Posted by Connie Moore on May 25, 2007
A couple of weeks ago, I attended the Ultimus User Conference in Munich, Germany. The conference was quite refreshing and encouraging from many different perspectives, starting with its unique theme: Empowering People, Driving Process. Why do I say it’s a unique theme? Every single BPM conference I have ever attended over the past 15 years has always zeroed in on one thing — how to use workflow or a BPM suite to automate the predictable and structured part of a business process. In other words, most business process management conferences explore how to drive business processes while ignoring anything about empowering the people who participate in business processes.
What a shift in thinking and maturity this get together demonstrated. Empowering people ran the gamut from the need to integrate collaboration, business intelligence and content into business processes, all the way to addressing user acceptance and people management issues that always surface whenever companies embark on changing or continuously improving their business processes.
Another real eye-opener at this event was the significant number of large, medium and small sized companies throughout western, central and eastern Europe, the Middle East and Africa that are getting tangible and measurable benefits from business process management suites. BPM clearly isn't just a US trend or a large enterprise only trend — it’s clearly gone global and also moved into medium size businesses in a big way.
The conference kicked off with an impressive presentation about the relationship between continuous process improvement and IT governance, which was given by Tariq Elsadik from Alfahim, a large conglomerate headquartered in Abu Dhabi. Mr. Elsadik shared the results of a worldwide CIO survey conducted by Price Waterhouse Coopers in 2005 that clearly demonstrates CIOs' reluctance to move from their comfort zone of managing IT to taking a strong leadership position in running the business. For example, 90% of the 695 CIOs surveyed from around the world said "adequate security and business continuity measures taken" represent good IT governance practices, and 85% believed "setting up the right organizational structures" represented good IT governance. But only 64% thought "informing the CEO of IT risks” was a good IT governance practice, and only 49% thought that having the "IT project portfolio managed by the business" was important.
Oh really? Wow — these survey responses immediately struck me as being completely backwards in terms of priorities. If I were a CIO, my answers for IT governance would have been just the reverse.
If we are truly going to empower people and drive effective business processes that optimize and even transform the business, then good IT governance practices must expand beyond the traditional focus of IT to embrace a true partnership between the business and IT. Mr. Elsadik clearly feels the same way — he asserted that the limited mindset many CIOs have in this survey point to a significant problem for effective IT governance. His closing recommendation? IT must become part of the business.
(This recommendation certainly resonates with Forrester CEO George Colony’s observation that IT can no longer simply be about closing the books at the end of the quarter. (My View: IT To BT). Forrester believes that IT executives and managers must expand their focus to tackle Business Technology — instead of keeping their sights more limited to running the IT organization. Clearly IT and the business must not only get aligned, but get blended into one team or partnership working toward a common business goal.)
Another major theme resounding throughout the conference was that business processes constantly change. I know from my own personal experiences and conversations with many business and IT people that this is true, but the speakers at the conference also expressed it quite succinctly. For example, an IT manager from an engineering company noted that “our processes are moving continuously, so the changes in the processes/rules must be easy.”
Here's another example. When asked how often his company reviews its processes for further improvements, a representative from a bank in Russia said the company conducts regular reviews of its BPM-enabled process every two weeks based on changes in the business, and get updates from sales about new requirements every week. In response, IT can then implement the changes within one day to one week. In this particular company, the responsibility for BPM is centralized within IT, but the spokesperson said the business analysts that report into the IT organization are also closely aligned with the business departments.
I also enjoyed a couple of comments about the importance of BPM from a competitive and customer perspective. One of the presenters cited two mantras that motivated his project team when implementing BPM: “put yourself into the customer’s shoes” and “our competitors are just one click away.”
A couple of other quotes I found memorable include:
“Change management is a key issue when talking about BPM projects.” (IT manager, engineering company)
“BPM is not just a technology, it’s a management approach.” (IT manager, telecommunications company)
One last takeaway for me is that business and IT managers are mightily confused about the relationship of BPM suites to packaged ERP applications, and also the relationship between process modeling — particularly IDS Scheer’s ARIS Solutions product — and BPM suites. I can see why people are confused — it’s a challenging subject because the technologies both compete and complement one another. Here’s what I noticed in many of the discussions and Q&A sessions:
Many of the attendees were trying to choose between a packaged ERP application and a BPM suite. They couldn’t figure out which approach was better for tackling their business processes. In my experience, most companies benefit from a packaged application when the best practices encapsulated in the packaged app closely match the company’s existing business process. In contrast, BPM suites really shine for business processes that can’t be easily codified in a packaged app without significant customization, for business processes that change rapidly and/or for more unique business processes that truly differentiate the company’s business strategy and results. As a result, quite often BPM suites and ERP applications don’t compete head to head because they are tackling different kinds of business processes. Instead, they co-exist — with packaged apps tackling processes that are less-differentiating like human capital management and BPM automating processes like customer service. That being said, packaged application vendors are making strides to add more flexibility to future releases — stay tuned for more on that from my colleagues Sharyn Leaver and Paul Hamerman.
Business process professionals also often confuse IDS Scheer’s ARIS Solutions product with BPM suites, and many of the attendees at this conference were no exception. (The Forrester Wave™: Business Process Modeling Tools, Q3 2006 and IDS Scheer Leads BPM Tool Vendors With An Added Boost From Partners)That’s because ARIS offers many important components of a BPM suite, including modeling, reporting, simulation and optimization — and many BPM vendors, including Ultimus, OEM some of their components from IDS Scheer. But if you want to automate a business process, ARIS alone can’t do it because it lacks a process execution engine. That’s why many of the BPM suite vendors partner with IDS Scheer and don’t really compete against IDS Scheer. The two different types of products have a high level of overlap, but if you want to go beyond modeling and monitoring a business process — in effect, if you want to automate or execute a business process — you also need a BPM process or execution engine. That’s the big difference between process modeling and business process management suites — and that’s why you often find IDS Scheer ARIS installed alongside a BPM suite.
Overall, this event, which was themed “Empowering People, Driving Process” was a smash success and a great learning experience. My final takeaway, which was voiced by an Ultimus manager demonstrating the new Ultimus iBAM product, shows real insight into the world of business process management suites. He said, simply — “We cannot manage what we don’t know.” In my opinion, that’s the real power that comes from empowering people and driving process.
Connie Moore | VP and Research Director