The lynchpin for a successful BPM implementation is continued focus on the business process. Many times this simple, but key point is forgotten and results in companies taking their eye off the ball. In my first blog, I discussed the importance of understanding your current process. The current state is important as you need to know where you are today before you know where you want to go in the future. After identifying your current state you should transition to defining your future state. In this blog, I will discuss the critical aspects associated with defining your optional future state.

To significantly change and improve your company’s operations much emphasis needs to be placed on future state process definition. As future processes and change at most companies is difficult you should leverage a candidate to lead this effort who is well respected internally and someone who has the authority to make change happen. This individual should understand the current state, have strong knowledge of the big picture and future opportunities, plus be able to champion and sell this vision to all organizations involved.

Once you have your leader identified the team should leverage the results from the current state analysis to pinpoint what works well, what doesn’t, and where you want to be in the future. This analysis should allow you to build upon your competitive advantages while improving your weaknesses. In defining your optimal future state its best to utilize JAD type sessions to develop your future state over time. During these sessions you can collaborate with end users, customers, IT, executives, etc. to ensure everyone is on board and has the opportunity to provide input and gain buy-in. Obtaining feedback from all related parties you can ensure you are developing a long term solution that can be executed by the business, supported by IT, appreciated by the customer, and aligned with the higher level executive strategy. It’s also during this stage when processes should be modeled, simulated, and validated to ensure they deliver the expected results.

When defining your future state processes this should be viewed as a journey and not a quick fix. In many cases, to develop a true long term operational roadmap this should be viewed as a 2-3 year plan. This effort should be supported by executives across the enterprise as a long term solution and one that may take several months to see significant results. To help expedite delivery of visible impacts the long term roadmap should be broken down into shorter phases. Breaking down into phase plus leveraging automation technology will help deliver measurable results faster thus generating much needed momentum.

Dare to be different and think outside the box when creating the future operational vision of your company. Don’t be afraid to challenge traditional lines of thinking and the mindset of "its always be done this way". Innovative processes and the creative use of technology can lead to new competitive advantages and increased market share. Leverage new technology such as BPM to automate manual processes, integrate disparate systems, and enhance existing operational visibility and knowledge of your customer base to leapfrog your competition. Defining your processes in advance as part of a long term strategy will allow your company to be much more nimble and have the ability to quick adapt to changing market requirements.

Continued emphasis on the business process will be a tremendous asset as you develop and build your future operational vision. When implementing new ways of executing business in conjunction with new technology such as BPM it’s critical to keep you eye on the ball as the business process is the most critical component.

In my first blog entry on drivers for BPM, I identified drivers around current process understanding, creating new processes, and process activity around mergers and acquisitions. In this blog entry, I will explore process outsourcing, package implementations, and process standardization.

Get Someone Else to Do the Dull Stuff with Business Process Outsourcing

Business process outsourcing (BPO) activities require enterprises to document their current processes, so they can ensure that the BPO provider will handle their processes properly. The process models will also be crucial in identifying opportunities for crafting service-level agreements (SLAs).

The side benefit to the BPO provider will be having a process road map for accurate servicing of the business process. Everybody wins with an accurate process model done at the appropriate level of detail. If the BPO provider identifies an industry best practice, a process model will be a strong way to communicate the effect on constituency relationships.

No enterprise wants to lose clients because of a bad process fit. This way everybody understands the process and/or has an opportunity to question this explicit process and the governing rules.

Another opportunity revolves around how some BPM players leverage explicit processes and rules. Most organizations outsource commodity processes that do not differentiate them. The implications here are that organizations do not want their unique and profit producing processes and rules available for others to copy and/or leverage with competitors of any kind. If the originating organization controls the flows and rules so that they are invisible, even the operation of differentiating processes can be run in an outsource mode. I have seen a few organizations take this next step.

Implement Packages Better

There are many examples of the effects of failing to understand the implied business processes contained in the package and the effects of taking those implied processes directly into an organization without understanding their long-term impact on the organization, the constituencies and the employees.

Although a “force fit” may work, the amount of pain and cost is sometimes so high that it takes years for an organization to regain momentum. Understanding the potential “pain points” and corresponding customization necessary to implement packages is a natural application of process modeling. An increasing number of organizations are attempting this process match activity with great success.

There is emerging availability of vertical and horizontal process templates. Patterns and frameworks are becoming available as package alternatives, and they are best evaluated through BPM (which are quicker, less expensive and more standardized than packages). I have found that larger organizations are attracted to these kinds of process templates and patterns because they have many habits that can be molded into a process that is 70% defined and be quite happy filling in the rest of the details.

Even if the packaged alternative is chosen over the BPM-based templates, process patterns and reusable process frameworks, BPM can help surround the standard package system transactions to allow for the customization and extension of standard package function. This surround strategy will allow for the processes to ideally customize applications around organizations and individuals.

This is a definite “win - win” combination that even the package vendors see as an opportunity. The problem with their offerings is that they are likely to be early versions of BPM; not the new forms of BPM (sometimes called BPM 2.0 or Human Interaction Management - HIM).

Get Control of Proliferating Processes by Consolidating to Core Processes

Enterprises often create separate, but similar, business processes to enter new markets for anticipated revenue lifts. This usually includes copying a process at a point in time and enabling the copied process to evolve into something that has a life of its own. Although this lifts the careers of the revenue gleaners who cloned the process, the total cost of ownership (TCO) tends to eat away at overall profitability. It’s hard to reconcile these processes/system variants without some business process representation to help normalize them back into a core process with local variations for product type or region.

Many organizations are trying to standardize on core processes with variations added for local customization. These unique customizations are easier to manage than multiple copies of the core processes that have to be maintained in a duplicity fashion. This is a much more economical way of dealing with customizations for unique countries, legal frameworks and/or constituents.

Bottom Line:

Good business leaders understand that process disciplines can be applied in many directions. The above money makers also leverage the individuality of processes, organizations and constituents.

Accidents and Traffic Jams have a lot to teach about Capacity Planning for Business Processes!

Whether it is Claims Processing or Home Loans or Help Desks, processes invariably deal with traffic jams.

Usually, there could be long, serene periods, when things are flowing smoothly; no customer is waiting on the phone long enough to be annoyed, and the people providing the service are not overworked and cranky!

Then there are peak periods in a Year when processes see Peak Volume - Day of the week, Month ending, Quarter ending crush or Annual crush (like Tax return time for tax preparers!) when peak volumes of work are seen in short bursts confounding the most diligent of capacity and work force planners!

Traffic Jams have taught traffic planners that when 70% to 80% of the capacity of any road is fully used, any small perturbation will cause massive slowdown for everyone. If an accident happens in one lane, every lane slows down because cars in the lane where the accident happens slow down to merge with the lane to their right or left whichever is available. This makes the entire traffic slow down even if you have five or six lanes each way!

The effect of any perturbation is less and less felt as the capacity utlization at any time is less than 70%. There is enough spare capacity for the other lanes to take up the slack and you may not have a traffic jam that requires everyone to slow and stop.

In a Business Process, capacity planning can always benefit by keeping the overall utilization less than 70% at any time. Novice managers may look at this and say that this is a waste of resources. But compared to the agony and customer dissatisfaction that may be caused by traffic jam equivalents in Business Process, and the consequent delays and waits you may subject customers to, this may be a small price to pay.

One of the things striking about Toyota or even many other Japanese automobile factories is that for the first two years they really do not care about the production throughput that much. They are using that time to fix problems by addressing root causes permanently!

When these factories are in full production, unlike other automakers they may not run their assembly lines in three shifts! Most of these plants do only two shifts and the third shift is used for finishing up planned production for the other two shifts as well as addressing root causes of problems faced in the assembly line as well as preventive maintenance of the facilities.

This ensures that everyday’s production schedule is met, you may have fixed problems before they occur, permanently. Preventive maintanance ensures that machines are inspected, lubricated and ready for the next day!

Business Processes should use the same concept and never plan for using capacity any more than 70%. This way, in the long run they may come out ahead rather than attempt for more utlization than the 70%. You may come out ahead on efficiency, but your effectiveness may have suffered irreparably!

Something to think about!

He who fails to plan, plans to fail - Proverb

BPM stands for Business Process Management so the key focal point for any BPM solution based initiative should always be placed on the process. Unfortunately, this is not always the case as some projects place emphasis elsewhere and essentially take their eye off the ball. As BPM solutions aim to transform the business it’s absolutely necessary that these three fundamental questions be addressed, keenly understood, and continuously communicated to all:

In this first of a three part blog, I will concentrate on addressing current state process analysis.

It’s imperative to have a deep and comprehensive understanding of the current operational processes within your company. This detail lets you know how work is currently executed, what are the problems, and what are the opportunities. From past experience, most companies lack strong understanding in this area. Typically, processes aren’t fully documented if at all and usually understanding of the process resides within only a few individuals.

To be most successful in your BPM implementation, you must clearly define your current state processes and understand present limitations and issues as well as best practices. The best way to do this is to go directly to the end users and observe what they do first hand. Chair sharing with end users provides you the opportunity to see the process, identify how your users interact with the customer, how they interface with technology, etc. As the end users perform the process daily, they are the best resources to learn how the work really gets accomplished.

Once observed, the current process should be formally documented in flow and narrative formats. These documents should then be verified with the end users and management. Also, while documenting, metrics and relevant data should be notated. Information such as current cycle times, average work volumes (daily, weekly, monthly), total headcount, etc. should be captured and included with the formal documentation. This data can later be used as a baseline to track future success following the implementation.

Focusing on your current state processes will set the foundation and understanding for your entire BPM roadmap and related projects. By keeping your eye on the process your BPM solution will have a much higher rate of being successfully implemented and delivering measurable value to your business, your end users, and most importantly your customers.

John T. Wilson is an executive level process improvement leader. He possesses a focused 15 year career delivering BPM and related transformation programs to companies within the Insurance and Financial Services Industry. He teams with business and IT to develop long term operational vision and guides those organizations in implementing the roadmaps to deliver measurable value. Mr. Wilson has expertise or professional certifications in BPM, BPMS, Change Management, and Lean Six Sigma. He is based in Kansas City and can be reached at johntwilson10@yahoo.com.