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Posted by Site Administrator on April 21, 2009
by Clay Richardson
According to The Economist, 2009 will be the year of the CFO. After reading Lucy Kellaway’s article in The Economist earlier this year, I can’t seem to shake this image in my head of a maniacal axe-wielding CFO’s lopping off departmental budgets. A la the French Revolution, “off with their heads!” Except with the CFO it’s more like “off with their bloated budgets!” Hmmm, doesn’t seem to have the same ring as the French Revolution mantra.
In the article, Lucy promoted the Chief Financial Officer as "the new king" in corporate America. For CIO’s and line of business managers, this means even greater scrutiny proving the value of new and existing business solutions, coupled with an intense drive to reduce development and IT operating costs.
Fortunately for CIO's with existing BPM initiatives, CFO’s understand the vernacular of "process improvement" and can easily wrap their minds around traditional ROI metrics for BPM – efficiency, productivity, cost control, etc. This means your BPM initiative will probably not get the full axe from the CFO. Instead, a haircut or a little trimming might do.
“Where to cut and where not to cut, that is the question.” Guess my Shakespeare is not what it used to be. At any rate, the key to trimming costs on your BPM initiative is to detect and eliminate – or minimize – common BPM project budget-busters. We’ll be talking about this concept in more detail at our IT Forum in May but, based on recent customer inquiries and interviews, Forrester found that many BPM projects exceeded their budgets due to:
• The blind leading the blind. Mismatched roles are a common and costly budget-buster on BPM projects. Most notable is the role mismatch for business analysts assigned to lead process discovery. As the first phase of a BPM project, process discovery often sets the tone and pace of the entire project. If the wrong person, or personality type, is leading discovery, the impact will be felt across all phases of the project – and most importantly on the project timeline and expense sheet. Eliminate this budget-buster by recruiting and promoting analysts that eat, sleep, and breathe process.
• Consensus log jams. Remember all that “smashing departmental silos”, and “killing the whitespace” rah rah talk that your BPM Suites sales rep was cheerleading about when you plunked down a bunch of cash to buy the tool? Hmm, as it turns out, killing the silos, or zapping the whitespace (or whatever you rep said) is pretty hard stuff. Getting those nutty people in marketing to see eye-to-eye with the bean counting accounts payables team just ain’t that easy; and the time it takes to build process consensus across these disconnected teams is crushing your original project budget. Eliminate this budget buster by embracing “evolutionary requirements” and adopting tools, such as process wikis, to accelerate consensus and buy-in at all levels.
• Waterfall mindset. Recently, a friend that leads government BPM projects commented to me “budgets don’t last forever.” This revelation, made me think “Aha, our government has finally seen the light!” As a former lead on government BPM projects myself, I recall sitting through many requirements sessions waiting for the paint to dry – both literally and figuratively. As a staple on both commercial and government projects, the “Waterfall” methodology emphasizes defining all requirements upfront and locking them in throughout development. This sounds great, until you realize that only 7% of requested requirements are actually used “all the time” after the solution is delivered. So what about the other 92% of requirements, you ask? Oh, well another 13% are “often” used, and another 16% are “sometimes” used (Craig Larman, Agile and Iterative Development: A Manager’s Guide, Addison Wesley Professional). That leaves something like “a lot” % not used at all (you do the math)! If that’s not enough to make you scratch your head, then I recommend you get ready for that axe I mentioned earlier. Eliminate this budget buster by adopting an agile and lean mindset that emphasizes delivering value over delivering “requirements.”
So, although The Economist predicts that 2009 will be the “Year of the CFO”, the next several years will also belong to BPM. Just ask the BPM vendors – they’re all crowing about how well they’re doing in the down economy. Cutting through the continued hype of BPM, pragmatic companies will continue to expand adoption and standardization of BPM usage throughout the enterprise. However, to keep your BPM out of the CFO crosshairs, use 2009 as a year to go lean and prove the value that BPM brings to the company – through good times and through bad times.
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