BPM Think Tank Day 2: Practitioners’ Case Studies

We had two case studies about BPM projects in the real world, the first of which was Lance Gibbs talking about AFLAC using BPM in their administrative services. They started with their invoice reconciliation process, since they dealt with over 500,000 remittances each month, and 30% of them didn’t match the invoice so couldn’t be automatically processed — a problem that I see in many of my own customers in a wide variety of industries. In their case, a mismatched invoice may correspond to a change in coverage, which required changes by their Policy Servicing group, and someone needed to figure out what was wrong with the invoice and start it through the remediation process. There was no visibility into the process, no prioritization to ensure that higher priority invoices were processed first, no coordination between the groups, and a lot of paper flying around. They really needed to get an invoice reconciliation turned around in less than 30 days, or else another incorrect invoice would be sent out for the next month’s billing.

To address this problem, they focussed on straight-through business process automation, human-facing workflow, and business activity monitoring. They started by scanning and indexing documents up front in the mail room, and early sorting and triage of transactions, which cut more than a day off their cycle time and allowed their reconciliation specialists to start work right away. They created web services that access their mainframe billing system using webMethods to be consumed by BPM. They had just achieved CMM level 3, and had to work at using agile BPM development processes that didn’t violate their CMM methodologies. Although it’s less than perfect, they now have more than 85% “one and done” for fixing invoices.

To establish KPIs, they looked at which were critical to the customer, and generally fell into three categories: quality, delivery and cost. They went from more general, hard to measure needs through to specific, measurable KPIs. For example, good customer service (a need) is a result of knowledgeable and friendly CSRs and a short wait time (drivers); knowledgeable CSRs can be measured by whether they were able to answer a question without further research (KPI, or what they call CTC for critical to customer).

They had a core process team of about five people, with other integration specialists being accesses as required. They went through a 4-1/2 month vendor selection process with a full bake-off between the two short-listed vendors (which he didn’t name, probably having been told not to mention vendors specifically from the podium). Update: Lance told me later than the BPMS is Lombardi.

The next case study was Clear Channel, with someone else pinch-hitting for David Jemeyson who took ill suddenly, discussing how they interfaced with Google to place ads through Clear Channel’s radio stations. The basic process is that a customer makes an ad purchase and uploads their audio spot with Google, who dispatches it to Clear Channel where it is prepared for broadcast and sent on to the radio station. At each step, they’re using loosely-coupled web services to move the data through the process, and they’ve modelled the entire thing in BPMN which he showed on the slides complete with drill-down to the detailed process with swimlanes. The result is that the entire process can be executed without manual intervention, including sending on the relevant information to their financial systems, and they were able to develop it all in about six months.

They used BizTalk and SharePoint for most of the SOA infrastructure.

The contrast between the two case studies was interesting: AFLAC was optimizing an existing business process; whereas Clear Channel was opening a completely new market enabled by the technology, which is one of those elusive ROI factors that we talk about but rarely see.

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