Process Mining with Celonis

Process Mining with Celonis2022-11-03T09:11:40+00:00

Project Description

Introducing the Celonis Execution Management System (EMS)

The Celonis EMS provides process mining, together with machine learning and automation capabilities, to transform raw data from an enterprise’s business processes to identify and realise process improvement opportunities. This data exists in the form of a process’s digital footprint: the main object key fields and their change records. Such a ground up approach eliminates the need for a process to be mapped first and provides the input for Celonis EMS to achieve its results.

This blog outlines the ways improvement conscious companies can leverage the skills of Rapid ERP with Celonis EMS to gain competitive efficiencies with very little demands on their key worker time. These competitive efficiencies include improving process compliance and reducing delays in achieving the essential outcomes.

Reasons for choosing Process Mining with Celonis

  • You have a complex solution landscape with many interdependent processes. This fragmentation gets in the way of root cause analysis for identifying problems in achieving process outcomes.
  • There is a lack of visibility in compliance to AS-IS processes and standards. Process improvement is an organisational priority.
  • Process owners have been established and responsible to drive better outcomes and aligned with strategic goals of the organisation.

How Rapid ERP implements process mining with Celonis

Rapid ERP has fine-tuned our tried and tested DMAIC methodology to implement Celonis EMS with the four steps shown in Fig.1. 

1. Collect raw data from source systems to create event logs.

The first stage of process mining is for our data engineer to establish a real-time link to those key data sources (through pre-built connectors and APIs) and extract that raw data to turn it into an event log for analysis. Every interaction inside the transactional systems your business runs (such as SAP, Oracle, Salesforce, ServiceNow etc.) leaves digital footprints – data with its timestamp for the key object – that can be turned into a record of process activities to discover points of process friction and their root causes .

2. Discover points of process friction.

Our analysts, working with your business process experts, starts to create activity visualisation apps known as “Execution Instruments” to discovers process deviations and problems seen in real world production data. Using a variety of root cause analysis approaches problems can be linked to process originator, business unit handling the process, or classification of the subject of the process.

3. Enhance processes by proactively removing friction

The variations and root causes identified during the Discover phase form the basis of enhancement opportunities—practical actions that remove friction and automate flow, for example:

  • Rationalisation – Removing erroneous steps (or examining hitherto ad-hoc and undocumented activities).
  • Automation – Reducing manual effort and realise opportunities for increasing rates of automation.
  • Coordination – Improving orchestration between systems to increase throughput times and help with standardisation and governance.

4. Monitoring for Continuous Business Improvement

Continual improvement is central to process mining. In this fourth stage, process owners measure and monitor process performance toward KPIs and business outcomes to:

  • Empower teams to achieve progress against targets. Tools such as the Conformance Checker provides tools to compare conformance to agreed processes, and the Transformation Centre provide a centralised hub for achieving agreed end-results targets.
  • Build demand for further process mining initiatives across the business by communicating success both up and across the organisation.

Case Study using the Accounts Payable process

This is a small example of how Celonis process mining works in the Accounts Payable process for handling incoming invoices. It is often the case that vendors offer cash price discounts for early payment, usually around the range of 2-4% if the invoice is paid before the due date. If the invoice is received before the goods a payment block is put in place pending confirmation that the goods have been received.

Owing to high volumes, removing the payment block in a timely manner can be difficult, and here there is the potential for Celonis EMS to help identify cash discount opportunities and so save money.

In Fig. 2 below, the Celonis dashboard shows that there are 238,074 invoice items with a value of £ 980M. A possible cash discount of £3.25M is possible if all invoices are paid before the invoice’s due date. To help prioritise where to look to realise the maximum savings from this potential, three analysis components have been created:

  1. A bar chart showing discount amount by remaining due date ranges.
  2. A pie chart showing the proportion of invoices with a payment block.
  3. A table showing the number of invoices with cash discount values on offer.

In this Execution Instrument, when clicking on the bar chart column for less than 10 days remaining, the segment of invoices with a payment black and the row indicating a cash discount value > £ 1000, selections are made automatically on the data and also the involved activities displayed in the process flow.

Fig. 3 shows the Execution Instrument after these selections have been applied. It now shows just two invoices with a potential saving of 7,070 GBP. Of these two invoices with a payment block, the process flow shows one has a goods receipt already meaning this invoice is blocked without a known good reason and the cash discount on offer expires with 10 days. Analyses and results such as this can be automated to send notifications to the relevant department for follow up.

The Rapid ERP engagement approach

Using our Enterprise Transformation and Process Mining experts, Rapid ERP will facilitate a discovery session to create a Rapid Path-to-Value Blueprint that summarises the current and desired states of the organisation, key process use cases and confirmation of pain points to assess applicability of process mining with Celonis. The discovery session usually consists of one or two 2-hour meetings and should involve Project or Transformation Lead, process owner(s) of the key processes to be analysed and the business process expert supporting the process. It consists of three parts:

1. Assess organisational readiness
Before getting into the details around process and technology, it is always beneficial to understand where execution improvement fits within the broader strategy and initiatives driving your business to confirm organisational readiness for execution of process improvements with Celonis

2. Define a value framework
Next we will start building a customised roadmap to success by identifying suitable processes and metrics. Here we ask: Are there specific processes you think need improvement in your organisation? Are there any metrics that are relevant and being monitored at your organisation?

In Fig 4. below, objectives and their KPI’s are presented for the A/P process. In other areas, Supply and Distribution for example, you could measure inventory turnover or out-of-stock rate; for customer acquisition: conversion rate and order cycle time; with products and services: carrier reliability or on-time fulfilment rates.

3. Agree success criteria and next steps
In this third and final stage, we now have a rounded appreciation of your goals and can list out the key success criteria that a Celonis solution should deliver to play its part in achieving your organisation’s desired state. This sets the stage for a more detailed validation and proposal phase on how Rapid ERP can deliver on these success criteria if Celonis EMS is implemented.

A call to action

Celonis is the market leading vendor in the domain of process mining, with over 60% market share and 400% year over year growth in its client base. Rapid ERP is a Celonis partner and has a long history of delivering business process improvement with the SAP Solution Manager suite of BPI Analytics and the mapping of existing business processes for optimisation with business users.

If you would like to find more about how Rapid ERP can provide process mining with Celonis and how best to make pragmatic usage of this functionality, then feel free to reach out for an informal conversation.

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