Process Definition and A3 Assessments

The Importance of Defining a Process for use During A3 Assessments

The first step of performing an A3 Assessment not to find out how to perform an A3 Assessment.  The first step is to determine what you need to know in order to define the process that will be the focal point of the assessment?

An A3 Assessment is based on a formalized current-state business processes and the data inputs required to perform a specific function and the data outputs needed to identify that a process is complete.  Process definition is performed by reviewing and assessing all functional areas, their related processes and data capture and downstream consumption requirements in order to identify the current-state.

It is impossible to have a process that does not involve retrieving, viewing and recording data.  It is redundant to have data that isn’t involved in a process, something has to happen to it or why even bother recording it (waste).  The majority of process problems are a direct result of not having information required to perform a function at the appropriate stage in the process.

A functional area is a unit within an organization that are grouped by specialization (functions).  Each function has capabilities within their area which includes work methods internal to the functions.  Functions have their own set of activities that they have to perform to meet a business objective.

Coordination between functions occurs through the use of cross-functional processes.  Each function must perform their set of activities to fulfill a process.  Some examples of cross functional processes such as Procure to Pay, Order to Cash, Lead to Order.  Functions tend to optimize their work methods locally, and focus on their responsibilities within a process.  This results in the development of functional silos that have negative impact on performance of the organization as a whole.  Process models help avoid functional silos because they provide a standard method for execution and a level of control.  Well defined processes provide data that is required for a function to perform their activity and can improve productivity as a whole, increasing capabilities overall within the business and reducing costs.

In order to define a business process, it is important to understand that a business process is a closed-loop system.  A business process changes and transforms data as the process moves towards delivering its goal for use in downstream inter-related sub-processes until the end of its lifecycle.

How Does a Business Operate?

A business operates by using data, data can come in the form of electronic or paper form.  Well-designed and well-implemented processes will be of little value if the day-to-day operation of those processes is not properly conducted, controlled and managed. Nor will service improvements be possible if data required from day to day operations is not systematically captured for use during the initiation, execute and completion of a process, monitor performance and assessing key metrics of the area.

To ensure that the process is functioning in an optimal manner it is important to understand the entire process and how one process fits into another and the use of the data in downstream processes.


Process definition is an activity that formalizes the action that a function must perform, the dependencies that the function has on upstream data and the sequence that the activities should be performed in.  A process has the following characteristics:


A business process should be able to be measured individually or across functions.  Processes are performance driven. Managers of functions that perform a process monitor and measure a number of variables that identify if a process is functioning in its ideal state.  E.g. cost and quality.  While individual contributors to the process are concerned with duration and productivity.

Specific result

The reason a process exists is to deliver a specific result such as shipping an order, billing a customer, issuing a quote to a customer, ordering products, etc. Every process must be individually identifiable and measurable.

Clients and Stakeholders

Every process delivers a product or service to a client or stakeholder.  A client or stakeholder can be internal to the business (such as a department) or external to the business (e.g. supplier, customer, etc. The outcome of a business processes must meet the expectations of the clients.

Must Respond to a Specific Event

While a process may be ongoing or iterative, every process should be traceable back to a specific business event that triggers the process.  A business process can support one or more business events.


The major issues facing process improvement initiatives today, is that many analysts do not understand what a business process actually is and its purpose during operation of a business.  Business processes are arguably the most important part of the operation of a business.  During process improvement initiatives an analyst must not think of how something is done.  The analyst must think in terms of what information (data) does a function need and must have access to so that it can perform their process.  If the process is supported by a management system than your client / subject-matter experts will naturally want to focus on the processes required by the systems that they use, and not the business process. Do not fall into this trap, It will be your primary objective to redirect them to ensure that the definition of the process is not biased with constraints of existing systems.

Components of a Business Process

A business process has 3 primary components they are the business event, business object and business rule.

Business Event

A business event is the foundation of a business process.  A business event is an essential condition, circumstance, state or external requirement that exists which the business must respond to or deal with to successfully meet its key objectives.  Here are two examples of business events:

  1. A customer calls to place an order
  2. A shipment of product from a supplier, arrives at the receiving department.

Business processes support one or more business event. In order to expedite the process definition phase and help your subject-matter experts define their business process look and listen for triggers.

Business Object

A business object can be a person place or thing, concept or idea.  A business object is absolutely necessary in order to support the business process that in turn supports the business events.  Each business object is distinct and contains a collection of related data about it.  Some examples of business objects are:  Customers, Accounts, Products, Invoices, packing slips, etc.  A business object must consist of at least two data attributes, and must include all the rules that govern it when the object participates in an event.  If you want to help your subject matter experts define their business process look and listen for nouns that have more than 1 data attribute, when you are walking them through their business process.

Business Rule

A business rule defines or constrains some aspect of a process and always resolves to either true or false answer. Business rules are intended to assert business structure or to control or influence the behavior of a function performing a process. Business rules define how the business objects will behave with each other.  Business rules are written as declarative statement specific to a business process.  Here are two examples of business rule statements:

  1. An order cannot be shipped unless it is authorized by the logistics manager.
  2. An invoice received from a supplier must be approved prior to payment being issued.

Today the business community isn’t willing to wait patiently for an analyst trying to guide them through a process improvement initiative that does not have an understanding of process definition.  In our next article we will define a business process using the components discussed.

In July 2019 I was asked by a client to perform an A3 Assessment on their receiving process.  We did not even make it to the A3 Assessment, with the process definition alone, I was able to determine root-cause and the corrective action with minimal impact to the business and significant efficiency gains.

The issue that was presented was that during receiving of products purchased from suppliers, the receiving personnel were forgetting to send an excel spreadsheet of package dimensions that they were required to be recorded when new items (that were never purchased previously) are received, so that that the dimensions can be entered into the warehouse management system.  They wanted to change the “process” and have the information automatically uploaded.  If you recall my statement “business processes do not define how something is done, but what must be done.”

My first step was to define the process that is experiencing the symptom of the problem, the  Receiving Process. The primary objective of the Receiving Process is to verify that the items physically received match the purchase order used to order the goods, and the packing slip provided by the supplier.  Once the verification has occurred receive the goods into the inventory management system, so that the product could be made available for sale to external customers. The business objects that support the receiving process are packing slip, purchase order, product, and inventory.

I then inquired about the New Product Set Up process with the client.  He advised me that products could not be purchased unless they were approved by engineering.  If the product was approved the buyer that initiated request would complete a New Product Set-Up form and sent to the Inventory Manager.  The inventory manager would then enter the new item within the management system.  Once the item was entered into the management system the buyers could be authorized to purchase the item from the Supplier.

I found no issue with the Receive Products process.  However, the package dimension data attributes are associated to a product business object and not the business objects within the receiving process.  The root-cause of the issue was not that receiving was forgetting to record dimension information and send it.  The root-cause was the injection of a business object into the Receiving process that is not used to support receiving.

I came to this conclusion because product cannot be received unless it is ordered, product cannot be ordered unless it is in the inventory management system, and product cannot be entered into the order management system unless it is approved by Engineering.  There should be no creation or modification of a Product within the Management system during or after receiving, because it is at this stage in the process that the information begins to be consumed. The package dimensions are a data attribute of product.

To verify my findings, I reviewed a sample set of historical New Item Set-Up forms completed by Buyers and found that in the majority of cases the Buyers were not completing the package dimension section of the form.  This was resulting in the inventory manager not having the information available during products set up and further impacted operations by not having the information available to support the downstream processes.

As a result, the business established a work around to fix the symptom by instructing the receiving department to measure packages and provide those measurements to another department who would manually data enter the information into the item record in their management system.  Instead of advising the buyers to complete the entire New Product Set Up form, prior to submission to the Inventory Manager.  This issue could have been easily avoided if there was an accurate process definition based on the understanding of the components of a business process.  The analyst would have been able to easily identify the root-cause and provide a corrective action.

It is important to take a practical, common sense approach to all process improvement initiatives.  The practical approach is ensuring that the business process is defined and formalized before performing any type of process improvement assessment, if you want to be successful.