Sunday Jun 09, 2013

Making a Case for Case Management

Enterprises need to achieve business results. In order to achieve the right business results, they often find themselves balancing their processes between being
  • Flexible yet Rigid
  • structured while unstructured
  • predictable yet cater to the unexpected
  • managed but free

It would be evident that this fine art of balancing requires trade-offs on both ends of the spectrum. 

In the recent years, several enterprises have implemented automated business processes to bring structure to multitude of activities during transaction processing. The business processes themselves have gone through multiple optimizations to suite business needs over the years. The optimizations follow the path of
  1. Straight thru Processing: These optimizations start with increasing straight-thru-processing and reducing the manual activities
  2. Increase visibility: Increasing visibility on both manual as well as automatic(system) activities. The visibility could range from reporting on monthly SLAs & KPIs of the processes to near Real-time reporting. 
  3. Process Control: ultimately leading to better process control
If we take the narrow view of a business processes, we could easily fall into the trap of making structure a prerequisite for implementing BPM. This is really not the case though, each business process can have varying degrees of 

  • Predictability: The sequence in which tasks & events are executed are known. In highly predictable processes there is little or no change in the sequence.
  • Flexibility: Flexibility allows the process to reach different results every time the process executes. The ability to reach different results is based on business dynamics and modeled as rules
  • Visibility: If we have low predictability & high flexibility, what will business owners do with the KPI metrics they collect? the process is unpredictable anyway.

Let me use a  simple metric called "score" to rank the degrees of predictability, flexibility and Visibility required on process execution & plot it on a radar chart

 Process Characteristics  Score (1..10), 10 Highest
 Predictability  3
 Flexibility  8
 Visibility  3

You can easily now see that the above scores show the process in question is high flexibility with low visibility & predictability. This process I believe would require a "Case". When you design(structure)a case, you are designing for unpredictability.

This looks good in theory, but in real tangible terms, what is the advantage to business to design a case rather than a business process? For that, let me use my favorite example, the Loan Origination Solution. If you closely look at the LOS example that is implemented, you'd see that we are following the path of structure, for example,
  • The decision making follows a more the structure approach of Branch --> Zone-->Region-->Central as would be followed by any bank in India
  • Business Rules decide the level of approval based on values such as loan amount, Net worth of loan seeker, customer credit scores etc.,
  • Canceling the loan means just terminating the loan process.
  • and several other sequential activities
Modeling the Loan Origination Solution as a Case would require some new thinking!!
  • The decision making should done by stakeholders of the case rather then structured management hierarchy
  • The activities could be modeled based on milestones instead of sequence of activities
  • each case would be handled by a case manager 
  • Canceling a loan is just one many case events that the solution allows for. It does not necessarily terminate the case
  • The case activities themselves could be either modeled as BPM processes or simple Human Tasks
  • Below is the brief story board design of the case, quite a departure from earlier storyboard

Sunday Jul 01, 2012

Seamless STP with Oracle SOA Suite

STP stands for “Straight Through Processing”. Wikipedia describes STP as a solution that enables “the entire trade process for capital markets and payment transactions to be conducted electronically without the need for re-keying or manual intervention, subject to legal and regulatory restrictions” .I will deal with the later part of the definition i.e “payment transactions without manual intervention” in this article.

The STP that I am writing about involves the interaction between a Bank and its’ corporate customers,to that extent this business case is also called “Corporate Payments”.Simply put a  Corporate Payment-STP solution needs to connect the payment transaction right from the Corporate ERP into the Bank’s Payment Hub. A SOA based STP solution can do a lot more than just process transaction.

But before I get to the solution let me describe the perspectives of the two primary parties in this interaction. The Corporate customer and the Bank.

Corporate's Interaction with Bank: 

Typically it is the treasury department of an enterprise which interacts with the Bank on a daily basis. Here is how a day of interaction would look like from the treasury department of a corp.

Corporate Cash

  • Retrieve Beginning of day totals
  • Monitor Cash Accounts
  • Send or receive cash between accounts
  • Supply chain payments
  • Payment Settlements
  • Calculate settlement positions
  • Retrieve End of Day totals
  • Assess Transaction Financial Impact

Short Term Investment Desk

  • Retrieve Current Account information
  • Conduct Investment activities

Bank’s Interaction with the Corporate : 

From the Bank’s perspective, the interaction starts from the point of on boarding a corporate customer to billing the corporate for the value added services it provides. Once the corporate is on-boarded the daily interaction involves

  • Handle the various formats of data arriving from customers
  • Process Beginning of Day & End of Day reporting request from customers
  • Meet compliance requirements
  • Process Payments
  • Transmit Payment Status

Transaction Processing

 

Challenges with this Interaction : 

Both the Bank & the Corporate face many challenges from these interactions. Some of the challenges include

  • Keeping a consistent view of transaction data for various LOBs of the corporate & the Bank
  • Corporate customers use different ERPs, hence the data formats are bound to be different Can the Bank’s IT systems convert the data formats that can be easily mapped to the corporate ERP
  • How does the Bank manage the communication profiles of these customers? 
  • Corporate customers are demanding near real time visibility on their corporate accounts
  • Corporate customers can make better cash management decisions if they can analyse the impact.
  • Can the Bank create opportunities to sell its products to the investment desks at corporate houses & manage their orders?
  • How will the Bank bill the corporate customer for the value added services it provides.

What does a SOA based Seamless STP solution bring to the table?

STP SOA

Highlights of Oracle SOA based STP solution

For the Corporate Customer:

  • No Manual or Paper based banking transactions
  • Secure Delivery of Payment data to the Bank from multiple ERPs without customization
  • Single Portal for monitoring & administering payment transactions
  • Rule based validation of payments
  • Customer has data necessary for more effective handling of payment and cash management decisions 
  • Business measurements track progress toward payment cost goals 

For the Bank:

  • Reduces time & complexity of transactions
  • Simplifies the process of introducing new products to corporate customers
  • Single Payment hub for all corporate ERP payments across multiple instruments
  • New Revenue sources by delivering value added services to customers
  • Leverages existing payment infrastructure
  • Remove Inconsistent data formats and interchange between bank and corporate systems 
  • Compliance
  • and many other benefits

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