The world of modern professional sports is ruled by data. Everyone from league owners to rabid fans is awash in statistics and metrics detailing the minutiae of team and individual player performance. This is a testament to the passion people feel for their favorite teams - and the staggering amounts of money involved in professional sports. With so much on the line, sports organizations are run according to scientific processes of deep analysis and consequent adjustments to strategy. Teams achieve success through innovative plays, effective execution and flawless repetition of the fundamentals.
In fact, managers of professional sports teams are perfect examples of how visibility into key data and metrics enables the control over processes needed to deliver top performance. Items such as career statistics for players, scouting and injury reports, and historic win/loss ratio data (all drilled down to a granular level) aid long-term planning and team development. Tactical game strategies are adjusted on the fly based on the actual performance of the players in the moment. In other words, sports team managers have both long-term and real-time visibility into the performance metrics that matter and total control to adjust strategies and resources based on that insight.
Business process management (BPM) technologies deliver the same type of detailed visibility and control to business managers and executives charged with driving their organizations to the top of the field. Just as fundamentals and set plays are the cornerstones of sports, process is the core of business execution. It provides the building blocks for all business activity, it is pervasive throughout the organization and the level of efficiency with which it is conducted often determines a companys level of competitive advantage in the market. BPM echoes the delicate balance of science and art found on the playing field; it is both a business methodology and a group of supporting technologies. It acts as the glue that ties together and optimizes existing attempts at employee collaboration, workflow and integration. It drives efforts in quality improvement, cost reductions, efficiencies and bottom-line revenue growth.
BPM enables business teams to better execute their existing processes; but more importantly, it delivers the ability to improve processes by highlighting deficiencies in the status quo and defining the path to process innovation. The process innovation enabled by BPM is badly needed in a world of constantly increasing competitive pressures, shortened deadlines, limited resources and heightened expectations. Todays business imperatives are to streamline operations, reduce costs, improve quality and increase revenue. Process innovation delivers on all these counts - and according to research from Aberdeen Group, more than 50 percent of companies surveyed were expected to turn to BPM in 2007 to get the process right at the line-of-business level without having to throw out their expensive enterprise resource planning (ERP) or custom back-end applications investments.1
This trend toward BPM is due in large part to the fact that it is a proven approach. According to Gartner, Inc., organizations deploying BPM initiatives have seen more than 90 percent success rates on those projects.2 This is a truly impressive number which clearly identified an improvement in competitive advantage. These numbers support the notion voiced by adherents that BPM is of greater value to a company than higher-profile technologies such as customer relationship management (CRM), ERP and supply chain management (SCM).
The single greatest benefit of BPM is the ability to design, manage and optimize critical business processes. But as with most business methodologies and technologies, BPMs value lies in direct proportion to the number of employees that utilize it. For this reason, the technical architecture and usability of a BPM solution is paramount. All employees across the organization must be enabled to be part of process innovation to achieve corporate goals. Sports team managers know that the equipment they provide to their athletes must be highly functional.
10-pound baseball bat could theoretically put a lot of juice behind the ball, but in reality, it would be too cumbersome to use effectively. The analogy here is that to be truly useful, a BPM solution must be easy to use. This means 100 percent Web-based software, intuitive and flexible user interfaces, multiple adoption alternatives and the like are strict requirements. It must be comprehensive in the aspects of process and collaboration that it addresses (including appropriate knowledge management, analytics, reporting and integration functionality). Business analysts must be able to make significant changes without involving IT. And the system must be natively designed to reduce (or eliminate) deployment and integration headaches. There is no one-size-fits-all scenario for managing business processes, and BPM solutions must be predicated on the flexibility and simplicity needed to allow organizations to function the way they want to behave.
Simply automating processes is not the answer because anything short of a holistic view of business processes that takes into account both the automated and human elements involved will fall short of the mark. Pure automation BPM - the type available as a mere bolt-on to infrastructure platforms - has a certain value, but it is not enough to achieve the kinds of transformative value were talking about. Regardless of how effectively a process is executed in terms of speed and repeatability, its business value is marginal if the human decisions embedded in that process are faulty. To return to the sports analogy, the most cunning playbook will not win games if the athletes involved make poor decisions when running the plays. Worse yet is if team management does not know what those decisions are and how and why they lead to failure. And just like a sports team, business groups are most effective when they work collaboratively. Innovative BPM enables broad and deep collaboration in both the development and runtime environments through portals, attached discussion threads, document management capabilities and configurable task views for teams and individuals.
When that mind-set is applied in concert with a flexible and comprehensive BPM suite, the result is a tremendously powerful ability to adapt processes on the fly. By connecting people to people, applications to applications and people to applications, BPM makes organizations more agile so employees are better equipped to respond to change. Lets say an organization has created a business rule stating unfinished tasks should receive escalated priority after 24 hours. By looking at performance metrics in real time, a manager or process designer may see that the average task time is actually in the eight-hour range. A BPM solution should include the ability to self-optimize the process, automatically resetting the threshold at 12 hours. This self-optimization means that workflows, exceptions, escalations and work assignments are adjusted based on actual process and worker conditions.
Employing all of these BPM principles can have a dramatic effect. For example, a financial services company can innovate all processes within a loan origination system through automation, increasing its visibility and control over the approval process. Increased efficiencies come not only through the automation aspect, but also through the ability of personnel to track applications through the entire process and take actions if needed to ensure finalization by a set deadline. This means the best possible service for customers. Retail-oriented companies can gain critical insight into the product pricing process, drilling down into pricing components and historical trends. They can automate the reconciliation of product shipments against supplier contracts, including subsidy agreement invoices received from manufacturers. They can also create a secure environment to share information outside the four walls on a need-to-know basis. Outsourced professional services firms of all stripes - who increasingly deliver their services via on-demand, Web-based models - can increase efficiency and control over processes in support of implementation and service delivery for clients. By streamlining system-to-system integration, back-end workflows and human-centric processes on a global basis, these firms can see benefits like greatly increased control of permissions, leading to greater data protection and regulatory compliance assurance. Specifically regarding compliance, utilizing BPM to increase global visibility into financial auditing processes makes it easier to monitor and sustain compliance, while also reducing current and ongoing compliance costs.
With all of this said, how does an organization get started down the road of implementing comprehensive BPM, innovating its processes and reaping the benefits? As with most beneficial changes in behavior and technology, small steps will lead to giant leaps. Start at a reasonable level by selecting a manageable project and grow the effort based on success. Limit the initial customizations and the complexity level. Find the right mix of team members to maximize relevant business knowledge while still maintaining development agility. In this way, early projects can act as best practices templates for later and larger implementations.
Keeping things relatively simple for the first process is actually the fastest way to achieve your ultimate goal of complete end-to-end processes management. The characteristics of an initial BPM project should include areas of medium-to-high business value combined with low process complexity. Good starting points are typically human-intensive, long-running tasks with many manual handoffs. For example, loan approval steps, new product development and compliance processes are often good candidates for your first BPM process. To maximize return, choose processes or business areas that have high visibility within the organization - customer-facing and/or sales-related processes are best.
Even though you start small, keep a larger vision in mind from the get-go. Consider how discrete pilot projects will fit into a larger framework. Make sure that early design and architecture decisions are scalable and robust, because the fact is that large gains are realized through cross-departmental and corporate-wide process improvement. Taking this approach will quickly prove the incremental value of BPM, which in turn will lead to the creation of BPM champions within the organization who are eager to see larger-scale, truly transformative solutions.
Business managers today are often not armed with the same visibility and control sports managers use to gain competitive advantage. Vital decisions about corporate objectives and how to reach them are made - and then executives sit back and wait to see if things work out as planned. BPM changes the game for business performance through process innovation, creating a process-managed enterprise that is able to respond to changing market, customer and regulatory demands faster than its competitors. In business, just as in sports, speed, agility and teamwork are what counts.
- Perry Donham. Aligning IT to Business Processes: How BPM is complementing ERP and Custom Applications. Aberdeen Group, May 2007.
- Janelle B. Hill, Mark Raskino and Michael James Melenovsky. Predictions 2007: Internal Skills Are Inadequate for BPM Maturity, Gartner, Inc., November 2006.
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