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  3. Tuesday, September 09 2014, 09:42 AM
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Do you think that it is more important than ever that a company understands and optimizes their processes? If so, why?
Ken Schwarz Accepted Answer
Yes, it is more important than ever to understand and optimize business processes, but more and more we see this in connection with customer engagement rather than "simply" back-office cost-cutting. Partly, this is a natural result of a return to economic growth after a long downturn, and partly an opportunity to exploit new technologies--mobile, social, and cloud. To compete in this business environment, especially when operating at large scale, visibility to customer needs and the agility to move swifty and respond to and make new markets become the focus of process innovation.
Ken Schwarz Director, Product Marketing, Pegasystems
Ken Schwarz is Product Marketing Director for Pega Business Process Management and Dynamic Case Management solutions. He is an expert in enterprise middleware and its application to business transformation and competitive strategy. Ken’s career spans marketing, competitive intelligence, international sales, technical service delivery and product development.
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Ian Gotts Accepted Answer
The internet has evaporated competitive differentiation through product innovation, price arbitrage and customer/buyer information asymmetry. Now competitive advantage is through superior customer service and the ability to adapt quickly. Both of these have process are their core.
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Tim Bryce Accepted Answer
Not really. It has been the same for the last forty years. It is always wise to have a model of your enterprise from an organizational, systems, and data perspective. This is what we call Information Resource Management (IRM).

Without such models there is a tendency for companies to create redundant work effort, and data (which puts into doubt the cleanliness of data). Even worse, you cannot integrate your information systems if you do not know what you have. Also, you cannot make intelligent project decisions without an adequate inventory of your information resources.

This is why we refer to IRM as "the view of the enterprise from 50,000 feet."
References
  1. http://timbryce.com/bryces-laws/
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ross harling Accepted Answer
Over the years I have worked with a number of CEOs who look at company results and think things will get better if they simply shout at the speedometer to make the car go faster. They might spend a bit of time doing this and then they either leave, or work out that outcomes and outputs are the result of business processes. Inevitably, poorly designed processes produce lower-value outputs and waste company resources. However, most organisations appear to be still working with pre-Digital age business processes so a bit of tweaking here and there ain't gonna fix it. This is bigger than shifting from a steam to electric-based economy, it's another industrial revolution,
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Peter Johnston Accepted Answer
In the industrial age a company bought in goods it had specified, turned them into something more complex and sold them through its own salesforce. The processes were all in-house.

Now a company is part of a giant eco-system. Companies who make components or provide services are partners and they design these components of your company's offer collaboratively. Often manufacturing or assembly is outsourced to sub-contractors close to the market. And selling is done through retailers, e-commerce and inbound and outbound salesforces, often also out of the company’s control.

So Edward Deming’s idea of What is a Process” is very different from a modern process consultant. And the idea that you can Manage – with Manage meaning Control – your business processes is frankly ludicrous.

So can you understand your processes? That word is dangerous. Because the minute you think you understand you stop trying to learn more. You dismantle all your learning and feedback apparatus. And you settle back into “we know what we’re doing” mode until disruption takes you by surprise.

We need to get rid of the “absolutes” mindset. That a process is fixed, immutable and the same everywhere. Just as a webpage changes from day to day unlike a brochure or book, so our processes should be continually evolving, intelligent systems.

The idea that someone – with their limited brain capacity – must understand them, be accountable for them and manage them is one of the biggest mindset problems holding us back.
Dynamic Process
Oxfordshire, UK
+44 (0) 1491 874368
+44 (0) 7590 677232
#dynamic_process
peter@dynamicprocess.uk
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Scott Cleveland Accepted Answer
Absolutely. I agree with Ken and would add that your competitors are attempting to become more efficient and if you want to be in business in the future, it is a must...
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Peter Whibley Accepted Answer
Yes, however they should be looking at optimizing customer journeys rather than business processes.
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Emiel Kelly Accepted Answer
Processes (and in all other names like customer journeys, cases, whatever they occur) are daily business. It's just what you do. If you don't care what you do and how your processes perform, fine.

If you care, you are automatically looking at your processes and maybe decide to do it a little better.
Common Sensei at Procesje.nl
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Peter Johnston Accepted Answer
Imagine you have a company HQ which lays down a fixed process worldwide, but allows each country to apply Lean Startup and AB testing principles to improve their processes.

Within a few months each country would have a much more optimised process for their customers. Probably one with more profit too.

But HQ wouldn't have in-depth knowledge of what is going on.

Normally the big company way is to impose one process for all countries. So they "understand" and can stand behind what is going on - they know it meets governance, quality and management of people standards.

But is that really better than each company having the best possible process for their customers? And presumably more profit.

You see how the "Understand" mindset holds companies back. Which is better - to understand or to optimise?
Dynamic Process
Oxfordshire, UK
+44 (0) 1491 874368
+44 (0) 7590 677232
#dynamic_process
peter@dynamicprocess.uk
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Michael Lee Accepted Answer
I am surprised that I have not seen one mention of compliance issues and why they make it so important for a company to clearly understand their internal processes today.

Hasn't everyone seen the billions of dollars in fines being levied against financial firms in this country? Especially in the light of extreme regulation faced by that industry as well as healthcare. Any failure to comply with all regulations can result in devastating effects on a company. How can a company be sure it is complying with all applicable regulations without completely understanding any business process that could result in a violation?

So yes it is more important than ever.
Comment
Agreed.
I would add risk management (e.g. security) into core drivers for a more process-oriented approach. Goal being a mechanism for assuring a method for compliance/security across business function(s).

Supporting this, I'm starting to some reasonably good hybrid BPM+case tools coming into light with a goal towards supporting "business concerns" (compliance, etc.) - or, stated in a more technical view... enabling a business-Aspect Oriented Approach to BPM. "Aspects" representing compliance, risk-mitigation, etc..
  1. Gary Samuelson
  2. 2 years ago
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E Scott Menter Accepted Answer
Blog Writer
No.

Now, before you decide (not for the first time) that I've lost my mind completely, let me explain. In the days of manual processes, organizations had to spend an inordinate amount of time and energy discovering and understanding their own processes. What's more, the moment they reached that understanding, the knowledge they had gained was already well on its way to obsolescence, thanks to the natural entropy of human-centric systems.

Yes, it's as important as ever that businesses understand their processes (not least of which for GRC reasons, as Michael correctly points out). But it can now do so at any time by reviewing information contained in, and generated by, its BPM platform. In real time.

It's also as important as ever that an organization know its bank balance. But it can look that up in real time, too, and we don't really talk about how important it is they do so. Because it's easy--of course they're doing it.
http://www.bplogix.com/images/icon-x-medium.png Scott
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Obviously that processes are critically important for an enterprise because one can derive organizational structure, measure capabilities, identify compliance issues, find performance bottlenecks, monitor risk, integrate systems (better microservices) and oversee data flows from having enterprise-as-a-system-of-processes (as a real management tool for enterprise optimisation).

I think that more important question is the following: if an enterprise wants to realize the power of processes then should an enterprise have its processes in an illustrative form or in an executable form?

Thanks,
AS
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Scott Francis Accepted Answer
Blog Writer
Sorry guys, I was busy watching apple news today, missed this one... :)
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David Chassels Accepted Answer
The answer just has to be yes. I agree with Ross "...most organisations appear to be still working with pre-Digital age business processes so a bit of tweaking here and there ain't gonna fix it. This is bigger than shifting from a steam to electric-based economy, it's another industrial revolution," Look at how IT has delivered over past 20+years where the emphasis has been on large processing and record keeping systems resulting in people having to fit into this “inside-out” approach where direct interactions have been poor at best.

As a result of this “support gap” people “do their thing” outside of corporate knowledge with often adverse consequences. George Colony CEO of Forrester Research summed it up some years ago in an exchange “If we don’t get from IT to “Business Technology” we’re going to have more disasters like our present mortgage meltdown. Why? Because IT creates impenetrable systems that human beings can’t manage. BT is about human beings back in control.”

Michael is right compliance is a huge and can be a costly issue and it will be this that will force C level to require better knowledge of activity. The other benefit is more positive by being able to delver real time operational feed back on all activity so empowerment of people becomes a reality without unnecessary risk. It also ensures knowledge of the process belongs to the business?

So plenty good reasons why the focus is switching to “outside-in” process optimization. The real trick is “how” without disrupting the business and ignoring needs of users; something old big “IT” projects were good at? This is an issue C level need to understand “how” will be avoided if they push for the required changes as articulated.
Comment
Hi Gary
You make some good points but maybe making "business" sound overly complex. First it is the use of "IT" in digitising where process and business are one and this is where the common "language" must be that of the user. But as you allude to in our modern world technology driven "gadgets / devices" are often driving actions (including results in use of algorithms) and they are what we would call a class of “performer” just as a human user is. As such their signals outputs whatever are integral to the process which is linked to human actions all of which makes any business.
  1. David Chassels
  2. 2 years ago
I initially read this as having a "business vs IT" perspective... leaning towards a "business is better" view.
However, I think I now understand your point being one of migrating business back towards the IT culture as apposed to the long-standing antitheses and side-effects of IT-mitigation (i.e. outsourcing).

So, we cannot have "process" without first transplanting "business", and it's traditional-business we're knocking off balance here, into the process-of-technology - specifically stating that business is technology... in our modern world.

This seems somewhat self-apparent depending on which side of the fence we're talking from. A more Hegelian approach is then appropriate, pointing out the "syntheses" representing our algorithms from which we automate. I'm skeptical... justifiably so, and with some humor, because who wants to be re-defined by the new defining order (technology)?
  1. Gary Samuelson
  2. 2 years ago
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Geoff Hook Accepted Answer
Yes….however it has always been important
According to Porter there are two basic types of competitive advantage a firm can possess: low cost or differentiation. Fundamentally this still applies…other aspects such as quality, responsiveness to customers and agility all contribute to one of these two fundamental strategies.
Speaking to a manufacturing company…they would obviously spend time on their manufacturing processes to ensure quality, consistent delivery and reduce cost / increase efficiency.
It is the same for business processes….whether these are the enabling processes supporting the manufacturing business or even more so if the company is service based business.
How else do most companies compete effectively without understanding and optimising their business processes? A word of caution, it is obviously crucial to Optimize against the right measure for the particular business. It all comes back to Process.
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Nigel Kilpatrick Accepted Answer
Are you kidding!! This has to be the most influential time in a long, long commercial time that companies need to understand their business and the processes that support it.

What is the only thing that separates a Coca-Cola from a Pepsi, or a BP from a Shell, or a Virgin from a BA? Is it their products? No! Is it their services? No! Is it their people? No! The only thing that separates them is how well they take care of their most important differentiator and that is their processes.

The big change over the last couple of years is the type of processes that have come to the forefront of demand and priority. Today, what is making the bid difference is customer experience, loyalty and brand. Get these 3 processes nailed inside the organisation and your survival rates go up. Get them wrong and you perish and you perish quickly.

At long last the tide is changing from the traditional static process IT ownership to forward thinking, aggressive, demanding and quick process owners - the business.

Once you have business ownership - and I mean full ownership, from cost, deployment, improvement and exploitation - then organisations take big care and attention of their processes. They understand what process care and attention means to the company in terms of competition, growth and survival.

Welcome to a new dawn of process awareness and optimization!
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