This document discusses establishing a Business Process Management (BPM) Center of Excellence. It outlines why organizations need to coordinate BPM initiatives across departments to ensure business strategies are executed properly. A BPM Center of Excellence acts as a central hub for all BPM activities, providing methods, standards and linking strategy to execution. The document includes a case study of how Horizon Healthcare Services established a BPM Center of Excellence to help achieve operational excellence goals.
3. Howard Webb
Director of BPM Advisory Services – Prolifics
Over 25 years as a consultant, trainer, facilitator, and
speaker on the topics of Business Process Management
(BPM), data architecture, and project management
Founded the Midwest BPM Users Group
Published articles on BPM and enterprise architecture
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5. Prolifics at a Glance
Who Are We?
A Corporate Group of 1,200 Employees Worldwide specializing in the expert delivery of end-to-end IBM Solutions
Over 30 years in business, Prolifics
is an end-to-end systems integrator
specializing in IBM technologies
New York Orlando
Boston San Francisco
Philadelphia London Application Testing
Washington DC Hamburg Santa Clara, CA USA
Off-Shore Development Center
Hyderabad, India
S t a b i l i t y, L o n g e v i t y & G r o w t h Solution Leadership
$70
Gross Revenue (millions)
SOA solutions and appliances for connectivity
$60 Business Process Management for business optimization
$50 Portal, Collaboration and Content Management
$40 IT Security for Applications and the Enterprise
$30 Monitoring and Managing Applications
$20 Testing, Governance and Methodology
$10 Information Management for Data Cleansing, BI & Dashboards
$0 Technology Migrations to the IBM Software Platform
2004 2005 2006 2007 2008 2009 2010
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6. Prolifics’ Customers
Healthcare
Financial Services Government
Retail & Distribution Utilities
Insurance Education
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8. Business Process Management
Some definitions…
A top-down methodology
A systematic approach for improving a specific
process
A set of software technologies
The same thing as business process reengineering
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9. Business Process Management
“Business Process Management (BPM) is a holistic
management approach that encompasses all aspects of
a business including Strategy, People, Processes and
Technology, in order to delivering value to customers
and other stakeholders.”
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13. Challenges
Limited resources
Competing priorities
Standardization (methods, technologies)
Increasing demands from both the business and customers
Management demand to show ROI
Gain process maturity and foster an environment of continuous
improvement
Struggling with complexity and change
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14. Complexity
“Change is linked to complexity. Complexity increases both
when the rate of change increases and when the amount of
things that are changing around us increase.”
Theodore Modis
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16. The BPM Center of Excellence
A centralized organization focused on the enterprise-wide
coordination of process activities
The Hub for all things BPM
A Steward of methods and standards
A link between strategy and execution
Agent of change
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18. The Need for Coordination
The only way organizations can deliver value to their customers is
via cross-organizational business processes
Business strategy is therefore delivered and executed by means
of business processes
To ensure the business strategy is being delivered as desired,
process initiatives must be coordinated, managed and controlled
Few organizations have a centralized structure dedicated to this
objective
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19. Traditional Management Model Redundant activities/duties
Misaligned incentives/
compensation
Departmental Silo Isolated measurement
Perspective model
Limited reuse
Traditional Multiple breakpoints
Hierarchical
Management
Multiple moments of truth
No cross-organization
Corporate control
Dept A Dept B Etc.
20. Process-Oriented Model Begin and end with the
customer experience in mind
Incentives based on end-to-
Cross-Departmental end process performance
Perspective Fewer handoffs, fewer
breakpoints
Few moments of truth
Process measures providing
visibility
Corporate
Function A Function B Etc.
Process 1
Process 2
Customer Process 3 Customer
21. Poorly Coordinated BPM
Redundant standards
Competing priorities
Program Sub-optimized operations
Inefficient use of technology
Process Silo Perspective More handoffs, more
breakpoints
Multiple moments of truth
Limited or no cross-
organization control
Corporate
Dept A Dept B Etc.
Sub-Process
Sub-Process
Sub-Process
Customer Customer
22. The Customer Experience
Discontinuous thinking leads to disjointed customer
experiences…
How many people or departments did I have to talk to just to get
my issue resolved?
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23. Current Trends
“Broadly speaking, investing in better coordination and management of process work
has been on the rise, while incremental approaches are slowly declining, or at least
being integrated into larger, organization-wide BPM initiatives..”
bpm six sigma Lean six sigma business architecture
*BPTrends, 2012, The State of Business Process Management, Celia Wolf, Paul Harmon : www.bptrends.com
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24. Operating Model
Maturity
Influencing Directing
Leading by example Setting policy
Gaining support Determining what projects to
Small, early successes do
Have a seat at the Strategy
table
Where your COE falls on this spectrum depends largely upon
your environment
How much power and authority the COE is granted
Not likely to start as a Directing model
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25. Structure
BPM COE Management
Process Process
Management Improvement
Strategic organizational perspective Process modeling
Coordination of activities Facilitation
Track and monitor benefits, ROI Coaching
Support the use of tools and Project management
technologies Business analysis
Development of standards, methods Data analyst
and techniques
Integrate with Project Office
Customer surveys
Process maturity assessments
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26. Staffing
BPM COE Management
Office administration
Communications coordination
Process Process
Management Improvement
Business Architect Project manager
Customer segmentation Process modeler
Delivery channels
Revenue streams
Data analyst
Trainer/coach IT analyst
Methodologist Facilitator
Business Rules Specialist Statistician
Some roles can be virtual, tapping expertise as needed.
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27. Funding
BPM COE Management
Centrally Funded
Process Process
Management Improvement
Centrally Funded Project Funded
Without central funding, staff could be „reallocated‟ to
other duties or continually be searching for funding.
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28. Positioning the COE
Location of the BPM Group 2011 Survey results
We do not have a formal BPM Group 36%
Our BPM Group is at the Executive 18%
level
Our BPM Group is at the Divisional or 16%
Departmental level
Our BPM Group is located within IT 15%
Our BPM Group is located within HR 1%
or Training
Our BPM Group is located within 4%
Finance
Our BPM Group is located within 5%
Quality Control
Other 6%
*BPTrends, 2012, The State of Business Process Management, Celia Wolf, Paul Harmon : www.bptrends.com
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34. Who is Horizon Healthcare Services?
Horizon is New Jersey’s oldest and largest health insurer.
Horizon traces its history back to 1932, when Associated Hospitals
of Essex County, Inc. began selling multi-hospital pre-payment
plans for $10 a year covering 21 days of in-patient care.
The company was one of the first health insurance companies in
the nation and also one of the first Blue Cross Plans.
Today, it serves more than 3.6 million members.
In 2010, the company processed more than 57.6 million claims
totaling more than $13 billion for its members.
The company has more than 4,800 employees and is
headquartered in Newark with offices in Harrison, Wall Township,
Mt. Laurel, and West Trenton.
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35. Why Horizon Decided to Get Involved in BPM
Journey to Agility
The Horizon Multi Year Strategy
Competitive Pricing Responsive Agile
Cost Reduction Standardization Event Driven
Horizon defined a comprehensive systems strategy and plan to achieve the following
goals:
Complexity reduction
Sources of truth for core business information
Flexible and agile platforms to respond quickly to change
Business model shift to self-service and the Internet
Catalyst for change
Industry trends requiring faster business response
Shift to the individual consumer
Shifting demographic to technology sophisticated customers
Increasing healthcare costs forcing operational excellence
Increased reliance on business partners
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38. Key Considerations
Executive Sponsorship is Key
Startups take vision and investment
BPM is a big investment … Hardware, Software, People,
Project Costs
It’s a business ... financial benefit to the Organization needs
to be documented
Communication … do it early … do it often
Surprises … Communicating the Reference Architecture to the
Business is important
Your peers don’t know what you have not shared with them …
until you tell them three times
You don’t know what your team has not told you …
Communication will create demand … do you have the
capacity?
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39. Key Considerations
Demand comes quickly … get your capacity ready
Recruit … Recruit … Recruit … get help
You need a diverse set of skills …
Setting up a new business takes a LOT of energy …
Plan for change … and stress
Work to stay aligned to your plan (“Plan your work and work
your plan”)
Work to get others aligned to your plan … communicate
Setting up the Infrastructure and Base Platform installs is a
massive project
• Development, Test, Pre-Production, Production
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40. Good Things Happen Along the Way
BPM & SOA lead to reuse
Reuse sometime pops up unexpectedly … especially when
focused on core processes
Example … Our pilot had to do with managing the process and data
for customers with multiple insurance policies.
Currently using two claim systems but working to converge to a single
one.
We reused knowledge, services, and processes to accelerate and
ensure consistency for the migration.
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41. Horizon BPM Success Stories
BPM & Web 2.0 Mash-Ups = Consolidation
Cycle Time Improvements of 20x 20 Letter Systems to 1
CRM & SOA = First Call Resolution
BPM Automations Integrated Medical Record Management
10% Increase in FPR Timely Resolution of Complex Claims
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43. Summary
Cross-organizational coordination of process initiatives is critical to
success
Implement your Center of Excellence sooner vs. later
Properly staff and fund the Center of Excellence with the
appropriate roles and skills
Don‟t burden individual process improvement teams with defining
standards and methods
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44. Next Steps
BPM Readiness Assessment
Setting Up and Configuring A BPM COE in Your Environment
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45. For more information:
Contact: Howard Webb
Email: hwebb@prolifics.com
Phone: 646.380.2948
And visit these useful links on the Prolifics Web site:
Case Studies: http://www.prolifics.com/case-study-technology.htm
Webcasts: http://www.prolifics.com/webcasts.htm
Podcasts: http://www.prolifics.com/podcasts.htm
Service Brochures: http://www.prolifics.com/service-brochures.htm
Technology Blog: http://expert-tech.blogspot.com
Twitter: http://www.twitter.com/prolifics
Prolifics TV: http://www.youtube.com/prolificstv
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Notas del editor
What it isWhy it is importantHow to structure and staff itCase study
Can’t reach consensus on definition.
The rate of change coupled with number of process initiatives…Demands central coordination and control.
Can’t change processes without impacting people and technology.
How well we execute our business strategy is determined by how well we manage and execute our business processes. Some organizations have other established offices, e.g. Project Office.
Define MOTJan Carlzon’s turnaround of SAS airlines in the mid ‘80s.
Functions might be: Take Order, Fill Order, Deliver to Customer
The larger the organization, the more compounded the problem
A COE can help coordinate and orchestrate your customers experience to ensure a consistent, singular message.Your customer should not feel like a ‘different’ customer when talking to Sales vs. Help Desk.
Think big, start small. Don’t boil the ocean. Early wins will provide traction…more so than standards and methods.
Assessment is critical to ensure consistency of process modeling. Even with standards like BPMN 2.0, modeling is still something of an art.
Responsible, Accountable, Consulted, Informed
Models, Choreography, Activity Monitoring, Business Rules, Data models
Very manual, paper based processes. Only a few people who actually know how things work.Support multiple platforms (website, mobile, etc.)Needed to do things in a methodical way. Prolifics helped them establish a COE.Understanding existing enviornment. COE would be a new structure. How the COE would fit.Role based structure, roadmap, RACI structure for the organization.SLIDE 13: KEY Organization structure, roles, services provided, RACI diagramCreated Roadmap…where we are today and what it should be.Role job description details, toolsets (what tools are needed for the role)MUST BE ROLE BASED to be reusable.Reference architecture: What are the components of a BPM System (components)Created a COE Internet site.SLIDES 32 & 33 Considerations/Communications. Were able to use a pilot and realize reuse. Services, knowledge and capabilities.DEMANDS build quickly
Increased number of claims being processed, first call resolution by presenting background information, etc.