posted 3 Nov 2008 in Volume 12 Issue 2
Ei feature: Four of BPM’s top leaders answer ‘Whatever happened to BPR?’
My primary hope for process management is that it will become embedded in the everyday and long-term behaviours of organisations around the world. It needs to stop being viewed as a fad (actually, a series of fads), and begin to be viewed as an essential aspect of organisational structure and management. If it’s a fad, organisations won’t use process management to constantly and consistently improve how they do their work on behalf of customers. – Tom Davenport
Business process reengineering (BPR) of the 1980s was/is a term knowledge management wonks love to hate. The process in BPR, they say, led to mindless downsizing that dismissed immeasurable sums of intellectual capital in countless organisations worldwide. So, whatever happened to BPR?
Paul Harmon, executive editor, Business Process Trends:
First of all, there were things that were happening well before BPR. Six Sigma and Lean were happening in the Eighties. Rummler had introduced performance improvement and Porter had introduced value chains well before Hammer and
Today, the focus is back on a broader array of options and, more important, on integrating and managing the whole set of process change options. Companies are still interested in reengineering some specific processes, but they are also interested in other redesign and improvement techniques and they are also interested in organising, measuring and assigning managerial responsibilities. That’s the point of BPM.
It isn’t as if any of the earlier efforts have disappeared. Many companies still have active Lean Six Sigma efforts. Lots of companies use Balanced Scorecard. Nearly all have some ERP software and many use workflow systems. Some still use Reengineering, in the manner Hammer and
[Editor’s note: Michael Hammer, former MIT Sloan School of Management lecturer and business process revolutionary, died at the age of 60 following an auto accident 22 August 2008.]
Increasingly, however, a few companies that have become very mature in their use of business process management have reorganised their companies to support processes in a more consistent way.
They have defined comprehensive business process architectures and assigned performance measures to each major value chain or process so that results can be measured. They have assigned process managers to be responsible for achieving process-oriented KPIs [key performance indicators] and they often use process-focused balanced scorecard systems to align goals, measures, processes and managerial responsibilities.
Foundation of change management
Process is ultimately about how work gets done in an organisation. In times when change is very rapid – as it is today – organisations need to be very clear about how work is currently done so they will understand what will be involved in changing their processes to meet external challenges.
When one company merges with another, each company’s processes must be understood and then merged. When a company outsources a key process, it must know what is being outsourced and exactly what inputs and outputs must flow between the company and the outsourcer. When new technology becomes available the organisation needs an efficient way to identify where the use of the new technology will impact the organisation.
Similarly when new government regulations require new reports, the organisation must have an efficient way to identify where data is generated that will be required for the reports.
All of these problems are simplified if the organisation has a mature, comprehensive understanding of its business processes. All are confounded if the organisation must start from scratch each time it is asked to define exactly how work gets done.
Business process management is less about new techniques than about how to coordinate technology and practice already in existence. We don’t need to reinvent the concepts that Rummler and Porter proposed in the ’80s or the practices that Lean and Six Sigma practitioners have used. In most cases we simply need to provide an overarching context and manage the effort in a more effective manner.
This description of BPM may suggest that BPM is a mature approach that can handle every problem. Not so. In fact, the best BPM practitioners are aware that they stand on the shoulders of many others, and, more important, that there are domains that are beyond current practices.
We are good at defining core manufacturing processes. We are getting better at defining core service processest and support processes. We aren’t so good, yet, at defining management practices or core practices that change frequently or that depend on lots of people interacting via email to evolve a solution to a more or less unique case.
It is important that new process practitioners develop a clear understanding of what they are good at and what still lies beyond techniques and practices. Process areas where knowledge plays a large role are very challenging and need to be approached with caution.
Human expertise is more than information – it changes every day and human experts encounter new cases or attend conferences, or talk with other experts and gain new insights. It’s far better, for example, to focus on developing good knowledge management systems that can capture human expertise – or internal websites with questions and answers, for that matter – than to try to formalise dynamic expertise in more or less static, formal process descriptions.
Process management, like business itself, is evolving and changing right along with the environment in which business exists. Organisations have been working at process management, in one form or another, as long as there have been organisations. BPM is simply the latest stage of that perennial effort to define how work is done and make it as effective and efficient as it can be.
Brett Champlin, president, Association of Business Process Management Professionals:
I see BPR as a methodology or approach to transforming major business process. As such it is just one approach in a spectrum or continuum of business transformation that goes from minor corrections (quick wins/low-hanging fruit) to process improvement (we’re doing the right thing, we just need to do it better) to business process redesign (we’re doing basically the right stuff, but we need to add something, take advantage of technologies, modernise, etc. (do some stuff the same, and change some stuff) to business process reengineering (we need to strategically rethink what we do and how we do it and then design the best possible way to get there as fast as we can.
As such, BPR is an accepted but infrequently used approach to managing business change. If we manage our organisation from a perspective of managing process performance (process management) we necessarily have BPR as one tool in our toolbox for change. Today we call the entire toolbox BPM – managing and designing business processes for ongoing adaptation and agility. BPR is still in the toolbox, but the rest isn’t specifically or strictly BPR.
Thoughts from a frustrated practitioner
From my point of view, BPM began as a new approach to process-oriented work at the same time (2001-2003) that software vendors began selling business process management systems (BPMS) as a new way to support process-oriented work. This followed on the heels of process improvement, process redesign, and process reengineering and subsumes all of them.
One of the major issues to implementing BPM as a new approach to managing business is changing management’s mindset. First, it must be recognised that this is indeed a new approach and then understood what that really means. Industry has been operating with an industrial orientation to business for about 250 years and that it is difficult to change. Most managers when hearing about BPM say “we already do that”, but what they mean is they already manage operational workflows of limited scope.
Many organisations have been through total quality management (TQM), and a multitude of ‘process improvement’ and ‘process redesign’ methods (including Six Sigma, ABC and Lean). And then there was BPR in all of its flavours which focused on the ‘big P processes’, those that cross functional boundaries and deliver value to the customer – the value chain.
Having been through all of this over the last 20-30 years, a lot of managers have come to view all of these approaches to operational improvements as more or less the same with a few slight nuances in technique or point of view. So, when they hear BPM, they think, “Oh, that’s just another workflow improvement fad”. And, unfortunately, that is just what a lot of vendors and consultants provide. They also think that it is just a way to manage a project, but it is much more than that.
In the current transitional period, most senior managers are still most comfortable managing their operations structured around hierarchical functional organisations and the information that supports those functional silos. To change that and become a process- managed organisation involves challenging the existing management system – the very thing that managers have learnt to be good at. It also involves changing the way IT builds and designs business solutions. It means managing end-to-end process performance across organisational or functional boundaries with process performance taking priority over localised measures (the traditional management responsibilities on which they were rewarded).
A Gartner analyst has said in one of his pieces that the ‘end game’ for BPM is two things: (1) business managers able to change their business processes without involving IT and (2) no more big disruptive projects… or something like that. That is for some BPM practitioners a long-term goal statement but not reality today.
I do know of a few organisations that have reduced their annual project portfolios from hundreds of projects to handfuls following BPM implementations. The idea is to design for change – both the IT and the business operations. That way, making changes to your business is not disruptive and making a change doesn’t freeze the new state of operations or IT into an expensive and difficult barrier to future changes.
A few organisations and individuals have been teaching and promoting process-oriented (process-based, process-centric, et al.) approaches prior to BPM as a semi-coherent discipline, but generally with few sustained successes. The advent of the BPM software vendors provided more consistency of approach and a far greater capability than was available before and really did bring a whole new approach to not just dealing with one-off changes to the business operations, but actually managing an organisation as a coherent set of interacting business processes (big P).
ABPMP is just about to release its Business Process Management Common Body of Knowledge (BPM COBK®) to the public. It has been available only to ABPMP members for the last six months for review and revision by the community of practice.
The major topics covered are: business process management (as a management discipline), process modeling, process analysis, process design, process performance management, process transformation, BPM technologies, process management organisation, and enterprise process management. An appendix contains a model curriculum for BPM for undergraduate and graduate academic programs (see www.ABPMP.org for the latest staus on ABPMP’s BPM CBOK®).
Shortage of BPM staffers
There are not enough qualified people who know what BPM is or have much experience doing it to fill the demand. Few academic institutions are teaching programs in BPM and there is only one degree program that I am aware of and it is entirely focused on the technology aspects of BPM. There are not a lot of training programs for BPM skills and not a lot of consistency of content between those that are available.
In fact, you might get the impression that every training program is competing with the others to present the ‘best’ way to do BPM when, in fact, there are a variety of approaches (and technologies) that work and need to be employed in most large organisations. So if you are building a BPM capability you probably need to think about building some of your own training and spending a lot of time recruiting the right people (those open to new ideas, willing to take some risks, learn and develop new approaches, and who can be creative in problem solving), and you will have to pay for that talent.
Organisational design for managing by process is another issue. Most practitioners know that to be successful you can’t treat BPM as a single project or a series of one-off projects. It must be embedded in how the business is managed – in other words, we have to redesign the management process before or as we transform the operational processes. And there is not just one organisational structure or design that is BPM. There are many different structures that work – the successful one will be the one that fits your business, your culture and your industry, not necessarily the ‘one’ way a particular training vendor favours.
So in summary, what do practitioners need to know about BPM (process management)?
This isn’t your grandfather’s/father’s process improvement;
It is challenging;
It is rewarding;
It’s as much about relationships as it is about process and technology;
You won’t be successful following someone else’s playbook;
It is expensive but done well brings huge returns;
Successful BPM projects are just baby steps – you have to provide compelling ideas to engage leadership to change how the organisation is managed;
Don’t believe everything the vendors (software, training, and consulting) tell you… their objectives are different than yours;
Do a lot of research and benchmarking, read BPTrends, read Davenport (all of his books);
If you feel like you are all alone, join ABPMP and get networked with an international community of practitioners who are dealing with the same problems that you are.
In view of the fact that nobody has been doing BPM (maybe some other stuff, but not BPM) for more than five years at best, all BPM is ‘immature’. Nobody/nothing is born fully formed as far as I know.
In Part II, in the November edition of Inside Knowledge, Michael Rosemann, Professor, Information Technology, Queensland University of Technology, Brisbane, Australia, will discuss BPM maturity standards and Tom Davenport, who holds the president’s chair in Information Technology and Management at Babson College, Massachusets, US, will wrap it up with a look into the future of business process management.
Paul Harmon’s e-mail address: firstname.lastname@example.org, Business Process Trends website: http://www.bptrends.com/. Brett Chaplin’s e-mail address: President@ABPMP.org, ABPMP Website: http://www.abpmp.org/