BCO2000 Business Process Modeling Report: Comprehensive Analysis

This report delves into the core concepts of business process modeling, examining various aspects such as functional structures, functional information systems, and enterprise resource planning systems. It explores the definition of a business process, differentiating between functional and process views, and analyzing the silo effect and its impact on organizations. The report also covers invoice verification processes, bill of materials, and production strategies like made-to-order and made-to-stock. Additionally, it discusses the influence of globalization, data views, organizational data, and transaction data within the context of business processes. The report references several scholarly articles to support its analysis and provides a comprehensive understanding of business process modeling principles and their practical applications.

[1]
BCO2000 Business Process Modelling
By
[Student’s name]
Course
Institution
Date

[2]
1. The functional structure. This is a system where a company groups its employees
according to their functions to form various departments. In a functional structure decision
making is done by upper management which ensures that the top management exercises
complete control over the organization (Galliers and Leidner, 2014, p. 88). However, this
structure could lead to poor communication among the departments which would mean that
cooperation would be lacking between the departments and it could foster inter-departmental
conflict.
2. A functional information system is a system that is based on various business functions
for instance marketing, finance, human resources, and production. Each functional area in the
organization is given a suitable application. Functional information systems are preferred
because they are function specific hence enhances the efficiency within departments (Jeston and
Nelis, 2014, p. 44). However, functional information systems can be very costly to install in the
whole organization. Enterprise resource planning systems are systems that support the entire
organization needs with a single integrated system. They are efficient for the organization as it
enables data sharing within the departments however it can be notoriously expensive to install.
3. A business process is a set of activities that once completed will accomplish the
organization's goals a business process comprises of the management process, operational
process and supporting processes (Koschmider et al., 2011, p. 500). For instance, Samsung
Company aims at increasing their sales and meeting the customer's current technological needs
hence management process would involve to the approval of the developed designs in as long as

[3]
they meet the standards, the operational process would be the product development and proper
marketing strategies. Finally to support this goal Samsung’s HR team would need to ensure they
use the proper talent and create an appropriate working environment for their staff.
4. a functional view of business means that the company ‘s activities are organized
along its functions such as production, finance or marketing while a business process view
means that events are arranged in the order of their process, e.g. purchasing raw material,
manufacturing, distribution then sales (Mendling et al., 2010 , p. 130). The advantage of process
view or orientation is that it enhances the performance of organizations because they concentrate
on the process and not a particular function, it also encourages direct interaction between
departments which improves coordination and streamlines work flow. Finally, business process
orientation ensures departments collaborate to achieve common goals unlike in functional view
where the failure of one department could be detrimental.
5. Silo effect refers to a situation where there is lack of information flow between groups
or departments in large organizations. Sony Ltd in the 1980s was reorganized into 10 and then 25
sub-companies which over time reduced its efficiency because of the internal competition within
it. Introducing ERP within the organization can help break down silos because all information
and data in the organization are contained in one integrated system making it easier for
departments to share and access information generated by another department (Trkman, 2010, p.
50).

[4]
6. A company may verify the validity of an invoice through a process called a three-way
match. This invoice validity verification process checks the costs used by a company in placing
an order. Also, it states what did the company receive? And what the vendor billed the
company? If the invoice is correct, it is approved for payment and once paid the accounts are
recorded.
7. Bill of materials refers to a catalog of components or parts that are needed to create or
build a product. It is simply a document that contains build data for some sub assemblies that are
components for products. For instance, a BOM can be a list of materials that a contractor
requires for him to complete or construct an order concerning raw materials or parts together
with their quantities and descriptions. Product routing, on the other hand, is a list that spells out
the necessary steps taken during the manufacturing of a product (Trkman, P., 2010, p. 88). It
simply dictates the tasks that are required for the process of manufacturing and can be assigned
to more than a single product if the same process can be used to make each product. For
instance, routing decides the path as well as the sequence of operations that are to be performed.
The purpose of routing is establishing the optimum sequence of operations that would ensure
efficiency.
8. Made to order is a production strategy that typically allows consumers to purchase
products that are customized to their specifications. The advantage of MTO is customer

[5]
satisfaction. MTO can be challenging to meet some demands no matter how willing the producer
is due to lack of some specific product. On the other hand made to stock refers to is a strategy
where business matches its inventory to customer demand forecasts. An accurate forecast can
lead efficient production however an incorrect forecast leads to losses.
9. Globalization has created greater competition of organization on global skills, the
emergence of influential consumers who are well informed, and development of new technology.
Organizations have had to adopt new technology to keep up with current markets. Improved
marketing strategies due to the market expansion and increased consumer awareness.
10. Products have various data views based on the order that has been put in place to
facilitate transfer to the procurement practice within the procurement processes. Internal control
systems are used in the verification of the accessibility of the product as stored and recorded in
the master data (O'Brien & Marakas, 2006). Production processes confirm the data stored in the
master data to ascertain with the vendor, and the end results see the ultimate verification of all
products from different sources. In the view of the master database, its uses include:
1. To correct the unavailable data without upsetting other queries
2. To ensure there isn’t a repetition of data in the queries

[6]
11. The term organizational data is defined as the information determined in any business
operation whereby autonomous distribution channels are used. The sales division attributes kept
in the business master copy helps in the proper organization of the data inputs to give the desired
outputs. The features of a master data of an object must remain constant and not altered over any
given period. The master data has the ability to store information in a secured manner.
Transaction data, on the other hand, refers to all the transactions that are carried out with the use
of the master data.
12. DIEN (services); services procured externally cannot be stored however a record of
this material type can always contain purchasing data.
FERT (production resources); finished goods produced by the company itself. Since they
cannot be ordered purchasing, a material master record of this does not contain purchasing data.
HALB (semi finished goods)a material master record of this type can provide both
acquisition and work scheduling data.
HAWA (trading goods) this master record contains purchasing and sales data.

[7]
List of References
Figl, K. and Laue, R., 2011. Cognitive complexity in business process modeling. In Advanced
information systems engineering (pp. 452-466). Springer Berlin/Heidelberg.
Galliers, R.D. and Leidner, D.E. eds., 2014. Strategic information management: challenges and
strategies in managing information systems. Routledge.
Jeston, J. and Nelis, J., 2014. Business process management. Routledge.
Koschmider, A., Hornung, T. and Oberweis, A., 2011. Recommendation-based editor for
business process modeling. Data & Knowledge Engineering, 70(6), pp.483-503.
Mendling, J., Reijers, H.A. and van der Aalst, W.M., 2010. Seven process modeling guidelines
(7PMG). Information and Software Technology, 52(2), pp.127-136.
Stavrou, V., Kandias, M., Karoulas, G. and Gritzalis, D., 2014, September. Business Process
Modeling for Insider threat monitoring and handling. In International Conference on Trust,
Privacy and Security in Digital Business(pp. 119-131). Springer, Cham.
Trkman, P., 2010. The critical success factors of business process management. International
journal of information management, 30(2), pp.125-134.
O'Brien, J. A., & Marakas, G. M. (2006). Management information systems. McGraw-Hill Irwin