Over the last 12 years, I've seen – and helped drive – a lot of change in the BPM market. First, I watched BPM move from a heavy focus on integration to a greater focus on collaboration and social interaction. And then, BPM expanded from highly structured and ‘automate-able’ processes to address unstructured, more dynamic business processes. It is safe to say that over the last decade, demand for BPM was driven by key characteristics of the "Information Age" - a relentless drive towards improving the flow and sharing of information across people and systems.
Now, the most compelling business cases powering fresh demand for BPM focus on characteristics of the new age we are moving into - what Forrester calls the "Age Of The Customer." If you look closely at most of today’s BPM initiatives, they tend to hide behind an imaginary firewall that separates what external customers experience and what internal business operations feel they need to be efficient. In this new age, business leaders are waking up to the realization that they can no longer divorce process improvement from the people and systems that touch customers, partners, and customer-facing employees.
In this modern world - where everything is in the age of the customer, I was looking for advice on which vendor I should engage in my strategic Bathroom Portal Modernization (BPM) program. So, I reached out to my friendly CIO Analyst Consultant, outlining my need for advice and guidance and this is what he came back with.
“Apple do a very attractive and shiny iDoor for showers but it only fits their own bathroom series – looks pretty, sort of works but they’ve only got part of the bathroom modernized. Google produce a huge range of doors designed by rank amateurs. Depending on which training school they went to, you’ll get either the framed, or frameless, shower door. While cheaper than the Apple door, once they’re fitted, they become brittle, require ongoing customization and can fall off without warning.
It’s a tough choice – you could also punt for the Microsoft variant. It doesn't really fit anything and requires upgrading annually at a significant cost. However, there are thousands of MS Doors consultants who will come in and rejig your measurements and overall bathroom design and sell you new mirrors, cupboards and shower mats, which are all color coordinated. Only problem is that each entails separate service agreements and you could end up with water all over the floor.
Watching a recent episode of The Apprentice, I was struck by how completely disorganized they all were. I realized that it didn’t matter who the PM was on the “team”; they all suffered the same problem – there was never enough discussion of goals and objectives, never any discussion of needed responsibilities and the roles that would carry them out, no clarity on ownership of those responsibilities (trust and empowerment). Instead of a consideration of what is needed, there is a rush to action . . . as though just starting will get them to the goal sooner.
As a result, there were always people standing on the sidelines wondering what to do – always people trying to lord it over others, always errors of judgment, missed opportunities, lack of transparency, and a complete failure to meet the goals and objectives (set by Lord Sugar).
Doesn’t that sound familiar?
So many businesses are similarly disorganized. Most organizations struggle to balance a wide range of issues – the differing demands of customers, the need to cut costs, ensure compliance, respond to the actions of competitors, etc. Point is that without an integrating architecture; these conflicting challenges spawn weak execution and organizational thrashing (just like the teams in The Apprentice). The culture in these organizations focuses on appeasing the leaders of the silos, with little thought put into what is needed to achieve the ultimate goals and objectives. And for most commercial businesses it’s the outcomes delivered to customers or external stakeholders that suffer.
Yesterday, Amazon launched an adjunct to its successful Amazon Web Service (AWS) elastic cloud offering. While we don’t normally comment on every product release, this one is significant — primarily because of who is doing it. The Simple Workflow service (SWF) clearly has nothing to do with Adobe’s Flash offering (although techno-nerds may initially think so, given the acronym).
So what was this all about? The business model is certainly interesting: an elastic, configurable workflow capability that’s distributed across any number of access points. Essentially, this will allow an organization to orchestrate processes in the cloud, linking participants up and down the value chain.
“Amazon Simple Workflow Service (Amazon SWF) is a workflow service for building scalable, resilient applications. Whether automating business processes for finance or insurance applications, building sophisticated data analytics applications, or managing cloud infrastructure services, Amazon SWF reliably coordinates all of the processing steps within an application.”
Pricing is initially free and then transitions into a blended, low-cost consumption model, with charges oriented around execution steps, bandwidth usage, how long the task is active, and signals/markers, etc. With usage charges at around $0.0001 per execution step, this gives you an idea of how small the operating overhead might be.
Reading the recent Harvard Business Review article from Tom Davenport et al., it occurred to me that next best offer (NBO) is actually a subset of what my colleague Jim Kobielus calls “next best action” (NBA). And when you couple that predictive thinking with advances in process mining (see Wil van der Aalst’s post and the Process Mining Manifesto), it clearly becomes possible to optimize operations dynamically on the fly. First of all, the organization could mine the existing system (the transaction logs of traditional systems or a newly implemented BPM/CRM system) to identify what happens today. This then enables you to identify the outcomes that are most interesting (or those you want to achieve) and then optimize the NBA accordingly.
We take for granted a process definition where the next action is predetermined by the arc of the process definition. But if we can do NBO in 200 milliseconds, we can also do NBA in a similar time frame. Directed arcs in process models and the business rules that go with them start to become a little redundant. This sort of combination (mining and NBA) enables wide-open goal-oriented optimization for all sorts of processes, not just those related to marketing and cross-sell/upsell ideas.
Over the last few weeks, I have had a variety of conversations with clients that have centered around the scope for the term BPM. I think we all agree that BPM is not purely a technology – but how far does it go.
BPM – The Discipline
Forrester sees BPM as a broad framework of methods, approaches, techniques and technologies that support organizational change, value optimization and ongoing performance improvement. While some see BPM as a narrow technical approach, Forrester regards BPM as including a wide range of improvement methods such as Lean and Six Sigma, along with customer-centric (outside-in) engagement approaches and organizational change management – each one of these levers ties back to a flexible and adaptable enterprise architecture that implements an evolving business strategy. Such an all-encompassing approach can help focus on strategic priorities, as well as opportunities to both differentiate the value proposition, and sharpen the competitive edge.
While some would argue that Lean and Six Sigma are separate – that they are “in the business” – our research data suggests that the most successful BPM initiatives are run by the business, for the business and are of the business (to paraphrase Lincoln). Something like just 20% of BPM process improvement initiatives are run out of IT. Indeed, I would go a little further than that – BPM initiatives run out of IT are just not sustainable in the long term. If you are charged with maintaining a BPM program from within IT (perhaps running a BPM CoE), then one of your primary tasks is to a) identify and b) work with any Lean/Six Sigma programs that are out there.
Firms are often challenged to undertake transformation at a grand scale — to sustain and scale BPM programs across the organization. All firms are at subtly different levels of maturity, with different histories, unique cultures — and while there are many commonalities, every organization needs to approach the BPM and transformation agenda in subtly different ways.
Enterprisewide transformation involves a large number of people doing some pretty special things. The reality is that each organization will need its own subtle blend of skills, methods, techniques and tools. In a sense, the organization needs to weave its own proprietary method framework — to create its own fabric — a unique approach that reflects its special needs, the maturity of the different business units, the history of change, culture, and political challenges.
There will be people inside the organization that need to own that framework and set of methods, monitor its efficacy, and improve it over time. And while external resources can complement those employees, the executives at the helm should understand that they cannot abrogate responsibility for change. Too often, I hear the transformational objective stated and then followed by something like " . . . and we are looking for an outsource provider to do it all for us.” That sort of attitude is likely to end up in a courtroom (as things go sour down the line).
Coming back to the weave — populating that framework is always a challenge (since you only know what you know you know). What methods, techniques, and approaches does your organization need? For the organization to answer those questions effectively, it needs to understand the likely challenges it will encounter and assess the skills and capabilities required to overcome them.
At the upcoming IT Forum in Las Vegas (May 26-28), I will be collaborating with Bill Band on a piece around using the customer experience to drive breakthrough process improvement, and with it, business performance. When you think about it, satisfying the needs of customers is what all business is about (OK you could argue that governmental organizations don’t have customers, they deal with the needs of citizens, but you get my drift).
In the first part of our presentation we will present research to support the view that improving the outcomes delivered to customers adds dollars to the bottom line of the business. Then I will switch to a theme dear to my heart -- that Business Process is at the heart of all significant Customer Experience efforts. And that comes down to:
How We Do What We Do -- Of course, the relationship between the Customer Experience, and how you do things, is pretty clear. I put this in the category of “Doing Things Right” -- i.e., the way in which the processes of the firm work and the employee behaviors.
What We Do -- But in order to deliver compelling customer outcomes, it’s also a question of “Doing The Right Things.” Which is about the business offering -- the services of the organization and the components that make it up. The business capabilities are, of course, a better way of thinking about this rather than the org chart (which is what so many folks seem to do ... decomposition of the org chart as a way of understanding processes).
Why We Do It -- And then it comes back to why we do this, and how it implements organizational strategy and the impact/benefit to the overall brand.