Working in any field over time, it is natural to build up a list of favorite mistakes to avoid. With access to many vendors and users of business performance management (BPM), I've seen what the missteps cost in time, money, project outcome and career impact. Do yourself a favor and take some guidance from other people's visits to the school of hard knocks.
Mistake 1: Believing vendor hype. In any relatively new field of software that is growing and competitive, you'll find plenty of participants stretching the truth to capture market share. It is difficult to separate claims from reality. For example, almost all BPM vendors claim to have a unified solution that provides one version of the truth. Our experience indicates that this is oftentimes not the reality they deliver. Although it's tempting to rely on vendor Web sites, brochures and canned demos, you need to look further. Customized demos, prototypes, detailed reference checking and advice from unbiased industry experts are ways to minimize this risk. You should also be aware that some BPM software buyer's guides are advertiser sponsored listings - they should be used as a starting list of popular vendors, but they may not be much help in separating vendor fact from fiction.
Mistake 2: Trying to custom build too much. An organization with a large IT group may prefer to acquire relatively inexpensive tools and build BPM systems in house. In reality, this approach can be quite expensive when you factor in the man-hours it will take to deliver robust BPM applications from these raw toolsets. In addition, BPM requires very specific domain expertise that you will need to hire if it doesn't already exist within your current staff. A common argument for this approach is that "because we are unique, no packaged application can fully meet our needs." While the fact remains that every organization is unique, the core business processes that BPM seeks to automate are surprisingly similar from company to company. In addition, today's BPM packaged solutions offer fairly robust and deep functionality enabling you to utilize just the features that fit the way you do business. All packages can be customized using built-in tools to define your chart of accounts, organization structure and report formats. However, these packages can't do it all. There are areas, such as operational analytics, that are still a work in progress for many vendors and are better suited to custom solutions. Purchase packaged BPM applications for the core processes of budgeting, consolidation, reporting and dashboards, and use tools selectively to enhance and expand your solution.
Mistake 3: Going it alone. BPM is not like every other IT project. It is a strategic, high-visibility company-wide initiative - and it is essential to get it right for both competitive and compliance reasons. You may say it sounds similar to enterprise resource planning (ERP), but I would emphatically disagree. ERP systems automated an important back-office task, but can you really call them strategic? Also, how many line managers went near the ERP system? BPM includes systems that will ultimately be used directly by every manager throughout the company. In addition, components of BPM systems may cost less than ERP systems, but they are still major investments that should have a seven- to ten-year lifespan. Because you will need to live with your BPM decisions, getting it right is critical. One of the more cost-effective ways to do so is to be guided by someone who has been there before. Bring in an expert to join the team. Expertise in BPM is still a rarity within most Fortune 1000 companies. To find impartial expertise, and experience that goes beyond a single vendor's offerings, you may need to look outside.
Part 2 will help you avoid mistakes relating to how BPM systems leverage your existing data warehouse, who in the organization should be involved in your project and what role IT should play in the overall deployment.
To share your perspectives of mistakes you successfully avoided (or maybe not so successfully), please e-mail me at email@example.com. Sharing your pain can be good therapy.
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