanced Telecom Operations Map (eTOM)

The enhanced Telecom Operations Map (eTOM) represents a business process reference model for the telecommunications industry which has been introduced by the TM forum as their Business Process Framework.[5] It provides a detailed description of relevant business processes for service providers based on a fourlevel-hierarchy. Figure 5 shows Level 0 and Level 1 within the eTOM process hierarchy.

Level 0 represents the overall enterprise level and defines the three major sections: a. Strategy, Infrastructure & Product, b. Operations and c. Enterprise Management. Level 1 “contains seven end-to-end vertical Level 1 process groupings in the areas of Strategy, Infrastructure and Product and Operations. These vertical groupings of processes focus on end-to-end activities [.. .] and each grouping includes processes involving customers, supporting services, resources and suppliers/partners. [.. .] The horizontal groupings represent major programs or functions that cut horizontally across an enterprise's internal business activities.”[6] More detailed process definitions exist on level 2 and level 3 of the eTOM specification.

In practice, a certain amount of experience with the application of eTOM exists as it is one of the most popular standards for managing business processes in the telecommunications industry (Tanovic and Androulidakis 2011). However, so far there are only few empirical studies driven by scholars concerning the real world effects of eTOM; e.g. Chou et al. (2008) report on a successful application of eTOM especially in the context of trouble management operations in the largest Taiwan telecommunications corporation resulting in an improved performance and improved user satisfaction.

3.3.5 APQC Process Classification FrameworkSM

The APQC Process Classification FrameworkSM (PCF) provides a comprehensive taxonomy of operating processes as well as management and support processes. The PCF supports benchmarking of organizational performance within one or among organizations “regardless of industry, size or location” of the compared organizations by means of a common terminology to describe and compare business processes.[7] It has been developed by the American Productivity & Quality Center (APQC) since the early 1990s and the current version 6 comprises more than 1,000 relevant business processes. Besides the cross-industry version, several industry-specific versions of the PCF exist, e.g. for retail, automotive, telecommunications, education. The content of the PCF is organized into the following five levels[8]:

• Level 1: Category, represents the highest level of processes in enterprises such as financial organization, human resources etc. One example of a category in PCF version 6 is “1.0 Develop Vision and Strategy (10002)”.

• Level 2: Process Group, represents connected groups of business processes within one category. One example of a process group in PCF version 6 is “1.1 Define the business concept and long-term vision (10014)”.

• Level 3: Process, represents a sequence of interrelated activities converting input into output. One example of a process in PCF version 6 is “1.1.1 Assess the external environment (10017)”.

• Level 4: Activity, comprises key events performed during the execution of a process. One example of an activity in PCF version 6 is “1.1.1.1 Analyze and evaluate competition (10021)”.

Fig. 6 Overview of categories in the APQC Process Classification FrameworkSM

• Level 5: Task, next level of decomposition after activities, more fine-grained. One example of a task in PCF version 6 is “12.2.3.1.1 Identify project requirements and objectives (11117)”.

Figure 6 gives an overview of the process categories contained in the PCF.

According to the APQC reporting, the PCF has been used for business process management and benchmarking in many different businesses in the last two decades worldwide and several practical case studies providing detailed experiences with the PCF in renowned companies from different industries exist.[9] Furthermore, the PCF has been used as a systemization approach for business processes as a fundament for scientific empirical studies and surveys, e.g. concerning IT and business process alignment (Cragg et al. 2007; Cragg and Mills 2011) and in the context of comparing service offerings in business transformation projects (Srivastava and Mazzoleni 2010).

  • [1] rmk.iwi.uni-sb.de/
  • [2] supply-chain.org/scor
  • [3] supply-chain.org/about/history
  • [4] itil-officialsite.com/
  • [5] tmforum.org/
  • [6] tmforum.org/Overview/13763/home.html
  • [7] apqc.org/process-classification-framework
  • [8] According to the framework description on: apqc.org/knowledge-base/documents/ apqc-process-classification-framework-pcf-cross-industry-pdf-version-600
  • [9] apqc.org/apqcs-process-classification-framework-case-studies
 
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