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?

Is Marketing a Process?

Is marketing a process or really a bunch of sub-processes that are part of other end-to-end processes?  I was looking at how to automate the different marketing functions (new product development, product management, pricing, research, marketing communications, and voice of the customer) and realized that most of these are simply part of a bigger process.

The process that consumes most of these is the lifecycle from idea through sales through billing. 

Here is a quick picture I came up with to describe the marketing function from a subprocess view. 

Perhaps you wonder why this matters?  Architecturally, it matters if you are building a system and want to connect processes.

Technology-wise, it matters if you want to focus on a SOA (service oriented architecture) approach where you can re-use components. 

Organizationally, it matters to understand how data and tasks flow and how to optimize your investment. 

Process-wise, it matters to understand best practices. 

As I have talked about several times, the fear with any improvement is sub-optimization which often happens when you focus on a subsection of the entire process. 

Here is a article to read on sub-processes (a little technical for some of you) 

http://www.bpmenterprise.com/content/c070212a.asp

Picture is worth a thousand words (at least)

As a former architect, I am a big believer that pictures have significant value in the business world.  I have been asked dozens of times to take complex ideas and simplify them down to a single-frame image that people can post in their cube or use in a meeting.  These images can be powerful. 

At Express Scripts, we choose to take on the battle of moving market share from Lipitor to Zocor a few years ago.  This was set up to save clients and patients billions of dollars as the Zocor patent expired.  We had a list of 50 ideas which we paired down to 30.  The challenge was how to get people to think about and rally around the 30.  I came up with what was initially called the "bubble chart" which showed the 30 ideas in swim lanes and then time-mapped horizontally against key milestones.  This became used everywhere and even presented to the street. 

This is important to BPM in several ways:

1. If BPM is to be transformational, you need a future state vision that can be captured and disseminated across the company.
2. If process mapping is part of your communication strategy, a simple to understand process map is critical.

I started thinking about this when I received an e-mail newsletter from BentonsEdge which is a company that helps you frame out your value proposition.  I have met with Dan Davison, the CEO, several times.  He seems to have a great process and good understanding of helping clients get to a simple story about their value proposition. 

One example is below.  It is a little busy, but it captures all the complexities of raising capital in a one-page slide which is amazing. 

http://www.tellingyourstory.com/content_library/files/whitepapers/RaisingCapital.pdf

BPM Lessons Learned

So...many of you thought I was going to offer some BPM lessons learned the other day.  Here they are:

1. If you jump right to technology, you will go backwards and have to do process mapping and/or reengineering.  Additionally, your project will take longer because you don't understand your metrics and the business side. 
2. BPM done right will cause organizational pushback.  Your adoption strategy is important.  This is traditionally overlooked in most technology implementations but here (whether you do this on paper or in a system) you are telling people how to do things that may have been fairly unstructured before.  You need to think through this.
3. Don't throw out the baby with the bathwater.  What I mean by this is don't abandon what has worked for you in the past.  If you have application development, project management, release management, or change management practices that work, don't ignore them just because BPM is new.
4. Real-time ongoing JAD doesn't work.  I have seen a few companies try to do real-time application development where the users are looking over the shoulders of the developers and trying to make changes.  Just because you can do this - don't.
5. Take action and divide your objectives into bite-size chunks of work.  Don't take on an end-to-end process that spans the globe and touches 5,000 people.  Understand the big picture and fix the key pain points in the process. 
6. BPM technology will make you think about SOA (Service Oriented Architecture).  And, having SOA will make BPM easier.
7. Just because there is a better way is not a reason to change.  Focus on the business case...document the current state...and capture the actual results.
8. Find an internal evangelist at a high enough level to support your efforts.  (always a good thing)
9. No one (vendor or consultant) can provide everything you need.
10. Simulation doesn't exist (that I have seen demonstrated to show value).

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."

BPM and Knowledge Management

Knowledge management is one of those terms that means different things to different people. In the 90s at Ernst & Young, I remember leading several efforts internally to create our knowledge management infrastructure. Our focus was on collecting lessons learned, key working papers, proposals, and deliverables. We would sanitize them (i.e., remove client specifics), review them with SMEs, and store them in Lotus Notes databases based on a taxonomy we had developed.

A few years ago, I led an effort at Express Scripts to select a document management tool to do much of the same. The idea was to get information off of people's desktops and from their file cabinets. We were going to load documents and scan documents. They would be approved by a central resource and categorized according to a metadata schema based on a taxonomy we developed. They then had role based security around the documents with a Google like search functionality.

But, knowledge management (at least in these forms) is difficult to embed into the daily processes. We ramp up efforts and get some initial push, but without continued focus, the databases become old and all you have done is spent money and effort to create a quickly outdated resource. That can be managed (of course). At E&Y, one of our performance metrics was what we had submitted for the shared repositories.

I haven't heard it explored much, but I see this institutionalization of knowledge management as a big value add for BPM. By capturing unstructured data (e.g., comments) along with documents in a process, you can create a shared repository for knowledge management. Additionally, you can begin to link outcomes data with those documents. Image at some point being able to analyze and say that project managers would used fishbone diagrams for analysis were 20% more successful than those that didn't. Imagine having the process prompt you based on previous experiences to say that if going down this exception path you should look at the following scenarios to understand what will be needed. Imagine that if you are working with a particular client that the technology could push information about that client to you at the right time of the process.

By simplifying and automating the knowledge, I think BPM could be a great enabler of knowledge management.

Audio from webinar

Rather than wait to figure out the optimal way to share this audio, I am posting the file from our webinar last Friday right here.  I think after numerous attempts that the link below should work to take you to a zip file that contains the MP3 file of the webinar.  It is large so if you would prefer it as an audio disk, I can burn a CD for you.  (Note: The first 30 seconds are music then the audio kicks in.)

Download bpm_webinar.zip

The slides are still available at www.talisentech.com/eseminar. 

On the file, you will hear Howard Webb from the BPM Group and myself talk about the process oriented mindset and how to approach BPM projects from strategy through implementation. 

Lesson From The Apprentice

As one of my favorite shows, I was glad to see another good lesson in this week's episode of The Apprentice with Donald Trump.  One of the three teams just completely bombed the assignment because they had no theme.

As you approach process work or BPM, it is critical to make sure you understand your current state metrics; what is important to drive the business; and how to make a difference.  Too many people want to jump right in without understanding the so what (i.e., the theme) of their effort.  Finishing a project that missed the mark is as bad as not finishing the project. 

BPM Institute's Brainstorm Chicago

I spent yesterday at the BPM Institute's Brainstorm Chicago BPM Conference.  Here are some of my raw notes.  I will blow some of these items out in the days to come.

• Good BRE (Business Rules Engine) maturity model presented by one of the initial speakers
• Interesting factoid about it taking 45-60 applications to run a company which translates to ~1,500 services in a SOA framework
• Lots of talk about business architecture (not sure if that means much to people...although I like the term)
• Good presentation from the BPM leader at Molson Coors...$175M committed to change around sales & marketing, overhead functions and streamlining operations...using BPM as a corporate strategy around process, change, and project management...started in 2001 using ARIS and began with building common framework / language...focused on innovation, growth, and delivery
• Brett (president of ABPMP) presented an interesting and novel framework for thinking about BPM using a medical model (e.g., patient only knows symptoms not problems)...companies have different types of processes as we have different types of systems...process for diagnosing
• Brett presented a picture of the Rumler relationship mapping model which was a good reminder
• Brett talked about all the continuous improvement tools out there...don't just use one because that would be like an MD who always uses the same drug
• Brett talked about teaching self-assessment and doing regular check-ups
• There was a panel on BPM with the vendors that was basically a bunch of softballs to them...what do you think about collaboration (isn't this just part of BPM)
• The most interesting comment on the panel was a woman from IBM saying that most big companies use 3-4 BPM vendors to address different scenarios
• The best case study I heard was HP / Compaq using SCOR to manage the process integration during the acquisition to get to standardization in 6-months with 12-people
• There was some talk about using BPM to manage SLAs which makes a lot of sense
• An interesting example of creating a call center desktop using SOA
• Discussion of creating a personalized quote to book insurance process
• Statistics on the CEO's view of IT from CIO Magazine October 2004
• Talk about BPM as the cure for healthcare's integration headaches
• Good discussion on manufacturing and BPM...key point being that BPM can help connect the shop floor with the corporate entity...can't have lean without real-time information and today's data is in disparate systems...process as key to competitive advantage
• Interesting discussion on using BPM for creating the electronic batch record for pharma manufacturing
• Good discussion on using BPM for product lifecyle management
• Quick discussion on how Erickson is using BPM to confirm JIT dates for cell phone antennas in 10-20 seconds accessing six levels of suppliers

Overall, I think the conference was okay.  Some good ideas.  Lots of smart people.  The group asked informed questions.  The vendor area was fairly limited.  I will do another blog comparing this with Gartner and Shared Insights. 

90-Day Fix

As many of us have done, imagine that you are doing your off-site planning for the year or some midyear review.  You likely produce a list of wishful fixes (e.g., I wish that our CRM system did Y; I wish that our forms were different).  At most companies, that list is prioritized, a business case is created, and the items are flushed through a project portfolio management process.

Now, imagine that by the time you finished prioritizing, capturing IT estimates, and building a business case, you actually had an application to fix your problem.  That is the beauty of today's BPM systems.  In 90-days, you can take a process from a Visio diagram to a production application. 

The challenges you face will likely be around the organization.

1. Does everybody agree to what the process is and should be?
2. Can people switch their approach to work in that timeframe?
3. Can procurement buy the software, hardware, and services fast enough to not miss the window?
4. Does business have IT involved so that there is an organization to support the environment, maintenance, and provide help desk support after go-live?
5. What happens when you go from a qualitative approach to a quantitative approach to management?

The good thing is that there is no other option that is this fast.  Custom development won't be able to fix your issue in 90-days.  It's not easy, but numerous companies have done it.