Process Management and Accounting - An Overdue Take on Measuring the Economic Value of Business Processes

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External Documents

Reference

vom Brocke, J., & Sonnenberg, C. (2014). Process Management and Accounting - An Overdue Take on Measuring the Economic Value of Business Processes. BPTrends: BPM analysis, opinion and insight(03).

Publication type

Article in Scientific Journal

Abstract

Imagine that your CEO asks you to report on the economic value of your BPM initiative. Such requests often arise for those who are trying to sell the idea of BPM. Projects must be planned according to investments and returns, and those who run BPM initiatives must demonstrate those initiatives' contribution to corporate value. Could you provide such numbers? Imagine that you approach your CFO to ask for funding for your next investment into process improvements. Do you have the data available to calculate the ROI of the process improvement? What if your CEO is not convinced at all by BPM evangelists' buzz phrases proclaiming that adopting BPM is the best thing to do to manage an organization? How do you convince your CEO that BPM pays off? Finally, as a process manager, ask yourself: “How do I know whether my BPM initiatives walk the talk in terms of economic value?” This Column presents a basic yet powerful toolkit, the Process Accounting Model (PAM), that can help you gather the data you need to make transparent the economic value created or drained by your business processes. This toolkit can help process managers justify their BPM initiatives in a language that sounds familiar to other business people, particularly accountants and decision-makers in the senior management team. Accounting for the “business” part of “Business Process Management” is overdue, as it has been widely neglected ever since the Business Process Re-engineering (BPR) wave hit organizations in the early 1990s.

Persons

Organizational Units

  • Institute of Information Systems
  • Hilti Chair of Business Process Management

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