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BPM White Paper

BPM Solutions - Building improved processes

It is one thing to identify the short comings of existing processes and their supporting IT
infrastructures, it is another to design, develop and deploy improvements.

The major impediments to the creation of smarter business processes are the limitations of
functionality in existing systems and the existence of islands of information and expertise.

For example, it is very common to find that spreadsheets are being used to assist in responding
to requests from customers for quotations. While spreadsheets are a boon in terms of the local
facilities they offer individual users, when used as part of a larger business process they create
some problems.

Firstly, the knowledge contained in the spreadsheet system is not available across the
organisation and is not integrated with any of the other systems needed to complete the
quotation/order/supply cycle.

Secondly the spreadsheet system does not have access to other knowledge sources such as the
latest manufacturing methods or costs.

Thirdly, to get information into and out of the spreadsheet stage is inefficient and prone to error.

The fact that spreadsheets have been resorted to in the first place points to inadequacies in the
functionality offered by the primary IT infrastructure - in this example, the inability of the ERP
system to adequately model products to generate the necessary costs for quotation. It many
instances, ERP systems cannot even maintain quotation information unless the prospective
customer is entered as an account with an account number and Bills of Material for the product
already exist.

Continuing our quotation process example, the knowledge needed to generate quotations is
present in the business - Knowledge of the customer or prospect is in the CRM system, some
product knowledge is in the CAD system and some in the ERP system. More knowledge is in
secondary systems such as spreadsheets and some may only be in the heads of certain key
people.

To improve the quotation process, all this knowledge needs to be pooled and made accessible

The Edenorigin Knowledge Architecture

A Knowledge Architecture is one where existing islands of Knowledge are linked together and
made accessible across the organisation or the complete supply chain. Gaps in knowledge are
identified and new knowledge sources created to plug them.

The Edenorigin BPM architecture provides a mechanism for identifying and integrating existing
knowledge sources, capturing knowledge and storing additional knowledge and applying
knowledge to business processes.
In this way, existing effective systems are re-used within an overall knowledge architecture on
which improved and automated business processes can be built.

Knowledge is a combination of data and rules. A table within a system may contain data about
the diameters, wall thicknesses and materials that a hydraulic cylinder component can be
supplied with. To make this into knowledge, we need to know which combination of size, wall
thickness and material are valid under which circumstances.

The Edenorigin knowledge management module provides a method of capturing and relating
rules to data to create knowledge.

Knowledge from Data

A particular car is available with three body styles and four engine options. In theory, this data
shows that there are twelve combinations of body style and engine type.

The company selling these cars has rules that state that the coupe body style cannot be bought
with a diesel engine and that the estate body option cannot be supplied with a 1.1 litre petrol
engine.

Applying these rules to the option data produces not twelve combinations but only ten - this is
knowledge

To create knowledge within Edenorigin, models are constructed that request data from multiple
sources, apply rules to that data, and output knowledge. In this simplistic example to create such
a system would take less than ten minutes.

A more realistic requirement might be for a multi-site company with manufacturing resources in
several countries with overlapping but not entirely duplicated product and sub-assembly
manufacturing capabilities. Each site has its own ERP system. The company needs to break down
orders from customers and allocate work to sites based not only on manufacturing capability but
also capacity availability and the geographic relationship with the customer. The objective here is
to maximise customer service at the lowest manufacturing cost. To make things more
complicated, the company plans to dispose of some sites and acquire others over the coming
years.

By creating an Edenorigin Knowledge Architecture across the entire company, the data required
for decision making can be associated with rules and the required process created without the
need for new software or any programming activity. Because it is a knowledge based system,
participating sites can be added or removed at any time, preserving the group's agility. This
approach also means that participating sites can retain their local IT infrastructures thus
preserving their investment and eliminating the need for expensive and time consuming systems
harmonisation.

Workflow

The way work is progressed is dependant on external and internal inputs and the outcomes from
the application of business rules
Individual process steps created in Eden are linked together to create a workflow. The linking of
the process steps is made via task lists which manage the direction and timing of the flow across
the process dependant on the previous process and the rules to be applied.

Full MAPI compliance ensures users are notified of actions required via e-mail and task lists are
updated.

The Knowledge Environment in practice

A knowledge architecture consists of many linked sources of data interacting with multiple
Edenorigin models. Within a knowledge environment, models will exist covering many different
requirements. Some will interact directly with users while others manage invisible tasks such as
requesting, transforming, combining and delivering data from one set of data sources to another.

Once created, a Knowledge Architecture provides an agile, dynamic environment within which
more and more business processes can be remodelled and enhanced as circumstances and
business needs dictate.

An real life example of the application of the Edenorigin BPM approach is provided by a company
that services garage forecourts. Engineers are sent to sites to undertake routine maintenance
and in response to requests for emergency maintenance. In order to maximise efficiency and
service levels, several sources of knowledge have to be accessed and business rules applied.

Firstly, details of the requirement have to be captured. If it is planned maintenance this


information comes from a customer database separate from the ERP system, and if it is a
response to breakdown it comes from a call centre operation.

Secondly, knowledge of the environment to be serviced is needed - The location, the numbers
and exact specifications of the equipment on site and the status of the site as a customer (Credit
check). The location and status come from the companies ERP system, but details of the
equipment on site are stored on paper and are not up to date.

Thirdly, knowledge about the capability, availability and current location of the engineers is
required. This information is held in the database attached to the companies field service
planning and scheduling system.

Edenorigin BPM was used to create a fully automated knowledge based process as follows:

A request for engineering assistance is received at the call centre and the details passed to the
EdenoriginBPM system. The format and content of the message are transformed by Edenorigin's
Integration layer before being interpreted by the rules engine. The rules engine interrogates the
required data sources, one of which is a newly created source based on the paper records of
equipment and now updated directly by returns from the engineers and details of new deliveries
of equipment retrieved from the ERP system.

The knowledge source that contains details of engineers' capabilities is accessed by the rules
engine as is the field service planning system to determine who will be available and when.

Instructions are then forwarded via the Edenorigin system to the selected engineer via his
handheld computer and details of the timing sent to the call centre to be relayed to the customer.
Business rules are applied throughout to select the lowest cost option that meets the required
service response target.

By integrating the multiple sources of knowledge and applying business rules to them a truly
market leading field service process has been created.

Integration and Edenorigin BPM

EAI (Enterprise Application Integration) is a prime requirement of any BPM solution. New
processes often involve many existing applications and these will range from new systems with
modern interfaces and ODBC compliant databases to older legacy systems with no interfaces and
file structures.

To be useful, an EAI system must be able to deal with all combinations. Edenorigin's EAI
configurator can detect API's and allow installers to construct integration processes using its drag
and drop functionality. Data extracted can be transformed using protocol converters and business
rules can be added. For example, Data extracted as text from one source can be transformed into
XML for onward transmission and vice versa.

The Edenorigin Task Manager supports the creation of task lists that define the sources,
destinations, transformations and business processes to be applied while managing both on-line
and time dependant environments.

An example of the application of Edenorigin EAI is a company that services white goods on behalf
of one of the UK's Major retail chains. The company needed to integrate a call centre running on
IBM AS400 technology with an ERP system running in a UNIX environment, a field service
planning system also running on UNIX and hundreds of PDA's used by field engineers.

Information from the call centre (40,000 transactions per week) were picked up and transformed
into two onward streams - one for the ERP system and one for the engineer scheduling system.
Multiple scheduling options per request were then received back from the scheduler and business
rules applied by the Edenorigin EAI system to select the best alternative. Job details were then
assembled, again by Edenorigin, from inputs from the ERP system (for materials) and the
selected schedule. These are then passed to the selected engineers PDA.

Job completion, material usage and costing information are then passed back from the engineer
and used to update the ERP system, call centre record and scheduler.

All this was constructed in Edenorigin's EAI layer without any programming.

Presentation , Portals and PDA's

New processes require new user interfaces. The better designed and the more flexible these are,
the more productive will be the users. The Edenorigin BPM presentation layer has been developed
to allow user interfaces to be designed to meet the exact needs of each user.

Keyed by security, in windows or JAVA environments each user can have different layouts to
maximise productivity for their particular task set, including choice of language.
The Edenorigin JAVA server provides the means to create portals to provide tailored access to the
systems by suppliers, customers and remote workers as well as internal users. Access to the
processes deployed can be via PC's, Thin Clients or PDA's(Personal Digital assistants).

Mobile and Remote Working

Every year the expectations of customers in terms of ease of doing business and access to
information increases. At the same time, the way businesses are structured evolves.

Salesmen need to be able to configure solutions for customers while in the customer's office, key
workers become wholly or part time home workers and entire businesses become virtual with no
fixed location or structure.

To support these evolutions, IT solutions need to be able to follow the working patterns as they
change. For this reason new processes should be able to accommodate any mixture of working
patterns and any level of automation.

Edenorigin BPM will run the same process via Fat and Thin clients, over the internet and remotely
with synchronisation. As knowledge is progressively captured, processes can be made more and
more intelligent reducing their cost of operation, their dependency on key personnel and
increasing the company's responsiveness

BPM and Lean Business Practises

Lean business was pioneered by manufacturing industry and started with the manufacturing
processes themselves. From there it spread to include all of a manufacturing business's processes
before achieving universal acceptance as a way of eliminating waste from any set of processes.

In the manufacturing environment, it was soon realised that ERP systems were ill-suited to the
support of lean processes. Manufacturing needed to be directly linked to sales activity and not to
replenishment algorithms based on forecasts.

Many IT processes were replaced by simpler, more direct, manual processes with immediate and
very significant benefits. For industries with simple, non customisable products, it was possible to
virtually eliminate most manufacturing orientated ERP processes all together. However, for
manufacturing companies with complex, customisable products, the problem of translating
customer requirements directly into manufacturing instructions has to be overcome.

For the rest of industry, the lessons learned by manufacturers are being translated into leaner,
simpler, more direct practises. At the core of this drive is the need to capture and apply
knowledge.

The Edenorigin BPM system, with its knowledgebase and Integration layer allows users to
redesign processes, eliminating non value added steps and extending their reach at both ends of
the supply chain to include suppliers, contractors and customers.

Product Configuration, Quotation and Sales Order Processing with Edenorigin BPM

More than any other set of processes, the way information is exchanged with customers and
prospects defines the way a company is perceived within its market place and therefore controls
its competitive edge. It is no surprise,
therefore, that it is the customer interface to which EdenoriginBPM is most often first applied.

All too often, this crucial interface is fragmented in operation, slow to respond, has a tendency to
be inaccurate and is expensive to operate. Quotations are frequently created on spreadsheets.
The order details from accepted quotations are then re-keyed into Sales Order Processing
systems, often themselves not well designed for the task.

Procedures such as these are error prone, slow and expensive to operate. Worse still, they
portray an image of a company slow to respond and backward looking.

The reason companies are forced into this position is that all ERP systems are a compromise. No
matter how configurable they purport to be, there will always be some key processes that they
cannot match. Because the customer interface is the face of the company, it is the most
demanding in terms of its specificity - it, above all processes, must be tailored precisely to the
companies needs. This problem is illustrated in the diagram below.

As the complexity and specificity of the processes increases, the degree of fit reduces to zero,
leaving the most complex, most key processes to be addressed by work-arounds such as
spreadsheets.
The reasons why ERP systems fail to serve these process needs are numerous, but common
among them is the need to draw on several different pools of knowledge. To create a valid quote,
detailed knowledge of what works with what and what can and can not be produced are needed.
Knowledge is not stored in ERP databases - only data.

Creating a valid quote requires that data be combined with knowledge. In most cases, all the
data is available but not stored in one place. In some cases, some key data elements are not
stored anywhere, there being no place in the companies databases in which to store them.

Margin Control

It is the quotation that fixes the terms of business and therefore, to a very large extent, in the
short term at least, it is the accuracy and control achieved within the quotation process that
determines the company's profitability.

Despite this reality, it is very often the case that a company's ERP system is unable to handle the
quotation process effectively or in same cases at all.

This is why so many companies have quotation processes that utilise spreadsheets. From giant
telecoms companies through medium sized manufacturing companies to builders in areas and all
scales spreadsheets can be found controlling this key process.

The key tasks in generating a quotation are:

1. Configuring the Product or Service correctly

2. Costing accurately using the latest information

3. Pricing correctly

If a quotation process is not integrated with all the required sources of knowledge, then control of
margin is loose, and money is being wasted. Data from the CRM system, ERP system and, in the
case of manufacturing companies, data from CAD and PDM systems will need to be combined
with business rules are continually being fine tuned to the current business environment.

Creating an effective and responsive quotation system with good margin control requires the
integration of all these data sources and a means of capturing and applying the business rules

Edenorigin BPM system, with its Integration configurator (EAI), Knowledgebase and presentation
designer overcome all these problems and allow the creation of new processes designed to
support the unique requirements of each company.

The following two illustrations show two examples of quotation/configuration solutions:

Example 1 -Glass manufacture

This glass company needed to be able to rapidly input hundreds of order lines for double glazing
units for commercial buildings. The solution is in three panes. Panel A draws customer details
from the ERP database. Panel B allows the operator to define the characteristics of the glazing
units that are common to the entire building (Outer glass type, Separator, fill medium, inner
glass type etc.)

Panel three allows the rapid input of numbers of panels with the Panel B characteristics by size
and shape (Not all are square). This panel is designed to be used without the need for mouse
clicks to maximise operator speed.

As data is entered, so a price is generated and a quotation produced. Once accepted, the
quotation is converted by a single key stroke and all the data needed to support manufacture and
delivery passed to the ERP backbone.

Example 2 - Peristaltic pumps

In this case, the requirement was for a web based quotation and ordering process based around
a drawing. Using this Edenorigin (JAVA Logo) solution, customers can define their pump
specification directly over the Internet, and can see the dimensional information they require as
well as the price they need to pay.

By selecting a pump speed, a median flow rate and a flow rate range, pump options are displayed
on Table A. The customer can select choices form this table and immediately see the critical
dimensions displayed on the drawing.