What Is a Business Process?

A business process is a collection of activities that takes one or more kinds of input from one or more different sources and produces value for the customer (see Figure K-1). The focus of the business must be to ensure that the effort of dealing with the process does not out-weigh the value received from completing the process.

Figure K-1. What is a business process?

For example, order entry/fulfillment is a clear example of a business process. From the customer’s viewpoint, the process starts when customer places an order and ends when the customer receives the goods requested. There are numerous activities in between. Credit checks may be run to confirm that the customer can pay for the order. Inventory is accessed to confirm you have what the customer is requesting. A typical list of activities would include:

  • Receiving the order

  • Logging the order

  • Verification of completeness

  • Customer credit check

  • Determining the price

  • Inventory checking

  • Production request

  • Order picking

  • Order packaging

  • Shipment

You will notice that the activity in a high-level business process might be regarded as a process itself by the performing organization. Processes can be decomposed into other processes until you reach the task level where some interim component is produced. The key is to start with the customer as the focus of the original process and define the subprocesses by their ...

Get Effective Software Project Management now with O’Reilly online learning.

O’Reilly members experience live online training, plus books, videos, and digital content from 200+ publishers.