Understanding Process Mining & Its Applications
- 2. Motivation For Process Mining - 100% Variation Discovery Aspirational Process Simple, Quick, Standardized Perceived Reality Few Deviations, Standardized, Repeatable Everyday Reality Inefficient, Roadblocks, Entangled Mess Built to handle the complexity and dynamism of the modern process environment.
- 3. What is it? Analyzing event data generated during the execution of a process to obtain insights into processes in an objective manner. Why care about it? 100% discovery of all variations taking place in the process Dive into Why of an outcome, not just What the outcome is!
- 4. Motivation For Process Mining - Why Behind The Outcome 94% 56% 79% On Time With No Deviations Activities Causing On Time To Drop With Impact Quantified Why are we seeing the reduced On Time Delivery outcome?
- 5. How Does It Work? Using Event log data - Activity, Time Stamp, Case ID More information, such as Product Category, Location, Resource Name, etc. can be added for enhanced analysis PO & Line (Case ID) Event Name (Activity) Timestamp PO 3401_01 Create Purchase Order Item 2/1/18 2:53 PM PO 3401_01 Vendor creates invoice 2/1/18 11:59 PM PO 3401_01 Record Goods Receipt 6/3/18 7:44 AM PO 3401_01 Record Invoice Receipt 6/3/18 8:53 AM PO 3401_01 Clear Invoice 6/29/18 8:53 AM PO 3543_02 Record Invoice Receipt 12/2/18 4:58 PM PO 3543_02 Clear Invoice 8/3/18 1:21 PM PO 3543_02 Create Purchase Order Item 8/1/18 8:21 AM Specifically developed algorithms aggregate these logs to reconstruct the process flows across your whole organization as they actually happened Your IT systems record the above information as digital footprints when you go about using them
- 6. Inhibitors of Process Mining Data Insufficient Data Poor Quality of Data Process Executed infrequently Highly non structured Highly Automated Very cognitive in nature People Unaware of Technology Lack of Training Avoiding Transparency
- 7. Business Cases - Discovery & Visualization Visualize The most common way your process flows aka the happy path. Number of different paths (variants) that your process goes through. How the real process compares to the SOP? Where does it differ? Why? End-to-end Process flow by combining different IT systems. Traditional Process Mapping Expensive & Time Consuming Subjective & Partial Insights One Time Understanding No Process Quantification Available Process Mining Based Mapping Data Driven & Automated Self Service Objective & 100% Comprehensive Insights Tracks Updates Continuously Frequencies & Impact Quantified
- 8. Identify Problems in your process flow, not just outcome. Analyze root causes based on process steps, time periods or case attributes. Quantify the Inefficiencies & Benefits to prioritize efforts. Benchmark your process against different locations, departments, acquisitions, and competitors. Figure Out How To Improve Service Levels & Cycle Time? Optimize Working Capital? Increase Customer Satisfaction & Provide uniform experience? Reduce resource costs & operating risk? Business Cases - Analysis & Improvement
- 9. Keep accountability objective by defining metrics Create & Report on outcomes as well as Process Based KPIs. Monitor pre-set parameters for breaches in KPIs to react quickly. Estimate & Predict issues to warn users for proactive actions. Become cognizant of How the company is performing overtime on KPIs it cares about? Which on-going cases are going to finish outside desired norms? What activities create progress towards a desired metric? Business Cases - KPI Monitoring & Prediction
- 10. Business Cases - RPA Potential Get RPA Right By Knowing 100% of your entire process. Scout where automation will have the largest business significance. Avoid pitfalls of choosing a task with many exceptions or errors. Ensure Its Working Review the processing and decisions made by the robot early-on. Track manual vs automated activities trend. Monitor for & quantify expected outcome improvements.
- 11. Business Cases - Conformance & Compliance Ideal vs Real Process Conformance Model/Upload the To-Be Process in BPMN. Check for non-conformity by comparing discovered models against the Ideal BPMN model. Get conformance trends and top violating variations Audit to Avoid Compliance Costs & Risks Cover 100% of the cases speedily, without losing the entire picture Highlight deviations from regulations, custom defined for your industry Identify Segregation of Duties (SoD) conflicts / Enforce four eyes principle
- 12. Use Cases - Sales & Customer Service Lead to Order Order Processing Know Your Customer Customer Onboarding Refunds Claims Service Tickets Customer Journey Processes Example Goals Boost Customer Satisfaction: Increase On-Time Delivery Faster Cycle Times Improved First Time Right Optimize Costs: Quantify/Reduce Order Changes Automate Steps Increase Sales Efficiency Higher Revenues: Improve Retention Rate Raise Customer Lifetime Value Better Conversion Rates
- 13. Use Cases - Finance Example Goals Accounts Receivable Accounts Payable Audit & Compliance Payroll Processing Financial Reporting Optimize Working Capital Address Early Payments Immediate Invoicing Control Inventory Reduce Spend Utilization of discounts Avoidance of late fees Automate Steps Manage Risk & Compliance Ensure Segregation of Duties Avoid duplicate payments Increase Touchless Invoices Processes
- 14. Use Cases - Procurement Example Goals Purchase to Pay Accounts Payable Invoice Processing Purchase Requisition Vendor Qualification Increase Purchasing Productivity Reduce manual errors Automate 3 way match Reduce price changes Optimize Spend Manage Long Tail Purchases Consolidate Sourcing Control Maverick Buying Reduce Risk Automated Cross Confirmation Emails Supplier Monitoring Standardized Qualification Process Processes
- 15. Use Cases - Production & Supply Chain Example Goals Order Fulfilment Production Routing Pick & Pack Process Import/Export Process Distribution & Shipment Quality Management Inventory Management Processes Improve Productivity: Reduce rework/change orders Enhance Operations Planning Improve OEE Harmonize Process Steps Accelerate Six Sigma Projects Increase Competitiveness: Reduce Lead Time Between Steps Fix bottlenecks & Deviations Diminish Downtime/Waiting Better Service Levels Improve First Time Right