Business Processes in the 'Age of the Customer': Clay Richardson Lays Out the BPM Road Ahead
- Published: December 27, 2013
Schooff: Hello, this is Peter Schooff, Managing Editor of BPM.com and today I have the great pleasure of speaking with Clay Richardson who's a Principal Analyst leading up BPM research at Forrester. Today we're going to discuss the current state of BPM, as well as what's ahead for BPM in 2014. So first of all Clay, thanks so much for joining me on our first podcast with BPM.com.
Richardson: Yeah, thank you Peter for having me.
Schooff: Indeed. So how would you say is the growing focus on design changing the relationship between BPM and business today?
Richardson: Yeah, it's really interesting. This is an area I started looking at the latter part of last year so during Q4 of 2012 to look at the relationship of really experience design and business process management. And so what I found, and a lot of this is driven more by mobile. So we took a close look at the impact of mobile on business process management and what we walked away with was it really requires more front-end experience design work as opposed when we look at BPM it shifts more to front end design and designing tasks were convenient, as opposed to back office optimization. So this focus on design has really recast BPM more from a convenient and front-end engagement standpoint than the traditional back office optimization perspective and this is a really big shift that we're seeing in the market. I've been working with clients over this time, over really most of this year, helping them make that shift to bring more of a design perspective into their BPM programs and their BPM practices and so we definitely see that a major trend continuing for BPM.
Schooff: Well, that's certainly makes sense. Now how would you say -- how are skillsets changing for BPM project teams and BPM professionals?
Richardson: Yeah, when we did this research, one of the things that we found is the methods that BPM teams normally adopt like Six Sigma, LEAN, the different modeling techniques, BPMN, those techniques don't necessarily get at the customer pain point they're really gaining empathy for the customer and designing the prospects around the customer experience. And so when we started looking at this, the real new skill that is beginning to come into BPM teams is around design thinking. And so you've heard some different thought leaders talk a little bit about design thinking, but it's more from a marketing perspective.
If you look at the leaders in design thinking, IDO, some of the other service design firms, they understand design thinking from that marketing perspective. And so what we see with BPM teams it really is a major shift because the way we solve problems as process professionals is focused more on productive logic and really more system inspecting that's how we get paid is to think logically holistically, to look at problems in a very matter of fact way. We look at the data from the past. We basically say, okay, well based on this past data now we need to think this is how the process needs to run. Here's the best practices we need to commit. When we look at design thinking from the key techniques and key principals center on things like specific interaction points so we're not looking at the entire end-to-end process we're just looking for this key area where the process can be improved. Maybe it's one or two tasks that need to be optimize for convenience that's what design thinking begins to focus on the process. And then the empathy part, I think the teams that I've been working with on the BPM side, this is the hardest, most difficult concept to block from a BPM standpoint.
What does empathy mean from a process perspective and how do you get empathy? And so the way we work with clients to help them build empathy from a process of BPM perspectives, the new skill that comes in is really using personas to building user personas to understand better what that client experience might be. And when you have a whole body of research being forced around persona, mapping, and creating persona, then it's really a way start putting yourself in a potential customer shoes and understanding what their experience is when they're engaging with the process. And then the other new skill that we're seeing is focus on using customer journey maps to root cause analysis for a process change. So it's really taking that persona and walking through the different stages of their journey as they interact with the business and with the process.
And what you're able to do and I've done several of these workshops to help clients make the shift, and what you realize is it gets the process team thinking beyond the boundaries of just the process model. They begin to think about what triggered in that customer's in mind the beginning of the process to actually start and go and investigate. And I did just recently yesterday; I finished up a workshop with the client to help them get these fields. And what we found at the end, the feedback they gave was, okay, this really is a game change because now we're beginning to design the process, to think about the process around the customer's needs, and the customers emotion, and so that's a really big deal. Instead of thinking about just the cycle time that our customer journey modeling connected with the business process really gets the process team thinking about the customer's emotional state as they're going through the different steps of the journey and then being able look at well what process steps need to be redesigned to actually improve the customer's emotional state.So the customer I worked with yesterday, the client we were working with yesterday on the process design thinking exercise, what we started looking at is how do we change the customer emotional state at this one stage to go from being frustrated, anxious, to having clarity, to feel clear about what they're doing, what they're buying, what they're getting ready to order. And so it really got them thinking from an outside in perspective. And so if I go back to your question, the new skill that we see coming in are these design oriented skills that focus on building up the feed for the customer and also understanding those interaction points. And so persona mapping, customer experience, customer journey modeling are the two big pieces that we see that'll have the biggest impact.
Schooff: Excellent. Now Elise Olding of Gartner recently wrote that the process model is dead and will in fact inhibit capitalizing on business moments. What you think about this whole notion that process is no longer relevant in the digital world?
Richardson: Yeah, it's interesting. I know Elise so I don't think she's that far off. And actually, within Forrester we're focused on how mobile -- I mentioned earlier how mobile changes what process means. And so I think it's less if you have people in the market that are always saying BPM is dead or process is dead. I mean, let's be realistic here, process has been around before any of us was born. Process was around in 1900, it was around in 1800; process isn't going anywhere. My take is and what we're seeing with customers is the definition of process begins to change. Instead of thinking about of a process as only the sequence of activities that have handoffs or can be done by systems, now the actual context of what a process is also have to take into account the task design. So what Elise may call business moments from a Forrester perspective, we talk about it and have been talking about this really for the last couple of years. We talk about process atomization and so this is the idea. Instead of looking at this end-to-end process and reengineering the whole thing, we're really beginning to use some of the design thinking concept I mentioned earlier, put the process under a microscope and figure out what are those tasks that the redesigned and optimized him, and we take it down at an atomic levels. So the process we feel have processes but we're really atomizing and focus on redesigning those tasks that needed for maximum convenience. There is the opportunity to pride better engagement and much better convenience for the customer and for employees. It's not just about the customer. So when we think about process metrics in the future, a future metric might be can the employee or customer complete this task while they're at the stoplight? That may become a metric. that's not a great metric that you what wants have people doing but if you think about how busy we are today and how we -- the expectation to be able to get things done instantaneously that's not far off. I mean, I've done it. I don't know if you've done it. You been at a light and you thought you know what, let me go ahead and order this gift from Amazon while I'm at this light. And to a certain extent, Amazon has created the process where I can do one click. Now I may get into an accident trying to search for the gift, but that's the direction that we're going to is really process changes the focus on task design, processes become atomized at that level. So I'm definitely not at the sky is falling person; I see just the opposite, if you will.
Schooff: And I think we've seen it before, sort of the process is dead; long live the process.
Richardson: And I guess for me, that's why I see it's a very exciting time in BPM and in the process world because processes are being disrupted at an unprecedented pace. I mean, I think we'd have to go back to the early 1900s when Ford created the assembly line to get to a similar time frame or similar opportunity around process. I mean, obviously, mobile is disrupting processes. If you look at how how social has had a big impact on how we think about process. Customer experience is going to be the big piece that really completely changes the way we think about process and what process means. But process doesn’t go away it just shifts into a new mode and is reframed. It's a very exciting time. The clients I'm working with it's a lot of fun. It feels like we're back at pre-DOT.com times.
Schooff: Now that leads kind of directly to the next question. It is the role process and let's say retail customer experience where would you place that?
Richardson: Yeah, it's interesting because I think process needs to come much more transparent. When we think about what is a process in retail. I mean if you think about when we started looking at the mobile impact on process, one of the scenarios that I started looking at is Apple's frictionless purchase. If you think about going into an Apple Store today, you'd pretty much can pick up the merchandise, scan it yourself, and leave the store. Most people just think about those sort of processes, it's like, wow, that's so convenient to experience. It's really great except -- when I was doing the research around it, and I went into the Apple Store, I was a little bit, I guess, I don't know what the right word would be but I was a little bit pissed maybe, maybe that's the right word, that the genius when I came up to him to ring something up was like, well, you can just ring it up yourself. No, I want you to ring it up, right.
And so I think when we look at these sort of new experiences coming in, in retail, very innovative experiences that's where a lot of the customer experience innovation that's happening is in retail. Think about that. It really requires the atomization concept that I talked about earlier to really begin to think get the process down to the lowest level. Think about the task that the customer is trying to accomplish and then bringing context into play to really be able to help them get the task done faster.
So if you think about in retail, another example, Apple's obviously a leader in the -- I don’t like giving them a lot of extra credit, but they -- if you think about the Apple process around coming into get something repaired on your device, buy it, right. One of the things I realized is when you come into the store, they're actually aware that you came into the store that you can check-in. When I went through this process, I actually did the mobile check-in once I got into the store and they were able to begin monitoring or at least being aware of where I was in the store, which is really nice. Once I opted in to use location services. So the genius was able to really come right up to me and say hey are you here to get this done? And so I think you begin to see these sort of location aware services near field communication being able to give off alerts to have the process interact with the client at the location, at the point-of-sale, or at the point of acquisition. You're seeing these sort of capabilities at the retail level.
But I think if you zoom out for second, a lot of the contextual awareness that is available on mobile devices and tablets make prospecting not just more intelligent, but actually able to give more guidance on what the next best step is. And the reason I bring this up, kind of extending it beyond retail is a lot of the process experience design work we're seeing is around fieldworkers. So I'm out in the field, I have my device, my iPad or my mobile device and beginning to get guidance on not only my route, where do I need to go to work on different devices or different utilities, different assets, but also guidance on how to actually repair the asset. We're beginning to see that across different utility services, so wind farms, cell towers, operators, cable operators are all beginning to redesign process for that sort of field engagement with rich context and that's a very fresh area where we see this convergence between process, and contextual awareness, and mobile analytics is really rich area for observation.
Schooff: Now, so we're at the cusp of 2014, what do you see ahead? You obviously already touched on it, but how do you think it's going be different from what we've just seen in 2013?
Richardson: Yeah, I think we are at an inflection point in BPM, to be frank with you. And a lot of it is around what Forrester refers to as the "Age of the Customer". And so, we just published fresh research around what the technology management means in the "Age of the Customer", how does technology management change. And the big part of that is how does processes change around "Age of the Customer"? I mentioned some of it. But what it really means is process solutions process teams begin to focus more on revenue growth as opposed to back office conditions. And we've seen this coming for a while, but we're just beginning to see teams able to quantify and build impressive business cases around revenue growth, revenue optimization, new customer acquisition, and get funding for their BPM efforts. So I think a lot of the trends that you see around BPM in 2014 will be driven by that macro trend.
So if I look at the trends that if I come down to specific trends you see in BPM, the first trend that is going to be critical is BPM becomes BPM solutions, BPM suites become a primary platform for systems of engagement. And so we talked about you hear organizations and different pundits, if you will, talk about systems of engagement, so what that means. And what we see with customers is they're asking the question, how do I use BPM as my system of engagement that's front end solution that I used to build to engage clients more to actually have that contextual guidance as they're completing the tasks. And so, we've just begun working with clients really over the last six months or so to help them architect an environment where BPM serves as that system of engagement and that's really about developing the process driven apps and process driven solutions off of a BPM platform that are more customer facing. I think that's the big trend.
The other big trend that's really interesting for me I j st started covering...BPM service providers. So we just published a report on market overview for BPM service providers. So these are the consulting firms that companies turn to, to drive their BPM initiatives or to build a BPM center of experts let's say to get up and running around BPM. And what we found in that research is this area is growing very rapidly. It still has a high level of demand. The demand is increasing. I think we ended up with a prjoectiong of a $8.9 billion market by 2017, and so a lot of these providers were given some very aggressive numbers for growth so we were getting 35, 40% growth projections from some providers. And when we backed it into their growth over 2012 and what they look like, they're going to end up 2013; those numbers were not out of reason and when you compare that to the 7 to 10% growth of the other parts of consulting organizations, that's pretty impressive. And so I think what we're going to see over 2014 is the BPM consultant providers becoming much more strategic in helping companies deal with destructive requirements around process. So, going back to what I said before, I think that's another big trend.
I think that the last big trend that I'll call out is continued convergence. I don't know if you really want to say that's a trend, it's something that we've been tracking for a while. But you see a lot of talk in BPM around dynamic case management versus traditional BPM, or other analyst firms talk about type iBPMS. There's a lot of confusion in the market when I talk to customers around, well, what should I buy? And I think what you'll see through 2014 is continued consolidation and convergence around dynamic case management and business process management. And if you look at these two markets, really, there's the vendors that operate in this space. They both offer traditional BPM pattern support along with dynamic case pattern support.
And so, you see these, the BPM vendors, which offer dynamic case management supporting the entire spectrum of BPM use cases, and that runs from structured well-defined business processes, support for that to more dynamic processes, and dynamic case, all the way over to being able to offer what we at Forrester call front process apps which are more solutions than frameworks. And so we're seeing the BPM players offer that full spectrum of process use cases and we think that is going to continue to happen and we'll seek consolidation. So don't be surprised if you see packaged app vendors. One of my predictions for 2014 is packaged app vendors find BPM plays. So if you think about somebody like SAP or Oracle, even though Oracle has a BPM tool, it would be surprising to see them pick up one of the pure play BPM vendors that’s out there. We've already seen a lot of that activity happening. So I think that's something that we can expect for 2014.
My counter prediction probably will get a good bit of the market is that BPM continues to expand an adoption through 2014. And so we have numbers that show the interest and demand growing definitely if we look at enterprise architects or enterprise architects that are looking at how do we deal with all this change. BPM is number three on their list. Recent survey we just finished, BPM and process change is number three on their list of priorities. And so we see that not only from the EA perspective, but even marketing strategy teams are beginning to prioritize the need for process change. So I think 2014 will be a very good year for BPM overall.
Schooff: That's great to hear and great to know. These are exciting times. This is Peter Schooff from BPM.com speaking with Clay Richardson of Forrester. Clay, thank you so very much.
Richardson: Thank you for having me.