BPM Futures

Back to basics – why use a BPM system?

January in Sydney tends to be a quiet month for business, only really coming to life after Australia Day on the 26th. From the 4th onwards there is a gradual return to workplaces that are abuzz with new projects, new sales opportunities, new marketing campaigns, all scheduled to start towards month end or early February. As a result, energy levels of those at work tend to be higher and minds – less stressed than usual, perhaps – a little more open to reflection. So, with that audience in mind, here is a blog about the bedrock of BPM systems (BPMS), and indeed BPM in general, that is, the reason why any business should bother to use it.

The benefits of using a BPMS can be summarised as:

  • Higher productivity
  • Faster process times (eg end to end)
  • An order of magnitude improvement in process transparency/visibility
  • An entry point to a virtuous circle of process understanding, improvement and execution
  • Better control over the process (eg through the use of embedded business rules)
  • Improved job satisfaction for operational staff using the system

Of these the most significant – in terms of both impact and universality – is undoubtedly process visibility. Businesses that lack a BPMS – or alternatively core or ERP software that fully encompasses their business processes – are like vehicles driven in a thick fog. Data about the past is patchy and unreliable, data about today incomplete and highly reliant upon personal observation, and data about the future seriously compromised.  (‘Data about the future’ can be both hard – today’s backlog, how much work is in pending and when it falls due – and relatively soft, for example resource forecasting based upon historic productivity data). Most obviously true of operations teams, this extends further into customer interaction. For example, without accurate end-to-end process times there is little chance of understanding the customer experience except by analysing complaints.

Whilst senior business managers can be passionate in demanding visibility, Boards can demand more. IT investments do not always produce a return and, to continue the fog analogy, we may not be able to see much out the windows but we’ve got this far OK, there is some rear and side vision, and the future’s always going to be largely uncertain.

Which is where the higher productivity benefit comes in handy. Higher productivity in the operations teams can pay for the initial project and the ongoing IT costs, whilst the benefits arising from enhanced visibility (tightly focussed process improvement in operations lowering costs, better informed product development and customer service increasing revenue) are spread across the business.

Some productivity benefits pretty much come with the territory – work distribution, management of pended/diarised work and enquiry handling are all areas where the BPMS will automate previously manual tasks, delivering benefits pretty much by default. Other areas like load balancing (between teams or individuals), exception handling (eg duplicate requests) and re-work management can take a little more work to achieve results. Hard benefits from these and other BPMS features are commonly augmented through add-ons such as automated outgoing document management and integration with core systems, which – whilst initially adding to project costs – can be relied on to provide further productivity improvements.

Faster process cycle times, particularly end-to-end times, routinely arise from a BPMS implementation. Naturally, additional focus and effort can drive further improvement. Where tiered service levels are required, the BPMS can use prioritisation to ensure that outcomes are optimised – something that can be especially hard to achieve where processing is manual.

Process control may be a more or less compelling reason to use a BPMS, and may mean high-end technical control and/or regulatory control. Running business processes through a BPMS will prove to the regulator – and to other stakeholders – that the process has been followed in a specific case (through the audit trail), and is followed in general (through sharing the process definition). Automating business rules will ensure 100% compliance with those rules that are automated and typically will make it harder for a careless or rogue employee to break others. It will also provide control where a – highly automated – process must happen so fast that people are no longer able to participate except on exception, that is, straight through processing.

And improved job satisfaction? Well, whilst rarely at the heart of the business case, the evident satisfaction of employees in receiving better tools for their work certainly makes change management that much easier. And doesn’t everyone want happier employees?

OK – that’s it. Your revision for the day is complete. And as a reward, here is my favourite viral video of the holiday – the Brooklyn Space Program. Any connection with BPM? Just inspiration from their ambition and ingenuity, and perhaps aspiration that we could achieve as much with so little. Maybe we need to recruit some younger project team members?

Tibco User Group, Sydney

A full house today at Sydney’s Sofitel Wentworth for the first 2010 Tibco User Group meeting. Networking – with cold beer, very civilised – was followed by the corporate positioning pitch and then on to a tour of the 2010 roadmap. Whilst many individual points were of interest, the overall message was clear – we’re all business process specialists now, whether we use BPM tooling as such (Tibco’s iPE) or Complex Event Processing (‘BusinessEvents’) as the ‘pointy end’, the ‘stack’ is all about business process outcomes.

Highlights on the traditional BPM front include new Organisational Modelling extensions to iPE; new Forms options including Google Web Toolkit and Windows Presentation Foundation (the key here will be the depth of integration with the rest of the stack); and new process optimisation functionality arising from the convergence of iPE and Spotfire (the latter being a rich/easy to use BI tool that threatens to be as much loved by the business, and as hard to control by the IT department, as Sharepoint). And tibbr, Tibco’s corporate answer to Twitter, was also featured – very compelling, it takes the concept of ‘following the customer’ to a whole new level.

The session was topped off with a case study from Vodafone Hutchison Australia, a 2009 merger that claims 27% of the Aussie mobile market, and growing fast. Presentations like this, whilst always well-meaning, can be a bit repetitive – we’ve all heard similar ones before. This one stood out in two respects. Firstly it related the replacement of VHA’s core provisioning and customer service system, handling 100k+ tx/day, with the Tibco stack in just 6.5 months – this old hand was impressed.

And secondly, VHA used BusinessEvents rather than iPE, despite the latter having a significant track record in the telco space (very high volume provisioning, MNP and others). This remained unremarked in the presentation, and I was unable to reach the front of the queue to speak with their Architect afterwards. I did find myself speaking with one of VHA’s competitors though, who confided that if he had the choice he would really like to use both products, with BE orchestrating iPE. A topic I shall try to delve into further in future blogs….

Renewing BPM for the coming decade

Isn’t it time we re-thought the definition of BPM? It seems to be getting increasingly jelly-like – wobbling and spreading to encompass every possible interest group. Check this out – the ‘official’ definition (at least until the editing debate settles down) from Wikipedia: “Business process management (BPM) is a management approach focused on aligning all aspects of an organization with the wants and needs of clients.” Presumably contrasting sharply with previous generations of business management methodologies, which focussed on aligning all aspects of an organization with the wants and needs of small furry animals. I love Wikipedia, but if this is the wisdom of crowds, then civilization is surely doomed.

My recollection is that the term BPM came into usage in the late 90s as a way for new entrants (Savvion, Lombardi, Metastorm and Ultimus come to mind) to the existing workflow automation market to differentiate themselves from the incumbents. A key aspect of these newcomers was a serious attempt to make the process definition environment more friendly and useful to business process analysts/modellers, for example with simple BPMN flowcharts and built-in simulation.

However, the newcomers could not emphasise this aspect alone, partly because the incumbents already used graphical process definition (albeit, they would argue, a less business friendly version), and partly because their prospective clients were also concerned with other features, such as ease of integration and reporting. So “BPM” became associated not only with built-in business modelling/simulation but also better integration and reporting (think Business Activity Monitoring) – something not contested by workflow automation incumbents, since some already had excellent integration and they could swiftly match any reporting improvements. Very quickly, everyone sold “BPM” products.

And everyone bought them. The tremendous success of BPM technology, particularly in banking/financial services, telcos & the public sector, over the last 12-13 years (since the explosion of new “BPM” products in the late 90s) has had a further, diluting effect on the terminology. BPM projects are now routinely enterprise-scale, and are therefore attracting a spending level significantly higher than most process improvement /modelling initiatives. This in turn means that a much wider constituency of professionals wants to be involved in BPM projects – and often rightly so, given that enterprise roll-outs do require a wider range of skills, particularly in relation to business (process) analysis. Unfortunately some of these folk are taking positions in relation to BPM terminology that owes much more to their history in process improvement than to the technology that created BPM.

Is this just technology bias? Well, consider your favourite BPM project, and imagine the impact if all of the BPM technology was suddenly removed. What new analytical or process improvement method would remain to distinguish the activities of business improvement folk today from those you might have seen 15 years ago? Six Sigma, Lean, more general process improvement techniques are tremendously important – but have they changed so much in recent years that they constitute a new business management methodology called BPM?

So is BPM defined by technology alone? Think again of your favourite BPM project, and this time remove the entire concept of process improvement, Six Sigma and Lean. What are you left with? I suspect something that looks a lot like workflow automation, at least in its primitive form – a process defined and automated … then the project finishes and the process improvement team (suddenly reappearing) pulls out its Visio charts and starts to negotiate future change with the IT department.

If BPM is to have any substantive and paradigm-changing meaning, it must include both technology and process improvement in a way that reflects their roles and illuminates their synergies. A suggestion:
BPM is the superior state of process management attained when business process analysis and improvement activities are supported by technology workbenches that are themselves deeply integrated with the systems in which the processes are to be executed.

This definition addresses the relationship between BPM, process modelling/simulation, workflow and ERP (and other types of ‘Core’ systems). The following statements become true:
• “BPM” products that do not include deeply integrated workbenches for process modelling, simulation and analysis are not BPM – they are workflow. Nothing wrong with that – many, perhaps most, of the world’s “BPM” implementations to date probably fall into this category and they have provided significant return on investment to their customers.
• Where a workflow product does include deeply integrated workbenches for process modelling, simulation and analysis it is indeed BPM or, perhaps better, ‘BPM-enabled workflow automation’.
• ERP (and other) systems that include deeply integrated workbenches for process modelling, simulation and analysis may also be classified as BPM – or perhaps ‘BPM-enabled ERP’.
• Process improvement professionals can state that they are practicing BPM (or process improvement in a BPM environment) if and only if they are using BPM-enabled technology. They might be practicing BPM in relation to processes executed in a workflow automation or an ERP system.

Such a definition would set a standard for all stakeholders and provide a target for both business and vendors to aim at, with a vision of process improvement and execution progressing in harmony that is both radical (in the context of where the “BPM”/workflow journey has actually been over the last 20 years – whilst a number of products would pass the BPM test above, many solutions based on these products remove the levers that would put process improvement professionals in the driving seat) and ‘back to basics’, in that this is very much what the pioneers of workflow automation envisaged in using ‘graphical process definition’ in the early 90s.

It remains a compelling vision, and one that could drive competitive advantage for those that adopt it in the decade to come. The first step is to collectively recognise the vision and the terminology under-pinning it for what they are, and discard all wobbly-jelly BPM definitions along with sub-prime loans and easy credit, as relics of the decade we’ve just left.