Business Process Modeling, Activity-Based Management, And Decision Support Systems: The Case Of B&B Plumbing

Abstract

This case was designed to be used as a resource for professors who are interested in using decision support systems to teach activity-based management.  Specifically, we developed the case for use with Hyperion Software’s Activity-Based Management application, formerly called NetProphet II by Sapling Corp. Professors wishing to use this, or other activity-based management software, have trouble finding non-proprietary materials for use in teaching with the software. We developed this case to address this need. 

Although the case was designed for use with this decision-support application, its usefulness extends beyond that for two reasons.  First, the case involves developing a business process model, first from a workflow, or engineering perspective, then overlaying that model with financial information to create the full business process model. The process model is developed independently of the software used to implement and run the model. The modeling process is important in itself because it focuses student attention on the nature of the work involved and interaction between work flow, resources, constraints, and costing.  A natural result of developing a process model is a greater appreciation for the difficulties inherent in, and the complexity involved with, making sound managerial decisions. Second, the process model can be implemented independently of the software as well. With some effort, a spreadsheet can be used to develop the appropriate formulas, flows, factors, and units of measure based on the workflow, to carry costs down to the appropriate demands. 

The case involves a plumbing firm, B&B Plumbing that has four lines of business.  Based on the poor operating results of one line of business, management is considering eliminating that line, but they are not sure that the current financial results for each line are indicative of that line’s true performance. Students are to develop or use the business process model for the company to assist management in making the most profitable operating decisions.  They are then to evaluate the business in light of the model and its associated constraints to maximize profits.