Monday 28 November 2011

The who, what and where of winning with business process improvement

This is the second in a two-part series on business process improvement strategies and trends. In the first part, IT executives and experts discussed the growing trend of involving more front-line employees and even customers in their business process management (BPM) programs. Here, IT executives discuss how they got their BPM programs off the ground and the challenges of keeping them on track.
Call them the three W's of BPM. Where to begin a business process improvement project is just as important as whom to involve and what technology and methodologies to use to position a BPM program for success.
Some BPM experts opt for greenfield business process territory with no existing policies. Others tackle well-worn areas where business processes touch the most people and need the most help. John Verburgt, director of BPM at the Chicago Mercantile Exchange (CME) Group Inc., went after both, beginning with new products and project management in 2010.

Business process management where once there was none

The CME Group's business processes for new-product and project launches suffered from a "chronic illness" that Verburgt said most enterprises encounter: email overload.
"If I could eradicate a quarter-million emails that we were using to manage the business on a quarterly or annual basis, that time adds up," Verburgt said. "It is an explicit shift of labor from non-value-add, because the administrative and grunt work is just automated."
The art of BPM is in creating a highly adaptable and even amorphous solution that can allow for ad hoc, on-the-fly, user-controlled changes to a process.
Verburgt solved this problem by introducing Appian Corp.'s BPM product to automate processes. At the same time, he added structure around the new-product and project-launch processes by building a "very transparent pipeline so that all the people involved could see all the activities and where they stood in the process."
The BPM technology helped by presenting the new-product design process to stakeholders visually, akin to the way Microsoft Visio does, Verburgt said. "What you actually design is what actually happens, so gone are the days where you generate requirements in a waterfall fashion. You can turn requirements around in an Agile manner using BPM tools, because it takes the abstract and puts it in a tangible context."
This same approach was introduced for onboarding employees, a process footprint that "thoroughly amazed" him, Verburgt said, in terms of the number of steps his team needed to build to make sure new employees were ready to work from Day 1.
The next project was virgin territory: a customer portal that would allow CME Group customers to initiate tasks and business processes. Because no process existed, Verburgt was able to introduce new BPM tools and such techniques as the Six Sigma methodology. "But when you add the latest tools and techniques, things change," he said. "The culture changes, and the way people get their jobs done changes."

Business process change management done right

A year later, Verburgt has a beautiful problem: Once he introduced business process improvements across new-product launches, employee onboarding and a customer portal, the business lined up for more.
"You need to plan for success, not failure," Verburgt said. That meant that getting a handle on change management from Day 1 was "hands down" the biggest factor in getting BPM buy-in, he said.
Continuous, rapid, real-time improvement, which is any BPM director's ultimate goal, calls for governing change management through BPM tools and techniques; but above all, it requires buy-in from the people involved in making the changes happen. "People love to see business and process improvements. It's the same as eating right and exercising. It's good for you -- but whether or not you can get people to execute that for you is a whole different story."
Verburgt's advice: Don't build everything out up front. Although he introduced a BPM program in three areas, he did so at three-month intervals. The business process changes were not introduced all at once, but in lightweight cycles and with all stakeholders well aware of what changes were coming, he said.

BPM for the people

When it comes to change management, Todd Coffee, senior director of enterprise process solutions at Tenet Healthcare Corp. in Dallas, recommends taking a user-controlled approach.
"The art of BPM is in creating a highly adaptable and even amorphous solution that can allow for ad hoc, on-the-fly, user-controlled changes to a process. Without the latter, change management will always be a risk for successful BPM initiatives," Coffee said.
The use of Pegasystems Inc.'s BPM product lets Coffee's team bring applications to production much faster than they could before. "And our ability to make ongoing tweaks to the system has improved by orders of magnitude," he said. The technology lends agility to Tenet Healthcare's business process improvement efforts, but that agility in turn also results in rapid changes for users.
Having people on board is critical because it is not possible to automate all functions within a process. "Certainly not those that are the most valuable to the company," Coffee said. "It is essential, as you bring application solutions to individuals whose expertise is instrumental to the outcome of the process, to allow their expertise to be fully leveraged, not thwarted in the name of automation."
Coffee's approach to business process improvement began almost nine years ago with such low-value-added processes as one for contract review. Although such processes do not affect customers and may be low-value-add, they still must be fluid and flexible because stakeholders need to make ad hoc changes, and contract terms and conditions often change, he said.
Today Coffee's focus is on business process improvement in critical business areas including compliance and telemedicine. Tenet Healthcare's pilot telemedicine practice offers remote diagnosis and treatment to stroke patients from a network of national experts.
A combination of focusing on the people behind the process and the use of BPM tools has paid-off, Coffee said. Project initiation to production delivery times dropped from about four months to as little as six weeks.
And once a BPM program takes root, stakeholder demand will shift naturally to continuous improvement, he said. He strongly recommends a BPM center of excellence that includes a feedback loop for ongoing improvements. "The quality of the feedback loop depends on accurate and extensive reporting capabilities and close customer interaction. Plan to provide detail as to process volumes and process timing, including averages, as well as ranges; and have a mechanism to routinely engage stakeholders for their perspective on the applications."
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The who, what and where of winning with business process improvement

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