 Business Process Modelling

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 Unfortunately
Reality is very complex

A business model is a simple representation of the

complex reality of a particular organization

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 Business process modelling is a means of representing
the business activities, the information flow and decision
logic in business processes.

 With the power of visualization, it is used to

communicate information regarding a process and the
interaction it includes within / between organizations
either among the persons reading a model or the
persons who create it.

 It externalizes the business knowledge with a view to

agree and bind all stakeholder in a representation that is
shared within an organization.
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 Event Driven Process Chains (EPC)
 EPC were originally developed to illustrate SAP processes.

 Business process modelling notation (BPMN)

 It is a standard graphical notation for modeling business
processes. The notation is strongly IT oriented and is maintained
by a standards organization, called Object Management Group.
 There’s a strong industry push for using BPMN, with over 70 tools
supporting the standard
▪ Bizagi Process Modeller (free), Oracle BPA , MS Visio

 Unified modelling language (UML)

 IT is leading standardized specification language for object modelling in the
software engineering sector.

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 Order-to-cash

Start event: trigger

Check stock
availability End event: process outcome
Purchase
order
received
Split gateway: this is where the control flow is split into two or
more branches.

In this case the flow is split into two mutually exclusive branches
(one taken when items are not in stock, the other when the items
are in stock).

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 Order-to-cash
 An order-to-cash process is triggered by the receipt of a purchase
order from a customer.
 Upon receipt, the purchase order has to be checked against the
stock to determine if the the requested item(s) are available.
 Depending on stock availability the purchase order may be
confirmed or rejected.
 If the purchase order is confirmed, an invoice is emitted and the
goods requested are shipped.
 The process completes by archiving the order or if the order is
rejected.

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Order-to-cash
end
activity
Reject order event
Items not in
Order
stock
rejected
Check stock split gateway end
availability
Purchase event
order Items in
received stock Confirm Emit Archive
start Ship goods
order invoice order
Order
event fulfilled

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 Techniques for Modeling Static Aspect of Business
Process
1. Flow Chart
2. Service System Mapping (SSM)
3. Decision Tables
4. Pseudo-Codes and Structured English
5. Data Flow Diagram
6. RAD
7. RID
8. Gantt Charts
9. IDEF
10. Activity Diagrams

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 Case:

Transform Business Processes: A Case

Study at a Precession Engineering
Company

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 Existing Sales
Work Flow in MAE

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1. Based on generated quote number, the salesperson can retrieve the
information from a list of items and thus quickly responding to customer
requirements.
2. Automatically generation of relevant item information such as description,
unit price and warehouse location code.
3. Automatically calculated total prices for each item
4. Hence salesperson can provide an accurate quotation to the customer.
5. Automatically transfers the relevant information from sales quotes to sales
order.
6. Subsequently, the sales person will key in the requested delivery date and
promised delivery date.
7. When all the required information is entered, the salesperson posts the sales
order.
8. The operation planning department, thus will be notified of the new sales
order and accordingly process it.
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 Planned Delivery Date- date to deliver an order to customer.
 Planned Shipment date –date when the picking process is completed and items are
shipped out from warehouse.
 Shipment date – date when an item must be available in inventory, hence picking
process can start

 They are calculated automatically.

 Outbound warehouse handling time – time duration that is required to pick, pack and
label the item in an order.
 Shipping time – time duration between the time that the items shipped out from the
warehouse to the time that they reach the customers.

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 The earliest delivery time for an order if there
is no requested delivery date is
▪ Shipment date + Outbound Warehouse Handling Time = Planned
Shipment Date
▪ Planned Shipment Date+ Shipping Time = Planned Delivery Date

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 SOLUTION: ERP, Microsoft Dynamics NAV

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 To improve efficiency and to shorten handling times.

 Allows the items to be easily tracked w.r.t to the basic

activities such as receiving, putting away, picking and
shipping.

 Can also accommodate the increasing complexities in

warehousing activities caused by e.g. expansion and
progress of MAE.

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 It took MAE several months to experience the
benefits resulting from ERP implementation.

 “The implementation of ERP system and the

standardization of company’s business processes
has brought about a raft of improvements that
have influenced management quality, cost
control and customer satisfaction.”

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