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BPM: Prospering in a Lean Economy
- 2. BPM: Prospering in a Lean Economy Kiran Garimella Vice President, BPM Solutions Software AG
- 5. Business Manages Process, but IT Delivers Functions © Copyright 2009 Software AG BPM: Prospering in a Lean Economy (Asia, 2009) | Page Find Buyer Sell Product Ship Order Get Paid Buy Resources Make Product BUSINESS ERP CRM ECM Oracle Financials HR IT Suppliers Systems “ Operational Black Box” THE BPM GAP
- 6. Buzzwords that mean absolutely nothing to business people: © Copyright 2009 Software AG BPM: Prospering in a Lean Economy (Asia, 2009) | Page WSDL SOA OWL BAM BI CAF Portals ESB BPMN BPEL JSR-168 XPDL AJAX WYMIWYR CMS EAI Web 2.0 Out-of-the-box functionality BPEL Cloud Computing Legacy Modernization Web Services Complex Event Processing ICE PLM PPM SAAS Agile Development
- 7. Words and phrases that have real meaning to business people: © Copyright 2009 Software AG BPM: Prospering in a Lean Economy (Asia, 2009) | Page Process Cycle Time Throughput Yield Bottlenecks Wait-times Defects per million opportunities Latency Process Variance Inventory Turns SLA Violations False Demand Triggers Return Rate Percentage Rework Cost of Poor Quality Unnecessary Motion Excess Processing Time to Completion Economic Value Add Transportation Waste Process Variance Process Capability Process Capacity Excess Transactions Root Cause Voice of the Customer Run Chart Critical-to-Quality Reduction of Waste Overall Equipment Effectiveness Key Performance Indicators Baseline Conditions
- 8. … and get everyone speaking: © Copyright 2009 Software AG BPM: Prospering in a Lean Economy (Asia, 2009) | Page
- 11. The Business Case for BPM
- 12. Many Forces of Change © Copyright 2009 Software AG BPM: Prospering in a Lean Economy (Asia, 2009) | Page Globalization Mergers & Acquisitions Technology Innovations Compliance & Regulation Mass Customization Process Methodologies New Technologies Legacy Utility Generational Change New Solutions Forces requiring businesses to improve performance. RECESSION !
- 13. Now, Process is an IT priority as well as a business priority. © Copyright 2009 Software AG BPM: Prospering in a Lean Economy (Asia, 2009) | Page 9 of the Top 10 IT Management Priorities are addressed by BPM.
- 14. Top Priorities in 2009 © Copyright 2009 Software AG BPM: Prospering in a Lean Economy (Asia, 2009) | Page *CIO Insight Survey, 2009 Business / IT Alignment Improving Business Processes Better Customer Service Cutting costs Improved IT Planning Reducing ROI Costs Creating / Improving Strategic Apps Improving IT ROI Spending Standardizing/Consolidating Architecture Improving Project Management Improving Information Quality Improving ROI of IT Creating Infrastructure for Growth Growth from New Business New Business Strategies Product & Service Innovation New technologies Improving Development Capabilities Productivity Compliance Competitive Differentiation with IT
- 16. What moves the business levers? © Copyright 2009 Software AG BPM: Prospering in a Lean Economy (Asia, 2009) | Page Business Performance Management Activities Poor leverage ---> The problems of the modern enterprise: functional silos, point solutions – slow, ineffective, inefficient
- 17. BPM is an effective transfer function © Copyright 2009 Software AG BPM: Prospering in a Lean Economy (Asia, 2009) | Page Business Performance Management Activities “ Give me a long enough lever, and I’ll move the earth.” - Archimedes
- 18. Yes, but … © Copyright 2009 Software AG BPM: Prospering in a Lean Economy (Asia, 2009) | Page Actually, Archimedes was wrong! Why? This takes too long… … to make a difference! can you do it in time?
- 23. The Process Architecture © Copyright 2009 Software AG BPM: Prospering in a Lean Economy (Asia, 2009) | Page Process Methodology Process Framework Process Lifecycle
- 37. BPM Resources © Copyright 2009 Software AG BPM: Prospering in a Lean Economy (Asia, 2009) | Page
- 38. Take that Next Step, NOW! Ok, what’s your next step? For further information please contact us at: Level 11, 201 Miller Street North Sydney, NSW 2060 (P) 02 9463 6400 (F) 02 9955 1171 (E) www.softwareag.com/au
Notas del editor
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- Presentation Title Date Author Well, firstly…just because this is what a business does and is comprised of, doesn’t mean the business does it well, with the right focus or with the right consistency Most businesses are run functionally…….the best businesses aren’t Some business do….have a good methdology for managing the top part of this diag. But even they often have issues with the way that IT contributes…..IT delviers pacakged apps that support business functions. BPM Gap….Operational Black Box………this is what we’re going to look into. But before we do The other reason that this is critical now is that whilst the business may be embracing process-centric thinking, there are serious issues in the ability of the IT infrastructure to support this…..and it’s not that IT is doing anything wrong, it’s just a function of how they have been organized to do their job in the past and the tools and goals that have been set. IT is treated as an external supplier in most businesses….. Business is starting to embrace the fact that managing the business = managing processes. Companies that see themselves as a value chain and manage by process are winning (GE, Virgin, Motorola, etc.) – their employees look at their role not. Managing the ‘white space’ between functional units is one thing, but one if the issues here is that it is the white space between the business functions and IT as a function that is not being addressed. But, IT is lagging It’s not that IT is not doing it’s job, it just doesn’t have all the tools or the ability to align with business objectives Bruce will talk about this a little later on. It’s more than just bridging CPI and BPM, it’s about bridging the business and their management practises and IT and their skills. Move straight to the CIO slide…..
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- Presentation Title Date Author OK, so why are these pains being felt now? What’s changing?...Net net, something has to change (look at the corporate pitch) CHRONIC PAIN – live with it ….the way things are…..until a shock happens or until a breakthrough comes along to take away the pain….both of these are happening now Mention BPR – Michael Hammer That real, transformational change can be achieved only by tackling business and IT issues hand in hand, through a partnership involving both business and IT decision makers unbalanced IT equation is bringing IT and the business closer together - only way they can solve the issue of requirements fit and control is closer, iterative collaboration business-level understanding of CPI as a management practise (Executive thinking is shifting towards addressing these needs as a fundamental characteristic of the organization rather than through iterative ad hoc reactionary market responses Fortunately, taking a more cohesive, holistic approach to BPM is becoming much easier, thanks to the way the supporting technology has evolved. Where, once, organisations had to grapple with the difference between Enterprise Application Integration (EAI), middleware, process modeling and supplier enablement, and how all of these confusing technologies fit together, complete BPM ‘suites’ now exist, enabling rapid deployment. The technologies to break-apart your infrastructure and efficiently and intellignetly recombine it on the fly are real: And of course the motivation is greater than ever: Competition Specialization has kicked-in in a huge way. Mass customization. Margins are waifer thin and businesses can set-up to attack the long tail. As business moves into the process excellence as a differentiator rather than the features or capabilities of products themselves Quality of service Viral marketing’s flip side is viral review – one failed process and one lost customer in the web era can have an exponential effect. Compliance! Also, we have learnt lessons. Most ‘traditional BPM’ projects failed. Partly because they treated them as just that – IT projects with a finite cycle.
- Presentation Title Date Author Think Process; Be Process Not good enough just modeling processes….you have to live and breathe it throughout the org. That involves ensuring that people do not deviate back to normal behaviors.Set in place the cross-functional organization with the roles and staffing to drive and sustain you’re a process orientation. Process teams, with process owners should plan together, meet regularly and work collaboratively. Be certain that the main stakeholder is directly involved. Get Smart! BPM is a new discipline and the skills can be hard to come by. But the people around you have most of what you need. They may not have the job titles, but they’ll have the right understanding of your business, the people, the processes and the right raw skills to be successful. Train them! And, appeal to service providers for help, especially in the short term as you gear up – the value is there. And, believe it or not, you’re not going to learn quite everything from a Dummies book! Get out and see what people are doing. Attend a conference or seminar, visit websites, read blogs. Seek out companies that have done this before. And don’t just look for technology references; make sure they have tackled the business issues and created real business value. Adopt an Executive Because BPM naturally aligns to strategic business initiatives, find the senior most individuals whose responsibility it is to solve the big problems and enlist them as sponsors, advocates and evangelists. Get them excited and educated about what BPM can do for them. Show them a demonstration of what’s possible, and they’ll jump on board. Great Expectations BPM programs involve many stakeholders, and each will naturally form their own perspectives and definitions of success. Be clear about the value proposition of your programs and projects. Repeat them often, and deliver on them directly, avoiding “expectation creep.” Pick a Methodology Do you already have a process improvement program like Lean or Six Sigma in your company? If so, these are an effective foundation for BPM. If not, pick something. Select a process improvement and management methodology that’s right for you, and set this in place as a cornerstone of your process architecture. The Right Technology Do your homework and choose the technology that best fills the needs and requirements of your BPM technology architecture. In a growing market segment like BPM, the technology varies considerably from vendor to vendor. After finding a technology set that fits your architecture, be sure to run it through its paces – ask for custom demonstrations and make the vendor show you what it can do Hear the Voice of the Customer Don’t get bogged down in the details and forget that the point of BPM is to create customer value. Use BPM to see your business the way your customers do. Your customers don’t care how things get done, they only care that they experience exceptional service, they receive what they ordered, at the best price, and when they wanted it. Remember that everything you’re doing should ultimately create more value for your customers. Pick a Project So many processes, so little time! How do you choose? Select the project that provides the greatest return to your business and can be completed in three months or less. And remember, you don’t have to improve entire processes all at once. Measure First Don’t start designing new processes until you understand what’s happening with your current ones. You wouldn’t let a doctor administer treatment without a thorough diagnosis. So don’t start implementing process change until you have diagnosed their current state. Using BAM, establish the baseline metrics. Only then are you operating from a position of knowledge.. Plan to change BPM is a change system. It’s designed to help you identify where change is needed and for you to make changes quickly and get to the next level of operational performance. With such a powerful toolset, you need to surround BPM with support for change. Manage change, implement policies for making changes, articulate change approvals, recognize change events, measure change, reward change…. Plan to change.
- Presentation Title Date Author Ready, Fire, Aim BPM technology will tempt you with its promises of visibility, productivity and fast results. You might be seduced into plowing ahead without methodology, architecture, and process. This is a short-cut to failure. Take the time to get the business, process, and management dimensions of BPM in place before you attack the technology. You’ll get better results sooner, and sustain the momentum. Thinking in Stovepipes Process-centric thinking is different. Cross-functional solutions are different. You need to be thinking end-to-end; about how a value-chain comes together; how your role, performance, and productivity creates value within the greater process. Getting everyone to think this way is difficult. It takes time and persistence. Warning If you put a process-centric model in place, but leave the incentives and controls in the hands of functional owners, your initiative will wander off course. Processes should be owned by process owners. The RIF program If you make BPM a veiled headcount reduction initiative, you will guarantee failure. People make processes work, and if you use a process initiative to justify a Reduction-In-Force (RIF) initiative, the program will die. BPM is for helping people work more effective and generate more value. If they re-engineer a process to work themselves out of a job, retrain and relocate them – and with great fanfare. Tactical Training Don’t just train an implementation team on how to do a one-time solution. Seek out training and professional development that will “teach you to fish.” Be sure to learn how to facilitate continuous and sustaining change. Be sure to include senior executives, IT staff, and users. False Empowerment BPM empowers process owners and participants to implement change. Be sure you support them with the policies, authority, rewards & recognition, compensation, and other means of facilitation. In particular, BPM empowers business users in ways that require the IT systems to share responsibility. Don’t overlook the need to make this happen. Ignoring the End Users Don’t over-fund infrastructure at the expense of the process participants – the end-users. Treat the user like a customer; make them more productive and the technology more invisible, so their day-to-day tasks can continually add more value. Forgetting to Celebrate Rolling out something in three months that used to take two years is worth celebrating. Achieving a lofty business goal for productivity or customer satisfaction is worth celebrating. BPM projects may be shorter and the improvements more incremental, but you must measure and celebrate the successes. Hard-Wiring the Framework BPM is to help you create adaptive processes. But you have to design for flexibility. It’s easy to just hard-wire today’s answer, at the expense of building in the flexibility to ensure it can change to be effective in tomorrow’s world. Driving Miss Data BPM provides the visibility and measures for fact-based decision-making. If you don’t let the data drive decisions, and if you fall back and let gut feel, intuition and tradition drive your decisions, you will be squandering your investment and your opportunities. Automate This! The old Chinese proverb says, “Man who shoots self in foot should not buy automatic weapon.” If a process is broken then automating it will only generate errors faster. Because BPM enables an unprecedented level of automation in actions, activities, and decisions, this doesn’t mean you just start automating things. BPM provides you the methods and tools to analyze and improve processes, and then automate them when they’re performing.
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