Business Processes
Introduction
The fourth component of information systems is process. But what is a
process and how does it tie into information systems? And in what ways
do processes have a role in business? This reading will look to answer
those questions and also describe how business processes can be used
for strategic advantage.
What Is a Business Process?
We have all heard the term process before, but what exactly does it
mean? A process is a series of tasks that are completed in order to
accomplish a goal. A business process, therefore, is a process that is
focused on achieving a goal for a business. If you have worked in a
business setting, you have participated in a business process. Anything
from a simple process for making a sandwich at Subway to building a
space shuttle utilizes one or more business processes.
Processes are something that businesses go through every day in order to
accomplish their mission. The better their processes, the more effective
the business. Some businesses see their processes as a strategy for
achieving competitive advantage. A process that achieves its goal in a
unique way can set a company apart. A process that eliminates costs can
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allow a company to lower its prices (or retain more profit).
Documenting a Process
Every day, each of us will conduct many processes without even thinking
about them: getting ready for work, using an ATM, reading our email, etc.
But as processes grow more complex, they need to be documented. For
businesses, it is essential to do this because it allows them to ensure
control over how activities are undertaken in their organization. It also
allows for standardization: McDonald’s has the same process for building
a Big Mac in all of its restaurants.
The simplest way to document a process is to simply create a list. The list
shows each step in the process; each step can be checked off upon
completion. For example, a simple process, such as how to create an
account on eBay, might look like this:
1. Go to ebay.com.
2. Click on “register.”
3. Enter your contact information in the “Tell us about you” box.
4. Choose your user ID and password.
5. Agree to User Agreement and Privacy Policy by clicking on “Submit.”
For processes that are not so straightforward, documenting the process
as a checklist may not be sufficient. For example, here is the process for
determining if an article for a term needs to be added to Wikipedia:
1. Search Wikipedia to determine if the term already exists.
2. If the term is found, then an article is already written, so you must
think of another term. Go to 1.
3. If the term is not found, then look to see if there is a related term.
4. If there is a related term, then create a redirect.
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5. If there is not a related term, then create a new article.
This procedure is relatively simple—in fact, it has the same number of
steps as the previous example—but because it has some decision points, it
is more difficult to track with a simple list. In these cases, it may make
more sense to use a diagram to document the process:
Wikipedia Term Search Process
Process for determining if a new term should be
added to Wikipedia.
Public Domain
Managing Business Process Documentation
As organizations begin to document their processes, it becomes an
administrative task to keep track of them. As processes change and
improve, it is important to know which processes are the most recent. It is
also important to manage the process so that it can be easily updated!
The requirement to manage process documentation has been one of the
driving forces behind the creation of the document management system.
A document management system stores and tracks documents and
supports the following functions:
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• Versions and timestamps. The document management system will
keep multiple versions of documents. The most recent version of a
document is easy to identify and will be served up by default.
• Approvals and workflows. When a process needs to be changed, the
system will manage both access to the documents for editing and the
routing of the document for approvals.
• Communication. When a process changes, those who implement the
process need to be made aware of the changes. A document
management system will notify the appropriate people when a
change to a document is approved.
Of course, document management systems are used not only for
managing business process documentation. Many other types of
documents are managed in these systems, such as legal documents or
design documents.
ERP Systems
An enterprise resource planning (ERP) system is a software application
with a centralized database that can be used to run an entire company.
Let’s take a closer look at the definition of each of these components:
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An Enterprise Resource Planning
(ERP) System
A software application with a centralized
database that can be used to run an
entire company
• A software application: The system is a software application, which
means that it has been developed with specific logic and rules
behind it. It has to be installed and configured to work specifically for
an individual organization.
• With a centralized database: All data in an ERP system is stored in a
single, central database. This centralization is key to the success of
an ERP—data entered in one part of the company can be immediately
available to other parts of the company.
• That can be used to run an entire company: An ERP can be used to
manage an entire organization’s operations. If they so wish,
companies can purchase modules for an ERP that represent different
functions within the organization, such as finance, manufacturing,
and sales. Some companies choose to purchase many modules;
others choose a subset of the modules.
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