Process modeling for sales management : critical analysis and improvement through information management technologies

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PROCESS MODELING FOR SALES MANAGEMENT

Carla Sofia Silva Bastos

Critical analysis and improvement through

Information Management Technologies

Dissertation report presented as partial requirement for

obtaining the Master’s degree in Information Management

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NOVA Information Management School

Instituto Superior de Estatística e Gestão de Informação

Universidade Nova de Lisboa

PROCESS MODELING FOR SALES MANAGEMENT

by

Carla Sofia Silva Bastos

Dissertation report presented as a partial requirement for obtaining the Master’s degree in Information Management, with a specialization in Information Systems and Technologies Management

Advisor: Prof. Dr. Vítor Santos

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ABSTRACT

Nowadays with the emergence of new technologies, the evolution of the environments and the empowerment of the customers, it is crucial to find new strategies, structures and ways to improve the performance, reduce costs, increase profit and improve customer satisfaction and experience. The solution passes by the adoption of Business Process Management by sales organizations that desire to be efficient and competitive in their marketplaces. It is known that it is vital to understand, implement, document, update and improve processes, more specifically, the sales processes. The main goal of this dissertation is to perform a critical analysis of the current sales management processes through the identification of their limitations and propose an improvement by modeling new sales processes and sub-processes as well to present the benefits that will arise from this change. To achieve this goal, it will be proposed new technologies and approaches like artificial intelligence, robotic process automation, Internet of Things, among others, that allows companies to generate what they want in terms of return on investment and drive up their efficiency levels.

At the end of this dissertation is intended to provide a holistic view of the sales management process and help companies to use a new mechanism to plan and allocate resources and to have a clear governance structure based on continuous learning and improvement.

KEYWORDS

Business Process Management; Sales; Sales Management Processes; IoT; BPMN; Robotic Process Automation; Artificial Intelligence;

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RESUMO

Hoje em dia com a emergência de novas tecnologias, a evolução dos ambientes empresariais e o fortalecimento dos clientes é crucial encontrar novas estratégias, estruturas e formas de melhorar a performance, reduzir custos, aumentar o lucro e melhorar a satisfação e experiência do cliente. A solução passa pela adoção da gestão de processos de negócio pelas organizações de vendas que desejam ser eficientes e competitivas no mercado inserido. É conhecido que é vital perceber, implementar, documentar, atualizar e melhorar os processos, mais especificamente, os processos de venda. O principal objetivo desta dissertação é a realização de uma análise crítica dos processos de venda atuais através da identificação das suas limitações e propor uma melhoria através de uma nova modelação dos processos e subprocessos de vendas, bem como apresentar as principais vantagens que irão surgir com esta mudança. Para atingir este objetivo, serão propostas novas tecnologias e abordagens como, por exemplo, artificial intelligence, robotic process automation,

Internet of Things, entre outras, que permitirão às empresas gerar o que pretendem em termos de

return on investment e aumentar os seus níveis de eficiência. No final desta dissertação, pretende-se obter uma visão holística dos processos de venda e ajudar as empresas a utilizar novos mecanismos para planear e alocar recursos e a obter uma estrutura de governança clara baseada na aprendizagem e melhoria contínua.

PALAVRAS-CHAVE

Gestão de Processos de Negócio; Vendas; Gestão de Processos de Vendas; IoT; BPMN; Robotic Process Automation; Inteligência Artificial;

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INDEX

1.

Introduction ... 1

1.1.

Background and Problem Identification... 1

1.2.

Study Relevance and Importance ... 3

1.3.

Study Objectives ... 4

2.

Literature review ... 5

2.1.

Business Process Management ... 5

2.1.1.

Concepts ... 5

2.1.2.

Lifecycle ... 7

2.1.3.

Disciplines ... 9

2.1.4.

Maturity model... 17

2.2.

Sales Management ... 20

2.2.1.

Concepts ... 20

2.2.2.

Characteristics of Selling ... 22

2.2.3.

Sales Management Information Systems ... 23

2.2.4.

Customer Journey ... 26

2.2.5.

Challenges ... 27

2.2.6.

Sales processes ... 29

2.3.

Information Management Technologies ... 34

2.3.1.

Business Intelligence ... 34

2.3.2.

Data Mining ... 36

2.3.3.

ERP / CRM ... 39

2.3.4.

Big Data ... 40

2.3.5.

Decision Support Systems (DSS) ... 42

2.3.6.

Robotic Process Automation ... 42

3.

Methodology ... 44

3.1.

Scientific methodology ... 44

3.2.

Research Phases ... 46

3.3.

Selection of the modeling tool ... 47

4.

Modeling of the current standard sales processes ... 48

4.1.

Prospecting ... 48

4.2.

Pre-Approach ... 49

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4.4.

Sales presentation ... 51

4.5.

Handling Objections and Overcoming Resistance... 52

4.5.1.

Satisfaction survey ... 53

4.5.2.

Improvement process ... 54

4.6.

Close Sale ... 55

4.7.

Post-Sale Follow-Up ... 56

5.

Critical analysis and improvement proposal ... 57

5.1.

Critical analysis ... 57

5.2.

Discussion and proposal ... 62

6.

Conclusions ... 70

6.1.

Synthesis of work developed... 70

6.2.

Limitations and recommendations for future works ... 70

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LIST OF FIGURES

Figure 1 - BPM Lifecycle ... 8

Figure 2 - Characteristics of selling ... 22

Figure 3 - Customer decision journey ... 27

Figure 4 - Business Intelligence components ... 35

Figure 5 - Design Science Research Phases ... 45

Figure 6 - Research Phases ... 47

Figure 7 - Process "Prospecting" ... 48

Figure 8 - Process "Pre-approach" ... 49

Figure 9 - Process "Approach" ... 50

Figure 10 - Process "Sales Presentation" ... 51

Figure 11 - Process "Handling objections and overcoming resistance"... 52

Figure 12 - Subprocess "Satisfaction Survey" ... 53

Figure 13 – Subprocess “Improvement” ... 54

Figure 14 – Process “Close Sale” ... 55

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LIST OF TABLES

Table 1 - Flow Objects ... 11

Table 2 - Connecting Objects ... 12

Table 3 - Swimlanes ... 12

Table 4 - Artifacts ... 13

Table 5 - Comparison of low and high maturity and the five maturity stages ... 18

Table 6 - Challenges of the Prospecting process ... 58

Table 7 - Challenges of the Pre-approach process ... 59

Table 8 - Challenges of the Approach process ... 59

Table 9 - Challenges of the Sales Presentation process ... 60

Table 10 - Challenges of the Handling objections and overcoming resistance process ... 60

Table 11 - Challenges of the Close Sale process ... 61

Table 12 - Challenges of the Post-Sale Follow-up process ... 61

Table 13 - Suggestions for new technologies in the Prospecting process ... 62

Table 14 - Suggestions for new technologies in the Pre-approach process ... 63

Table 15 - Suggestions for new technologies in the Approach process ... 64

Table 16 - Suggestions for new technologies in the Sales presentation process ... 65

Table 17 - Suggestions for new technologies in the Handling objections and overcoming

resistance process ... 66

Table 18 - Suggestions for new technologies in the Close Sale process ... 67

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LIST OF ABBREVIATIONS AND ACRONYMS

AI Artificial Intelligence

BI Business Intelligence

BPD Business Process Diagram

BPM Business Process Management

BPML Business Process Management Language

BPMM Business Process Maturity Model

BPMN Business Process Management Notation CHAID Chi-Square Automatic Interaction Detector

CMM Capability Maturity Model

CRM Customer Relationship Management

DSS Decision Support System

EPM Enterprise Process Management

ERP Enterprise Resource Planning

IoT Internet of Things IT Information Technology

OMG Object Management Group

ROI Return on Investment RPA Robotic Process Automation

SEO Search Engine Optimization

SEM Search Engine Marketing

SFA Sales Force Automation

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1. INTRODUCTION

Nowadays, organizations are giving a lot of attention and importance to their business process management aiming at the performance and effectiveness improvement (Schmiedel, Vom Brocke, & Recker, 2014). So, emerge the need to document business processes in a simple and easiest way to be understood by all the interested parties. That is achieved by using Business Process Management, that allows the visualization and documentation of business processes, but more importantly allows the evaluation and management of them to identify improvements, errors, and inefficiencies. The purpose of this dissertation is the identification of the sales management business processes and modeling the improvement proposal of them using BPMN.

1.1. B

P

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Business Process Management has gained recognition in the Information Systems discipline (Schmiedel et al., 2014). Is a “disciplined approach to identify, design, execute, document, measure, monitor, and control both automated and non-automated business processes to ensure targeted and consistent outcomes” aligned with the strategic goals of the organization as well to take advantage of improvement opportunities (ABPMP, 2009,p.24; Schmiedel et al., 2014). It allows a company to align their business strategy with their processes, increasing the performance through improvements in the precise activities of a department or across the enterprise (Association of Business Process Management Professionals, 2009).

With the intensification of the globalization, the effective management and identification of key business processes became even more important, emphasizing that in order to achieve success it is crucial to understand the definition of business process (Ko, Lee, & Wah Lee, 2009; Lemańska-Majdzik & Okręglicka, 2015). If a company desires to be competitive in the market it must identify the key processes using structured approaches, designing appropriated measures, allocating the right resources and aligning the outcomes for their improvement and to deliver the business mission (Lemańska-Majdzik & Okręglicka, 2015). During the past century, business models became the main strategy to reduce costs, improve quality, and customer satisfaction. However, implementing them is hard and entails significant risks but, even though, it helps organizations to respond to changes (Euchner & Ganguly, 2014; Lindsay, Downs, & Lunn, 2003).

Digital technology, predominantly the Internet, is an enabler of a global marketplace, characterized by the access of information about goods, products, prices, and specifications to everyone (Strauss et al., 2006). The increasing use of information and communication technologies is shifting market power from suppliers to consumers. The task of selling goods is no longer considered a simple

2 exercise as meeting the buyer and seller at a marketplace and carrying out the exchange. It involves so much more. The consumer has become the focal point of many economic, social, psychological and cultural aspects. He seems to dictate production, to be the actor of innovation, the creator of new services sectors in highly developed economies and the one capable of protecting and saving the environment of the planet (Gabriel & Lang, 2008).

Consumers have the right to choose. Due to consumer’s empowerment, a real concern was born: improve customer’s experience. Customer experience is characterized as being a set of interactions between a customer and a product, a company, or part of its organization, which provoke a reaction. This experience is strictly personal and implies the customer's involvement at different levels: rational, emotional, sensorial, physical and spiritual (Pires, Stanton, & Rita, 2006). This concern in customer experience guarantees better results, more exactly the customers stay loyal for a long time, pay less attention to other brands and products, are less sensitive to prices, buy more as the company launches new products and spread a good word-of-mouth. The constant need of getting loyalty consumers by companies, the powerful global competition, the slow growth of the markets and the demanding customers are making companies change their sales strategies and structures as well as their sales processes. From that emerges the need to consider that reinventing the sales process and sales organization are an essential item in the agenda as companies streamline to lower costs and leverage their capabilities to build customer satisfaction (Cravens, 1995).

Researchers indicate that major changes to traditional sales strategies to increase the efficiency and effectiveness of the sales processes are crucial. (Paesbrugghe, Rangarajan, Sharma, Syam, & Jha, 2017). This change incorporates the idea that the sales workforce needs to manage and translate the work of the other departments causing a rise in the importance of sales management to business (Ştefan & Crăciun, 2011). Every sales company knows that to have success is necessary to first analyze the market, establish a strong relationship with consumers and invest in an efficient sales system to have an exponential growth and be able to compete in the market. Furthermore, the solution starts by analyzing the current sales processes and evaluate the need for changes made through business process management and innovation.

According to these statements, the questions that require answers are the following:

1. Using the current sales processes, are companies getting all the benefits of the sales management?

2. Are they doing it in the best possible way? 3. Is it important to change the current processes? 4. Could they be improved?

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1.2. S

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“Researchers have been suggesting major changes to traditional sales strategies” (Paesbrugghe et al., 2017, p. 1). To survive and succeed in the current competitive markets, manage costs efficiently, raise brand awareness and improve the overall performance it is crucial to adopt new methodologies and approaches. Business process management is the main key to these changes. Over the past years, companies are increasing their focus on business processes. The sudden interest derives from the necessity to optimize business operations, reduce costs and consolidate organizations (Association of Business Process Management Professionals, 2009). Agility, integration, customer focus, performance, innovation and compatibility combined matches the dreams of every company. The possibility of business strategy alignment, value chain and business processes as well the development of action plans to overcome the goals and success are some advantages of the BPM discipline (Association of Business Process Management Professionals, 2009).

Customer satisfaction and retention are the reasons why it is important to change and restructure the sales organization. With the goals to reduce costs and increase profits, emerge the conclusion that the current processes are not fulfilling the actual company’s needs. (Cravens, 1995; Paesbrugghe et al., 2017). Another reason is the constantly changing competitive environment, that requires attention to business models because of the need for adaptation and strength over time as the competitive environment evolves (Euchner & Ganguly, 2014).

The BPM approach brings value to every company. Their power of automation, continuous improvement continuous learning and good customer experience are the proofs that BPM is the future. Successful process innovation in companies involves the development of a suitable business model, however, it is vital that the model can be resistant to change (Euchner & Ganguly, 2014). As organizations mature in business process management it is important to be aware of procedural questions, so it is critical the use of new mechanisms to plan and allocate resources and to have a clear governance structure to clarify decisions that enables the improvement and transformation of inter-functional and departmental processes (Association of Business Process Management Professionals, 2009). Knowing that change is inevitable, it is essential to investigate and analyze the actual performance and limitations of the current sales processes to be able to improve and provide ways, strategies, and models that companies can adopt to get all the benefits of a BPM approach, and reach higher levels of customer trust and satisfaction.

This research and analysis will provide a holistic view of the sales management process with the introduction of the new technologies like social media, IoT – Internet of things –, artificial intelligence

4 and robotic process automation. These technologies will allow companies to acquire more relevant information for decision-making and reduce costs, since these technologies could replace humans that have the function of monitoring and maintaining the quality and the viability of the supplies and at the same time generate what companies want in terms of ROI and drive up the efficiency levels as well gain insights for the future.

1.3. S

O

The main objective of this dissertation is to perform a critical analysis of the current sales processes management by identifying their limitations and to propose an improvement through the modeling of new sales processes and sub-processes as well the benefits that will arise from this change.

To achieve the proposed main goal, the following specific objectives are defined: 1. Identify the main sales processes and sub-processes.

2. Analyze the current sales management processes performance (Prospecting, Pre-approach, Approach, Sales Presentation, Handling Objections and Overcoming Resistance, Closing the Sale, Post-Sale Follow-up).

3. Propose and simulate new BPM models that could improve processes’ performance by the changing the current workflow or/and use new technologies and approaches;

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2. LITERATURE REVIEW

This chapter aims to provide detailed concepts for the development of this dissertation based on scientific and specific articles concerned with this topic. The literature review is one of the most important phases of academic research because it focuses on uncovering what is already known “in the body of knowledge”(Levy & Ellis, 2006). It is defined as “the use of ideas in the literature to justify the particular approach to the topic, the selection of methods, and demonstration that this research contributes to something new”(Levy & Ellis, 2006, p. 182).

2.1. B

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2.1.1. Concepts

Business Process Management is considered the art and science of overseeing how work is performed in an organization and to understand it, is crucial to, first , understand the definition of a business process (Dumas, La Rosa, Mendling, & Reijers, 2012). A business process is a defined set of activities or behaviors with a beginning and an end performed by humans or machines that create value for the customer and have clearly defined inputs and outputs. It is considered the basic unit of business value in a company and his main objective is to achieve one or more goals of the organization (Association of Business Process Management Professionals, 2009; Lemańska-Majdzik & Okręglicka, 2015).

There are three types of business processes (Aguilar-Savén, 2004):

• Primary processes that represent the essential activities that an organization performs to fulfill its objectives and constitute the primary activities of the value chain with an inter-functional nature;

• Support processes that create and manages the appropriate conditions (resources and infrastructure) to uphold the core processes;

• and management processes that are used to measure, monitor and control business activities, but also to ensure that primary and support processes achieve the organization’s overall strategies and objectives.

However, processes can also be divided by its nature (Ko, 2009):

• Public processes or collaborative business processes defined as being those processes that involve communications and exchange of something with external organizations, in other words, transversal processes.

6 • And Private processes that are those processes that can be at operational, management and

strategic levels and are only for internal use.

Business processes are also defined as the collection of inter-related events, activities, decision points and even , more important, several actors and objects defined across time and space that together produce a specific outcome with value to at least one customer (Dumas et al., 2012).

Due to several factors, such as the need to adapt to change, the constant need for access to information in a faster way, shorter cycle times and quick decision-making it emerged a challenge for companies. That challenge was the management of the business processes to achieve profitability and survive in the marketplace that evolved into what is business process management nowadays (Ko et al., 2009). Business process management is defined as “supporting business processes using methods, techniques, and software to design, enact, control and analyze operational processes involving humans, organizations, applications, documents and other sources of information” (Ko et al., 2009, p. 745) and it implies a strong importance on the way processes are designed and performed since affects the perceived quality and efficiency of service delivery in the eyes of the customer (Lemańska-Majdzik & Okręglicka, 2015). It is a management discipline that relies on the assumption that organizational objectives can be better achieved through an effective business process management and to do that it is crucial to possess the three main pillars: processes, people, and technology. Considered a “body of knowledge” is mainly used to define best practices and principles (Moore, Benedict, Bilodeau, & Vitkus, 2013).

The essence of business process management resides in looking beyond functional boundaries to offer valor to customers and to see business processes as independent elements of a formal organizational structure (Tang, Pee, & Iijima, 2013). The main purpose is to increase the efficiency and effectiveness of organizational processes through improvement and innovation (Schmiedel et al., 2014). The implementation of BPM requires the commitment of all the organization because induces new roles, responsibilities, and tasks derived from the shift from a vertical or functional focus to a horizontal or process focus (Schmiedel et al., 2014).

Over the past few years, business process management is gaining a lot of attention and being recognized as a critical approach to support innovation, change management and transformation (Lemańska-Majdzik & Okręglicka, 2015). Their strategy to apply a shift from a vertical to a horizontal process orientation and their change of thinking and working that gives a special emphasis on processes, outcomes, and customers rather than on hierarchical or functional effectiveness became the essential keys to the success of business process management (Tang et al., 2013).

7 To achieve successfully BPM results is necessary to also take in consideration some factors that include organizational, process, management, and technology practices (Association of Business Process Management Professionals, 2009) such as:

• Alignment between business strategy, value chain definitions, and business processes; • Definition of goals for business units in a way that exists agreement with the strategy;

• Development of action plans and tactics to achieve organizational goals and business success;

• Designation of executive sponsorships, responsibility and process authorities; • Identification of the process owners as well the authority to make changes; • Establishment of metrics, measurements, and processes;

• Institutionalization of practices such as continuous improvement research, change management, change control and products;

• Standardization and automation of business processes and related methodologies.

2.1.2. Lifecycle

BPM is mainly a cross-discipline “theory in practice” subject involving knowledge from several areas such as organization management theory, mathematics, and linguistics. Given its multi-disciplinary nature, there are many views of the generic business process modeling lifecycle since each business reality, and each project is unique, it is impossible to predict how its implementation will be (Ko, 2009). The generic BPM lifecycle is known as a continuous and iterative lifecycle of integrated activities that include: Planning, Analysis, Design and Modeling, Implementation, Monitoring and Control and Transformation influenced by primary factors such as leadership, values, culture, and beliefs (Association of Business Process Management Professionals, 2009).

8 Figure 1 - BPM Lifecycle

Source: (Association of Business Process Management Professionals, 2009)

Planning: In this phase, a process-driven strategy and a plan are developed to set the goals, responsibilities, performance, methodologies, and direction to BPM processes to ensure the delivery of value to the customer and the inclusion of customer’s expectation. It is very important to spread an understanding of the organizational structure for customer-centric process management to guarantee an alignment with people, processes, and systems with the strategy across functional boundaries (Association of Business Process Management Professionals, 2009).

Analysis: In this phase, business processes problems are identified, delimited, documented and addressed according to the desired objectives and goals. This analysis incorporates different methodologies and provides an overall view of business processes models, performance, resilience and their relationships. During this phase, several points like business modeling objectives, business environment, the stakeholders and the modeling scope are analyzed (Dumas et al., 2012).

Design and modeling: In this phase, it is defined what the organization wants the process to be and answers the questions: what, when, where, who and how the work is executed.

The Design covers not only the existing business process identification and design but also the future process improvements (to-be). It is crucial to underline the importance of component design to ensure that the appropriate metrics and controls are implemented to allow the performance and compliance measurement. Is supported by modeling software in which the flow of processes, actors involved, messages, notifications or other operational procedures are designed for a system that already exists or for a future system (Juric & Sasa, 2009).

The Modeling phase is defined as the set of activities focused on creating complete and precise representations of an existing or proposed business process where the level of detail and the specific type of models are fundamental (Moore et al., 2013). The main purpose is to analyze in detail the drawings produced in the Design and to introduce combinations of variables that allow the evaluation of process consistency, that is, to understand how the process reacts to different circumstances or unforeseen scenarios (Hajiheydari & Dabaghkashani, 2011).

Implementation: In this phase, occurs the transition between the theoretical models to executable models, in other words, the processes seen as mere abstractions become executable processes and the changes required to move from the “as-is” process to the “to-be” process are prepared and performed (Association of Business Process Management Professionals, 2009). The implementation involves two complementary facets: process automation that involves the configuration or

9 implementation of an information system to support both “as-is” and “to-be” processes and organizational change management that are defined as the set of activities required to change the way of how things are being done by the actors involved in the processes (Dumas et al., 2012). Monitoring and Control: In this phase, occurs the monitoring of processes individually to identify necessary resources adjustments and generate performance statistics acquired through key measurements related to goals and value to the organization that can result in improvement, redesign or re-engineering to better control the execution of the process (Association of Business Process Management Professionals, 2009). “Every good process eventually becomes a bad process”(Vom Brocke & Rosemann, 2010), unless it is carried out a continuous measuring and monitoring of business processes to keep up with the ever-changing environment, customer needs and competition (Dumas et al., 2012).

Transformation: In this phase, the outputs and data of the iterative process lifecycle are implemented to optimize the information flow, in other words, process improvement. It is identified the possible organizational change management constraints and challenges to achieve process optimization, reduced execution time, human intervention and costs. The process optimization is managed to be able to respond to the environmental changes and achieve consistent results. If the process optimization doesn’t reach the expected outcome it is recommended business process re-engineering that is been used to achieve efficiency and productivity (Association of Business Process Management Professionals, 2009).

2.1.3. Disciplines

Business process management is composed of eight disciplines: Modeling, Analysis, Design, Performance Measurement, Transformation, Organization, Enterprise Process Management, and Technology.

Modeling:

Process modeling is considered the fundamental basis for managing a business. (Moore et al., 2013). Requires a combination of a set of processes and techniques that give a vision and an understanding of the business process to allow the analysis, design and performance measurement (Association of Business Process Management Professionals, 2009). It should be capable to “support emerging consumer-technology-driven and take a stronger role in communicating to the business in different ways”, that is, focus more on business services and capabilities instead of process maps (Moore et al., 2013, p. 84).

10 Is also defined as the group of activities that are involved in the creation of existing or proposed business processes to provide an end-to-end perspective of the primary processes, support, and management of an organization (Association of Business Process Management Professionals, 2009)

.

The main purpose of process modeling is to create an accurate and sufficient representation for the process and it should be noted that the level of detail and specific type of model need to be based on the expectation for the outcome (Moore et al., 2013). Its focus passes by document an existing process clearly, understand how a process behaves in different situations or in response to some anticipated change, serve as a basis for identification of improvements and use as training support and an assessment of standards and requirements (Association of Business Process Management Professionals, 2009). In 2004, with the growing need for a common language or symbology to facilitate understanding and acceptance arose a modeling standard for process modeling – Business Process Management Notation (White, 2004).

Business Process Modeling Notation is a simple notation proposed by Business Process Management

Initiative with the main objective to create a language and a universal architecture for business

process management that provides the understanding of modeling to all users that are involved in business and support process improvement and management (White, 2004). “Being a graphical notation, BPMN hopes to bridge the gap between IT and business analysts”(Ko et al., 2009, p. 756). BPMN is a visual model of BPML Business Process Modeling Language and defines a single BPD -business process diagram to express -business processes based on a flowcharting technique (Association of Business Process Management Professionals, 2009; White, 2004).

A BPD is made up of a set of graphical elements divided into four categories: flow objects, connecting objects, swimlanes and artifacts.

Flow objects are graphical elements that determine the course of the business process and are composed of three core elements: event, activity, and gateway.

• An event is something that happens during the course of a process, affecting the process flow and normally have a cause or an impact. There are three types of events, based on when they affect the flow: Start, Intermediate, and End.

• An activity is task or tasks carried out by members of the organization. They stand for manual or automatic tasks performed by an external system or user and can be classified into tasks or sub-processes.

• A gateway is used to control the divergence and convergence of sequence flows. It implies that there is a decision that either allows or disallows passage through the gateway.

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Category Element Type Representation

Flow objects Event Start Intermediate End Activity Atomic Compound Gateway

Table 1 - Flow Objects

Connecting objects represent the connections between the flow objects in a diagram to create the basic skeletal structure of a business process. They are composed of three elements: sequence flow, message flow, and association.

• A sequence flow is used to show the order (the sequence) that activities will be performed in a process.

• A message flow is used to show the flow of messages between two separate process participants (business entities or business roles) or processes that send and receive them. • Association is used to associate information and artifacts with flow objects and is used to

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Category Element Representation

Connecting objects

Sequence Flow Message Flow

Association

Table 2 - Connecting Objects

Swimlanes are described as a mechanism to organize activities into separate visual categories to illustrate different functional capabilities or responsibilities. Are divided into two types: pools and lanes.

• A pool is a container of a single process that contains the sequence flows between activities and expresses a participant in a process. Is used when the model involves two or more business entities that are physically separated in the diagram.

• A lane is a sub-division within the process. Is used to differentiate elements such as roles or positions and represent functional areas responsible for tasks.

Category Element Representation

Swimlanes

Pool

Lane

Table 3 - Swimlanes

Artifacts are used to provide the ability to add context or extra information to a specific situation, but also to represent entries or exits of documents, information, etc. There are three types:

• A data object is a mechanism to show how the data is produced or required by activities and is connected to activities by associations.

• A group is a mechanism that allows the grouping of activities for documentation or analysis. • An annotation is a mechanism to provide additional information about the process.

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Category Element Representation

Artifacts Data object Group Annotation Table 4 - Artifacts Analysis:

Process analysis creates the foundation for process design. (Moore et al., 2013). It is considered an essential tool to create a common understanding of the process activities and their current state but also to measure the outcomes of those activities according to the defined organizational objectives. Can be applied to evaluate the current and future improvement opportunities and to generate useful information for decision-making because, without it, decisions are made based on opinion or intuition rather than documented or validated facts. This information generated should include some factors such as business environment, process context, process inputs and outputs, strategy, objectives, goals, business rules, performance metrics and roles of each business unit that must achieve the goals regardless of some inefficiencies (Moore et al., 2013).

Process analysis creates also an understanding of process efficiency and effectiveness that is defined as the measure calculated through the attainment of a purpose or a process need and whether the process meets the needs of the customer or reaches the business objectives. It can be done at any time by the organization or in response to single events, but it is recommended that the company carry out continuous monitoring of processes instead of waiting that specific events trigger the analysis. This continuous monitoring is essential since alerts to the possibility of reduced process performance and supports the discovery of the root-cause to take immediate action to resolve them (Moore et al., 2013). It must be noted that the process analysis should not be seen as an event, but rather as a commitment that will enable organizations to optimize processes and monitor their performance, thereby increasing organizational performance(Moore et al., 2013).

Design:

Process design is the definition of objectives, rules, and deliverables that could be logical or physical to create a result, service or product that is beneficial for everyone involved. Implicates the identification of current activities, functions, information systems and mechanisms and the understanding of the existing processes, sub-processes and the interaction between them and the business units responsible for their performance (Moore et al., 2013).

14 The first step to being taken before starting any process design is to review the deliverables from the previous phase (analysis phase), more specifically: it should include documentation of the current process state, list of constraints, as well as the clear scope. Is main objective passes by the creation of specifications for the new and the modified business processes considering the process performance, the data resources, business objectives and technology platforms to improve the ability to grow and change in a quicker way. The outcome should be measurable because it will define the quality of the new process design and to be attainable it is essential to understand how the business work today and how it should work tomorrow (Moore et al., 2013). “A process design can be simple and static, but it tends to evolve, taking on an intelligent and dynamic nature as the business context gets more complex and differentiating” (Moore et al., 2013, p. 157).

Performance Measurement:

Performance Measurement is defined as the foundation for performance management to specify the management of a business operation at a process level and a workflow level that belongs to a business unit. The first step to take in consideration when initiating any performance measurement is to look at the effectiveness of the processes that will be measured and monitored because they must be justified by their impact on the end-product or service but also if processes are defined and understood by the customer and organization (Moore et al., 2013). Once this step is accomplished, it is possible to develop a method to define and measure the performance avoiding common mistakes such as the lack of understanding of processes, their way of work and the inexistence of sufficient maturity to support a complex performance measurement.

All processes have a metric and measurement associated with the work or output of the process that is executed. The four fundamental dimensions of metrics are (Moore et al., 2013):

• Time: is a measurement of process duration, that is, the time it takes between the start and end of a process.

• Cost: is a measurement of the monetary value associated with a process, that includes resource and opportunity costs.

• Quality: is a measurement of actual percentage to the optimal maximum in process terms, that can be expressed by satisfaction, variation, and error or defect rate.

• Capacity: is an amount/volume of a viable output associated with a process.

The measurement results are related to many factors: level of flexibility in data access, process maturity level, definition and agreement on what to measure and how, ability to report through presentation and the acceptance of the users that will carry out the measure (Moore et al., 2013). The key aspects of performance management are the focus on people and processes, the guarantee understanding of the whole process, not only individual tasks, the understanding of how the process

15 is tied to operational performance metrics and aligned with performance compensation and the guarantee that those who draw up and approve the activities are the same persons who carry out the activities (Moore et al., 2013).

Transformation:

Process Transformation is defined as the planned evolution of business processes using a clearly defined methodology and a disciplined approach to ensure that the process continues to achieve business objectives. It is considered the fundamental rethink of a process with the main objective of innovating and creating new business techniques, technology and so much more. Being cross-organizational, their scope must involve all business units, whose existence is crucial for a definition of the processes that are involved in the transformation, due to the invasive and disruptive nature (Moore et al., 2013). The main goal is to optimize process work. However, there are some limiting aspects that need to be discovered at the beginning of the process transformation to avoid time and resource waste.

Process transformation can deliver high-quality outcomes faster and at a reduced cost, leverage the competitiveness and production capability as well as improve the long-term strategy. It involves pursuing ideas, though and opinions from the inside and outside of the environment, but it must be noted that what results in one company may not work in the other company even if it is similar. So, it is extremely important to analyze all the information and inputs gathered to “fit” in the company at the beginning of the process transformation. Process transformation contains a much bigger change than improvements even when is applied to every aspect of the transformation (Moore et al., 2013). Includes several methodologies such as Six Sigma, Lean, Total Quality Management and Activity Based Costing. Six Sigma is considered the measure of organization business process performance and focuses on increasing customer value and efficiency by improving product or service quality and cost to leverage profit. It identifies and eliminates unnecessary costs. In other words, costs that don’t bring value to the customer and can be used to predict the future, because it provides to the organization a better understanding of customer needs (Pyzdek & Keller, 2010).

Lean methodology is a management philosophy based on the reduction or elimination of seven wastes (overproduction, waiting time, transport, processing, stock, handling, and defects). Is reflected as an instrument for improving operational processes and, therefore, a mean of re-engineering or designing new processes (Freire & Alarcó N, 2002).

Total quality management is characterized by the cooperation between the organization and their business processes to achieve continual improvement and better-quality products and services that exceed the needs and expectations of customers. It has a set of principles to manage the

16 organization such as everyone should be involved, quality for profit, competition standards and ownership (Dale, 2015).

Activity Based Costing is a methodology that defines and measures the costs and objects, resources performance that an organization needs to perform logistic activities. Incorporates relationships between cost objects and activities and between activities and resources (Bartolacci, 2004).

“Today, business transformation, leveraging emerging technologies and BPM methods and techniques, is positioned to change the way business is conducted”(Moore et al., 2013, p. 262).

Organization:

Every enterprise has its own culture, structure, values and business processes tailored to its own business which makes it unique. (Moore et al., 2013). However, most of the organizations are still structured around functional structures or products instead of being around their business processes. Instead of managing the resources and responsibility delegation by hierarchical levels and with a restricted control as traditional organizational structures do, the organizations that made the transition to a process-driven organization assign horizontal responsibility by delivering value to the customer, involving process design, documentation, measurement, and transformation achieving more success. Changing organization’s approaches is very challenging but it is strongly important since processes achieve new maturity levels, emerge new skills, roles and new ways to align the employee’s motivation (Moore et al., 2013). A process-driven organization is a structured, organized, managed, and measured organization through its primary business processes. Having a process-oriented organization does not mean that processes are the only dimension of management, performance measurement, or organizational structure, there are also financial dimensions and functional capabilities involved (Moore et al., 2013). It is an integrated approach for performance improvement that takes into account the organization as a whole and the inclusion of processes and roles of individuals in the process and organization. By fostering a process culture companies should identify their business processes, communicate and make it visible to all the organization because this new culture covers a set of rules, procedures, tools to achieve a specific goal.

Enterprise Process Management:

Enterprise process management characterizes a new approach to business operations. It involves the transition from strategy thinking in general or financial terms to a strategy in terms of observable cross-functional activity and is concerned with all processes. By using a higher-level perspective, it allows the control of the impact and the change benefits in business operations and individual business units, but also the management of performance, cost, and quality. Requires careful thinking,

17 change of vision, and a new set of leadership behaviors and it aims to align the processes with the objectives of the organization and achieve efficiency (Moore et al., 2013).

It ensures the alignment of the end-to-end business process portfolio and process architecture with the organization's business strategy and resource allocation, providing a governance model for management by involving planning, collaboration and the growing definition of technologies to uphold, upgrade, innovate and manage end-to-end business processes that drive business agility. The role of measurement is essential to maintain a customer-centric focus and ensure accountability for the performance of the organization's large cross-functional business processes (Moore et al., 2013).

Technology:

Nowadays, BPM technology is evolving and changing quickly going from “simple workflow modeling tools to complex integrated tools that provide a complete operating platform and environment” (Moore et al., 2013, p. 373). It is characterized by two types: standalone single-purpose tools and integrated group of tools called Business Process Management Suites (Moore et al., 2013). The standalone single-purpose tools provide model reuse, operation visibility and rules rationalization within their focus area. However, they cannot offer the capability to change and optimize the organization’s operations or provide a complete operating environment that generates applications that runs inside them that BPMS delivers. Business Process Management Suites enables the integration between business and IT and the implementation of change management with a focus on processes when it is necessary. “BPM technology supports the entire lifecycle of a business process, from design through implementation to execution and controlling of processes. It supports the linking of strategy to processes through an appropriate design using Business Process Analysis (BPA) tools and converts that strategy into an agile execution using BPM automation engines” (Moore et al., 2013, p. 367). Nevertheless, the agile BPM technology needs a well-defined governance to create value with agility and scalability and to be certain that their technology is aligned, consistent and in conformance with organization requirements (Moore et al., 2013).

2.1.4. Maturity model

Business process management “is widely recognized as a foundation for contemporary management approaches as it goes via the analysis of business processes to the roots of an organization” (Rosemann & Bruin, 2005, p. 3). With the increasing importance of BPM, organizations start to focus on the analysis of the different maturity level of their processes. Maturity is defined as a way to assess “the state of being complete, perfect, or ready” and the “fullness or perfection of growth or development” (Rosemann & Bruin, 2005, p. 3). As organizations that implement BPM can be in different stages/levels of maturity, it is crucial that they implement a model of maturity to know in

18 which levels of maturity they are and to be guided to future improvements. There are several proposed models to measure the maturity of BPM, being the most common basis of comparison, the capability maturity model (CMM). CMM was created by the Software Engineering Institute at Carnegie Mellon University to enrich software-development and maintenance capability. It helps companies to gain control of their process improvement and determine their current process maturity to identify critical issues (Paulk, Curtis, Chrissis, & Weber, 1993). CMM argues that the greater the maturity of a process, the greater the predictability and quality of the results achieved and to set “sensible goals for process improvement it is required an understanding of the difference between immature and mature software organizations”(Paulk et al., 1993, p. 19). An immature organization is an organization that doesn’t follow any guide or plan for software processes. It is reactive, in other words, take immediate actions when something goes wrong and improvises along the way (Paulk et al., 1993). Is impossible to measure/predict product quality because “when hard deadlines are imposed, product functionality and quality are often compromised to meet a schedule” (Paulk et al., 1993, p. 19). A mature organization is an organization where plans, schedules, budget, and objectives are well defined and fulfilled. The software processes, roles, and responsibilities are communicated and known by everyone and the product quality is monitored constantly as well as the process that produces them (Paulk et al., 1993).

Immature organization Mature organization

Uncoordinated and isolated projects

Coordinated BPM activities

Low BPM skills High BPM Expertise

Key personnel Organizational-wide coverage

Reactive Proactive

Manual Automation

Internally Focused Extended Organization

Low Resourcing Efficient resourcing

Naive Comprehensive understanding

Static Innovative

Table 5 - Comparison of low and high maturity and the five maturity stages Source: (Rosemann & Bruin, 2005)

Nowadays, the Business Process Maturity Model developed by OMG derived from the CMM is one of the more than 200 existing maturity models. BPMM is a model created to monitor the improvement of business processes “characterized as workflows across organization boundaries”(Weber, Curtis, &

19 Gardiner, 2008, p. 4). It incorporates improvements in coverage, structure, and interpretation, and contains several principles such as (Weber et al., 2008):

• If the organization is not mature enough will not be able to support capable processes. • To define process capability, their attributes could be assessed to achieve organizational

goals.

• “Each stage or maturity level lays a required foundation on which future improvements can be built” (Weber et al., 2008, p. 3).

• Process improvement should be an organizational change program to reach more predictable stages of organizational capability.

BPMM is divided into 5 maturity levels that represent different stages that a company achieves as they improve their processes and skills like all maturity models that follow the CMM framework (Weber et al., 2008). The five maturity stages are the following (Weber et al., 2008):

Level 1 – Initial level: organizations included in this stage typically produce their own products and services, however, they spend too much money or exceed schedule. Some of their characteristics are lack of commitment and specific goals, processes rarely defined or documented, documented processes are not followed, practices and inconsistent process results, excessive difficulty to adapt to change, and the inexistence of a stable environment for process implementation.

Level 2 – Managed level: organizations included in this stage already have basic planning and management processes that perform all the crucial activities to support and improve their products and services. Some of their characteristics are: being aware of key costs, schedule, and quality, control of management needs, existing support of senior management positions, assignment of roles and responsibilities, commitments and supplier sourcing agreements made.

Level 3 – Standardized level: organizations included in this stage are in a growing state of development of their BPM capabilities, increasing the number of individuals seeing the organization from a process perspective. Some of their characteristics are the creation of documentation for the use of the whole organization, standard processes synthesized from best practices, consistent performance of work activities, assignment of a team responsible for coordinating the activities, use of mechanisms to improve standard processes and elaboration of a guideline that compiles all questions and clarifications.

Level 4 – Predictable level: organizations included in this stage already have a solid implementation of BPM in their business and benefit with that. Some of their characteristics are the management of the infrastructure capacity of organizational processes and the compliance with established goals for quality and performance, existing integration of processes, predict performance and outcomes to be

20 achieved to manage organization assets, use of different approaches and measures, implementation of changes to reduce process variation and achieve expected performance and quality goals.

Level 5 – Innovating level: organizations included in this stage view BPM as an integral part of its strategic and operational management and addresses its critical business issues or areas of concern. Some of their characteristics are: the definition of improvement objectives in all stages of the organization, implementation of changes to fill the gaps between the current performance, capability and the expected outcomes, execution analysis of defects and problems to determine their causes and implementation of corrective actions.

It is important to take in consideration that these models are suggestions and best practices that indicate what should be done, but not how it should be done (Weber et al., 2008). It is recommended that every organization define their strategies and approaches according to their objectives and desired outcomes.

2.2. S

M

2.2.1. Concepts

Nowadays, every person in their daily lives deals with goods and services transactions. Selling is defined as the act of convincing people to satisfy a need or want and the exchange of something between two parties - the vendor, and the buyer - for money (Kundu & Bishnoi, 2009). “Selling is the act, sales are the result of this act” (Kundu & Bishnoi, 2009, p. 18). It has been gaining importance due to a simple reason: the person that performs the sale defined as a salesman is the most significant connection with the buyer (Jobber & Lancaster, 2009) but is also the major point of failure. Therefore, emerged the concept of salesman coordination and control called Sales Management (Kundu & Bishnoi, 2009).

Sales management “meant management of all marketing activities, including advertising, sales promotion, marketing research, physical distribution, pricing, and product merchandising” (Kundu & Bishnoi, 2009, p. 3). It is also defined as “the planning, direction, and control of the personnel, selling activities of a business unit including recruiting, selecting, training, assigning, rating, supervising, paying, motivating, as all these tasks apply to the personnel salesforce” (Singh et al., 2011, p. 4). And “sales management refers to the control and form of the personal sales contact, the sales system (sales structures, processes, and channels) and distribution in national and international markets” (Dannenberg & Zupancic, 2009, p. 4).

The person who performs sales management is called sales manager. This manager has the responsibility to guarantee that the sales activities generate the most effective contribution to the accomplishment of the organization goals and objectives, determine the goals of the salesforce, forecast and budgeting, salesforce selection, recruitment and training, motivating the salesforce

21 team, organize the sales force size and planning and evaluate and control the salesforce (Jobber & Lancaster, 2009).

Sales management is composed of four elements: planning, coordination, controlling and motivating (Kundu & Bishnoi, 2009).

Planning: organizations must create some strategy to plan. First, they need to be aware of the future, the way they want to do their work and decide who should do it. Then develop a plan after doing some market research and studies, identifying the competitors and types of products. This plan should be flexible, continually updated and communicated to all people that execute activities in the organization.

Coordination: “ is all pervasive and permeates every function of the management process”(Kundu & Bishnoi, 2009, p. 7). It involves principles and good practices to build up organizational skills, support the workers and help them to have a total vision of their activities and how to coordinate them with the team. The sales manager has an important role in this phase because he needs to motivate, develop a close relationship, promote direct contact among the organization and guarantee the flow of information about the objectives.

Controlling: involves the constant revision of the sales activities direction and the conformance of sales activities with the organization objectives and goals. The sales manager need to guide and lead the team to anticipate problems that can occur in the future and avoid them by taking corrective measures. In this phase, the budget and schedule are controlled and the level of efficiency of the salesman’s work.

Motivating: only motivated salespeople can achieve business goals (Kundu & Bishnoi, 2009). To join a different type of people in a team and leverage their productivity is crucial to analyze and understand behavior patterns in the first place.

Every organization has goals and objectives that aims to achieve. The most common ones are reasonable profitability, sales volume, market share, continuous growth, and good corporate image. All objectives have their importance. However, they must be represented in a measurable, quantitative way, must be realistic, achievable, integrated and organized in a hierarchical manner. They must be defined and formulated not only by the top management but must involve the salesforce and should only be defined after some studies and analysis of the market and trends. These objectives are affected by the efficiency and effectiveness of the sales management that helps the organization to achieve economies of scale (Kundu & Bishnoi, 2009; Singh et al., 2011).

22

2.2.2. Characteristics of Selling

There are some very essential characteristics of selling that the sales force need to know and engage with them to succeed in their job that are: customer retention and deletion, database and knowledge management, customer relationship management, marketing the product, problem solving and system selling, satisfying needs and adding value (Jobber & Lancaster, 2009).

Figure 2 - Characteristics of selling Source: (Jobber & Lancaster, 2009)

Customer retention and deletion: it is known that 80 percent of the organizations sales come from 20 percent of their customers (Jobber & Lancaster, 2009; Kotler & Keller, 2016).

This means that the organization should dedicate some time and resources to identify, satisfy and retain highly profitable, valuable and high-volume customers. From that emerges the concept of key account management that allows sales team to target and serve a specific group of customers with complex needs and give them special treatment. However, organizations shouldn’t focus only on their profitable customers but also analyze and identify the customers that cost more to retain than to generate profit. In that case, it is crucial to define a strategy and take actions to transform them into valuable customers or discard them (Kotler & Keller, 2016).

Database and knowledge management: the information gathered from customers, products and competitors should be stored in an organized, simple and integrated repository. Sales force needs to be able to use and create databases to store information and generate knowledge from it. Nowadays, with the technological advances, it is easier to find information and communicate with customers and potential customers, so organizations should take advantage of that and store them electronically (Jobber & Lancaster, 2009).

23 Customer relationship management: The customer is always right, so the sales team need to focus on long-term and close relationships with customers and not only on closing the sale. The idea is that the organization start to create win-win interactions, where customers gain more trust and become loyalty (Beverland, 2001).

Marketing the product: face-to-face communications are starting to lose their value, because of content that customers have access to in the internet that allows them to receive up-to-date information easily and more-time convenient. Sales force is dealing with so much more activities than only planning and presenting the product or service to the customer such as product development, market segmentation and database management (Jobber & Lancaster, 2009).

Problem-solving and system selling: “Customers are increasingly looking for a systems solution rather than the buying of an individual product” (Jobber & Lancaster, 2009, pág.30). Therefore, sales force need to communicate and follow the customer to identify problems, determinate needs and propose solutions. It involves multiple interactions, follow-ups and sales force analytical skills (Jobber & Lancaster, 2009).

Satisfying needs and adding value: customers sometimes don’t know they have a need, and in this type of situation is where salesforce enters. They should be able to identify customer needs and persuade them to be aware of that need (Jobber & Lancaster, 2009). With that recognition “the salesperson will have added value to the customer’s business by reducing costs and created a win-win situation for their company and the customer”(Jobber & Lancaster, 2009, p. 30).

2.2.3. Sales Management Information Systems

An information system is a set of interrelated components that collect or retrieve, manipulate, store and distribute timely, relevant and accurate information to achieve an objective and to support decision making. It is used to help workers to analyze issues and problems, complex subjects and create new products or services (Donaldson, 1998; Laudon & Laudon, 2012; Reynolds & Stair, 2010). To truly understand the power and the definition of information systems it is necessary to go deeper and deeper into their structure such as organization, management and information technology dimensions of information systems. The area of management information systems embraces the understanding of all the following sub-dimensions: organizational, managemental and technical (Laudon & Laudon, 2012). A management information system is a systematized collection of people, software, databases, machines, and techniques that provide repetitive information to support decision makers. It is focused on operational efficiency and an integrated database (Reynolds & Stair, 2010).