Dynamic Business Process Management in the Knowledge Economy

Creating Value from Intellectual Capital

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Abstract & Keywords

The rapid development of process management and its practical uses stems from the changing conditions of business, which are the result of overlapping and mutually stimulating changes in business culture, social conventions, the development of information and communication technologies, as well as the process of globalization and changes to the principles of competition themselves. For several years now it has become apparent that practical methodologies and IT systems supporting the implementation and use of process management in organizations are developing at a much faster pace than their theoretical underpinnings. This chapter discusses the limitations of traditional business process management, as well as its main discrepancies with the requirements of business in the knowledge economy. The 3rd wave of development of process management, which has been initiated around the year 2003, is becoming increasingly less responsive to the requirements of modern business. There is a lack of theoretical reflection on traditional process management, despite the fact that due to changes in the paradigms of the knowledge economy it may be used in the case of a mere 20–30% of the processes within the organization. The chapter describes changes to process management and the practical solutions which exceed traditional process management. Of fundamental significance for practitioners dealing with the preparation of tools and the implementation of methodologies pertaining to process management is the distinct integration of the methodologies and tools of business process management (BPM) and case management (CM). Such integrations are often the result of trial and error, sometimes fall outside of the mainstream of process management, but have nonetheless been positively verified by the clients, that is, in the most objective manner possible. The chapter also points to the factors leading to the emergence, as well as the main characteristics of the so-called 4th wave of process management. Just as in the case of the previous waves, its direction is mostly determined by practical solutions.

Keywords: Business process management (BPM); Dynamic business process management (dynamic BPM); Case management (CM); Knowledge management (KM); The 3rd wave of BPM; The 4th wave of BPM

As discussed in Chap.  1, all organizations which hope to prosper in the 21st century must be process-oriented. At the same time, traditional process management does not encompass the majority of processes in modern organizations, as well as prevents the broad use of intellectual capital. Dynamic business process management is an extension of traditional business process management. It does not share its limitations, which hinder or prevent its use in the knowledge economy. Among multiple names of methodologies or proposals of directions of development for process management presented in literature, such as agile, intelligent, adaptive, or human, the author has selected the term dynamic in order to underline that the actual source of all new possibilities offered by dynamic business process management is the dynamism of the knowledge workers themselves. Not just their knowledge, but also their willingness to work is decisive in terms of whether the course of performance will see agile, intelligent adaptations with the aim of tailoring process performance to the context of performance, which stem from the experiences of the process performers themselves. The concept of dynamic business process management does not substitute traditional business process management, as much as it is its extension based on the three principles described in Sect. 2.2 of this chapter. This chapter presents different dimensions of the change, which taken together form an ecosystem enabling the engagement of the entire (or to a larger degree than before) intellectual capital of the enterprise, working and sharing knowledge in the course of process performance and creating value for the client. This ecosystem consists of philosophies, methodologies, and tools supporting management, or the entire BPM.

Keywords: Business process management (BPM); Dynamic business process management (dynamic BPM); Process lifecycle; Knowledge management 

Knowledge is the most important asset of the enterprise in the knowledge economy. Intellectual capital is fast becoming more important than financial capital. The key to success does not rest in amassing knowledge, but in its ongoing use and renewal in the business processes which create value for the organization and allow it to maintain competitive advantage. This requires the ongoing and consistent management of the entire knowledge within the organization—not just knowledge belonging to the management itself, but to the entire personnel. A particular challenge in this respect is the management of tacit knowledge, the existence which is often overlooked or hard to articulate, and which is naturally revealed and created in the course of work itself. For this reason, the aim of this chapter is to answer the following question: Is it possible to integrate (dynamic) process management with knowledge management, including the management of tacit knowledge? Section 3.2 discusses the term knowledge and presents two selected models of knowledge management in the organization, with a particular focus on the sources of knowledge, the awareness of lacking knowledge, and processes of knowledge renewal and verification. Organizations in the knowledge economy face the challenge of avoiding the risk of owning outdated knowledge and pseudo-managing such knowledge, as well as the challenge of maintaining the pace of acquiring knowledge and instituting its broad practical use. Sections 3.3 and 3.4 demonstrate how the expansion of traditional process management with the concept of dynamic process management enables organizations to create new knowledge on an ongoing basis, as well as implement mechanisms of constant knowledge verification. The ability to perform limited experiments and acquire knowledge in the course of business process execution allows for the continued creation of practical knowledge and its objective and independent verification on the part of the clients. The last section of this chapter 3.5, presents the consequences of integrating dynamic BPM with knowledge management with a view to creating a learning-by-doing organization.

Keywords: Knowledge; Knowledge management (KM); Explicit knowledge; Tacit knowledge; Knowledge codification; Knowledge acquisition; Dynamic business process management (dynamic BPM); Case management (CM); Process-oriented knowledge management (pKM); Knowledge-intensive process management (kiBP); Process mining 

The implementation of process management requires, first and foremost, the introduction of changes to the fundamental principles of management within the organization. It is insufficient for the owner or the CEO to decide on the development of new infrastructure, the purchase of new computers and new software, or even the introduction of comprehensive personnel training. Process management requires the use of proven methodologies and the skillful implementation of their supporting IT systems with a view to changing the organizational culture itself. The aim of this chapter is to present the results of studies on the higher efficiency of implementing and executing dynamic business process management, as compared with its traditional counterpart. The chapter then goes on to describe the changes in defining goals and preparing descriptions of business processes throughout the entire process lifecycle, which are the result of the requirements of business within the knowledge economy. The chapter provides an overview of the research and its conclusions, which point to the necessity of introducing changes to the principles of describing and presenting business processes. To conclude, the chapter presents the principles of implementing dynamic business process management, including the use of process exploration techniques, as well as the integration of process management with knowledge management. Drawing from the author’s personal experience, which stems from cooperation with diverse research teams executing commercial implementation projects in the years 2006–2017, as well as based on a review of relevant scholarship in the field, the chapter points to those fields, in which the use of a dynamic approach does not offer virtually any benefits, as well as those fields, in which it provides significantly better results than traditional process management or is a necessary condition for process management to provide any results at all.

Keywords: Business process management (BPM)l Dynamic business process management (dynamic BPM); Business process model and notation (BPMN); Case management (CM); Process mining; Process automation; Knowledge management (KM); Process-oriented knowledge management (pKM); Knowledge-intensive business processes (kiBPs)