Business process management not only makes processes work better; it makes them more malleable too
Down in the dusty, dry streets of Laredo, Texas, a truckload of furniture arrives at a Lacks Valley Store. Unnoticed by the dock workers as they scan each product are the myriad exceptions typical in a large-ticket retail business: missing items, special customer orders and items that were never ordered but that showed up anyway. However, behind the scenes, a business process management (BPM) application is monitoring the warehouse and receiving systems, identifying each exception as it occurs.
The BPM application then goes beyond monitoring and actually prioritizes the exceptions and launches tasks for various employees (for example, walking an employee through the steps to review and address an expected order that did not arrive). The exceptions persist as tasks, or "in flight" processes, in the system and are monitored until they are resolved. The business analysts who actually deal with the problems are able to tweak the resolution processes in real time as they learn more efficient ways to improve operations.
In Extreme Competition: Innovation and the Great 21st Century Business Reformation, author Peter Fingar describes the rise of intense competitors from around the globe who "innovate by how they operate" and who are attacking markets both large and small - including small Texas border towns. To respond to these new competitors, companies like Lacks Valley Stores must transform and evolve their operations faster than ever before.
BPM helps them do that. "The biggest impact has been catching exceptions early enough to actually do something about them," says Lee Aaronson, CEO of Lacks Valley Stores. "Before, we had to rely on a customer complaining about an issue or accidentally discovering that something was wrong." Now Lacks employees either receive e-mails alerting them to take action or they log in to a portal to manage exception tasks and resolve them before customers even notice.
BPM can transform customer contact operations as well. American National Insurance Company (Anico) was one of the early adopters of BPM and has used it to streamline customer service processes across four business groups, resulting in a CSR workload capacity increase of 192 percent. "Our BPM initiatives have paid huge dividends," says Gary Kirkham, VP and director, planning and support division for Anico. "We eliminated the need for CSRs to 'dive bomb' into multiple mainframe applications to handle customer and agent requests and built rules into our process to guide them through a single view of the customer's information across multiple systems. BPM allowed us to both keep up with huge growth in our customer base and improve on all of our customer service metrics at the same time."
Of course, seasoned CIOs understand that no single new technology will be a cure-all for complex process issues. It often takes significant effort just to define who owns a process and how it actually works. If a process is bad, automation may only get bad results faster. Like Lacks Valley Stores and Anico, however, a diverse group of companies has achieved real results by leveraging BPM technology in their process improvement efforts.
A New Way to Build and Manage Processes
There is an old story about a clever university planner who waited to pour concrete footpaths on the new campus until students had worn paths between the buildings. Traditional IT infrastructure has evolved in much the same way: Experienced practitioners now try to thoroughly understand user requirements before deploying automation that can be as intractable as concrete. Conventional approaches to re-engineering and application development, however, can no longer meet stakeholder demands for rapid and ongoing process change.
BPM emerged as a response to this "move the footpaths now" requirement once easier integration technologies finally caught up with management's ongoing push for operational improvement. Although hundreds of vendors may each define it differently, most agree that BPM gives an organization the ability to define, execute and manage processes that: a) span multiple applications and involve human interactions, and b) handle dynamic process rules and changes, not just simple, static flows.
Software vendors eventually caught on and started providing platforms that integrated process modelling, execution and management reporting of process-specific metrics. Organizations now have the tools to automate and change processes across previously isolated applications, databases and people.
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