Business Process Improvement

06 January, 2009 11:13 AM EST
Making Progress in Healthcare: Visible Process = Predictable Results
Posted By: Elise Olding, Research Director

A warranty from your healthcare provider? Not only has Geisinger Health System moved to a flat fee for their coronary artery bypass surgery, but they offer a 90 day warranty. If a complication arises within 90 days, they will cover the cost.

How did they make this quantum leap? By turning healthcare on its ear! According to its CEO they shouldn't get paid if they don't do it right and have adopted a pay for performance strategy. Seems to be a concept that is gaining popularity these days.

By looking at this specific surgery, it identified 40 steps that must be performed. Much like a checklist, these steps guide the process - they are for conscious consideration, not rote following. What they found with the original process was that different surgeons had their own variations, with variable results - most of the time because they missed one or more of the 40 steps. While the patient group is still small - only 181 patients in this study - the results have been significant: a 45% decrease in readmission rates.

I often think about the tension between structured and unstructured processes and the connection between work that can be standardized and that which is knowledge work. It seems that Geisinger is on to something here by creating an overall framework that guides the surgery with the 40 steps, but obviously doesn't get into excruciating detail and enables surgeons to perform their "art." And it's working!

This seems a good example of using BPM to manage at the strategic level and produce big results - all things that Dr. Geary Rummler envisioned - BPM as a strategic management discipline. I believe that if you look at your organization, there are many opportunities to apply the strategy Geisinger has adopted. In these tough economic times, customers will be loyal to the companies that can promise to get things right. If this can be done for something as complicated as surgery, the sky is the limit for your organization. What better time to deploy BPM?

(Article in Fast Company: "The Cure," October 2008)

22 December, 2008 01:03 PM EST
Want More Blog?
Posted By: Elise Olding, Research Director

Did you know that Gartner has external blogs too?

Two esteemed analysts from the BPM team have external blogs. David McCoy and Jim Sinur write entertaining blogs about all sorts of interests.

The links are:

http://blogs.gartner.com/dave_mccoy/

http://blogs.gartner.com/jim_sinur/

These are personal blogs and do not constitute Gartner research but they are always entertaining! You are encouraged to leave comments.

Enjoy!

19 December, 2008 10:50 AM EST
BPM Initiatives Don't Seem to Be Getting the Axe
Posted By: Michele Cantara, Research VP

Over the past few months I've been sure to include the following question in every customer interaction. "Are you being pressured to reduce your BPM budget or disband your BPM initiative as a result of economic pressures?"

I've talked to scores of customers during this period. And so far, those that have BPM initiatives underway have escaped the axe. In fact, most have reported that there is even more management support for BPM than ever. Here's what they had to say.

• One executive sponsor from a global discrete manufacturing company, said "The current economic downturn is BPM nirvana."
• An enterprise architect at a large investment company, said "BPM is not a luxury."
• A CIO at a large insurance company, said, "We're going to reduce costs by 30%, but triple output, and BPM is key to making this happen." He also noted, "I don’t have to budget extra for BPM. BPM is actually a better way for me to reach my IT goals."

What do these customers have in common? They all have successful BPM projects to point to as successes.
• These projects were tied to solving critical business problems; they were not just skunk-work pilots to test out technology.
• Most of the business benefits related to eliminating process redundancies or automating manual processes and saving on labor costs.
• Business users were actively involved in constructing and validating models. Active involvement did not necessarily mean that the business users were actually constructing business process models on their own. Instead, something akin to a "pairs modeling" approach was used. Business analysts or process architects from IT worked closely with specific business stakeholders when developing the models. The process models made the solution tangible to business users. As result, business users were as committed to the solution as IT was.
• IT made heavy use of the "playback" capabilities of various BPMS tools in order to get business user input and validation. Playback lets users walk through the process using the process model as a visualization tool. Users can see process steps, paths, and the user interfaces they would encounter if they were using the solution in production. This greatly speeded up development and reduced the gap between IT's solution design and business expectations.

What's going on with your BPM projects?

17 December, 2008 08:36 AM EST
Gyokuro, Sencha, Matcha and Me: The Ritual of Process
Posted By: David McCoy, VP and Gartner Fellow

Green tea: One of the few essential elements of life. After decades of toying with tea in little bags - the American way - my taste buds have staged an oral coup. Over the past few months, I've dived deep, deep, deep into the rarified world of high-end green teas - teas prepared from whole leaves; teas in their most natural form. The flavors and feel are phenomenal, the caffeine can be sense-jolting, but is somewhat muted by theanine (see here for details), the catechins will make me live longer, and the complex processes for harvesting and preparing the teas are amazing.

There are two points to this post:

1. If you drink from little tea bags, you should really experience tea that hasn't been funneled through a little doll-house throw pillow. The quality of a cup of gyokuro - made from pristine leaves - is far superior to the already wonderful tea you can get from a dip-and-dunk approach. Try it.
2. We humans love ritual. We love to use language, semiotics, nuance, mystery and repetition. I believe that the "tea culture" that has been around for centuries is a good example of a refined and rarified ritual. Ritual is powerful. Ritual transcends simple understanding. Ritual cannot be ignored.

Drink your green tea. Experience the ritual. And as you do, keep in mind that your organization is chock full of ritual. Ritual is a manifestation of your culture and your culture will make or break your processes. So, if you don't respect ritual, you'll damage your process efforts. If you don't acknowledge ritual, you'll run into walls - walls you can't see.

Ask yourself a question: Is "ritual" an inhibitor to progress, or is ritual a way to incorporate process into the culture? If you answer correctly, you will have to say, "It's both." The trick is to find out what to keep and what to throw away. What part of ritual is critical for adoption and what part is just a legacy of mythology and habit?

Look at your organization and ask one more question:

Which portion of our process culture represents the rich, colorful tea and which represents the leaves? Which portion do we want to savor and which do we need to discard after it has served its purpose?

16 December, 2008 12:23 PM EST
Among Triggers to Launch BPM - Add One More: Value
Posted By: Bill Rosser, VP Distinguished Analyst

"Don’t pave the cow paths" has been a good guide for application developers for many years. This implies that there are generally much better ways for getting from A to B than to follow an existing ad hoc approach - certainly a sound idea. This guidance comes up whenever an application becomes a candidate for a new implementation. The stimulus may be a simple legacy upgrade (such as a new platform), or replacement by a packaged application, perhaps moving to a shared service offering, or the need for an added feature. An important step prior to such a change is to review the actual business process itself in order to analyze it and make it better, prior to building the new system.

This pattern is of course smart and sensible, but has its own shortcomings. It is inherently restricted to those applications which happen come up for a change for some reason or other. It misses lots of other applications that could greatly benefit from a process view and a BPM initiative. The result of this behavior is to very likely miss those processes which: a) play an important role in delivering enterprise value, and b) are not done well and could be greatly improved. So there needs to be another trigger mechanism added that will identify and promote such candidate processes for consideration in getting BPM attention.

The concept to pursue to do this is one of "value analysis". This means a review of all the processes in an organization and determining which of them make a major contribution to the value added to the enterprise. Experience has shown that it is relatively easy to narrow down the high-value candidates to less than twenty-five percent of the total number of processes. Once you identify these, you need to determine how well they are currently being done - to justify action. As a corollary, this is also a strong message from Geary Rummler, the recently deceased BPM pioneer, who has stressed that it is best to make certain that any BPM project must be directly connected to the highest level of primary value in the enterprise. If this is not done, he said, you "get lost in the weeds" and make only minor improvements that do not earn the attention of the senior executives.

So always consider applying "value chain analysis".

15 December, 2008 11:03 AM EST
Mel Blanc and BPM
Posted By: David McCoy, VP and Gartner Fellow

I was listening to some old recordings last night - listening to one of the features on disk one of this DVD set. It was a recording of Mel Blanc reading dialogue for a character in the Looney Tunes cartoon series. Being a fan of Mel Blanc and classic cartoons, I was conflicted as I listened to the raw audio - audio that was eventually processed into final form cartoon dialogue that we've all heard.

The Exciting Part: Mel Blanc was a professional. To hear him rattle through the dialogue was to listen to an expert. I was once in radio - actually considering a career in voiceover - but my talent was nowhere near the true pros. To hear Mel at work was amazing. He was the master, and I got to hear raw audio files where he was toying with the lines, changing inflection, varying his trademark tones, and generally creating famous character traits with his voice alone. After his basic tracks were established, the studios would go to work - speeding up certain lines and, of course, adding the music and sound tweaks. This recording was just pure Mel - he spoke the lines, did some basic sound effects, and gave instructions to the production guys.

The Depressing Part: There was something depressing about the entire experience. The best cartoons are works of art. Yet, to hear Mel rattling off the lines one by one, doing retakes and alternate voicings, stole a lot of the beauty. He was just recording tracks to tape, but he was also stripping the art down to the bare metal. He had to give directions to the guys who would process the dialogue. He had to offer multiple takes since there were multiple ways to interpret a line (inflection points, etc.) It made the whole cartooning process seem like a production factory and Mel just another worker on the line. Of course, that's exactly what cartooning is... but I didn't need to be reminded. I don't like to think that art is sometimes manufactured; that cartoons and lawnmowers share a common heritage on the production line.

This is the price we must pay for intimate process knowledge. When we look behind the curtain and see how things actually work, it's not always nice. Sure, it's exciting to figure out how business processes actually work - examining the innards and watching the gears and cogs in action. There's nothing more educational and this is the joy of doing BPM. However, the innards and gears are not always pretty. Sometimes, the details mar the beauty. Sometimes, you wish you had never seen inside the black box.

Sometimes, I wish I didn't know how things actually worked. Sometimes, I wish I were ignorant of the details (and sometimes I wish I could be ignorant of the subjunctive voice that forces one to use "were" over "was"). But you can't be in BPM and be ignorant of the innards. "Ignorance is bliss" does not apply to process work. Unfortunately, it no longer applies to Looney Tune cartoons either. Sniff... I guess I'm a romantic at heart. What a curse. A curse of too much knowledge - of seeing behind the art and watching the gears and cogs at play.

11 December, 2008 04:23 PM EST
How BPM Could Have Saved One Man's Thanksgiving
Posted By: Michele Cantara, Research VP

After taking my son and his entourage of friends to karate practice last night, I had to drop off my car for service. One of my good friends picked me up and then launched into the trials and tribulations going on in his latest project at work. (Being an analyst is a bit like being a doctor – with one difference, instead of asking you about health problems, people ask you about IT problems.)

My buddy is a developer at a large financial services institution and he lives to code. His company has recently outsourced much of its transfer agency work, except for certain trade exceptions that the outsourcer hands off to an in-house trade control group. These exceptions are then processed manually.

Several months ago, my friend and a few others were tasked with automating the process flow for these trade exceptions. The first step involved a series of interviews with the business users in the trade control function, in order to capture requirements. Interviews were also held with the outsourcer to understand what data would be provided when the exception trades were returned to the in-house staff. The IT team designed the solution on paper and then went back to the in-house trade control group to walk through the solution and to determine whether the solution would meet business requirements. The trade control group signed off on the requirements.

This solution involved a lot of overtime on the IT team's part – particularly during Thanksgiving week, which really annoyed my friend's wife. (Let's just say my friend's wife had already clued me in on the Thanksgiving problem.) What I was not aware of was a new problem -- the solution may need to be withdrawn and totally revamped because it doesn't meet business user requirements. In other words, this guy's family Thanksgiving got squeezed for a less than effective solution. Furthermore, this all could have been avoided with BPM.

My friend, being the typical developer type, did not understand why the trade control group thought the original solution design would meet their needs. He was adamant that the solution design was not presented to them in techno-weenie terms. I patiently explained than exception handling tends to involve a great many process paths, many of which are undocumented, are handed down by oral tradition. The business users can't possibly "grok" the solution implications of all these permutations.

More importantly is lack of process context. The in-house trade control group gets these exception trades back from the outsourcer. They are accompanied by lots of data, but there is no way to tell what process steps that exception has already been through, and what the data means as a result. If ever there was a clear case of when process visibility was vital, this is it!

After hearing all of this, I launched into my BPM pitch – since I had a captive audience, stuck in the car with me. My friend insisted that neither IT or the trade control group will go for a model-driven approach. I asked him what his alternatives are? Just do it again the same way and end up in the same situation. I went on and on about the merits of BPM, and my friend turns to me and says, "well, all BPM is a better way of communicating with business users," Yep, you betcha. That's one of the biggest benefits.

Friend:. So I wouldn't be coding, I'd develop the solution via A MODEL?
Me: "yep, pretty much."
Friend: "Nobody really uses this BPM stuff for back-office processes. Give me some examples."
Me: I give him five examples from recent MQ reference check calls.
Friend: Silence.
Friend: "I need to look into this BPM thing. Send me some pointers to those reports your write."

So today, I have unleashed another BPM evangelist on an unsuspecting IT department. Let's see what happens.

10 December, 2008 01:35 PM EST
Happy Birthday to the Mouse - and I Don't Mean Mickey!
Posted By: Elise Olding, Research Director

One of the great things about being a Gartner analyst is that we get to spend time doing research and seeing some really cool stuff. I had the chance to do just that on Tuesday by attending the Program for the Future conference held in San Jose, CA. The conference was celebrating the 40th anniversary of Doug Englebart giving the "mother of all demos" (see http://sloan.stanford.edu/MouseSite/1968Demo.html). This demo was done in 1968. I would encourage you to watch this video if you haven't already.

The conference content focused on "Collective Intelligence," a concept that states that shared or group intelligence emerges from the collaboration of many individuals. Hiroshi Ishii presented his work at MIT Media Laboratory with tangible user interfaces. ("Guided by the Tangible Bits vision, we are designing tangible user interfaces, which employ physical objects, surfaces, and spaces as tangible embodiments of digital information." See http://tangible.media.mit.edu/projects/.)

He had several examples, but most interesting was a device called the I/O brush. This is a drawing tool equipped with a video camera and touch sensors that "picks up" a representation of the objects it is exposed to and lets the artist draw with it. For instance, you could hold it up to your mouth moving and then take this moving mouth image and "paint" it onto a digital canvas - in moving video (see http://tangible.media.mit.edu/projects/iobrush/).

As many of you may know, I'm not in love with the two-dimensional modeling that seems to be central to BPM. I envision a different interface and believe a more intuitive approach will drive much better adoption and collaboration. After spending the day at the conference, I believe that my vision could one day be true. Here it is:

Imagine you could capture work activities with a "brush" that digitalized the working environment. (For an example of this environment check out http://oblong.com. Their work was used in the movie "Minority Report.") The work activities would be captured and be analyzed and optimized in a truly simulated environment - where all the activities, environment, workers, information, etc. are in context. Non-value added work could be tagged by the workers and redundant steps identified. New ideas could be tried out and experimented with before implementing. The environment would be used for training and knowledge transfer. Everything would always be in the context of the whole. It would be a realistic and natural extension of work.

I was encouraged that my vision, while perhaps still a ways off, is a step closer to getting some teeth!

I know there are some examples out there of using these sorts of environments for training and design. I would love to hear from you.

08 December, 2008 10:00 AM EST
Ghoulish Science Experiments and BPM
Posted By: David McCoy, VP and Gartner Fellow

Today was really, really creepy. It's "science experiment" time at the local high schools, and all the neighborhood kids are doing their best, trying to discover a cure for cancer. One of my own is testing the regenerative powers of planaria (flatworms). It seems you can slice-and-dice planaria beyond all recognition and they'll attempt to repair themselves, regenerating missing parts. How wild! I ordered the planaria from a biological supply house, and my son is manning the scalpel. He wants to see if the regenerative powers of the planaria can be extended to other entities (plants). I won't go into the details, should you foolishly be trying to eat and read this at the same time.

Even creepier is what I saw in my yard, today. On the way to my Rotary meeting, I saw what I thought was a newspaper, tossed in the yard, far from the driveway. When I got closer, I saw that it was a skull in a plastic bag. That's unsettling. Upon inspection, I concluded that the skull was not anyone I knew; it is - I believe - the skull of a 'possum, a well-known critter of The South. Since the bag was dropped near where the neighborhood kids wait for the bus, I assumed it was accidental. I left the skull alone, hoping it would find its way home. Sure enough, the bag and skull are now both gone. I assume some poor kid was running around all day going, "Have you seen a 'possum skull in a plastic bag?" I bet that person made lots of friends.

Why tell you all this? Indeed, why? Let me just say this: high school science experiments are fun, but generally poorly conceived, poorly executed, and woefully optimistic. This sounds just like some BPM projects I can recall. How many employees have we sliced-and-diced in the name of BPM? How many skulls have we soaked in bleach? How many wild ideas have we tested on live subjects? Too many - way too many.

If you are going to do BPM experiments, learn to simulate. Simulation lets you slice-and-dice and no one gets hurt. Unlike planaria, you don't get a second chance with your employees, partners, suppliers and customers. If you figuratively cut a customer in half, you won't get two customers in return. Leave the science projects to my neighbors and my kids; don't let BPM become a lab experiment. Check out Marc Kerreman's introductory simulation note ("The Why, When and How of Business Process Simulation"), and see what you can start doing tomorrow.

What a creepy day, but at least I got a BPM story out of it. And you thought Erskine Caldwell's picture of The South in Tobacco Road was fictional. Ha! Down here, finding a 'possum skull in your front yard is just the start of the fun.

05 December, 2008 01:26 PM EST
Will You Take the Challenge?
Posted By: Elise Olding, Research Director

Do you believe BPM can produce results? Are you willing to put your livelihood on the line to prove it?

I saw the following when perusing the news today:

DETROIT - Ford Motor Co. will tell Congress that it plans to return to a pretax profit or break even in 2011 when the Detroit Three automakers' CEOs appear before lawmakers this week to request $25 billion in government loans.

Ford CEO Alan Mulally said he'll work for $1 per year if the company has to take any government loan money. (Associated Press Writer Alex Dominguez in Baltimore contributed to this report.)

I strongly believe that BPM should produce results. When I think about results, I consider the cost of doing the work vs. the outcomes. Think about talking to your CFO. What would she/he consider as results? Those are the kind of results I'm talking about. This is especially important when BPM is still in the phase of proving its value.

Perhaps we need to up the ante! I suggest following the lead of Ford. BPM projects should target a minimum of four times the cost of the project (resource salaries, consultants, technology, etc.) If not, then perhaps they should not be undertaken. Are you ready for the challenge? Will you declare victory over analysis paralysis, miles of process models and endless meetings? Will you cut through the political obstacles and engage your organization to develop a collaborative solution? Will you deliver meaningful results?

And if not, will you work for $1?

Let me know your thoughts.

26 November, 2008 02:00 PM EST
Gartner Symposium Sydney - November 2008
Posted By: Elise Olding, Research Director

This was my first trip to Sydney and there could not be a more spectacular place. The sun was shining and the waters surrounding the harbor provided an enticing backdrop. The conference kicked off with a keynote that portrayed the economic climate lined with a ray of hope for the AsiaPac region.

On the first day I presented "Rethinking Change" which seemed to be a theme that resonated with the audience and was carried out in my 1:1 meetings with the attendees. There was a small BPM community amongst the 1000+ attendees, but the ones that attended my sessions were astute and mindful of the cultural and political implications of the BPM journey. The majority of the meetings were with leaders charged with implementing BPM in their organization or dealing with large scale business transformation.

Many of the attendees were well versed in attending to the cultural change that is associated with business change, but felt that they were alone in seeing this need. Questions focused on how to talk about the need for change management and gain the funding necessary to secure resources on the communication and change management planning and execution with executive IT and business leadership. It can feel like a lonely road when you are one of the few who understand this need.

I was surprised at the number of leaders I talked with who had this issue. Not necessarily that this was an issue, but the fact that this is a "techie" crowd was asking about the "soft stuff" and that they resonated with the need for organizational readiness and buy-in for their business transformation efforts. These were stimulating problem solving sessions and ones that left me feeling encouraged that IT leaders will step up and do the right thing to ensure that business transformation is a success.

IT talking about change management, that's a breakthrough!

25 November, 2008 02:05 PM EST
Ten BPM Adoption Tips from Down Under
Posted By: Elise Olding, Research Director

At the recent Symposium in Sydney I facilitated an AUR (analyst/user roundtable) discussion on the topic of BPM adoption. The small group was well versed and provided a number of insights that I thought would be useful to share.

Critical success factors:
1. Engagement of executives – ensure executives are bought in and supportive of the transformation or process improvement work.
2. Ensure that governance is in place to provide the guide rails for the process improvement work.
3. A BPM methodology is more important than the tool.
4. It's important to build the needed skills in the organization to support BPM. It takes time to build these skills
5. Find "versatilists" in the organization and train them in BPM skills this is a good early adopter group and can help gain momentum.
6. There is always a "viewpoint" when modeling – consider whether you are looking from the customer, supplier or internal customer and design your processes based on this view. This framing helps management to understand what problem is being solved and how to assess the impact. (In his personal blog, David McCoy has written on this very topic – called Weltanschauung).
7. Find a "pain point" and target this as a proof of concept (POC). One attendee realized a 45% increase in productivity in the selected IT operations area. Proof drives adoption.
8. Iterate the design of the target to be model with users to achieve the best future state model. The iterations made a connection between the business and IT and fostered teamwork.
9. Gathering current state metrics and showing the target "to be" improvement is a key to adoption. Then be sure to clearly communicate the improvement results.
10. "Shadow" people doing the actual work. Observe what they are doing and ask questions to really understand the current process and validate models. Solicit ideas for improvement directly from the workers. This creates engagement and adoption at the worker level.

Words of Advice
There were also some lessons learned that were shared:
1. Don't implement BPMS tools without a full understanding of the methodology, discipline, governance or any concept of what a process is. Without this perspective the tool effectively helped one organization "make mistakes faster" to quote one attendee. The scenario left a bad taste and now the leaders charged with BPM in the organization are left with a lot of baggage and struggling to recover.
2. Don't present your business users with models developed in a tool. They don't want to review the diagrams in excruciating detail.
3. Don't jump to designing the future state. Failing to understand the current process may not allow adequate benefits quantification (because there is no baseline) and often overlooks the opportunity for quick wins.

18 November, 2008 10:50 AM EST
Forty-Nine-Year Mortgages: Think Your Processes are Any Safer?
Posted By: David McCoy, VP and Gartner Fellow

Scenario: Driving home from lunch; passing by that really expensive new neighborhood that tried to leapfrog the normal market price by about $200K in one swoop and fell flat on its face. Lot after lot sits unoccupied. Now, I see a new sign in big bold colors:

49-Year Mortgages Available!

Almost half a century of mortgage payments? So if I took out one of these mortgages today (assuming I could find a lender), I would be 97 when it gets paid off? Notice the yucky passive "when it gets paid off" construct there? I know for a fact that I'll be long gone from this life before I reach 97. I won't be paying anything off, not in any active-voice-kind-of-way. Even a typical, upscale 35-year-old buyer would be 84.

Who are we kidding? No one stays anywhere for 49 years. This is just an arbitrage game to get the monthly payments lower and move these houses. More power to you - you people who don't own amortization tables. Just pay a few bucks a year in principle (or whatever it works out to). All that interest is deductible, right?

I'm sure that 49 year mortgages will have a ripple effect throughout the lending process: origination, underwriting, funding, servicing, issuance of mortgage backed securities, private lender terms, documentation, etc. If nothing changes other than a variable named TERM_OF_LOAN, it's not the mortgage industry I once knew. But the point of this post is not to single out the changes that this will bring to your basic mortgage processes. It's just to say this:

If you have been dawdling and not paying much attention to BPM disciplines and values, what happens to you when everything you took for granted about "business as usual" is suddenly up for grabs? Do you think you'll have time to play catch up as all of your traditional processes are forced to embrace change, all at once?

49 year mortgages - that's just a small example of the change to business as usual. Better get some of that BPM religion now while you still can.

11 November, 2008 03:32 PM EST
EA/BPA Tools or BPMS?
Posted By: Janelle Hill, Research VP

At our Cannes Symposium, the most frequent questions I heard were, "Do I need both a BPA/EA tool as well as a BPMS? Why?" "What are the best practices for using such tools in conjunction?" The short answer is that organizations adopting BPM as a program will need a full EA/BPA tool and may also need a BPMS for model-driven execution of some of their process designs. EA/BPA tools support the modeling of processes in far greater detail and in relationship to other enterprise assets much better than the modeling layer of a BPMS.

Many aspects of how processes work and how they impact other areas of the business must be understood by stakeholders, even though some of these aspects have no automation impact. An EA/BPM tool supports stakeholder needs for shared process understanding and analysis (such as impact analysis, critical path analysis, what-if scenario comparison, etc). The purpose of the modeling layer of a BPMS is to capture those aspects of processes that have execution consequences. Thus, organizations adopting BPM as a program will likely chose the BPMS implementation approach for those process designs and implementations that have requirements for visibility and end user involvement in change management of the process to better meet business agility demands.

Many understood the risk of EA models getting out of synch with process execution models and asked about vendors that could deliver full roundtrip support from the higher level plans and designs built in their EA/BPA tool to their execution environment and back. My conclusion is that demand for full model-driven architectures is increasing. Organizations that have been on the cutting edge of BPM are clearly in a good position to capitalize on completed work and apply the lessons learned to even more complex process challenges.

10 November, 2008 05:25 PM EST
Fight back! BPM Shouldn't Be BPR All Over Again!
Posted By: Janelle Hill, Research VP

At our Cannes Symposium, in our Mastermind Interview with Ian Livingston, CEO, BT, he mentioned that, in his opinion, reducing headcount is definitely going to be one of the core approaches CEOs adopt to deal with the economy and that it's inevitable. Nevertheless, he also feels that acts of "random violence" in the name of cost cutting are not the right approach. Instead, he - and Gartner! - suggest using technology and process to reduce failure, work on increasing agility and ensure customer experience is at the forefront of each decision. In my view (and I acknowledge being the eternal optimist!) this has to be the answer; making the organization better able to realize opportunity and delivering to customers more effectively.

Many times, economic downturns cause organizations to become more concerned with the efficiencies that can be gained through greater process automation. In the days of business process engineering, gaining efficiencies often took the form of automating human efforts and then laying people off. BPR ultimately became associated with "downsizing".
However, equating process management with layoffs seems less likely this time, because many of the most successful BPM initiatives are attributed to better coordination of people and information assets as contributing factors to creating higher customer value, not just to better task automation.

Furthermore, BPM adoption is strongest in services-based industries (ie. banking, insurance, telco) in which the "product" is largely a commodity and in which higher customer value is created more through human interactions and expertise in servicing the consumer than through the product itself. In comparison, past process management approaches were largely practiced in manufacturing industries where value is attributed more to the product itself rather than to the servicing of the product. Some of the most notable past process management success stories have been from manufacturers (for example GE, Intel, Motorola, Toyota, Ford Motors, Allied Signal, Cemex and Dell.)

Given today's greater reliance on human creativity and insight, think about where social networking technologies, cloud computing, SaaS and remote working can make life better for the business and for employees and use the technology to serve those ends. Make people want to use the new approaches to enhance their effectiveness.

10 November, 2008 05:18 PM EST
Impressions from Cannes Symposium
Posted By: Janelle Hill, Research VP

I just returned from our Cannes Symposium and thought I'd share some impressions. In preconference surveys, Business Process Improvement was ranked the second most important topic for the conference. Thus we had four BPM analysts participating and all of us were quite busy both presenting and meeting with attendees one on one. Personally, I met with attendees interested in BPM from approximately 36 different enterprises, both commercial industries and government, from all over Europe and also a few from the middle east and Africa. I spoke with individuals from hospitals, life sciences industries, banking, automotive, insurance, telco, energy (oil, gas and electricity), tax agencies, immigration services, social services, conglomerates and even a membership-based association.

Similar to my experience at our September BPM Summit and our Orlando Symposium, I was really struck by the growing maturity reflected in my discussions with attendees. Of course some are just beginning their efforts, but 2008 overall has marked a turning point for business process management as a discipline. Organizations are scaling up their business process management (BPM) efforts to establish BPM as an enterprise program - not just apply its methods and technologies to one-off projects. For the last eight years, financial services (retail and investment banks as well as insurance) has led the BPM charge, implementing multiple projects and often using multiple vendors' products. Many clients mentioned having 3 or more BPMS tools. With the current financial crisis, Gartner expects that in 2009 many of these organizations will consolidate their BPM technologies while at the same time expanding their efforts. Clients with whom I spoke clearly demonstrated this direction. In many instances, process improvement leaders that have process initiatives underway don't expect those initiatives to be heavily impacted by the economy, mostly because their organization has invested sufficient time and money in them to make stopping now unattractive.

Establishing a system of governance, including BP competency centers, continues to be a major concern for organizations trying to advance process maturity and discipline. For maximum effectiveness, stakeholders from both business and IT should work together to create a process-driven organization.

And lastly, as always, I met at least 4 new technology providers that I had never heard of before! The market interest in BPM continues to attract many new technology and consulting services companies, many bringing new innovations to the market.

04 November, 2008 05:47 PM EST
Greening the Business with BPM
Posted By: Jennifer Kenny, Senior Director, Consulting

Business Process Management - the design, implementation, management and ongoing improvement of business processes - has the potential to make very substantial contributions to the measurable impact of any Green or Sustainability program.

Green initiatives face a huge task to educate people on the "what," the "how" and the potential relative impact of their contribution to the initiative. Power management and materials innovation will impact the data centers, R&D and the supply chain. What are the rest of us supposed to do - take shorter showers? Turn off our PCs?

Let's take the simple example of travel. The airline industry accounts for 2%[1] of our annual global carbon emissions, or 544,915,160 metric tons of CO2[2]. This is equal to the total carbon emissions for all IT. At least16%[3]of this is business related travel. In addition to this, the average American contributes approximately 22 metric tons of carbon dioxide emissions each year[4].

Historically, we have redesigned our business processes to improve customer satisfaction, reduce cycle time or align process and strategy. There is now an opportunity to redesign our processes to accommodate all of the aforementioned and to balance that with the goals of our Green Initiatives.

The introduction of web-based collaboration tools and social media software gives us an opportunity to leverage e-work and telecommuting and redesign our business processes to add green-friendly business value while improving the collaboration and coordination both inside and outside the firewall.

We still don't have solid numbers for the total carbon footprint for all of the "people processes" in business. However, we can rely on common sense to inform us that by educating people about their role in their business processes' impact on an organization's carbon footprint, we can encourage them to reduce their carbon impact in the redesigned processes and make them aware of other wasteful practices and missed opportunities for carbon reduction both at home and at work.

Systems thinking is a requirement for effective Business Process Management. The global warming crisis is a systemic problem that we will not be able to solve until we can teach a critical mass of people to think systemically about sustainability. This way of approaching business process design is an inherently "Green" approach and therefore has an increased chance of adoption by any company or group seeking to achieve Green goals.

References
1. "Europe Must Abandon 'Tunnel-Vision' on Emissions Trading," International Air Transportation Association (IATA), June, 2008.
2. "Global Carbon Emissions," Wikipedia.
3. "Business travel is 16% of all US long-distance Travel," Bureau of Transportation Statistics, October, 2003.
4. "Public Transportation's contribution to Greenhouse Gas Reduction," American Public Transportation Association (APTA), September, 2007.

04 November, 2008 04:14 PM EST
A Tribute to Dr. Rummler
Posted By: Elise Olding, Research Director

Today I learned that Dr. Geary Rummler passed away. I was so very saddened by the news. He was a wonderful visionary man and a pioneer in the field of process improvement.

One thing that is so wonderful about working at Gartner is that I have the privilege to meet some extraordinary people. My interactions with Dr. Rummler are certainly a highlight in my career. We had the honor of having him keynote at our BPM Summit in Las Vegas in February. His low key presentation style, simple message and dry wit delighted and energized the audience. The halls were buzzing with enthusiasm as attendees poured out of his closing keynote. As conference chair one could not hope for a better outcome.

Daryl Plummer and I recently spoke with him. When asked what he thought about the current state of BPM, he told us he was "under-whelmed." That is because many companies are down in the weeds, doing small projects to improve low level functions and he is not seeing the value and outcomes that he envisioned. He believed process management should be a key strategy, because all enterprises are fundamentally a collection of processes and these processes generate value. The discipline needed to be elevated to this strategic management level - that was his original intention. This message so clearly resonated with me. I have shared it in presentations and with many clients.

He has made a difference and his philosophies will continue to make a difference. His vision will continue to set the mark for our progress with process improvement. His words have made an impact on me. I for one will continue to promote his vision of BPM as a strategic advantage and continue to work with clients to take their BPM efforts out of the weeds in order to realize the full potential of process management that Dr Rummler envisioned.

My sincere condolences to his family and colleagues.

31 October, 2008 04:53 PM EST
Innovating Human Resources
Posted By: Elise Olding, Research Director

When you work in a large company, everyone likes to "rib" HR. They are often the only group that takes more heat than IT! But a company called Kenexa is changing that view. I just finished reading an article in the current issue (November 2008) of Fast Company (www.fastcompany.com) under their "NextInnovation" segment and I must admit I was compelled to read further.

We are all familiar with employee surveys. Those gems rolled out once every couple of years by HR that reports back everything we knew already, right? There's a lot of attention on the survey results but never much success with the projects that are aimed at fixing them. Why? Because often there is little understanding of what the real causes of the survey results are. That's where Kenexa comes in. Their approach is to marry interviews and surveys with sophisticated technology that doesn't just spit out a report with lots of tallied results, but looks for correlations and possible causes.

This reminded me a lot of the basic construct of process improvement. Assess the current situation, benchmark and then perform analysis to determine the course of action to improvement. In the case of Kenexa, this approach of linking the current state with an action plan of next steps has resulted in tripling their revenue since 2005.

There are some interesting by-products here too. They have an extensive data base and one of the correlations shows that companies with higher employee satisfaction scores had 700% higher shareholder return than companies with low scores. Another factoid stated that manager turnover is 21% lower among managers that were proud of their companies. This results in solid impact to the bottom line and productivity. The power is in linking the current state with an action plan and next steps.

All this still sounds like BPM to me and I'm pleased to see some solid analysis of the people side of the equation - one that is often considered to be a "squishy" and difficult subject area in which to demonstrate significant, tangible results.

28 October, 2008 04:20 PM EST
The Path of Least Resistance: A Road Well Traveled
Posted By: Jim Sinur, VP Distinguished Analyst

Often it's easiest to take the path of least resistance. Today it seems that survival is on everybody's mind with all of the economic malaise that's surrounding us. Unfortunately, the path of least resistance when an organization is in survival mode is usually to cut the number of employees and try to move forward until conditions improve.

We think that the better path that should be considered should be "doubling down" on the bet to eliminate and/or improve processes and redistribute the employees, especially in the knowledge-intensive, service-based industries that have led this wave of adoption of BPM!" We think the best way to accomplish this is to take talented key personnel and charge them with process discovery on a programmatic basis. This process discovery effort would be best led by a business process competency center (BPCC), but if that smells of a staff target then it would be important to make sure they paid their way through savings and/or distribute the key people in areas of opportunity.

There are two basic ways to discover process. One is to model them and look for low hanging fruit. The other is to instrument processes and measure them. There is a new healthy sector around automated process discovery that instruments existing processes to look for better behaviors. There has been debate around which approach is better, but both have proven successful. Organizations that have planning cultures tend to lean towards modeling and results oriented cultures lean toward monitoring.

Really smart companies also look for downturns as an opportunity to introduce process innovation. They quietly build new processes that please clients and/or value chain participants and tune them during these down times. This keeps critical talent focused and ready to launch when times move us into better growth conditions. Aggressive firms will unleash these better processes to steal business away from companies unwilling or unable to change.

Bottom Line: The road to perdition is a wide and paved road. It's time to embrace new explicit process management techniques; not shrink away from them.

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