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I have heard some representatives of big companies saying that it is easy to change small companies, but changing a big one is difficult to do. Still there are several big companies like Best Buy, Apple, Microsoft, Google and IBM that are huge and still succeeding well. One thing that is common to them is that they are managing their customer expectations actively.
So, maybe it is not impossible to make big companies change their course also?

IBM is an interesting player on the market, since some years ago it sold its laptop business to Lenovo and decided to start focus their business more to higher profit margins by expanding aggressively overseas, seeking sales, low-cost engineering talent and quicker organizational response.

That did not happen by itself; big credit goes to Samuel J. Palmisano, who functioned nearly a decade as a chief executive in IBM. His time in IBM has been a textbook case of how to drive change in a big company (and there are many books and blog articles about him). Mr. Palmisano has explained in interviews that his guiding framework has been these four simple, but important questions:

  • Why would someone spend their money with you? What is unique about you?
  • Why would somebody work for you?
  • Why would society allow you to operate in their country?
  • Why would somebody invest their money with you?

Mr. Palmisano formulated those questions in the months after he became CEO in March 2002. In meetings after he took over, Mr. Palmisano told colleagues that IBM was still good, but that it was not the standard-setting corporation that it had been when he joined in 1973.

The four questions, he explains, were a way to focus thinking of the company beyond its comfort zone and to make IBM pre-eminent again. He presented this four question framework to the company’s top managers at a meeting in early 2003. He said: “This needs to be our mission and goal, to make IBM a great company”, according to executives who attended the gathering.

The pursuit of excellence in those four dimensions shaped the strategy of IBM. To focus on doing unique work, with its higher profits, meant getting out of low-margin businesses that were fading. IBM’s long-range technology assessment in 2002 concluded that the personal computer business would no longer present much opportunity for innovation, at least not in the corporate market.That is why they sold their PC business to Lenovo in 2004. They were not anymore the biggest PC provider in the world, but they made up elsewhere. That included acquiring other companies like PWC Consulting and others. Today they are doing bigger business than ever!

The hardest thing is answering those four questions”, Mr. Palmisano says, “You’ve got to answer all four and work at answering all four to really execute with excellence.” These four questions are important for smaller companies also, but they are crucial for bigger companies to change their course. And as IBM has shown, it is possible. Steve Jobs did the same for Apple and it is easy to see the similarities in customer focus of these companies. If you start to focus on the customer in big organizations, that will eventually turn the big ship around.

 

 

Get Janne Ohtonen's latest BPM book for free at http://addvalueto.me/download-a-free-process-leadership-book/

The following factors are related to management and leadership perspective in Business Process Management (BPM). You can read this list through and think about how these matters are set up in your organization.

Managers place confidence between supervisors and their subordinates.

The middle management is in many organizations the biggest obstacle to success. Higher lever managers do not trust their middle management and middle management do not trust their subordinates. This causes several bottlenecks that hinder communication and cooperation. Confidence between these parties is crucial.

Managers share vision and information with their subordinates.

It is important for employees to know where organization is heading at. In old world hiding information was quite normal, but nowadays all the information is available for everyone anyway, so there is no reason for managers not to share information regarding organization with their employees.

Managers constructively use their subordinates’ ideas.

Those people who actually do the work are the ones that have good ideas how to improve the organization. Thus, managers should listen to their employees and use these ideas to improve the organization.

Top management frequently communicates with project team and users.

Managers who do not talk to their employees are bad managers. They should not sit in their ivory towers and give out orders, but rather they should participate and communicate with everyone in the organization. That helps the flow of  information and stops the bottlenecks even before they arise.

Top management generally has realistic expectation of the projects.

Many times top management is somewhat disconnected from realistic expectations. According to Bain & Co. 80% of CEOs think their organization is providing great customer experience, but only 8% of their customers agree. Top management should realistically understand expectations of the improvement projects the organization is performing.

Top management has sufficient knowledge about the projects.

Top management should know what kind of improvement projects is going on in the organization. This helps them to understand what is going on and how it fits the big picture. So, make sure that top management stays up to date about your improvement projects.

Top management generally supports changes in processes.

If there is no support for changes by the top management, those improvements will not have chance to realize. So, the organization should have culture of continuous improvement and all good changes should be supported by the top management.

The employees are empowered to make decisions.

Old fashioned way of managing thinks that managers know everything and tell employees what to do. However, we are all people capable of thinking and we should be allowed to use our brains for the benefits of the organization. Managers do not need to decide every little detail and employees should be empowered to make decisions that take the organization forward.

Organization has empowered process owners, who are responsible.

Someone should be responsible for the processes in your organization. That person needs to be empowered to optimize the process and he should also have appropriate education and knowledge to do that. As you well know, money usually dictates who can do what, so make sure that when process owners have responsibilities, they need to have resources also. If process owner cannot have those resources personally (money, people, etc.), then make sure that the co-operation between process owners and line managers works well.

The performance measurements adequately correspond to the processes and changes into them.

You get what you measure. Thus, your organization should only measure what is really important and when you get the results, you should do the changes they require. There is no point to measure, if you do not act. The customer experience is the process; the organization should carefully measure their performance based on factors related to that.

 

You can reflect these factors to your organization for example with the following questions:

  • Does your top management have realistic expectations on projects?
  • How open communication do you have in your organization?
  • Does your organization listen to ideas and actually implement them to improve organization?
  • Are your employees empowered to make decisions?
  • Does your top management support changes in processes?
  • Do you measure the right things and act based on the results?
  • Do you have confidence between your different management levels and subordinates?

 

Get Janne Ohtonen's latest BPM book for free at http://addvalueto.me/download-a-free-process-leadership-book/

ased on extensive literature research on scientific journals, I have found the following factors related to Change Management perspective to be relevant for an organization to succeed in Business Process Management. You can read this list through and think about how these matters are in your organization, no matter if you are new to BPM or already seasoned.

There are training and educational programs to update employees’ skills.

People need to have good skills on their jobs. When you train employees, it does not just increase happiness, it will also help you to get your change programs through easier. That is because people do what they know and if you do not train them to know new things, the old ways will die hard. Especially in BPM, where the term is not always clear to everyone, it is important for your organization to train people to understand the concepts of BPM.

The reward system adjusts to serve the employees after the changes.

People do what they get rewarded on. When you do process improvement in your organization, remember to keep your reward system up-to-date and reward people only for the results that you want to achieve in your organization. Actually, when you want to change something, you should change the reward system first so that people are eager to change things rather than staying with old ways. As you well know: “Money talks…”

BPM concepts and methodologies are known and understood.

Business Process Management is not very clearly defined term. It will mean different things in different organizations. Therefore you should train your people to know the basic concepts and methods, so that will will have common language to talk about change programs. This includes also top management, which should have and use the same language as employees also.

People are eager to improve the existing state of processes.

The culture of organization should be change positive. When people are rewarded on change and they are taught to embrace positive change, then doing change programs will be easier and faster. People will resist what they are afraid of, so feed the atmosphere of questioning current state of processes and foster the ideas that people have for improvements.

The project plan for re-engineering processes is adequate.

You should start with the end in mind. How do you change your organization from current situation to the new one? Do you have enough resources? Is there enough time, money, etc. to make the change program successfully?

You can reflect above mentioned factors to your organization for example with following thought provoking questions:

  • What are your people rewarded on?
  • Do you ask employees for new ideas and take them into use?
  • Do you have training programs for BPM?
  • Is your customer experience aligned with process improvements?
  • Are your employees eager to improve the processes that you have now?

 

Get Janne Ohtonen's latest BPM book for free at http://addvalueto.me/download-a-free-process-leadership-book/

For consultants selling creativity to organizations is quite easy, because there is unlimited demand for it. Who would not want to improve their business at any given moment if it means getting more money? But, there are no authorities watching over this creativity creation and even companies who sell creativity seem to get stuck every now and then.

Isn’t it so that when the organization is having it’s roughest time, the people start to innovate new things, because they have to? That is not ‘true’ creativity however, since it is done under pressure. Organizations that show true creativity dismantle and rebuild their processes from time to time to make better structures. I bet you know the old saying: “If it ain’t broken, don’t fix it”. Creative organizations are doing exactly that; fixing the process even it ain’t broken YET. It does not mean that those organizations should run around like headless chickens renewing their processes just for the sake of doing it.

Renewing organization processes is most definitely needed and it must be nicer to do it when things are still all right, rather than when it is too late. What should be the perspective on innovating the processes then? Effectiveness, productivity, revenue, etc.? If we think about the question why those processes exist, maybe we will find the answer also. The customer is the very reason for any business organization to exist. Those working in public sector might think  that it does not involve them, but they are wrong. Even in the public sector, money comes from somewhere and is used to do something. Then there must be a customer, too!

When we start to innovate processes based on the customer needs, we get into the very source of business. People have interactions with your organization, because you fill in some need for them. And whoever does it best will get the most clients. How can organizations have endless process creativity then? Certainly, knowing their customers really well and being able to think outside the box how to fill their needs.

Here are some reflective questions for you to ask:

  • Are our processes designed and optimized from the customer’s perspective?
  • How do we optimize our processes? Does that work as well as it should for us?
  • Do we have a process for optimizing processes?
  • How do we handle new ideas, innovations and such in our organization?
  • Do we think “out of the box” when planning our processes?

 

Get Janne Ohtonen's latest BPM book for free at http://addvalueto.me/download-a-free-process-leadership-book/

Discussion about good and especially bad customer service experiences is favorite topic of many coffee table conversations. These customer interactions can be called also as moments of truth (read more about them fromJan Carlzon‘s book titled “Moments of Truth”). Moments of truth can be either misery or magic. If you get really good customer experience, then you will be happy and recommend that business to others also. But if something goes wrong, it becomes moment of misery, which will make you feel bad and work against the organization. Managing those moments of truth is one of the key factors to success for an organization and here are some reasons for it:

Customer interaction. Every time a customer interacts with your organization, it is an opportunity for them to form an impression, which may be either good or bad one, i.e. moment of magic or misery. People will treat the organization based on those moments of truth.

Surplus costs. Every moment of truth is a cost to the organization, because you have to work to produce that moment of truth. And you do not want to pay for producing moments of misery, do you?

For every  customer interaction there is at least one moment of truth. If customers have too many  moments of misery, the likely result is that the customer will leave or at least seriously think about leaving your business.

Less is more. The more moments of truth it takes to get something done with your organization, the less successful the customer experience and the more likely the customer will leave. The more you have those customer interactions, the higher the probability to produce moments of misery.

Optimizing your process. For every customer experience that deserves to exist, there are an optimum number of moments of truth. The customer experience is the process that your organization should be delivering.

Let me explain this with an example from my life. Let’s take pretty much any phone service that you need to use. I will tell you about phone service of one ISP in Finland. I wanted to cancel my subscription and to do that I had to call them. First of course the automatic responder will ask your details like customer number and such. Then you need to select from the voice menu what is your business with them, then what do you want to have done. That has caused already tens of moments of truths before even getting down to the matter. It does not cause ISP much of surplus costs, because the system is automated, but one must still wonder what do they do with the information. And I ask this because when you get a real person on the phone, she will ask you pretty much the same questions. And if you happen to ask her “can’t you see the details I just gave to your automatic system?”, she’ll respond that this information was just needed to route the call to right person. Talking about moments of misery! If someone would just answer me right away and help me deal with my problem, that would mean less customer interaction and a happier customer.

When challenging most customer experience management professionals about how they would improve the customer experience for this interaction, they talk about making each touch point better, ensuring the business support people are as helpful as possible and capturing the survey results, feeding them back into the customer experience management program and employee rewards program.

Ask most consultancies how they could improve this customer experience and in most cases, their approaches will be the same. They would assume this customer process deserves to exist because it is not possible to stop customers. Thus, using traditional approaches, they would create a project to design an improved experience for customers. Then they will ensure that each customer interaction is “better” and “quicker” and will reward customer service agents for their increased “efficiency”, their KPI’s being aligned to the average touch time and talk time, or the quicker they can get customers off the phone or sending email.

Here is the catch. This whole customer interaction could have been made significantly better and significantly cheaper by considering the philosophy of whether this customer experience deserved to exist. Instead of having automated middleman, a significantly better customer experience would be just to have trained personnel deal with most customer service situations. This approach could have helped to solve the problem quicker and in most cases, could have prevented the need for spending so much time on the phone.

This kind of customer centered thinking is being used by many of this century’s most successful companies and there are many techniques, which are enabling organizations to benefit from this kind of approach. So, when asked to improve the customer experience, never assume that all customer experiences deserve to exist; you have to challenge them!

Here are some reflective questions that you can ask:
  • Does our organization produce proper customer interactions?
  • Have we analyzed our business processes from customer perspective?
  • How could we simplify our business processes so that they would make customer’s life easier, simpler and more successful?
  • Do we actively engage with customer to discuss about the service we provide?

 

Get Janne Ohtonen's latest BPM book for free at http://addvalueto.me/download-a-free-process-leadership-book/

Starting a business process management project and choosing the right BPMS system can be a quite tricky thing to do, especially if your organization does not have experience on it. There are several ways to start BPM projects and there are many methods available to choose from. Here are some questions that you can ask when thinking about starting a BPM project.

What process is at hand and what does it achieve?
You should first get an idea what that process is about. Asking what it achieves will help you get the reason why this process exists. It will also help you understand how critical is this process for organization’s customers. The process should be clearly some part of producing successful customer outcomes. But do not restrict yourself into one process only, every process in your organization needs to have some clear function in fulfilling customer needs (otherwise that process is redundant and needs to be get rid of).

How does the process currently work?
To choose what is going on in the process, you should get some kind of idea how that process works today. There are many ways to do that, for example flowchart and CEM Method. If your organization does not have process maps, this is a good time to pick up a pen and start drawing. But remember that the point is not to get that process map, but to understand how that process works today. Therefore, it is important to have all relevant parties participating process mapping. I say it once again: the goal is not to model the processes just for the sake of modeling them, but to understand how those processes work.

Who are the participants in the process and what are their roles?
This will get you the roles and responsibilities of the people involved with process. This will also help you to find right performers to various tasks. Right people should be doing the right work. This is why it is important to have people from all parts of processes participating the modeling, because they do taks that others do not know of and thus, could not model them into process map.

Which business units participate in the process?
This will help you understand who are the stakeholders and how complex it will be to design the process. The general rule is that if there are more units, the more complex the process will be and the more effort you (and client project team) will spend bringing everyone to a common accepted stage. The more you have functional silos in your organization, the more complicated it will be. Process optimization goal is to get rid of those useless functional silos and design the organization’s hierarchy around fulfilling the customer needs.

What will be the value of the process to customers in future?
Now you start asking questions about what needs to be built. Find out what business you are in, what are the customer needs and how to provide that with minimal customer interaction. Such processes that are not directly contributing to fulfilling customer needs are the be get rid of. Also tasks in processes that are not clearly contributing to that goal, should be either removed or at least improved.

Where does the process start and end?
This is very important, maybe even the most important question besides what business are you in. Sometimes you will realize that employees do not understand where process starts and where it ends for your customers. They know just their part of the process. Make sure that everyone involved in that process knows both their part and the whole purpose of the process. This helps people to be more proactive in process improvement and it will also make the work more meaningful because they will know how their contribution is used in the big picture. This will also help to avoid building those functional silos that do not work well.

What information flows from one person to another?
It will help you to model and minimize internal hand-overs. If you are going to use BPM System, this will help you determine what the screen and data fields should be. Sometimes you could be dealing with complex sets of data. Do ask questions why these information flows happen and whether they are really useful.

Which internal and external systems will this process interact with?
Find out what level of integrations are you looking for. Most of the business processes will be integrated with some other systems. Sometimes integrations could lead to complex processes, screens and routing. Remember that integration is a tool for providing successful customer outcomes easier. Use technology to help you, not to slave you. Nowadays there are many good BPMS system available to do that.

Are there any business rules associated with the process?
Ask what business rules are there. Also ask how often do they change. And most importantly, ask whether they are still relevant. If you are going to use rule engine as part of the BPMS, this will help you determine if rules should be embedded into the process or put in as a separate component.

What are your reporting requirements?
Your data layouts, your process routing could depend upon what reporting requirements are there. If user needs reports business unit wise or region wise, you will need to incorporate those fields into your work-flow. When you measure, remember that you get what you measure. It is crucial that your KPIs are aligned with successful customer outcomes, otherwise you will not get the results that you are looking for in business sense. You can use Business Intellicence tools joined with BPM tools to get that information.

What are your implementation time lines and constraints?
Determine what are the time lines and constraints. It is possible that people will ask you the question “when can I have this?”. Be sure you keep it open or at least realistic. Unless your implementation team has analyzed everything, do not give an estimate. Determine what constraints organization has and figure out how the project can still go through.

Who will sign off the requirements and final production for this process?
Finding out the right people is important. If one person is going to sign-off the requirements and the other is going to do user approval tests, you are in trouble. Make sure the right stakeholders are in your list and you spend enough time talking to them over the course of project implementation. It is  very important to make sure that top management is committed to process improvement and give their full support for the project.

As this blog article has shown, there are many things to consider when you start a business process management project. And that being said, actually BPM is not one-off project, it is on-going, iterative process where you improve your business continuously. If you are a beginner in BPM, it might be a good idea to get some experienced people to help you.

 

Get Janne Ohtonen's latest BPM book for free at http://addvalueto.me/download-a-free-process-leadership-book/