Money Making Drivers for BPM Part 2

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.