How can your firm deliver great, loyalty-inspiring customer experience – and achieve its efficiency objectives?
Firms that want to boost Return on Equity (ROE) or Return on Capital Employed (ROCE) must improve productivity. And in a very real sense Productivity = value / resources. But too often, the role of IT is to reduce the denominator – resources, and usually leave the numerator – value, to someone else to worry about. So many EA professionals are expected to deliver cost or risk reduction - reducing the resources required for delivery of that value, or the risk associated with that delivery. They usually take an inside-out view with a primary focus on efficiency; and struggle to engage with the value delivery side of the equation.
But if productivity = value / resources, then the challenge is to both reduce resources and deliver enhanced value. The opportunity for Business Architecture and BPM professionals is to connect great customer outcomes and experiences (the value side of the equation) to scalable and efficient back office operations within the organization. That’s “both/and” – not “either/or.”
But how do you do that?
Generally speaking, business people don’t really care too much for efficiency. They come to work for the value they deliver to their customers; not the reductionist philosophy of cutting costs. If you want to engage them on a journey toward performance improvement, leading with the efficiency side of the equation can be a mistake.
Business architecture has become a bit of a watchword for organizations thinking about their future. It’s about all sorts of things – the “what” we do and “why” we do it. It’s about the “who with”, or more importantly “who for.” But it’s also about the “how we do it”, and “how we build engagement” to ensure we “do the right things,” rather than just “doing things right.”
Given that I focus on the methods and techniques that help organizations translate strategy into action (business architecture, process architecture, business engagement, etc.), I want to talk a little about the trends, methods and approaches that we see in the practice of business architecture.
I have to say recent engagements have been a real eye opener … some folks are very advanced in some areas – say capturing strategic intent, but then struggle to translate that into meaningful plans that energize colleagues in the business. Some are talking a good story of target operating models – focused around the experiences they deliver to their customers, but then miss the link to current day project portfolio that’s singularly focused on reducing the employee headcount. And as we saw in our recent BPM Suites Wave, business architecture principles are becoming more important at the process execution layer too.
While you no doubt answered wellness, the reality is that when you look at the typical change programs in a major corporation today, Band-Aids are far more common. But that's hardly surprising given the short-term pressures facing organizations today. Let's reflect on a few examples:
Those in the financial services industry are still struggling to deal with the rash of new regulation post meltdown. Following a spate of high-profile failures, risk management has taken center stage, while in others there is a hurried review of operating procedures in far-flung corners of the corporation.
In virtually all industries, others are trying to respond to hemorrhaging sales statistics. Customers are no longer happy to keep quiet when they get a bad service experience - they tell their friends and followers via Facebook and Twitter. Customer churn is rampant.
Or is it increased competitive pressures? More and more new entrants are turning up to challenge and disrupt the incumbent business models of many established firms. They don't have the baggage of high-cost business models and 12 layers of management.
I think we would all agree that BPM and business architecture set out to overcome the issues associated with silos. And I think we would also agree that the problems associated with silos derive from functional decomposition.
While strategy development usually takes a broad, organizationwide view, so many change programs still cater to the suboptimization perspectives of individual silos. Usually, these individual change programs consist of projects that deal with the latest problem to rise to the top of the political agenda — effectively applying a band-aid to fix a broken customer-facing process or put out a fire associated with some burning platform.
Silo-based thinking is endemic to Western culture — it’s everywhere. This approach to management is very much a command-and-control mentality injected into our culture by folks like Smith, Taylor, Newton, and Descartes. Let’s face it: The world has moved on, and the network is now far more important than the hierarchy.
But guess what technique about 99.9% of us use to fix the problems associated with functional decomposition? You guessed it: yet more functional decomposition. I think Einstein had something to say about using the same techniques and expecting different results. This is a serious groupthink problem!
Nowadays, there are two topics that I’m very passionate about. The first is the fact that spring is finally here and it’s time to dust off my clubs to take in my few first few rounds of golf. The second topic that I’m currently passionate about is the research I’ve been doing around the connection between big data and big process.
While most enterprise architects are familiar with the promise — and, unfortunately, the hype — of big data, very few are familiar with the newer concept of “big process.” Forrester first coined this term back in August of 2011 to describe the shift we see in organizations moving from siloed approaches to BPM and process improvement to more holistic approaches that stitch all the pieces together to drive business transformation.
Our working definition for big process is:
“Methods and techniques that provide a more holistic approach to process improvement and process transformation initiatives.”