Business Process Analysis Report: Examining GAAM's Workflow

This report provides a comprehensive analysis of GAAM, an international manufacturer of hydraulic systems, focusing on its business processes, particularly within the purchasing department and MRO. The report examines the existing workflow, including the process flow, participants, inputs, and outputs, and identifies both strengths and inefficiencies. It highlights the need for business process re-engineering, specifically advocating for the integration of an IT infrastructure to improve efficiency and reduce errors. The analysis includes a business process model using a swimlane diagram to illustrate the workflow, discusses the benefits of using purchase workflow engines, and suggests recommendations for restructuring the business model to enhance competitiveness. The report concludes that by addressing the identified inefficiencies and adopting IT solutions, GAAM can optimize its processes and improve its market position.

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Name of the Student
Name of the University
Author Note

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Table of Contents
Introduction......................................................................................................................................2
Purpose............................................................................................................................................2
Participants, Inputs and Outputs to the current system....................................................................3
Process flow.....................................................................................................................................3
Exceptions........................................................................................................................................5
Business Process Model..................................................................................................................6
Strengths of the Process...................................................................................................................8
Inefficiencies of the Process............................................................................................................8
Use of Information Technology.......................................................................................................8
Business Process Re-engineering....................................................................................................9
Proposed Workflow Diagram........................................................................................................10
References......................................................................................................................................12

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Introduction
The case study that has been presented is of an international company named GAAM, a
manufacturer of Hydraulic systems, building systems and metal products for heavy-duty
vehicles. Headquartered in South Australia, GAAM has 27 facilities across seven countries with
a strength of 3,800 employees approximately. The company now aspires to have a reengineering
of its processes to have a better scope to compete with the competitors in the market. In this
context, the overview of the purchasing department has been given. The purchase department of
the company takes entire control of any kind of purchase that have to be made for the company.
Starting from filling up of the forms and accepting orders to getting the products delivered to the
department of the company is being totally controlled by the purchase department. Even the
MRO supplies are also provided by the purchase department itself. Having a strength of 4
officials the purchase department has been authorized to all kinds of resource requirement for the
company. The department for purchase contains a purchasing manager, two buyers and a
secretary-cum-clerk. The workflow that is given for the company shows that the controlling
centre of the company that is the MRO entirely depends on the purchasing department for any
kind of execution within the department.
Purpose
This research report will briefly analyse the workflow of the company and all of the
participants who are responsible for the success of the company. The impact of purchase
department and its authorities over the processes of the company will be discussed. In addition, a
recommendation will be formulated in order to redistribute the authority among the new

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departments, if could be initiated. The primary purpose of the report is to restructure the existing
business model and include the necessary components and departments in order to make the
process more efficient and make the company able to compete with other participants in the
market.
Participants, Inputs and Outputs to the current system
The current system scenario that is depicted is of two departments of the company –
purchase department and Maintenance, Repair and Operations (MRO). The dependency of MRO
on Purchase department and the personnel working for these two sections are discussed. Two
sections of the company contains a total of 40 officials, out of which there is a purchase
manager, two buyers and a secretary-cum-clerk in the purchase department and 36 officials are
there in the MRO, including the Maintenance, Repair and Operations department. The inputs in
the system can be considered as the purchase requests that are forwarded from the MRO towards
the Purchase department (Chen & Yadav, 2018). The outputs of the system can be considered as
the purchase made by the purchase department and the delivery of the products to the respective
department (Liberti & Guenther, 2017).
Process flow
The process flow of the current existing system between the department of purchase and
MRO is given below:

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Purchase request from the MRO is
forwarded to the purchase department
MRO card or Purchase Requisition
Reviewed and signed by MRO buyer
MRO card Purchase Requisition
P/O generation
Completion of the order
Emergency Purchase by
any department
Assigning purchase number
The process that has been depicted in this diagram describes the workflow of the process
between the MRO and the Purchase department. In the first stage of the process a purchase
request is made by the MRO towards the Purchase department. The purchase can be completed
with the help of either MRO cards or Purchase requisition. MRO cards are used when there is a
requirement of a regular product and requisitions are filled up in order to make a purchase of the
new items that will be necessary for the department. Both of the purchase types have a limit to
which the purchase can be made. The general limit that has been fixed by the company is
AU$500 to AU$1,000. In case the limit is exceeded then the higher authority in the purchase
department will be referred to further clarification. Once the order request is cleared, the order is
listed in the purchase department. A chain command is seen to be followed in this area.

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Thereafter the purchase requests are reviewed by the MRO buyer and Purchase Orders are
released.
There are certain emergency cases where the purchase is not made by the MRO buyer
and the purchase has to made by the department. In these cases, a purchase number have to be
assigned to the request, which will be different from the sequential numbers for the normal P/O.
Once the number is assigned, the purchase department completes the P/O for the order and get
the order distributed.
Exceptions
The path that is followed in the workflow seems to be precise and compact. However,
there are certain inclusions need to be made in the system. Before stating about the inclusions,
the limitations of the system need to be analysed. The most common situations that can arise are
illegible form, missing piece of information and meeting some special conditions only. In case
the form is illegible then the most common result that can be expected is cancellation of the
purchase request. That would certainly lead to delay of the processes that need to be done for the
business to function normally (Brits et al., 2017). Else, another situation could be a point of
interest where the official, who is in charge of taking requests of the purchase, can overlook the
mistakes made in the form and can assume the illegible party and can forward the orders. Such
instances could bring a misunderstanding between the respective officials and likewise the
business could be suspended due to the unavailability of the resources. Missing information can
lead to obvious cancellation depending on the priority of the information (Gregory, Lindsay &
Porteous, 2017). In addition to it, meeting certain specific conditions can hide the details that
might be missing and the order request can be faulty, which would again lead to the suspension

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of the process. Hence, it can be concluded that any issue would finally lead to the suspension of
the process and that cannot be suitable for the company’s success.
The inclusions that could be made into the system is a separate department for receiving
the requests and clarifying the details while the purchase department will only take over the
responsibility of finding suitable vendor and executing the purchase. Less number of employees
in the purchase department certainly makes the process flow slower and in the competition of
market dominance, the company will surely remain behind of many competitors. A separate
department would certainly increase the rate of work done. Another major inclusion that would
be the best option to choose is inclusion of IT infrastructure into the system. An infrastructure
with the support of IT would surely serve the company at its best.
Business Process Model
The business process model for the existing infrastructure consists of two major sections
– purchase department and MRO. With a strength of 40 officials the business process will be
depicted with the help of a swimlane diagram. The diagram will be able to define the flow of
processes between the departments. The diagram is given below:

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Purch
ase
Depa
rtme
nt
MRO
Purchase request to
purchase department
Request
acceptance
Regular order or new items
MRO card
Regular
New
Purchase
Requisition
Purchase Order (P/O)
Delivery
Purchase Request Purchase Processing After Purchase
Fig. BPM Diagram using Swimlane method

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Strengths of the Process
The compactness of the functionalities can be considered as the primary strength of the
existing business model. All of the purchase related functions are handled by the purchase
department itself and thus it is easier to have an understanding between the processes of
purchasing upto the delivery of the product to the respective department. The department making
the requests has no responsibility in between and their task ends with approaching with a request
only. Until the delivery is done, none of the department officials has to do anything at all. This
makes the other department work on their own track with the available resources. Besides, in
case of any mistakes or issues, it will be easier to find out the responsible person as then all the
higher officials have to do is to scan a single department.
Inefficiencies of the Process
Though the compactness and the integrity is maintained by having a single department to
handle all purchase related affairs, the time consumed by the department to process all requests is
higher as compared to if distributed among other departments. The process execution is slow and
hence, the path towards success for the company will be long and especially in the race of the
market, they will be behind by miles enough. Besides, issues like this could lead to suspension of
the business processes, which will affect the overall productivity of the company.
Use of Information Technology
It has been discussed earlier that how integrating all of the responsibilities into a single
unit can lead to unnecessary pressure and slowing down of the processes. Hence, the introduction

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of an IT infrastructure is necessary to combat all of the issues that are taking place or may take
place in future (Pearlson, Saunders & Galleta, 2016). To improve the purchase workflow, there
are certain softwares that deal with the purchasing workflow. These engines make the processes
able to handle all of the transactions in a well engaged manner and the softwares restrict the
blocking of accessibility by the user or some settings specified by the user (Reece et al., 2016).
The softwares that top the list of the purchase workflow engines are Promena e-Sourcing, Deltek
Costpoint, Expeni, Panacea, ISNetworld and so on. Besides, few of the softwares allow the entire
functioning of the purchase on cloud services. Hence, it becomes much easier to perform the
functionalities without keeping an extra load of information over the in-house data warehouse.
The benefits while using a Purchase Workflow engine are the following:
 As an optional service with the software, additional web requisitioning and approvals will
be available (Tasnim, 2018).
 Availability of defaulting information, except item number and quantity (Bhargave,
Mantonakis & White, 2016).
 Templates will be available where loading of the list for standard items can be done
(Makrickienė, Gudas & Lopata, 2019).
 Control of vendor selection will be available at user and item level (Benekohal &
Armstrong, 2019).
 Allowance to review every document is given to the reviewer to maintain the
transparency between the stages of the purchasing workflow (Ahmad et al., 2016).

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Business Process Re-engineering
Re-engineering of the business model is necessary at regular interval due to the heavy
changes that are taking place at daily basis (Chang, 2016). Even if there is no need of
reengineering, the model should be revised and any past issues that had taken place or future
issues that may take place should be analysed and measures should be formulated (Huang et al.,
2015). The process of business reengineering is recreating the core of the model of the business
for better efficiency and productivity (Esbenshade et al., 2016). The reengineering that has been
considered necessary for the company under consideration is having an IT infrastructure for the
workflow of purchasing. The necessity could be well understood as the process that is being
currently followed in the company is slow and non-efficient. Once the whole set up will be
shifted over the IT platform, the efficiency rates would definitely increase and there would be
less room for errors and mistakes (Grant, 2016). In the former section of the paper, it was
discussed about the common issues that can take place where missing information and illegible
forms are some of the instances. However, a computerised system makes these issues disappear
completely (Alomari et al., 2015). The guidelines, which will set up for the entries to be made
will restrict entry of any faulty or erroneous data. Besides, making the necessary fields
mandatory will remove the issue of having missing data in the purchase request. Requisitioning
will be faster and easier when an automated system will perform the respective functions
(Medina-Santiago et al., 2017). Updating data in the in-between stages will be possible and
informing the required personnel will be fast too. There are certain technologies that could be
applicable for the introduction of IT platform in the process of purchasing such as purchase
workflow softwares, cloud services where there are softwares available as service (Wang et al.,
2017). With the introduction of IT infrastructure, a separate IT department has to be set up so

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Purchase request from the
MRO
Request reaches the portal of
the software
Purchasing officer reviews
the orders
Is Order delivery possible?
Yes
Order forwarded
for purchase
No
Order Cancelled
Purchase done from the vendor
by the purchase team
Delivered to the department
that in case of any issues there will be a team who will fix the issues and would bring all the
services back on track.
Proposed Workflow Diagram
The workflow that has been proposed in the former sections of the paper will be
described in the visual as the flowchart of the proposed workflow. The flowchart is given below:

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