ANALYSIS
Flying Blind No More: A New Generation of BPM

As a result of having little to no visibility into business processes, many companies have turned to the integration capabilities of Business Process Management (BPM) tools. In the Aberdeen Group benchmark report "BPM and Beyond: The Human Factor of Process Management," Best-in-Class companies are working to build an information culture around BPM usage.

"This culture delivers capabilities to a wider audience," said Michael Lock, Business Intelligence research analyst at the Aberdeen Group. "It also addresses human factors that drive the relationship between process management and operational performance." Best-in-Class companies were derived from the top 20 percent of the aggregate performance scorers in three Key Performance Indicator areas: operating cost, customer responsiveness, and process efficiency.

Companies that were able to leverage a wide array of organizational capabilities were able to drive marked improvements in customer service and process waste reduction. "We have more than 50 business processes that have been automated using BPM. Our experience with implementing, upgrading, and automating new business processes using BPM is getting better and better as our organization matures and the technology evolves," said Venkatesh Yadav, information technology architect for Adobe (Nasdaq: ADBE) Systems Canada.

Lack of Visibility

The growth in the use and applicability of enterprise software has generated productivity and efficiencies for many companies. A common side effect to this expansion is that some organizations are left with a confusing web of heterogeneous systems. "As a result, these companies have little or no visibility into their business processes," said Lock. "This lack of visibility makes organizations struggle to identify and eliminate process waste and unnecessary operating cost."

In order to gain better visibility into their operational processes and deliver that visibility to key business decision makers, organizations are now looking to a new generation of BPM solutions that strip away the need for programming expertise and make BPM deployment far more palatable to a broader range of enterprises. "With the convergence of knowledge sharing, workflow management, and analytics, the new generation of BPM tools expands beyond the IT user and enables business users to understand and manage their business processes better," explains Lock.

Many companies have turned to the integration capabilities of BPM tools. Aberdeen's May 2007 study, "Aligning IT to Business Processes: How BPM is Complementing ERP and Custom Applications," revealed that 70 percent of Best-in-Class organizations have the ability to integrate systems possessing critical data or information, confirming the importance of back-end integration. "This first wave of BPM tools provided sorely needed integration but were costly, resource intensive, and not for the technically faint of heart," adds Lock.

As BPM technology has grown in accessibility, more solutions have risen to provide not only integration capabilities but address workflow management issues as well. Aberdeen's September 2007 report, "BPM Convergence: Workflow and Integration Meet in the Middle," demonstrated the tangible benefits to be achieved through a converged BPM solution (Figure 1).

Fig. 1: Driving Performance With Converged BPM (click to enlarge)

The Challenge of Process Management

Even with the purported usability of next-generation BPM tools, there are many organizations that are still hesitant to deploy a formal solution. In the September 2007 BPM report, "BPM Convergence: Workflow and Integration Meet in the Middle," which focused on the convergence of integration and workflow management functionality, 57 percent of survey respondents felt that the biggest challenge of implementing BPM was the difficulty of getting buy-in from the business stakeholders.

"This highlighted an issue of perception in the BPM world that while IT managers may have seen the value in deploying these solutions, the business users weren't convinced," said Lock. Because one of the most frequently espoused notions in the IT world is the need to 'align IT with business,' a solution that doesn't speak the language of business or lacks a clear value proposition makes achieving this alignment all the more difficult.

"Current research shows that there is a lingering sentiment that falls in-line with the challenges of a year ago," Lock said. "And of the companies without a formalized BPM strategy , the barriers to adoption are still heavily centered on knowledge and expertise." The biggest challenges remain understanding the BPM tool and developing a plan to leverage the investment to solve multiple business problems rather than as a point solution for a single IT issue.

In light of today's volatile economy, many organizations are looking to trim the fat off their operations and drive out any unnecessary cost. In this case, the research validates this notion by revealing that cost reductions are absolutely top of mind for business executives looking into BPM initiatives (Figure 2).

Fig. 2: Top Pressures Driving a Focus on Process Management (click to enlarge)

In a receding market, process agility is also an objective that many organizations strive for. In order to leverage business opportunities with a short window of execution, an organization must be able to adapt its processes quickly and efficiently. While driving new business and developing customer relationships will always be primary focuses, companies are now faced with an unforgiving business landscape that necessitates cost reduction and process efficiency.

"BPM automation and workflow allow Fuji Xerox to run lean outsourcing operations for our customers with low cost, high quality and efficiency, complete audit and security as well as help customers become part of the workflow and use all its benefits," said Olga Esina, regional technical manager, Business Process Services, at Fuji Xerox Global Services.

Many companies are aware of issues that exist in their key processes. "They understand that there is process waste that needs to be addressed and eliminated, but they don't know how much or where to start," adds Lock. The selection of a BPM solution and its integration with existing business applications and information systems plays a crucial role in the ability to turn these strategies into profit. "To use the complete BPM-platform potential we integrate it with full-scale call center infrastructure for inbound and outbound client communication, workforce schedule management tools, and internal customer support structure," concludes Esina.

Case in Point

Concur Technologies is one company that has been able to drive substantial process efficiencies and realize six-figure cost reductions through the use of BPM. As the world's leading provider of on-demand Employee Spend Management services, Concur is always searching for innovative ways to increase the quality and efficiency of its services. Because companies of all sizes depend on Concur, the company understands the vital importance of effective business process. Concur's customer implementation and support processes were not delivering the level of cross-departmental visibility and governance that Concur desired, so the company sought a solution to streamline its business processes and reduce operating costs through improved internal controls and enhanced visibility and actionable process analysis.

The lack of a central source of information on procedures inhibited Concur's success with process standardization and scalability and also created the potential for information staleness. After an extensive search process, Concur selected a BPM platform that provided the ease of use necessary to achieve its goal of overall process maturity. "BPM enables Concur to easily increase the efficiency of our processes in response to the demands of our clients, increasing the quality and effectiveness of our services," reports Cristen Rankin, a business process analyst with Concur. Since deployment, Concur has implemented 48 managed processes with their BPM platform and has seen a 20 percent average reduction time for process completion. Concur estimates that their BPM platform has delivered an annual cost avoidance of greater than US$700,000.