Business Process Network
Encyclopedia
Business process networks (BPN), also referred to as business service networks or business process hubs, enable the efficient execution of multi-enterprise operational processes, including supply chain
planning and execution. A BPN extends and implements an organization's Service-orientation
in Enterprise Applications.
To execute such processes, BPNs combine integration services with application services, often to support a particular industry or process, such as order management
, logistics
management, automated shipping and receiving, and others.
) and attain their goals outside of the 'four walls' of the enterprise-—by selling to consumers (B2C) or to other businesses (B2B
)--thus the importance of efficiently enabling and managing processes that span multiple organizations. This inherently includes supply chain management as well, and BPNs are gaining in popularity because of the changing nature of supply chains.
and offshoring
to Asia, India and other low-cost production regions of the world continue to add complexity to effective trading partner management and supply chain
visibility.
At the same time, the transition to global sourcing will be challenging for most companies. Few companies have the requisite strategies, infrastructure and extended process control to effectively make the transition to global sourcing.
The majority of supply managers continue to use a mix of e-mail, phone and fax to collaborate with offshore suppliers—-none of which are standardized nor easily integrated to enable informed business decisions and actions.
Further, distant trading partners introduce new standards, new systems, multiple time zones, new processes and different levels of technological maturity into the supply chain.
BPNs are also increasingly being used to enable and manage operational, business process outsourcing
(BPO) functions such as human resources, finance, information technology
(IT) and other ‘non-core’ (relative to each business) business functions, whereby the BPN facilitates collaboration and document movement between an organization and its outsourcing firm.
value-added network
s (VANs), industry exchanges, B2B Gateway
s, point to point integration brokers, VPNs, and other mechanisms that enable trading partners to connect electronically, collaborate and conduct business amongst each other.
BPNs are being further accelerated by growth in Web services and service-oriented architecture
s (SOA), technologies that simplify the integration of people, processes and systems.
or one-to-many
(hub-spoke model
) connectivity between trading partners across the extended supply chain.
Multi-tenant frameworks also ensure that all trading partners work from a single, shared set of applications and collaboration tools which are hosted by the network provider, mitigating integration barriers and hurdles from heterogeneous back-end IT infrastructures and systems across the trading community.
VANs and industry exchanges bring the added benefit of pre-connected trading partners, often ranging in the tens of thousands, that enable faster trading community implementation and lower overall cost to manage and maintain these connections.
Supply chain
A supply chain is a system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer. Supply chain activities transform natural resources, raw materials and components into a finished product that is delivered to...
planning and execution. A BPN extends and implements an organization's Service-orientation
Service-orientation
Service-orientation is a design paradigm to build computer software in the form of services. Like other design paradigms , service-orientation provides a governing approach to automate business logic as distributed systems...
in Enterprise Applications.
To execute such processes, BPNs combine integration services with application services, often to support a particular industry or process, such as order management
Order management system
An order management system, or OMS, is a computer software system used in a number of industries for order entry and processing.- Electronic commerce and catalogers :...
, logistics
Logistics
Logistics is the management of the flow of goods between the point of origin and the point of destination in order to meet the requirements of customers or corporations. Logistics involves the integration of information, transportation, inventory, warehousing, material handling, and packaging, and...
management, automated shipping and receiving, and others.
Why?
Most organizations derive their primary value (e.g., revenueRevenue
In business, revenue is income that a company receives from its normal business activities, usually from the sale of goods and services to customers. In many countries, such as the United Kingdom, revenue is referred to as turnover....
) and attain their goals outside of the 'four walls' of the enterprise-—by selling to consumers (B2C) or to other businesses (B2B
B2B
B2B may refer to:* Business-to-business* Back to Back * Back to Basics * Budapest-Bamako...
)--thus the importance of efficiently enabling and managing processes that span multiple organizations. This inherently includes supply chain management as well, and BPNs are gaining in popularity because of the changing nature of supply chains.
The problems
Today’s supply chains have become truly global. Trends such as global sourcingGlobal sourcing
Global sourcing is a term used to describe practice of sourcing from the global market for goods and services across geopolitical boundaries. Global sourcing often aims to exploit global efficiencies in the delivery of a product or service...
and offshoring
Offshoring
Offshoring describes the relocation by a company of a business process from one country to another—typically an operational process, such as manufacturing, or supporting processes, such as accounting. Even state governments employ offshoring...
to Asia, India and other low-cost production regions of the world continue to add complexity to effective trading partner management and supply chain
Supply chain management
Supply chain management is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers...
visibility.
At the same time, the transition to global sourcing will be challenging for most companies. Few companies have the requisite strategies, infrastructure and extended process control to effectively make the transition to global sourcing.
The majority of supply managers continue to use a mix of e-mail, phone and fax to collaborate with offshore suppliers—-none of which are standardized nor easily integrated to enable informed business decisions and actions.
Further, distant trading partners introduce new standards, new systems, multiple time zones, new processes and different levels of technological maturity into the supply chain.
How BPNs can help
BPNs help reduce this complexity by providing a common framework for information exchange, visibility and collaboration.BPNs are also increasingly being used to enable and manage operational, business process outsourcing
Business process outsourcing
Business process outsourcing is a subset of outsourcing that involves the contracting of the operations and responsibilities of specific business functions to a third-party service provider. Originally, this was associated with manufacturing firms, such as Coca Cola that outsourced large segments...
(BPO) functions such as human resources, finance, information technology
Information technology
Information technology is the acquisition, processing, storage and dissemination of vocal, pictorial, textual and numerical information by a microelectronics-based combination of computing and telecommunications...
(IT) and other ‘non-core’ (relative to each business) business functions, whereby the BPN facilitates collaboration and document movement between an organization and its outsourcing firm.
How BPNs are implemented
BPNs can be implemented using a host of technology platforms, including but not limited to traditional EDIElectronic Data Interchange
Electronic data interchange is the structured transmission of data between organizations by electronic means. It is used to transfer electronic documents or business data from one computer system to another computer system, i.e...
value-added network
Value-added network
A Value-added Network is a hosted service offering that acts as an intermediary between business partners sharing standards based or proprietary data via shared Business Processes...
s (VANs), industry exchanges, B2B Gateway
B2B Gateway
-Business-to-Business Gateway:Business-to-Business Gateways integrate data from back-end systems enabling information exchange across trading partners...
s, point to point integration brokers, VPNs, and other mechanisms that enable trading partners to connect electronically, collaborate and conduct business amongst each other.
BPNs are being further accelerated by growth in Web services and service-oriented architecture
Service-oriented architecture
In software engineering, a Service-Oriented Architecture is a set of principles and methodologies for designing and developing software in the form of interoperable services. These services are well-defined business functionalities that are built as software components that can be reused for...
s (SOA), technologies that simplify the integration of people, processes and systems.
Usage paradigms
Business Process Networks are often managed using multi-tenant architectures to more rapidly enable seamless, many-to-manyMany-to-many
Many-to-many is a term that describes a communication paradigm and an associated media form. It is the third of three major Internet computing paradigms...
or one-to-many
One-to-many
One-to-many may refer to:* Multivalued function, a one-to-many function in mathematics* Fat link, a one-to-many link in hypertext* Point-to-multipoint communication, communication which has a one-to-many relation-See also:*One-to-one...
(hub-spoke model
Spoke-hub distribution paradigm
The hub-and-spoke distribution paradigm is a system of connections arranged like a chariot wheel, in which all traffic moves along spokes connected to the hub at the center...
) connectivity between trading partners across the extended supply chain.
Multi-tenant frameworks also ensure that all trading partners work from a single, shared set of applications and collaboration tools which are hosted by the network provider, mitigating integration barriers and hurdles from heterogeneous back-end IT infrastructures and systems across the trading community.
VANs and industry exchanges bring the added benefit of pre-connected trading partners, often ranging in the tens of thousands, that enable faster trading community implementation and lower overall cost to manage and maintain these connections.