<p>I am putting together an architecture for a mid sized company who want to introduce a BPM (Business Process Management) tool. I understand that this would be helpful and want to introduce it but stuggle to find its appropriate place within the architecture. </p>

<p>I want to know when and how you should use a BPM tool, how do you differentiate Business Process from Application Workflow?</p>

Why do you want to introduce a BPM tool? Is it buzzword compliance? If you are struggling to find a place in the architecture, then I would suspect that the tool isn't going to bring a big win (at least not with your current understanding).
Application workflow tools typically concern themselves with modeling a specific process and giving semi-technical process designers the ability to show the steps and interactions, while allowing programmers to flesh the skeleton out with code that implements the pieces. Personally, I have found that the overhead of training semi-technical process leads can offset the promised gains in effective communication and turnaround, but in large organizations it can ensure the the process "owner" has the illusion of control necessary for buyoff on plans. I say illusion, because at the end of the day it is the IT staff that regenerates the code that implements the process, and often suggested changes get reverted due to problems on the technical side (such tools often make changes easier to suggest than to implement).
Some Business Process Management tools are little more than Application Workflow tools with higher price tags. Some take a higher view and incorporate the manual flows and other non-IT processes into the architecture (although obviously such steps are really nothing more than stubs or gatekeepers for exiting and re-entering the IT flow). I have no idea what you are calling a mid sized company, but at a 160 man aerospace engineering firm, we found BPM tools that we evaluated overkill.
Sadly, this is one of those questions where only subjected answers can be given, even with all the facts (different System Analysts will give different opinions). I hope that a quick overview is at least of some help. Just beware sales hype: I find such tools to be of value only in specific organizations with specific process flows and a hindrance in others.