Sixty years ago we did not have the Internet. We did not have client-server computing. We did not have mainframes, by and large (and LARGE is right!). We did not have workflow, automation or iPods, either.
But we HAD business process management. Cats like Deming and Drucker were already thinking, writing and acting on the science of the business process. These were the guys who helped rebuild the tattered world economy after World War II, for cryin’ out loud.
"For 60 years, we’ve been going through ‘the process movement,’" explains Bruce Williams, senior VP and general manager at Software AG. "And we’ve spent decades on ‘process as a discipline’ movements such as TQM, Six Sigma and Lean. Now, practically any problem, no matter how bizarre or gnarly, can be analyzed to determine what it takes to optimize it, what the causal elements are, how to control them and what it takes to keep the process in bounds," Bruce says. "The science of process is fairly mature." There has also been a steady influx of technology development to deploy process management in a globalized-business way, he adds.
The problem is: those two things have not come together very well. Why, in 2009, are there still lingering questions surrounding how the "process" part applies to the "business" part…?
That’s what I set out to discover in my talks this month with a varied and diverse group of BPM—that’s business process management, for you newbies—professionals. I’m not sure I reached the Holy Grail, but I think I got pretty close…
Expanding the Scope of BPM
"Business process management was, in the past, the domain of fortressed wizards who knew how to do it for very big, heavy-duty corporate processes as part of the corporate ‘information plant,’" says John Gonzalez, director of product management and business development for Xerox DocuShare. "It’s now become much more democratized, moving into smaller, departmentally or even geographically constrained deployments. As a result, BPM is being applied to more areas in the business where the problems are more ‘local.’"
And, no doubt, more plentiful.
"There’s a trend toward ‘application- specific BPM,’" says John. "Meaning, people are looking for ways to automate specific business processes and make them more efficient—whether it’s HR, or accounts payable or whatever—and there are lots of independent software vendors looking to meet those needs."
Laura Mooney, VP corporate communications for Metastorm, agrees, but adds that "the early adopters have already automated many of their individual processes, such as HR or customer service. Now they want to keep the momentum going and broaden their view to a larger, enterprise process improvement initiative. The availability and number of vendors who address specific business problems allow companies to apply workflows and process management to distinct point solutions. This means they can get started with BPM in smaller, specific ways at first, rather than trying to develop an entire enterprise BPM suite all at once. They’re able to dabble in process automation first, without going through the whole process lifecycle roundtrip," she says. Laura adds that organizations are creating an atmosphere more conducive to process management by pulling together various organizations into "centers of excellence" that have oversight for the entire global organization.
Perhaps, but as Bruce Williams points out, "centers of excellence have become de rigueur as a way to introduce business interests into the IT community, but in only about 10% of the time have we seen this actually take place."
This is typical. There have been many times when the press and analysts and vendor community tends to "hurry" a trend that hasn’t caught up to the real world. As Chris Preston, senior director of content management and archiving at EMC, points out, "There are pundits who claim that businesses have already squeezed every last ounce of cost out of their operations, so the only thing left is to be ‘transformational.’ That couldn’t be further from the truth. Business changes, constantly, and new goals and objectives come forth, so organizations need to change to adapt to those. In a way, that’s transforming, I guess, but it’s a matter of focus."
Bruce thinks the lack of innovation is not the fault of business leaders, but the result of years of misunderstanding the nature of the technology-to-people dynamic. "Encapsulating business processes into ‘black boxes,’ (packaged ERP, packaged CRM) purports to facilitate things more efficiently. But instead all it’s done is suck all the knowledge, initiative and spirit of ownership out of the business people. Now business people are fundamentally disempowered. All the issues now surround what the ‘system’ is or isn’t doing. We’ve got to get that power out of the ‘systems’ and into the hands and the hearts of the business people. It’s a fundamental paradigm shift of how you look at technology."
Chris also would like to see a fundamental shift in philosophy. "For example, there needs to be a much bigger emphasis on retaining the most profitable customers…not as much of a push to acquire new customers. Maybe (companies) will try to gain new customers from competitors that are asleep at the wheel, but the primary goal should be retaining the most valuable customers."
(P.S. Chris called in from Prague. I just thought I would mention that because it’s cool.)
The Cornered Elephant
It was inevitable that the subject would turn toward that elephant in the corner, of course. Everyone talked about the economic downturn. And the consensus seems to be that businesses are still looking at BPM solutions, but viewing them through a different, more conservative lens.
"There used to be a free-spirit, every-department-solve-your-own-problem mentality," says John Gonzalez. "But with current economic rumblings, that is changing to a more centralized, cost-controlling attitude. It depends on who you talk to. I hate to be so cold-hearted, but to the extent you can demonstrate a headcount reduction, I think people will look at BPM just to get that economic exchange. Customers are looking for two things: 1. Efficiencies that cut costs; and 2. Flexibility… people don’t know WHAT they’re going to have to do in the future. They don’t know if they’re going to go up, down or sideways. If they’re going to invest in a system, they want to be sure it’s flexible enough to accommodate their needs, no matter WHAT the outcome."
Laura Mooney says she’s taking pages out of yesterday’s playbook. "I’m going back and dusting off old marketing messages. We’re back to ‘lowering costs,’ ‘increasing productivity’ and ‘doing more with less.’ Everyone’s a little shell-shocked, and in financial services in particular, there’s a hold on IT investments. But at the same time, there are banks, for example, who are on the lucky side of it, and are acquiring assets. They have to figure out how to integrate those new acquisitions. And they’re smart enough to know BPM will help them by making it easier to analyze and get rid of duplicate processes, duplicate people and duplicate infrastructure."
Bruce Williams, always colorful, puts it this way: "When you’re making money, drunk and happy with an appearance of success and grandeur, nobody worries about cost savings. If everyone’s taking big bonuses home, why bother? But people are more motivated by fear of loss than opportunity for gain. It’s the old story of selling pain pills and antibiotics instead of vitamins."
"People are looking for relatively short-term ROIs in very specific areas," says John Gonzalez. "It depends on ‘who’s the buyer?’ IT is finding their budgets reduced, so they’re turning to tactical purchases. We’ve even shifted our focus to the business owners who are looking, frankly, for point solutions. I agree that a platform approach that incorporates many process solutions results in a better ROI in the long-term, it’s just that the purchase cycles are very long."
Laura adds, "As an enterprise software provider, we’re more tolerant of long sales cycles. We can address a business problem, but if the competition is a point solution only, we’re able to pull our ‘continuous ROI’ card. Customers rarely make the entire investment up front, though. They’ll start with one problem, and once they’re happy… they spread the word."