Development leaders! Project leaders and business analysts! Application and solution architects! Want to move forward on your business technology (BT) journey and be viewed by your business stakeholders as a valuable team member? Take a tip from last week's Forums held in Boston. Embrace Business Process Management (BPM) And Customer Experience. Don't ignore them, embrace them. Why? They're essential to helping you achieve your business outcomes.
I know, I know. You read the above and now think "Gee Kyle, what's next? Going to enlighten me on some new BPM or customer experience management technology that's going to transform my very existence, my company's future?"
Nope. Let me explain....
Last week we hosted more than 250 of your application development and delivery and business process peers in Boston and focused on how to succeed in the new world of customer engagement. The most impactful discussions I heard were the side conversations we held with attendees, sometimes occurring over dinner and cocktails. We didn't discuss technology. We discussed the skills your peers were developing in two fundamental areas:
BPM - no, not the technology but the Lean and Six Sigma based methods, techniques, and tools organizations use to focus on business processes and not functions; to strive for continuous improvement; and to focus on customer value.
Customer experience - defined more eloquently by my peer Harley Manning, but I'll summarize as the methods, techniques, and tools used to understand how customers perceive their interactions with your company.
Dan Simpson understands business transformation - and the critical role the customer plays in it. Before joining Trustmark, Dan led the Enterprise Technology Group at Physicians Mutual in Omaha, Neb., where he was the driving force behind the company’s business transformation strategy and the Greenfield program, which implemented new customer-centric business processes, service-oriented architecture (SOA), a new enterprise data warehouse, and several key business applications. For these efforts, Dan was recognized as Technology Chief of the Year in 2010 by the Applied Information Management Institute.
Q: What are the business challenges and issues that typically motivate the need for business and IT transformation?
Dan Simpson: Common challenges facing business today include changes in market conditions, consumer behavior, and the regulatory environment as well as increasing competition and complexity. The inability to adapt to these changes drives the need to put new business process and technology foundations in place.
Q: How have you approached business process redesign?
Dan Simpson: The most effective approach is to focus on business process first before diving into systems. Depending on specific situations, I’ve seen great value in taking an approach where processes redesign starts and ends with the customer. This customer-driven approach helps drive customer-friendly decisions and efficiencies.
Q: What is a customer-driven application, and why is that concept important to transformation outcomes?
At a recent roundtable discussion with Forrester’s leading application development & delivery (ADD) and customer experience analysts, my colleagues and I explored the topic of how application delivery must change to address the age of the customer. Today’s customers have tremendous influence and reach through social media, more options and choices for whom to buy from, and high expectations about how they want to be served. In response to this new reality, we see many businesses making moves to dramatically increase their focus on the customer experience. These shifting priorities bring huge changes to application delivery organizations, as ADD professionals must now embrace the customer-centric skills, culture, and processes essential to success in the age of the customer.
Mike Gualtieri: As application development professionals, we’re often asked by the business to design a very focused app. As such, we’re often not in a position where we can think about that bigger picture. Sometimes, we’re just told that we need to develop an app for this. And that’s our job; that’s what we have to do, and we have to do the best we can. Would you recommend that we try to think bigger and then push back on the business when they ask us to do that?
CSC announced today that it is acquiring AppLabs, a US-based IV&V testing vendor. At first glance, it's a win, maybe a win for both sides. CSC states that one of the reasons that it acquired AppLabs is to augment its horizontal application strategy - due to AppLabs' presence in the US and UK (both vendors have firmly rooted practices in both markets) and to leverage AppLabs' testing strength in both custom and package applications. It's clearly a win for CSC:
This acquisition brings the larger vendor something new - a foot into the ISV market. AppLabs has had a pretty successful track record in testing software products. Historically, CSC's focus has been supporting internal IT for both private and public sectors.
AppLabs is one of the vendors that has been consistently successful in adapting both iterative and Agile practices to its test methodology. This allows it, if it can transfer AppLabs' approach into its current testing practices, to better poise itself to support testing continuous build and integration environments.
If you've been reading the research I've been writing over the past year, you know that I'm a fan of implementing an application life-cycle management strategy that focuses on increasing development flow and supports high-performance teams. You don't need to religiously implement all 22 CMMI processes or deliver dozens of intermediate development artifacts like some leading processes advocate. Rather, there are certain important processes that you should spend your time on. We wrote about change-aware continuous integration and just-in-time demand management in last year's Agile Development Management Tools Forrester Wave™. They are two of my favorite areas of focus, and they are great areas to invest in, but once you have them working well, there are other areas that will require your focus. In my opinion, the next process where you should focus on flow is everything that happens post build and preproduction. Most folks think about this process as release management or configuration management, but I think there's a better term that focuses on how quickly software changes move through both processes. It's called continuous delivery. When you focus on establishing a process of continuous delivery, you'll find that your capacity to release changes will increase, your null release cycle will shrink, and a larger proportion of the productivity gains you've seen from your Agile development efforts will flow through into production.
The statistics that salesforce.com broadcast at Dreamforce last week are impressive: a $2.2 billion annual run rate; 104,000 customers; and 35 billion transactions per quarter (see Benioff's keynote slides here). The conference was attended by 40,000 users, with a further 35,000 joining online. Salesforce.com’s cloud messaging is mature and no longer a focal point. However, what was most interesting from a customer service/CRM standpoint was the focus on the “social customer” and the way that CRM applications need to adapt to accommodate them.
Traditionally, CRM software has been anything but focused on the customer. It has been positioned as software aimed at the business user to increase their productivity and efficiency as they interact with customers, clients, and sales prospects.
Salesforce.com’s new CRM messaging spotlights the customer and the way that customers interact today using the new social channels and loose social processes to research and select products to purchase and get answers to their questions. Customers are also company employees and want to use these channels to collaborate with other employees at work in the same way they use these channels in their personal lives. This means that these social channels and processes need to also extend inside the enterprise. Check out salesforce.com’s interaction map for the social customer:
Better customer experience drives improvement for three types of customer loyalty: willingness to consider another purchase, likelihood to switch business to a competitor, and likelihood to recommend to a friend or colleague. But how does that affect a company’s bottom line? Our models estimate that the revenue impact from a 10 percentage-point improvement in a company’s performance, as measured by Forrester’s Customer Experience Index (CxPi) score, could be in excess of $1 billion.
My colleague at Forrester, Megan Burns, spotlights in her research how companies are using best practices to improve their CxPi score and capture untapped revenue growth opportunities:
Create or enhance voice of the customer programs. Voice of the customer (VoC) programs help companies understand what customers want from their interactions and how customers think that current interactions stack up.
Implement customer-centric design processes. Too often, customer interactions are designed to meet business needs or are based on incorrect assumptions about what customers want. Customer-centric design processes solve that problem by putting well-researched information about customers into the right hands at the right point in the design cycle.
I am both a Murphy AND originally from the Boston area - Ahhhlington to be precise (that's Arlington for you non-native speakers), so I could not resist a reference to The Dropkick Murphys. Never heard of them you say? Boston Red Sox fans recall fondly how in 2007, Jonathan Papelbon danced a jig to "Shipping Up To Boston" when the Red Sox beat the Anaheim Angels to clinch the American League East title. Red Sox fans still treasure the moment, our friends in LA - not so much.
Why should you join us in "Shipping Up To Boston"?
Because we've entered an age where customer experience is king, but our applications are troublesome pawns on the IT chessboard - processes and data trapped in silos that do not fit the "outside-in" perspectives of customer-experience driven change.
Because you're being pressured to keep pace with the business change driven by customer-experience, but you're falling behind a little bit more every day - you can't make any progress on tomorrow because you are consumed by today's issues.