Compliance Process Modeling



Process modeling is necessary to design, implement, and improve compliance. Many of the techniques and approaches used today are based on flow charting process activity.

Activity models focus on diagramming how work moves from person to person to achieve the desired output and for this reason is well suited for prescriptive processes. However, in today's climate of performance based compliance is this still the best choice?

In this blog, I will look at how the Activity Model compares with the Phase-Gate Model which is used extensively for capital projects and new product development.


Activity Model

Activity based models typically diagram the process using flow charts containing: boxes, diamonds and arrows. Swim lanes are often added to represent activity performed by different roles.

Flow charts are great at detailing how a process flows and useful for prescriptive work. This lends itself to mapping easily to workflow engines which are usually designed to support activity based processes.

The flip side of using activity based workflows is that it is difficult to implement processes that require greater facilitation, descriptive procedures, and activity that is not known in advance such as risk mitigations.

Once you select this approach you have to make it work for your entire process which may not always be the right fit.

Phased-Gate Model

This modeling technique is based on a state driven approach depicting the life cycle of a project, product, asset, or some other thing that goes through a series of phases or steps. This approach is used extensively for value creation and is the preferred approach for new development and capital projects.

A popular and successful representative of this approach is Stage-Gate(r) model which is a trademark of R.G. Cooper & Associates Consultants.

The phase-gate approach includes:

  • Phases - these follow the state of the process focused on the development of intended outcome.

  • Gates - provides a control point where quality is assessed, deliverables are reviewed, and decisions are made to proceed or not.

One of the key strengths of this approach is that it affords a rigid structure to govern the overall process while at the same time allowing for flexibility in how the work gets done between gates. This flexibility provides a method for balancing prescription and descriptive parts of the process.

In addition, the sequencing nature of this model offers the same kind of benefits as cellular manufacturing does on the shop floor. If implemented appropriately these are the benefits that can be expected:

  • Reduced Work In Process (WIP)

  • Better use of resources

  • Better scheduling

  • Better control

  • Easier automation

  • Increased quality

A downside of using this model is that it may lack the appropriate level of detail and prescription for parts of the process that require it. The inherent flexibility can be abused and allow situations where appropriate program and system governance is not being followed.

Hybrid Model

This approach combines the best from both worlds. It is easier to add prescription to the phase-gate approach due to its flexibility. An example life cycle that combines the phase-gate and activity models is shown in the following diagram:


In this scenario, prescriptive workflows have been added to the approval and verification phases of the life cycle. The other phases follow a facilitated process to produce deliverables which are then reviewed using a checklist.

By combining both approaches, the hybrid model overcomes the lack of prescription while gaining all the benefits of the using the phase-gate model. The benefits of using this approach include:

  • Increases overall process visualization - you know where you are in the process instead of just knowing what activity you are at within a work flow

  • Identifies more easily where program compliance directives are done - ex: approvals, verification, quality review, and so on

  • Embeds quality control throughout the process using gates

  • Bottlenecks are easier to discover and alleviate

  • Supports a continuum of prescriptive and descriptive process steps

In order to adapt, to changes in the compliance landscape, it is necessary to evaluate the effectiveness of existing tools and techniques. Considering approaches found in other domains provides companies additional options to better meet compliance challenges.

The Hybrid Model has been used effectively to support risk based compliance processes for several years across diverse industries. To find out more, visit our website at www.leancompliance.ca

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