Community Trip Report Business Process Improvement Gartner Symposium/ITxpo Orlando, Florida 8-13 October 2006 Key Takeways This Trip Report

Transcription

1 Community Trip Report Business Process Improvement Gartner Symposium/ITxpo Orlando, Florida 8-13 October 2006 Key Takeways This Trip Report highlights the major sessions from Symposium/ITxpo for attendees interested in business process improvement. It also encapsulates questions that conference attendees asked and forecasts some emerging issues to prepare for. Business process management (BPM) is a hot topic, yet organizations generally are at the early stages of process maturity. Some are just getting started and are still trying to understand what BPM is all about. These companies see an immediate need to model their processes and are asking about BPM methodologies and tools. Others have been at BPM for some time. They've gotten past the initial stages of modeling their processes, have created competency centers, and are looking forward to how they can use BPM technology to further optimize their processes and create more business value. Not surprisingly, IT organizations are more interested in business process tools, especially business process management suites (BPMSs), while those on the business side tend to be more concerned about the human side of BPM, especially how they can start to implement the cultural changes that are so important in creating a process orientation for their business. According to Vice President Janelle Hill, "People seem to understand BPM a lot better than they did last year, at Symposium/ITxpo They understand that it's not just about technology, it's about better management of enterprisewide processes and about empowering the people (employees and managers) that contribute to successful work outcomes." Key points from the conference: Unlike past infatuation with process management theories, BPM is here to stay, and it will only become more important as time passes because the fundamental business markets have radically changed during the past 10 years. Creating a culture of process orientation can't be accomplished through piecemeal efforts. It requires a fundamental shift in your corporate culture.

2 Technology isn't the whole story it may not even be the most important part of the story. Business process leaders need to pay just as much attention to the human aspects of BPM. Conference Highlights These Symposium sessions were particularly valuable for business process improvement (BPI) leaders. "Championing Business Process Improvement in 2006 and Beyond" Process thinking is not a temporary shift in management approach; it must become ingrained into the corporate culture, said Ms. Hill. BPI leaders must educate executives about what might happen if they don't pursue process management disciplines, then follow up by promoting initiatives that use technology to narrow the gap between business strategy and execution. Activities to create buy-in for process thinking should emphasize education, use case studies, and foster enterprise transformation. BPI leaders must be careful not to present BPM as a one-time project competing with other projects for funding and attention. It must become an ongoing program. Focus on building process awareness by educating senior management and highlighting how process management addresses their strategies and performance goals for the company these are more important than technology. Ask for proof-of-concept funding only after you've built awareness and identified an appropriately scoped initial effort. Initial projects should cross at least three boundaries; a functional boundary, an information boundary and a system boundary. It is usually a subprocess of a broader, enterprisewide core operational process. "BPM Technology Selection: How Solutions Are Evolving" In 2003, Gartner coined the term "BPM pure-play" to describe tools that delivered an application-independent approach to coordinating business processes, said Vice President and Distinguished Analyst Jim Sinur. More recently, the BPMS has evolved to support a more comprehensive approach to process coordination. However, BPMSs are still maturing. Organizations that have already made investments in BPM-enabling technologies must assess their technology strategies to determine what level of BPM they still need. Understanding how BPM products are changing is crucial to making intelligent choices. Understand the trade-offs between expanding BPM technology investments with established vendors vs. new BPMS specialist vendors.

3 Work with BPM vendors to promote a more-integrated solution using existing tools. If BPM problems are still acute, evaluate the potential value of a BPMS. "BPM Best Practices: New Roles and Responsibilities for Continuous Process Improvement" A process-managed organization is more about business transformation than about technology. According to Research Director Michael Melenovsky, organizations that assume technology alone will address the challenge of becoming process-oriented are making a mistake. Much of the success hinges on addressing culture and leadership changes. Without fundamental cultural change, continuous process improvement initiatives will disappear shortly after implementation. Recognize that continuous process management is an organizational change not a solo act. Create an environment in which project work and continuous improvement coexist. "The IT Planning Challenge of Enterprise Platform Migration" Enterprise platform migration is a multidisciplinary task that will require strong leadership. Vice President and Gartner Fellow Andy Kyte and Vice President and Distinguished Analyst Yvonne Genovese explained that the starting point for enterprise platform migration is a clear understanding of the asset base that needs to be migrated. The management challenge is deciding what level of time and effort is justified in pursuing evaluations, and putting an effective program management structure in place to maximize the value from such evaluations. Develop an inventory model of your key business processes, applications, information and existing projects that will need to be considered in the migration process. Identify the life cycles of each asset. Identify where each asset is in its life cycle. Extrapolate the life cycles for the next five years. Share the results across the IT management team. "Crafting a Process-Managed Vision and Execution Plan" Creating a vision and a plan for BPM should not be done casually, said Jim Sinur. Business process leaders must choose the right time, know BPM critical success factors and understand how those factors map against Gartner's BPM

4 maturity model. Because BPM involves a process of maturation, skipping steps can be detrimental to enterprise BPM success. Although a BPM plan will discuss specific initiatives, BPI leaders must present BPM as a management discipline and way of life its vision must transcend any one project. Plan for BPM by knowing what it is, who wants it, why, how badly and what capability you have to apply. Comprehend the spectrum of BPM capabilities, where you are and what will accelerate your pursuit of it. Incorporate the BPM critical success factors in the plan and focus on a few things that will have the biggest reward. What People Asked About Some important questions that business process leaders asked at Symposium include: How do I justify BPM? How do I build the business case and quantify the value? Just like any other business discipline, BPM creates hard savings and soft savings. In creating a business case, most people focus on the hard money savings first. Gartner defines three stages of value: productivity, visibility and innovation. Business process leaders should generally focus on productivity first, which is much easier to quantify. Visibility of processes yields softer results the cause-and-effect relationship between transparent processes and productivity gains is much less clear. Because innovation comes later, after productivity and visibility have been achieved, it's not just hard to quantify it also isn't very useful for creating your initial case. However, down the road, good processes often enable businesses to develop new products or services based on the expertise they have developed. Often, when you say "BPM," people hear "BPR" business process reengineering. When trying to implement BPM, how do you get around this psychological roadblock? People want to avoid repeating the errors of BPR, because business process reengineering was often perceived as "re-engineering me out of a job." This perception caused a lot of resistance. However, most BPM leaders seem to have learned their lesson from the mistakes of BPR. Now, people are more interested in leveraging human capital many organizations are actually taking technology out of processes and putting people back in. A good example of this phenomenon would be call centers. Many businesses are recognizing that

5 having good processes enables them to leverage human capital at high-value touchpoints and use self-service technology for lower value-add touchpoints. What's the difference between traditional workflow and BPM? Aren't BPM vendors just old workflow vendors? People use the term "workflow" to refer to a lot of things. Gartner's definition of workflow is the full coordination of work, whether it's human- or machine-based activity. Some people use workflow to refer to products that put software controls around human-based activities for the purpose of making those acts more visible and more manageable. Some vendors of earlier-generation human workflow tools have grown into BPM providers. Most early workflow products (whether human-workflow-oriented or document-routing-centric) were very proprietary, using proprietary scripting languages, and weren't accessible to people in the organization beyond IT professionals. Modern BPM tools take a more comprehensive approach to workflow, coordinating people, system interactions and information flows. BPM, on the other hand, means getting explicit about processes that is, making process visible in ways that can be understood by anyone in the business. What's a good initial BPM project? A good initial project is one that crosses three types of boundaries: an information boundary, a people boundary and a systems boundary. Order-tocash is a good example. In an order-to-cash process, you have information that comes from the customer: It might come on an order form, or over the Web, or by phone. This information has to move from point of capture to fulfillment and then get invoiced, based on the fulfillment. Depending on available inventory, fulfillment is often different from quantity ordered. So the front end of the process has to match the back end in terms of information flow. The process crosses boundaries in terms of the people involved it goes from customer to a salesperson, perhaps, and then to order fulfillment. It crosses system boundaries because different systems are needed to facilitate that transfer of all the information. And it crosses at least three functional areas; sales, inventory management/warehousing and finance/accounting. A project that crosses the three types of boundaries will highlight the full range of capabilities of a particular tool, will provide excellent training in process management disciplines and will help make a better case for further BPM in an organization. Things to Watch For Some ideas and trends in BPI that will affect your business in the near future include:

6 BPM technology is evolving rapidly, and people are worried about the viability of some vendors. Many BPM vendors are small, and Gartner analysts estimate that no more than 20% will make the transition to BPMS vendors through Business process managers should take care in their vendor selection, focusing on "stalwarts" where they are strong, and leveraging others for other needed functions. Depending on risk tolerance, they may need to stay with power vendors for system-tosystem activities, and consider others for human-to-human functions. When it comes to facilitating BPM, the role of CIOs is changing. In the future they won't just be selecting technology, they will be facilitating processes, doing modeling and sponsoring work sessions. They need to learn to sell ideas to the business, not just tools. It won't be long before the major infrastructure and development tool vendors such as IBM, SAP and Oracle will deliver model-driven development frameworks and challenge other BPMS tool vendors (Microsoft is further behind). Their BPM tools lack some important functions now, but that won't continue to be the case.