Business of BPM

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?

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.

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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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. 

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).

The Art of Ware

I was just skimming a story from Guy Kawasaki's blog about The Art of 'Ware by Bruce Webster.  I was a little skeptic, but Guy always has great instincts.  I read a few of the chapters in the book and think you would enjoy it.  Especially if you work with or at a software company. 

Here is some text from the home page about The Art of 'Ware...

Back in the early 1990s, I [Bruce Webster] wrote and published The Art of ‘Ware (M&T Books, 1995), a reinterpretation of Sun Tzu’s The Art of War, a 6th century BC treatise on conflict and warfare. My reinterpretation of Sun Tzu’s maxims applied to developing and marketing information technology products, most particularly software. Here’s an example:

• Sun Tzu (Chapter 2, ‘Waging War’, 1910 Lionel Giles translation): Now, when your weapons are dulled, your ardor damped, your strength exhausted and your treasure spent, other chieftains will spring up to take advantage of your extremity. Then no man, however wise, will be able to avert the consequences that must ensue.
• The Art of ‘Ware (Chapter 2, ‘Supporting Development’, 1995 edition): When your developers are burned out, your technology aging, your resources diminished, and your advantages gone, then others will take advantage of your weaknesses and cut into your market. Even expensive consultants and new CEOs won’t be able to turn things around.

The McKinsey Way

You can certainly never go wrong looking at McKinsey.  Their consultants are usually very top notch and their process of thinking and root cause analysis is great.  Although this post is more about how you analyze a problem (i.e., business process innovation), it also makes a point about how important process and methodology is.  The only way of delivering consistent, high-quality advice worldwide is to have a process of training and consulting that leverages smart people and delivers them to clients.

(Never mind the fact that McKinsey once told me that they only interview people with a 4.0 or people with a 3.8 and above from a top 5 business school.  I didn't fit the bill, but I have several good friends who were there.  I have lots of respect for them.)

The McKinsey Way is actually a book so you can see some insight into the company.  I have read the book and recommend it.  Rather than re-type all my notes, I found comments about the book at MeansBusiness and on blog called Brian Groth's Life at Microsoft and looked at notes on MECE (mutually exclusive, collectively exhaustive) from a book review on The McKinsey Mind.

My old boss who worked for McKinsey was a genius at asking the probing questions.  She new how to get to root cause better than anyone I worked for.  This is essential is diagnosing any problem not least of which are process problems.  (Since I assume you only look at BPM to drive value where you have some type of problem.)

So MECE, as Brian states in his blog, it suggests you should do the following:

1. Identify the problem using a mutually exclusive, collectively exhaustive framework and then map the problem out using some type of logic tree (see example).
2. Create a hypothesis (or hypotheses) about the solution...this drives your analysis.
3. Analyze the data...remember that the only thing that is right is data (assuming some data integrity).
4. Repeat steps 3 & 4 until you find a fact-based solution that makes sense.

  From the book, some of the other key points are:

1. "The most brilliant solution, backed up by libraries of data and promising billions in extra profits, is useless if your client or business can't implement it."
2. "Most business problems resemble each other more than they differ."
3. "If you get your facts together and do you analyses, the solution will come to you."
4. "If you keep your eyes peeled for examples of 80/20 in your business, you will come up with ways to improve it."
5. "Know your solution so thoroughly that you can explain it clearly and precisely to your client in 30 seconds."
6. "It's much better to get to first base consistently than to try to hit a home run and strike out 9 times out of 10."
7. "Just as you shouldn't accept I have no idea from others, so you shouldn't accept it from yourself, or expect others to accept it from you. This is the flip side of I don't know."
8. "When you're picking people's brains, ask questions and then let them do the talking. Keep the interview on track by breaking in when necessary."

5 Patterns of Extraordinary Careers

At Express Scripts, all of us on the leadership team (top 1.5%) were given the book The 5 Patterns of Extraordinary Careers.  It was a good book with several relevant tips especially for someone in the BPM space that is likely playing the role of change agent or somone whose career might include an objective of becoming the Chief Process Officer or Chief Innovation Officer. 

From the website, I have pulled in the 5 Patterns.  They also have an online quiz which gives you feedback on whether you are on your way to an extraordinary career. 

1. Understand the Value of You
People with extraordinary careers understand how value is created in the workplace, and translate that knowledge into action, building their personal value over each phase of their careers.

2. Practice Benevolent Leadership
People with extraordinary careers do not claw their way to the top, they are carried there.

3. Overcome the Permission Paradox
People with extraordinary careers overcome one of the great Catch-22s of business: you can't get the job without experience and you can't get the experience without the job.

4. Differentiate Using the 20/80 Principle of Performance
People with extraordinary careers do their defined jobs exceptionally well but don't stop there. They storm past pre-determined objectives to create breakthrough ideas and deliver unexpected impact.

5. Find the Right Fit (Strengths, Passions & People)
People with extraordinary careers make decisions with the long-term in mind.  They willfully migrate towards positions that fit their natural strengths and passions and where they can work with people they like and respect.

The Power of Process

It has been a few days without blogs while I was on vacation.  But, it gave me a chance to sit down and read The Power of Process by Kiran Garimella  from cover to cover.  Kiran follows the story style of The Goal (Goldratt and Cox) and The Choice (Russell Roberts). 

In this story, a mythical consultant helps a management team (primarily CEO, CIO, and CFO) understand BPM, SOA, and many other TLAs (Three Letter Acroynms) related to process.  It is a good and quick read that addresses many of the questions that I get from clients - isn't this a technology issue, does this compete with Six Sigma, how does this relate to other projects, where should this be located within a company, how to start, etc.

Let me highlight a few of my favorite parts:

• "Lean takes the fat out of processes.  BPM keeps it out."
• "Process Management offers a disciplined, sustainable meta-process for controllership and compliance."
• He emphasizes a lot the opportunity for BPM to automate the repetitive tasks and create a greater "Return on Time" that frees up the opportunity for innovation.  (more on this in another blog)
• He provides great discussion on Six Sigma and BPM which I have seen to be a point of confusion for many people.

Paul Harmon of BPTrends  did a good review of this book.