Process discovery from SAP data isn’t rocket science

SAP, the omnipotent ERP system with many mysteries. It is often regarded as complex, or a black box, so unfortunately organizations actually use a fraction of the wealth of information they collect to improve their business performance. Let’s take supply chain as an example as its state has direct impact to business. The performance is usually followed through numerical KPI reports giving statistics on lead times, delivery accuracy or stock rotation. But is this enough to ensure the optimal running of such a core process? Wouldn’t it be great to have timely access to information which gives basis to make relevant changes with the wanted impact rather than just guess WHY the reported delivery time has gotten longer.

Getting the WHY from SAP, and even quickly, is just about knowing, which data tables are needed. And then a process mining software that has the built-in capability to acquire the right information directly from SAP and transform it to an end-to-end process visualization. Automated data acquisition is key and our software QPR ProcessAnalyzer delivers just that. When talking to customers, the value of being able to see how their supply chain runs in reality is almost priceless. Yes, they systematically follow performance metrics, have different dashboards but what has been lacking is the visibility to the process itself, the process reality.

As they say, a picture is worth a thousand words, or numbers in this instance. This truly is the case when looking at a process flowchart that is based on facts. Keeping with the supply chain example, from the flowchart, organisations can see immediately at what stage of the process the promised delivery time is compromised or an order is not handled according to guidelines. And it takes just one click to get to the root cause, the WHY. With the right process mining tools, organisations can harness their SAP data to build an understanding of where the issues lay so that they know what needs to be corrected in order to improve the supply chain performance. The time spent on trial and error is removed, saving money, enabling better sales and ultimately delivering better customer experience with a smoothly working process.

When striving to best possible process performance, it’s not enough to rely just on statistics. You need to understand the real underlying problem before you can effectively improve anything.  It’s the same with your own performance or condition. If you notice a pain, a problem, you get an expert to tell you what you need to do to fix the issue right away rather than randomly try different things, hoping one would eventually work. Or do you?

Teija Räsänen

https://fi.linkedin.com/pub/teija-r%C3%A4s%C3%A4nen/3/7b3/71b 

Data and processes in Portugal

Couple of weeks ago QPR joined OnGlobal Solutions, our partner in Portugal, to a breakfast seminar in Lisbon titled “Improving and monitoring performance with QPR ProcessAnalyzer”. Sharing the stage was also Link Consulting who presented how process performance monitoring is linked to overall process management and improvement. In QPR’s presentation I concentrated on describing how organizations can get value out of the data that they already have in their existing IT systems such as SAP ERP.

It’s actually surprising how many organizations still improve their processes and performance merely based on a “gut-feeling” and on perceptions of individuals. According to a study we published in September in Finland, about 40% percent of the interviewed organizations said that they are not measuring the performance of their processes and only 1/3 of the organizations measured a crucial KPI like delivery accuracy. Truthfully, these results were a bit shocking to us. But they also showed that there really is a lot to do within organizations when it comes to process performance measurement and monitoring. And the best value can be reached by using existing data.

The seminar presentation in Lisbon and of course data driven process improvement itself generated a lot of discussion amongst the audience. Many of the participants were not aware how much information regarding their process performance and inefficiencies they actually could get from the data they just have “laying around” in their systems. And how easily and visually it can be done with QPR ProcessAnalyzer. The discussion continued also after the seminar in one-to-one meetings with customers together with OnGlobal Solutions and so message of using data to improve processes is well on it’s way in Portugal.

Mika Leonsaari

fi.linkedin.com/pub/mika-leonsaari/3/359/495/



Process improvement with hunch or facts

Traditionally, processes have been developed more or less based on a hunch that comes from often subjective viewpoints. By talking to people and manual modeling, you do get about 80% understanding as to how a process runs, or should run, and where the possible problems may lay. But it’s the unknown 20% of the process where most of the problems can usually be found. That 20% causes 80% of the process hassle so it’s vital to open that up and get it under control.

Data is the road to discover the unknown 20%. You get the data from business IT systems such as SAP. As most organisations have support systems which log data, so in principle, all those companies already have the possibility to benefit from that information by using process mining or automated business process discovery (ABPD) methodology (both terms are used for using data to improve processes).

Visualization of process based on data from the IT system

Usually data is looked at through BI goggles, which doesn’t tell anything about the actual process, only numbers. There are tools available that let you analyze the data in a process context and reveal surprising facts of the process performance.  Based on the experience of dozens of process mining projects we have done, customers are amazed what data can unveil and what development possibilities it provides. The biggest pain points can be found in Order to Cash and Procurement to Pay processes. The discoveries and benefits that our customers have gained include e.g. optimized raw material purchasing lowering the working capital levels and shortened process lead times after discovering the root causes for the bottlenecks.

Organisations today continuously battle to develop their processes and optimize costs. And to reach optimal results, In our opinion, organizations can’t afford not to use their existing data for process improvement. Thoughts?

Mika

fi.linkedin.com/pub/mika-leonsaari/3/359/495/

Who stole Enterprise Architecture?

Dear friends,

The term Enterprise Architecture (EA) appeared in the literature for the first time some 25 years ago. Enterprise architecture pioneers like John Zachman and Stephen Spewak linked the concept with a multidimensional and layered structuring of an enterprise, intended to satisfy the needs of the business. Since then, various frameworks have been introduced by different individuals and organizations, ranging from military and government to private sector. Practically all of them contain the basic elements in some shape or form: business drivers and requirements, information architecture, process architecture, application architecture, and technical architecture. The practitioners and standardization bodies are in violent agreement that these are all in the heart of enterprise architecture.

Given the above, one would assume that the concept and the term Enterprise Architecture would  be a stable part of common knowledge. I wish this was true, but the EA culture is suffering from unnecessary turbulence. There are individuals and organizations, acting out of ignorance or commercial interest, trying to introduce definitions and interpetations that are not adding value but rather distorting the picture and confusing those that are new to the topic. For example, some companies having a significant interest in the technology side of IT have advertised enterprise architecture as a big IT architecture. Having strong marketing muscles and excellent access to enterprises through their IT departments, they have created the confusion among their customers that EA is about IT only. If this is the first message that the CEO hears from the CIO about EA, the damage has been done and is difficult to repair.

The above is an example of twisting the meaning of an existing term. Another type of confusion arises from inventing completely new terms. This has been the core competence of marketing departments throughout the history. Marketing is seeking novelty, defining niches which then can be occupied, claiming to be the first or biggest in the recently invented niche. You can always define your own terms and concepts, and distract your customers from the competition. There is no need to have true novelty in your products or services, playing with words is enough. This is an old strategy: if you can't win on a level playground, try tilting the playground. Who cares if you do damage to your customers and to the enterprise architecture community.

Education, science, and language are part of our culture. As such, they are subject to the natural laws governing the eternal evolution of culture. Despite of this unavoidable evolution, we need to keep in mind that it is not random but is influenced by people. It does matter, where the evolution takes us and that we do influence it, when it matters. Concepts like business capability and enterprise architecture are purely abstract and artifical, but they are serving an important purpose for the enterprise management and should be engineered to serve that purpose effectively. Whether we can or cannot, is determined by the strength of the global community of scientists and practitioners driving the ontological process for enterprise architecture. New terms and concepts should be introduced cautiously, weighing their value and linkage to existing ones. New knowledge has value only if it can be put in the context of some existing knowledge. This way we can make sure that climbing the stairs of knowledge is not followed by falling down on our noses.

Enterprise architecture is not something completely new and isolated from other parts of management science. It derives from systems thinking for its philosophical part, and from systems engineering and economics for the methodological part. We need to protect it as the broad conceptual framework and foundation for defining, scoping, and positioning other disciplines like Business Modeling (BM), Operational Development (OD), Business Process Analysis (BPA), Business Process Management (BPM), Enterprise Business Process Management (EBPM), Capability Maturity Model (CMM), Six Sigma, Business Intelligence (BI), and Corporate Performance Management (CPM). None of these disciplines has the richness of semantics and structure to be used as a reference framework for the others. Enterprise architecture as a concept and discipline has these properties for the most part, and as for the remaining properties, let's make sure EA evolves to cover them as well. Starting from the scratch, with a completely new term and concept, is not feasible nor necessary.

Together we can catch and stop the term thieves!

Jaakko Riihinen
Senior Vice President
Products and Technology
QPR Software Plc

fi.linkedin.com/in/jaakkoriihinen/