Posted by Alexander Peters, Ph.D. on May 9, 2010
As you may know from my previous blog post, on Thursday last week I delivered the Forrester Teleconference titled Increasing the Maturity of Your BPM Center of Excellence. This blog post summarizes the organizational practices discussed during the teleconference for those of you who could not attend:
- Assess the enterprise's BT maturity level. Forrester has developed a business technology (BT) maturity self-assessment approach. I presented an example of how to use it in a recent blog post. Perform the assessment with key business stakeholders first -- the CEO, COO, CFO, BU leaders -- then go for IT. Visualize the existing business-IT alignment gap at your enterprise and develop an improvement plan focusing on organization, enabler processes, and behaviors.
- Develop unified BT demand management function. BPM initiatives emerge when and where business stakeholders need them. The pervasiveness of technology services allows these change agents to roll out process improvements with or without support from the IT department. But you will need a place where everything comes together to ensure that investments are synchronized and beneficial at the enterprise level. This business demand function must establish also the enterprise's governance, monitoring and control framework, and provide strategic directions for BT.
- Approach BT governance from a business perspective. When establishing the governance framework, you will need to provide decision-making clarity with respect to five management areas starting at the top of the enterprise: strategic alignment, value delivery, resource management, performance measurement, and risk management. Business stakeholders, not IT supply functions, must decide: 1) the directions for BT investments; 2) the spending levels and prioritization; 3) how resources are allocated; 4) security and risk levels; and 5) how performance is measured and rewarded.
- Establish transversal COEs. With the governance questions answered, it is time to establish the delivery organization. This may consist of several shared centers of expertise (COEs) for enterprise applications, methodologies, platforms, and tools. The COEs' role is to drive the quality management process and provide operational support for all organizations benefiting from these transversal capabilities. Each COE has people, resources, budgets, and relationships with suppliers and the business stakeholders — with the goal of providing expertise, life-cycle management, and governance for a defined set of transversal capabilities and services.
- Deploy end-to-end enterprise processes. The unified demand function, the governance framework, and the transversal COEs are critical prerequisites for the development of a unified business process architecture and execution plan. The plan should focus on the deployment of cross-functional business processes such as order-to-cash, procurement-to-pay, finance or manufacturing, and differentiate between global processes and the local processes and levels of customization that would be permitted. Similar to the transversal functions, you will need to appoint for each identified business process an owner and BPM team with the goal of providing expertise, life-cycle management, and governance.
- Harmonize the business-IT relationship processes. For many organizations the design of the COE-based structure and governance means radical change. However, the transition to the BPM-driven model should be incremental to avoid undesired disruptions. Traditional IT-business relationship management functions continue to play an essential role during transition. Their purpose is to maintain a mutually beneficial relationship between business units and IT supply through processes such as requirements management, marketing of IT, service-level management, business satisfaction, and operational support.
At the upcoming IT Forum in Lisbon (June 9-11), I will deliver a session designed to guide SAP applications professionals through the process of developing and structuring their SAP governance initiatives using COE best practices. I would be pleased to welcome you in Lisbon. In the meantime, I would very much appreciate your comments on the six practices summarized in this blog.