Three Little Letters

Business Management draws on the experience of Rashid Khan, CEO and co-founder of Ultimus, to find some of the answers

BM. There continues to be a great deal of debate about whether BPM is about business change or technology. What is your take?

RK. Business Process Management is a new approach to business activities that is enabled by technology. Those that focus solely on the business aspects of building a process focus or creating a process-centric organization are missing the fact that trying to do so without leveraging technology in new and different ways is likely to fail. Conversely, those that just try to use technology to implement business processes also tend to miss the bigger opportunity to enhance business practices.

BM. So how does BPM impact the IT organization?

RK. A big area of concern for many IT organizations is finding ways to provide more value to their business. Often the core premise for accomplishing this is to become more business focused, and BPM provides exactly that opportunity.

To capture the organization, some things do need to change. First of all, a BPM project needs to be managed differently from traditional application projects. Instead of using traditional application development methodologies with strict phases, a BPM project requires more iterations and flexibility. Ideally, a team will be formed that includes both business and technology experts. This team will work together on all phases of the process effort, collaborating on requirements, implementation activities, and most importantly change.

This team-based approach gives each group an enhanced perception of the other, while increasing understanding and empathy for their business opportunities and challenges.

BM. Can you give any examples of the impact that BPM has had on IT - in a positive way?

RK. Sure. We have one customer in the cellular industry that experienced some challenges due to the economic climate and was looking for ways to improve efficiency and competitiveness. The company created a team of people to work on process improvement projects, starting with a key process around contract activation. The team was sponsored by IT, but included business experts in addition to technologists. In the first effort, the cycle time for the process was cut from six weeks to less than one week, giving the company a six-times advantage over the competition.

This effort gained visibility with the CIO and the COO, and thus the IT-driven process team was empowered to do more. Since that time, the team has implemented 40 more processes, while continuing to enhance the existing ones. The BPM team members are acknowledged throughout the organization as the key change agents in the move to a process-centric culture at the firm. In fact, some believe that the team’s success was the key factor in the recent acquisition of the company at a price of approximately seven-times earnings.

This is an incredible story with huge impact. We also hear stories from our customers of reduced application backlog, lower risk projects, more user satisfaction, and increased business understanding as key IT benefits.

BM. What can get in the way of BPM success?

RK. There are some pitfalls that can impact BPM projects. These are both business and technology related. On the business front, it is important to use existing processes as a starting point for improvement efforts. While the project may change the process dramatically by starting with something that users are familiar with, you are more likely to gain acceptance and buy-in than you do when starting with something completely new. Similarly, business cannot treat these process efforts as an ‘IT project’ – they must share ownership at all times. Processes must change so often that expecting IT professionals to keep pace with business needs without business driving many of the changes is both unrealistic and unproductive.

On the technology side, it’s important to select real BPM technology. It seems like every application vendor or infrastructure vendor is touting BPM capabilities today and, indeed, their software can be used to improve processes. But often these solutions require the user to either adapt their processes to fit the application (whether they want to or not) or do so much custom code-based development as to make process change impossible.

We’ve seen some recent research where over 40 percent of companies that have implemented a BPM or workflow solution find them hard or very hard to change. This is extremely disappointing, but not that surprising.

If you try to do BPM with traditional applications or commonplace development models, the strain of keeping pace with the process will be tremendous. To avoid this, you must both choose an adaptive BPM environment that empowers a BPM team to not only implement processes, but change them easily, and that change must not always be driven by developers. The most volatile aspects of processes, things such as rules and roles, should be managed without code and placed in the hands of people who can adapt them as fast as needed.

And where is BPM headed next?

We believe that BPM will continue to evolve with a focus on making more and more of the components of a BPM product highly adaptable. Here, I’ve emphasized the role of business in process efforts. At the same time, it is unrealistic to expect a modern business process to be implemented solely by business people unless it is incredibly simple and of relatively low value. Processes require integration with existing systems, but while that integration is getting easier through technologies such as web services, it still often requires developer’s to make sure the right information is available and that connections are optimized. Frankly, we expect that there will always be a need for some deep technical involvement in BPM to be successful.

At the same time, we’ve also found areas of processes that need to be handled differently. We recently introduced some new technology, Adaptive Discovery, in response to needs that we saw over and over again at our customer installations. Basically, what they told us was that they could not define their processes completely, and even if they thought they had, by the time they got them implemented (even if that only took one month), they would change.

This actually makes sense when you think about processes. People are constantly presented with new information and situations that require creative decision-making. Often, the range of decisions is bounded by the capabilities of the business. That is how processes work.

That is not, however, how applications have worked. Applications typically force people down paths with limited flexibility, and all the choices have to be predefined. Adaptive Discovery lets us do things differently. Customers can deploy processes without completely defining all of the paths to decisions. Instead, as the process is used, it will recognize when new situations occur and, at that time, process experts can create new rules to handle these situations. These new rules become part of the process. So the more the process is used, the more able it is to handle a wide range of situations.

What final pieces of advice would you give to CIOs looking at BPM?

I would recap on some of the key points discussed here. BPM can really help the IT organization increase the value it is delivering to business. However, it requires IT to become more business focused, either with its own resources or by demanding more shared ownership of projects with business units. Forming a BPM team that includes business and IT is critical to this effort.

Additionally, the definition of a project and project approaches must change. BPM requires more flexibility and more collaboration. The BPM team not only works on deploying new processes, but also continues to enhance existing ones. This occurs iteratively and continuously, so rigid structures make that too challenging.

A key point I haven’t yet mentioned is that BPM can help increase the value of existing applications. Processes interact with existing systems, using them either as sources of information or as endpoints that require updates. Since processes allow these systems to be used in additional ways, the value of them increases. If your existing applications do a great job of managing a set of information and making that available for review, then BPM can provide the process front-end that makes them even more actionable.

Ultimately, BPM is a terrific way for CIOs to drive real business value from technology when accompanied by appropriate adjustments in the development and application management practices to accommodate the continual change of business processes.