Business of BPM

Next St. Louis User Group meeting

Thanks to Howard Webb (formerly with BPMG) who lives in St. Louis.  While I have been busy with a client, he has stepped up to drive the BPM User Group.  The next meeting is September 14th at St. Louis University.   

If you missed our last meeting at A.G. Edwards, we had two excellent presentations from Rich Phillips, COO of Maritz Travel and Jeanette Lynch, Business Process Management Lead at A.G. Edwards.

Location
The meeting will be in Room 253 a & d of the Busch Student Center.  This is right on the corner of Grand and Laclede.  Visitor parking is available in the parking garage on Laclede (there is a charge for parking, so plan accordingly).

Meeting
The meeting is shaping up to be another enjoyable and informative event with speakers from Lombardi and BP3.  One of the topics of interest brought up from our last meeting was metrics.  So, that will be our focus in September.

As usual we will begin at 7:30am and adjourn at approximately 9:00am.  There will be some time before and after to allow for networking and catching up with colleagues.

If you are interested in attending this event, please RSVP to me via email at [email protected] by September 7th if possible.  Lombardi is providing the refreshments and we would like to have a close count by then.  Please send any questions to may have to the same address.

Agenda

Lean Six Sigma and BPM: The Power of Two
Speaker: Lance Gibb, President & CEO of BP3

Lean Six Sigma Master Black Belt. www.bp-3.com

Lean Six Sigma (LSS) and Business Process Management (BPM) have much to contribute to each other. While Business Process Management and Lean Six Sigma can run successfully as parallel initiatives, companies that successfully connect these two initiatives will realize a competitive advantage. Lance is going to share real world examples of how Lean Six Sigma and Business Process Management can provide organizations with real value in the area of process metrics to better manage and optimize their business processes.

Common pitfalls in integrating Lean Six Sigma and BPM initiatives
How to leverage existing Lean Six Sigma practices and assets in BPM initiatives
How companies that are doing BPM can get started with Lean Six Sigma
How Lean Six Sigma practitioners can get BPM projects started on the right foot.

Business Process Management in Action
Speaker: Brandon Baxter, Senior System Engineer of Lombardi Software

Lombardi is a recognized leader by both Gartner Group and Forrester in the area of Business Process Management.

Brandon is going to follow up with a live demo of a customer implementation were you can see the capabilities of what BPM offers in action with a focus on the metrics of the process as well as the metrics around the people working with the process. You will learn how in using a Business Process Management (BPM) suite you can not only get control of your business processes but also get the visibility into your business process so as to make better business decisions and to be able to more quickly react to business events. Through the demo you will see:

How you can Define a business process
Measure how the business process is performing
Analysis how the business process is performing
Improve the business process
Control the business process

Management Frameworks

I have used this site a few times to look up concepts.  It is called Value Based Management.  It is a data dump of lots of theories.  One theory that I have been particularly interested in lately is called Blue Ocean Strategy.  I have not read all the press on it, but as one friend explained it to me, it is about collaborating with your clients to expand your market.  Rather than go out into new markets seeking new clients (which is the Red or Bloody Ocean), you focus on developing new growth through your client base.  This website above explains it a little different, but you can always go to the official website or read the book to get all the details.

Here is one of their tools called the Four Actions Framework:
To break the trade-off between differentiation and low cost and to create a new value curve, there are four key questions to challenge an industry's strategic logic and business model:              

• Which of the factors that the industry takes for granted should be eliminated?
• Which factors should be reduced well below the industry's standard?
• Which factors  should be raised well above the industry's standard?
• Which factors should be created that the industry has never offered?

USAir Process Failure

Sometimes it is hard to find an example of a broken process, but fortunately, USAir made it very easy for me.  Yesterday, I get an e-mail from them informing them that I had lost my 50,000+ miles due to inactivity.  Certainly, it is hard to fly USAir direct to many of the cities I fly out of St. Louis, but I would have used the miles for something (if I knew I was going to lose them). 

Usually, I use them to visit my wife's grandparents in Philly.  Since her grandmother was recently put in hospice care, I imagined we would be using them soon.  I could argue quite strongly about whether they should be able to simply take miles that I have earned, but I won't go down that path.

Where I see the failure is in their communication to me.  I am sure I got some message about the change in program status from 36 months of inactivity to 18 months of inactivity.  It was probably buried in some other communication (or maybe I never got it).  But, they clearly could have informed me 3 months before the miles expired or 30 days before the miles expired.  Now, they simply get to hold my feet to the fire and force me to pay money for my miles, fly them to get the miles, or get one of their credit cards.

So, what can I do?  I don't know.  Maybe, I can get the Cranky Flier blog or some other advocates to bang on USAir?  Maybe, their SVP of customer service (Anthony Mule) will respond to my nice e-mail about helping me?  I simply asked them to extend this 30 days so I could use the tickets (likely for a funeral).  Maybe, I need to try someone else like their VP of Marketing (Travis Christ) or another executive?  I tried the call center which was nice enough, but (supposedly) not empowered to override this. 

Anyways, just an example of a big company failing to care about their customers and ignoring common sense to proactively inform them when it benefits them.

Upcoming Webinar

Although I get a ton of e-mails on BPM webinars, this one caught my eye.  It talks about process optimization which I think is key.  Too many companies are willing to implement a current practice even without re-evaluating it.

Process optimization and process improvement initiatives are becoming integral components of BPM best practices. With this in mind, we would like to invite you to Wednesday's Webinar, titled "Aligning Process Improvement Initiatives with BPM." This Webinar will discuss approaches to BPM and the discipline of process optimization, as well as:

    * Real world techniques for process improvement
    * Advanced software solutions for process optimization
    * The impact on the future of BPM
    * How Lean Six Sigma is used in conjunction with BPM

Featured speakers are Jim Sinur, Chief Strategy Officer of Global 360 and Craig Edmonds, IT Manager of Symetra. Join them this Wednesday to learn effective techniques for process optimization.

To Learn More: http://www.ebizq.net/to/EBWGlobal3600801
   To Register: http://www.ebizq.net/webinars/8268.html?uid=0x1d9e5

Forrester: IT Strategy Maps

It isn't often that I read a great piece of research, but I was recently reading a piece from Forrester from 2005 called IT Strategy Maps: A Tool For Strategic Alignment.  It does a great job of talking about the Balanced Scorecard and its application within IT.

It also uses what they call a Strategy Map which is built off the Balanced Scorecard layout using four perspectives:

• Financial
• Customer
• Learning and Growth
• Internal Business Processes

As I have talked about many times, this business process quadrant is key for BPM.  Understanding this.  Knowing the metrics.  Understanding how it drives strategy.  With that information, BPM can be strategically positioned.

Optimists??

I was a little surprised.  I put a pessimistic view out there thinking I might get a few of the vendors and some others I know that read the blog to comment.  Obviously, there is a lot going on in the BPM world.  Just look at Gartner's next conference or any of the PR coming out of the companies. 

It is a challenge to get this integrated with all the other efforts and prioritized, but the information is out there.  Ideas?  Comments?

I often go to BPM Enterprise's news feed to see the latest articles and PR...(here).

BPM: State of the Industry

BPM (as a technology) continues to move along, but after my time in CRM years ago, I see several parallels. 

1. It has had significant year-over-year growth but is still small dollars in a relative technology pool.
2. Big companies that are innovators have embraced it.
3. Small teams have embraced it.
4. Mainstream executives aren't yet talking about it.
5. No one is betting the business on it yet.  (As I told someone the other day, if the PE firm that bought Chrysler announced they were rebuilding Chrysler around a BPM approach and using a BPM technology platform then the market would change.)
6. The value propositions although clear aren't packaged up enough.
7. Methodology is still lagging.

Will it disappear?  No.  Did CRM?  Look at Siebel.  Look at how 1:1 marketing has evolved.  Look at the impact on database marketing.

I simply think BPM is at the chasm (i.e., Crossing the Chasm by Geoffrey Moore).  As with anything new, you get huge lift from a small group of people willing to innovate.  Then, the hard work begins.  But, I believe BPM will change the way people think about process mapping.  It will change how people approach process integration projects.  It will get people thinking about automated process innovation and problem identification.  All great things.

We will see how things evolve.  Lots of companies are exploring.  Buying has been slower, but it is a long sales cycle.   

Healthcare Blog

I have decided to split out into two separate blogs.  Probably not easier on myself, but I think it represents my two areas of work right now.  With that, I have started The Patient Advocate blog which is more about healthcare and consumerism.

It includes some of the historical posts from here, but my intent is to manage the two separately.  Here I will talk about process related issues and technology while I focus on healthcare over there. 

You Have to See Sicko

Have you seen Sicko?  I got the management team from a healthcare client of mine to go see it with me last week in Boston.  I thought it was great.  If you know nothing about healthcare, you will think our system is the worse system in the world and be appalled.  If you work in healthcare, you realize Michael found and did a great job of pointing out many of the weaknesses. 

He also did a good job of identifying some interesting facts and showing us how healthcare works abroad.   Without being a spoiler, here are some observations:

• People without health insurance that get hurt face some very tough challenges.  We need some type of care system that supports them.
• Our  processes should not interfere with care.  Dropping people off in hospital gowns  since they can't pay their hospital bills is wrong.
• Drugs are a lot cheaper outside the US.
• The hypothesis that you wait for care outside the US seems to be a myth.
• Running a company based on denial of care versus managing risk through wellness is a problem.  This ties to bigger problems we have with the system design.

Before I go off as a liberal republican (or conservative democrat), my only recommendation is see the movie. 

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Biometric Loyalty Program

Loyalty is a very interesting process.  How do you drive people's behavior to make them more loyal to your service or product?  This is especially complicated in healthcare.  For example, how do you encourage people to visit your pharmacy more often without incenting them to fill prescriptions unnecessarily.  How do you encourage people to use your ER versus another ER without discouraging them from going to their primary care physician?  Aligned incentives is a problem that HR and performance management consultants have worked on for years.  It isn't easy.

I was intrigued by another article in Chain Store Age (July 2007, pg. 150) about Green Hills Market in NY.  This is a small, $18M company which is using technology from Pay By Touch to take their loyalty program to the next level of personalization by introducing biometrics.

• No more need to carry a card.
• The ability to know use by family member.

It seems to work.  Participants are shopping more often and spending more.  After they scan in at the front of the store, they get personalized promotions based on their shopping habits.  They are getting supply chain efficiencies and improving cross-selling. 

I also found it interesting that the author pointed out that at many stores you could scan any loyalty card and get the discounts.  As she pointed out, this makes some of the data suspect. 

Gift cards - young shoppers

I have always wondered about gift cards and young people.  I still prefer to give presents versus a gift card.  I might as well be giving them cash.  It seems just as general.  Now the following article didn't talk about gift satisfaction, but I found these statistics interesting in Chain Store Age (July 2007, pg. 152):

• 60% of children have received a gift card in the past few months
• 58% of children use gift cards for impulse purchases (seem logical)
• Toys and board games were purchases with older kids (9-14) more likely to use them for video games or apparel
• Cards were biased by gender - boys (entertainment, electronic stores) and girls (department stores, clothing stores, book stores)
• The average card value was $44
• 39% of recipients spent more than the card value (so they work)

MIA

It has been a few weeks since I posted.  Sorry.  I am going to do a little bit of a data dump over the next few days, but I have also been exploring the creation of a healthcare specific blog.  It needs some work before I unveil it.

Interestingly enough, I have had a bunch of conversations with people - entrepreneurs, consultants, executives, and corporate people - on the same topic.  Career management.  It is an interesting process which I am sure many of us wish could be automated with rules and best practices to guide us.  There are lots of tough questions.

• What am I good at? 
• What do I enjoy?
• Is there a role that I enjoy and will be successful?
• Am I better off at a big company or a small company?
• What is my individual value proposition or elevator pitch?  Does anyone buy it?
• What constraints do I have - geographic, travel, other commitments, financial obligations?

Given today's economy and the job market, things are pretty open.  This places a different pressure on people.  Options are not always good.  Too many choices can make your decisions complicated.  Some of the questions I have heard recently are:

• How do I reposition myself after being out of the job market raising my kids for 7 years?
• I spent a small period of time at a company and want to leave...do I even show it on my resume?
• I make a lot of money, but I hate my job.  Can I honestly walk away from it?
• How do I conduct a job search and do my daytime job?
• I want to leave, but I think there will be layoffs.  Should I stay around until they fire me and get a package? 
• The market does look that good for this product.  Should I take my future in my own hands or leave it up to the company?  Will they be compassionate if I wait?
• I am in a big company.  Should I be actively managing my career or leave it up to the company to manage it for me? 

Some people are very methodical about this.  I have one friend who has been a CEO and sold a company who spent the past year evaluating his options.  In the end, he decided he wanted to be a broker for EdwardJones.  Great for him, but a big surprise to me. 

Myths of Innovation

Guy Kawaski has another great interview on his blog.  This is an interview with Scott Berkun, author of "The Myths of Innovation".  If you are fascinated with innovation, this is a good read.  I have tried innovation internally and externally.  These last few start-ups which I have worked on have been great.  This article addresses some of the things I have learned the hard way. 

• Innovators are born and made
• Innovators face lots of challenges outside the creative process - support
• Get out of the ivory tower and "tinker"
• Problem definition (i.e., asking the right questions) is key  (At HOK, we used to use a book called Problem Seeking for architectural requirements which is a helpful framework here.)

There is a lot more here.  I think companies often miss the importance of "sponsoring" innovation through several actions:

• Encouraging people to try things and having a culture that allows risk
• Capturing ideas and having people who look across ideas for new combinations of things
• Having funds allocated to try things...if VCs who get their pick of ideas only expect 2 of 10 to flush out, why do companies look for 10 of 10
• Bringing in people with diversity (background, culture, education, industry)

Innovation is a critical process for companies.  Thinking about how you create it, capture ideas, and manage your portfolio is important.  In this blog, I have talked about P-TRIZ and ROT which are both relevant here. 

Mycroft / Talisen - Merger

I just thought I would post the fact that Talisen (my current employer) has decided to merge with Mycroft.  Mycroft brings a very strong brand in the financial services industry and around identity management.  Here is the official announcement...

MYCROFT AND TALISEN MERGE TO FORM PREMIER PROVIDER OF IDENTITY AND ACCESS MANAGEMENT, IT SECURITY SERVICES

SAN FRANCISCO

, June 27, 2007 – Mycroft Inc., a recognized leader in identity and access management (IAM), and Talisen Technologies, a top provider of IT and business process management solutions and managed infrastructure services, have combined to form Mycroft Talisen.   Mycroft Talisen immediately becomes a premier provider of IAM and related IT security services, leveraging a variety of established and emerging vendor relationships. The company offers an integrated, comprehensive services suite, from Mycroft’s expertise in assessment, architecture, development and implementation, spanning through Talisen’s capability in maintenance, management and support. The combined experience of the merging companies represents hundreds of successful implementations...  MORE

MOM = MCM + PM + CEM + DAM

I read an article this morning by Chris Graham on Multichannel Marketing which I thought was a great framework for several marketing related items I have been thinking about.  He talks about the following:

• Marketing Operations Management (MOM)
• Multichannel Marketing (MCM)
• Permission Marketing (PM)
• Customer Experience Management (CEM) and
• Digital Asset Management

If you don't know what all these mean, it doesn't surprise me, but I think MOM is the key.  Chris describes it as MCM in a box.  I think it is the key of how direct marketing processes operate.  You need to understand the customer.  You have to know what channel they respond to.  You have to know how to effect their behavior.  You need to have proven messaging (DAM) that you can pull from.  And, this needs to be part of a process so that it is not simply a one-time ping of that customer. 

From Chris' article..."So let's look at an MCM scenario: The customer makes an enquiry through his digital satellite TV remote in response to an advertisement; immediately an email is sent back to them, a personalized MMS confirms the dispatch of a personalized printed document specific to their geographical area, a call center flags a "to do" for seven days time, from which a personalized micro Web site is automatically generated with the latest product literature specifically for the products they want to look at."

Medical Devices and the 10 Faces of Innovation

Today, I unsuccessfully searched for a smart consumer device that would link process and medical monitoring.  I am sure it is out there, but I couldn't find it.  The opportunities are numerous. 

Imagine having a device that monitored your blood sugar levels and sent off messages based on your current levels.  The messages could be to home to make something different for dinner.  It could be a note to yourself to remember to snack earlier in the day.  It could be a note to your physician keeping them aware of your situation.  I think that the opportunities for consumer centric medical devices that have embedded intelligence and plug into some type of BPM or process centric model are great.

This made me think of one of my favorite companies - IDEO.  If you don't know them, you should.  They have been involved in all types of innovation and product design.  The Art of Innovation by Tom Kelley is a great book about their process.  You should also read the article about the different types of innovators in Fast Company. 

This article categorizes them into Learning, Organizing, and Building personas.  Which are you?  I am either a Cross-Pollinator or a Collaborator (in my mind anyways).

CDHC - Success or Failure

It is probably too early to make any decisions here around Consumer Driven Healthcare (CDHC), but I enjoyed an entry on Matt Winn's blog Punctuative about this (see entry).  A quote I especially like is:

If I were a product manager in any other industry and saw scores this low in customer satisfaction and understanding, I’d be thinking of pulling that product from the shelves or retooling it,” says David Guilmette, managing director of Towers Perrin’s health-care consulting practice.

I believe a big issue here is communications.  Patients suffer from too many healthcare communications and too much healthcare information which is delivered to them in ineffective mediums (e.g., letters that happen two weeks (or more) after the event) using confusing language and ask them to jump through hoops.  CDHC (and healthcare in general) will be much more successful when companies embrace a CPG (consumer packaged goods) approach to driving behavior.  I am working with a client right now that has had some great successes in this area and which has some great idea.  It is worth your time to look at them if you operate in this space as an HR director, a managed care company, a pharmacy benefit manager, or even a healthcare provider.  The company is Silverlink.

Wellness Incentives

Last year, I had a chance to do some consulting for my previous employer (Express Scripts).  One of the areas that I helped them with was CDHC (consumer driven healthcare).  I worked on competitive intelligence, framing the opportunity, and creating the strategy pitch including evaluating a technology investment.  Recently, I have ended up in a few conversations about this topic so I thought I would spend a minute on it.

Incenting people to get serious about health and wellness is an interesting challenge.  You have a handful of questions to answer:

1. What behaviors do you want to encourage?
2. How can you shift behavior?  (And who are you - employer, insurance company, disease management, marketing company?)  This has to take into account messaging, channel, timing, value proposition, demographics, etc.
3. Is there a return for your money?
4. Will consumers allow you to step in in a big brother type role to tell them what to do?

There are some interesting players out there.  I was always fascinated when I saw that Humana (who is progressive in many things) was working with Virgin to offer airline points for working out at a gym (for example).

Now, there are several companies focusing specifically on creating wellness incentives (IncentiveLogic, Hallmark Insights, Healthpoints).  There is even a Wellness Council of America.  I found an article on their site that provides a good overview - click here.

Some related information:

• 2001 article on wellness at work
• AON article on creating an effective wellness strategy
• Elizabeth Boehm who is a good Forrester analyst has an article about this
• A story about a specific company example and results
• National Wellness Institute
• Horizon BCBS points program
• Humana's Virgin LifeCare
• Lots of the managed care companies are offering health discounts (e.g., BCBS VT)

I could go on.  It is an interesting topic.  As the focus grows, you will see your consumer experts begin to focus on this problem.  It is not unlike the move from defined retirement to 401K.  With CDHC and other programs, the consumer is becoming more important in making healthcare decisions.  With that, an understanding of the health consumer is important.  This is not done well at most companies today especially with any of the typical marketing rigor that you would expect - segmentation models, campaign management, database analytics, etc. 

   

Value Based Insurance Design

Now here is a name written by either an academic or someone from finance - "value based insurance design".  Try selling this to the masses.  But, regardless of the name, the concept is very interesting.  At the core, most of what I have seen revolves around companies (e.g., Marriott) reducing the copayments on certain drugs for patients that are compliant with other actions (i.e., taking other medications, participating in disease management programs).  I had provided clients with some advice on these programs 2-3 years ago before it had a name.  Now, we even have an Center for Value Based Insurance Design at my alma mater - University of Michigan.

The key challenge here is plan design and how to create incentives that motivate people to take the right actions.  Here are some of the questions that I remember struggling with a few years back:

1. Do you reduce the price of all drugs (or some drugs or just generics) for patients that comply with recommended actions?  How much is meaningful?  If you make them free, does that change their perception of the costs and value of prescription drugs?
2. What type of patient profile (e.g., tenure, age) will this work for?
3. How do you track compliance?  Just because they register doesn't mean they comply?
4. How does this tie back in to broader health initiatives?  Are there other incentives that aren't prescription based?
5. How do you get this information into the hands of the patient in a timely fashion?

A lot of these questions play into the broader field of CDHC (consumer driven healthcare). 

If you are interested in this topic, you should visit the Center and Activehealth.  Activehealth was acquired by Aetna and is clearly the leader in this space.

So...linking this back to BPM is pretty easy.  VBID takes a process (which is the patient's healthcare) and establishes a series of rules (e.g., if they do X, lower their copayments on Y).  They systems need to connect a series of companies / databases to share information (think SOA).  Subsequently, the company investing in this type of solution needs a dashboard and reporting to understand their results and how their investment is paying off.  Finally (and ideally), the company needs to have some ability to do simulation and understand how changes to the rules might impact future results.   

Natural BPMS

I ended up being out of commission most of this week after my 3-year old kicked me in the eye and scratched my cornea.  Yes - it hurt pretty bad.  Although the hardest part was being a type-A personality and having to sit around temporarily blind.  For the first 24-hours, I couldn't open either eye.

I was reflecting back on the week (now that I can actually read) and realized there was one interesting example for BPM.  There were little things that impressed me around the healthcare process...for example, the eye doctor had my chart at 8am on Wednesday when I had just left the emergency room at 1am. 

But, the most interesting piece to me was the fact that neither eye would open the day after the incident.  I asked the doctor about this and he said it was (essentially) my body's defense mechanism.  This made me think about business rules which I thought of as an interesting analogy.  Our bodies are probably the perfect BPM systems.  They serve to process a series of rules that control our responses to things.  They learn to improve the responses over time.  And, with genomics and other areas of medicine, we can begin to map these processes. 

Now, getting BAM (Business Activity Monitoring) or dashboards of our bodies actions is a little harder (unless you are sitting in a hospital bed), but I think the general concept has some applicability. 

Anyways, I won't stretch too far, but there is something there.