Is Process Fragmentation a barrier to delivering digital transformation and automation at scale?

‘Process fragmentation happens when business?critical processes are not managed in a unified workflow. They become a series of handoffs among departments, teams and systems, introducing the risk of error, mistakes and delay with each handoff.” Business Process Management Institute

Many organisations fail to recognise that their processes are disjointed or that a single processed item can travel along multiple pathways within a single workstream. This means that attempting to tune or automate the process often fails as the automation can only deliver a low value, tactical solution that satisfies part of the required deliverable. The result is that the host organisation’s process automation projects often fail to scale and they do not capture all of the work items.

Fundamentally business fragmentation occurs when critical processes are not managed as a fully integrated end to end system that encompasses all elements of the actual process including all of the upstream and downstream processes.

Process Fragmentation can occur across many of the key elements within a business and include:

• Physical fragmentation such as different geographical locations
• Cultural fragmentation arising from different regions, countries or departments within an organisation (e.g., Sales versus accounts)
• IT Fragmentation such as legacy systems versus new systems or cloud versus on-premise
• Lack of process measurement, metrics, and objective data

Understanding the four main areas where fragmentation can exist is important. However, the most critical element is capturing objective data and studying the results of where fragmentation is creating friction and flow issues.

Silo Structure and Process Enforcement

Traditionally most organisations still concentrate their power in vertical units, whether generated through organic growth or through acquisition. These vertical units can often become silos that operate as functional islands that deliver a functional output within the process chain.

Typical Silo’s include:

• Sales
• Procurement
• Accounts
• Warehousing
• Manufacturing
• Customer Services
• HR
• Payroll

Even within defined silos, multiple functions and mini-Silos can exist such as Account Payables (AP) and Account Receivables (AR) if there is no joined-up process flow.

Systems Fragmentation

Typically, when processes grow organically over time, ERP workflows can become a complex series of handoffs between business functions, job roles and information systems. This is particularly relevant when organisations use multiple systems of record such as Oracle, SAP, ServiceNow, SalesForce….

Over time the systems and applications are customised and enhanced in response to business strategy changes, compliance, security and a wide range of other drivers that move the business processes away from the original process path.

Each handoff or workaround represents a possibility to introduce mistakes, delays and added cost which all contribute to further organisational and process complexity. Devoid of a fully integrated process workflow and full understanding of all the variables and metrics within the process, value deteriorates and system complexity increases.

The potential for further friction and resistance increases again as tactical individual workarounds, whilst satisfying a need locally, fail to recognise the upstream and downstream consequences of changing the work item flow and this impacts the efficiency of the complete system.

Fragmented Process Flows are like a dammed stream

Processes that are fragmented across the organisation are like dams that block a stream or river and prevent a smooth flow of water. Eventually, the water backs up and find other routes to travel down, and this is comparable to where work items can get stuck, log-jammed or find other routes to get to the required destination. Whilst the business is still able to function risks increase especially in areas such as compliance and audit.

So how do you find where those dammed processes are?

As with any business change exercise, identifying where to start is the first major hurdle for stakeholders and managers to contend with. Typical engagements involve teams of ‘Process Documenters’ who map out the ‘as-is’ to the ‘to-be’, taking up valuable time and resources with interviewing everyone in the process chain.

Not only is this very time consuming and frustrating for those needing to perform their day jobs, but it also typically fails to capture all of the process flows including the workarounds and exceptions. This creates a misunderstanding of the scale of the issue at best and at worst means that any future defined strategy is doomed to failure as it does not cater for the real world but rather the more limited perceived one. Therefore, process improvement projects only part solve the problem.

The Future is Process Mining

There is a solution and service that allows you to look deep inside your organisation's systems by utilising already captured data, making it an objective rather than subjective exercise.

Process Mining utilises Data Mining technology to replicate processes in real-time and capture all the interactions and timelines of the process. This gives a holistic oversight across the process landscape and allows changes to be tested and modelled before implemented into production. Process Mining allows a complete view of the end to process including all upstream and downstream components. This is particularly important where the process flow touches multiple systems of record such as Oracle, SAP, Salesforce, ServiceNow….

The level of detail and understanding of the complexity of the internal workings with the ability to capture all the process touchpoints and interactions empowers stakeholders and users with the ability to make changes and deliver significantly improved outcomes.

Summary

Process Mining is a next-generation Digital transformation product that enables accurate assessments and fully measurable analysis of process flows with captured systems data. It allows organisations to predict outcomes before changes are made and once changes have been made to measure them against the expected results.

For further information on how Process Mining can help your organisation please contact Jim Brown at ONQU Automation at [email protected] or phone 0121 803 8808