Category: process

business process management

Pegasystems’ Platform as a Service

Last week, Pegasystems announced their BPM “Platform as a Service” (PaaS) offering, and I had a chance prior to that to chat with Kerim Akgonul, VP of product management. My first thought on reading the phrase “internal cloud” was that they were just hitching a ride on the cloud bandwagon — check out James Governor’s 15 Ways to Tell It’s Not Cloud Computing for all the reasons that this isn’t cloud computing — but there are definite cloud-like capabilities to what they’re offering from the viewpoint of the individual projects, although not to the organization as a whole.

A problem that I see in many large customer organizations is that BPM projects end up being departmental, and even if the vendor manages to sell enterprise-wide licensing, it often ends up only deployed in one department. In many cases, this is because departments don’t want to share BPMS instances, and it’s just too hard to go through the effort of deploying another separate server and instance for every project. There’s also the need for multiple instances for development and testing, usually hand-installed at some cost. This is exacerbated in large organizations with a variety of geographically-dispersed business units, where they may have several different independent BPM projects on the go at the same time, and have difficulty in applying successes in one area to another.

Pega’s PaaS offering is a platform on top of SmartBPM that allows corporate IT to offer out independent BPMS instances to business units: true multi-tenanted instances for individual projects, but sharing the same infrastructure. Effectively, they’re turning corporate IT into an internal cloud BPM vendor, and the individual projects as customers of that offering. This gives some of the benefits of an externally-hosted SaaS BPMS — shared infrastructure, fast provisioning — while alleviating (perceived) security concerns of using external services for operational systems. You still have to buy and maintain the servers, and have in-house Pega system administration knowledge (which would not be necessary in a true SaaS environment); the real benefits come to the individual projects.

Allowing each project/department to deploy their own virtual BPMS will definitely speed some projects along, but it feeds the habits of some of the problems of departmental solutions that we’re trying to get away from. Encouraging the continuation of the silo culture makes it difficult to get to a true process-centric view of your business and tackle those end-to-end processes. However, Pega is allowing for some cross-instance sharing of artifacts using a new registry/repository to encourage reusability: different instances can share services, processes and rules directly, or make a copy into their local instance.

There’s some nice features in terms of synchronizing upgrades of instances: instances can opt out of an upgrade for a period of time to allow for custom application synchronization, although there would be limitations to how long that they could delay the upgrade. This capability is critical since many of the instances are likely to have custom applications built within them, and they’ll need time to test and make adjustments to those applications for a new version of the underlying platform.

At this point, there’s no billing capabilities or other modules that would allow this to be used as a multi-customer SaaS offering, but next year, they’ll be offering  a series of applications that may be offered internally or externally, for example, by business process outsourcing firms.

The first version of PaaS is planned for release before the end of the year, although it wasn’t yet in beta when I had my discussion with them three weeks ago. I expect to see more at PegaWorld in just over a week.

I’m viewing trends like this as a long-overdue maturation of the industry: vendors are starting to realize that customers are having serious problems with rolling out large BPM programs across their organization, and starting to offer products and advice on how to accomplish that.

The next stage in the BPMG saga

Remember BPMG (later reincarnated as BPTG)? I wrote previously about the original troubles when Steve Towers and Terry Schurter (two of the key people at BPMG) left and started Bennu Group, a competing training organization. If that wasn’t bad enough, they also redirected the BPMG domain to their own website, in what many consider to be an incredible show of bad faith.

That was just over a year ago, and today it appears that Bennu Group is dissolving. From an email sent yesterday from Terry Schurter to a participant registered for an upcoming course:

I must inform you that the Dallas CPP class offered by Bennu Group has been canceled as Bennu Group LLC is now in dissolution.

If you would like to receive a refund of your purchase please let me know and I will process your refund promptly.

Alternatively, if you would like to attend a CPP class on the same day and same location with myself as the instructor I can transfer you over to that course at no additional cost.

Then, in a follow-up email:

It will be announced tomorrow morning that I, Alex Morse and Don Smith [the latter two also from Bennu Group] have formed a new organization – the International Process and Performance Institute (IPAPI). This is a not-for-profit organization formed in the state of Texas and will be carrying forward the CEM vision.

Certification (IPAPI CPPTM) will be granted under the new organization. The material for the course is based on the same fundamentals used in the Bennu Group program, revised to reflect the learning from delivering that program for a bit over a year. The primary revisions include simplification of explanations and context along with discussion on flexibility that can be employed with the techniques presented. We also include additional new resources and templates for class participants to help make using the techniques easier, simpler and more successful. We will be using at least 3 case studies for hands-on activities in the class.

I am personally very excited about the new direction. The movement to a not-for-profit is a very important step (if you decide to attend my class you will be given a free one-year’s membership in IPAPI). You will also receive one year’s access to the online training which is again a revised and updated version of what was offered by Bennu Group.

The IPAPI.org domain was registered by Alex Morse over a month ago, so this has been brewing for a while. If you check LinkedIn, there were only four employees of Bennu Group; after this latest round of musical chairs, Steve Towers is the one left standing on the outside as the other three start a new venture of the backs of the work started by BPMG and continued by Bennu Group.

This raises a number of interested questions, not the least of which is about the value of BPM certification from training organizations like this. To state that they offer certification for their courses seems a bit hollow and self-serving: what sort of accreditation do they have to make a claim for the ability to offer certification? And more importantly, when the music starts again in a year or so, who wants to be holding certification from an organization that no longer exists?

My advice: take training with any organization that appears to offer what you need, but pay little or no attention to claims of certification unless it is a widely-recognized organization (think Microsoft or IEEE here) with a well-established training and certification program.

Note: I’m receiving this information (and the email quoted above) third-hand, so there could, of course, be inaccuracies.

Business Process Driven SOA using BPMN and BPEL

I just received a review copy of Matjaz Juric and Kapil Pant’s new book, Business Process Driven SOA using BPMN and BPEL. It’s on my list of recent books that I’ve received to review, and I hope to get to it soon.

According to the authors’ description, you’ll learn the following from this book:

  • Modeling business processes in an SOA-compliant way
  • A detailed understanding of BPMN standard for business process modeling and analysis
  • Automatically translating BPMN into BPEL Executing business processes on SOA platforms
  • Overcome the semantic gap between process models and their execution, and follow the closed-loop business process management life cycle
  • Understand technologies complementary to BPM and SOA such as Business Rules Management and Business Activity monitoring Approach

I’ll let you know if I learned all of that once I’ve had a chance to read it.

Gartner BPM: Global 360/Carlson Marketing

Robert Lang of Global 360 to talk about an implementation at Carlson Marketing, a travel, meeting and event planning company. They had a lot of paper-based processes that included hand-offs between departments with complex approval processes; not only was the basic process difficult to manage, but changes to a customer proposal were difficult to execute efficiently.

They used Global 360, SharePoint (as a portal), InfoPath (for complex forms UI) and SQL Server to implement their travel proposal request process, including automating the routing of work requests related to the proposal process. They automated some operations, and made other operations considerably more efficient by maintaining a common folder for the proposal that could be accessed by any relevant participants. They allowed for spawning related but independently-executing processes.

Their benefits:

  • Faster processing of proposal requests
  • Better accuracy in data collection
  • Less rekeying of data
  • Consolidation of data into a centralized database for historical analytics
  • Improved turnaround time by 30%
  • Reduced number of personnel required to process a proposal request by 19%
  • Ability to identify and address bottlenecks in the business process
  • Dynamically reconfigure and reassign staff to optimize work

They plan to use Global 360 for other projects, including A/P, HR and their call center.

That’s it for me for this Gartner BPM summit: after spending most of the last 2 weeks traveling to 3 conferences, I’m skipping the vendors’ parties tonight and the last half-day of content tomorrow morning. I’ve been thinking about a wrap-up post comparing the 3 very different conferences — one academic, one vendor and one analyst — so watch for that over the next few days.

Gartner BPM: Global 360/Citi Cards Imaging and Workflow

Global 360 has a bit of revolving door with analysts: first, they hire Jim Sinur from Gartner. Then, they hire Colin Teubner from Forrester. Then, Sinur leaves. And here today at the Gartner show, which he admits is his first-ever, Teubner presented on behalf of Global 360 about putting people first in BPM. He really only did the introduction, however, before turning over the presentation to one of their customers, Richard Van Hoever, SVP of Customer Service Paper at Citi Cards.

Citigroup uses a lot of Global 360: 10,000 users worth. They’ve implemented a pretty standard imaging and workflow transaction processing application, with work queues that push work to participants rather than allowing cherry-picking, work prioritization and routing, and load balancing across their domestic, nearshore and offshore workforces. The big challenges are the volume of work, tight integration between document management and BPM, and geographic routing.

They were able to get 75% of their required functionality out of the box with Global 360 (they were promised 90%, but that type of discrepancy is pretty common). Most of the customization was around the work filtering, sorting, assignment and presentation, as expected; Global 360, like other BPMS’, does most of the behind-the-scenes stuff out of the box.

What amazes me is that this is fundamentally not different from the types of imaging and workflow systems that I’ve been helping organizations to implement for about 15 years; the only thing that has changed is that the relative sophistication of today’s tools means much less custom code and greater process agility. However, the business process is the same inefficient, key-from-paper/image process that’s been happening the same way for years. Undoubtedly, the relative volume of some transaction types will have reduced due to online self-service, but it’s clear that many large financial services organizations have a long ways to go in terms of making it easier for their customers to do their data entry for them.

Gartner BPM: SaaS and BPM

Having bugged out of the Agile BPM session, I arrived late to Michele Cantera’s discussion of whether software as a service is a viable option for process improvement projects. She covered off some of the same material as the SaaS and BPM session in February, but there was some new information as well. I won’t repeat the material from that session on the topic of BPM SaaS delivery and multi-tenancy models, so you might want to go back to that post and check that out as background for this. Go ahead, I’ll wait.

One interesting bit, based on 2007 estimates, segmented the BPM SaaS adopters into four categories:

  • Pragmatists, forming 49% of the market, who are replacing departmental on-premise applications but don’t have an enterprise-wide scope.
  • Beginners, 40% of the market, who are replacing low-end software tools with simple utility applications. These are often small or medium businesses who don’t want to grow an IT department.
  • Masters, 10% of the market, who are weaving SaaS applications into their enterprise-wide application portfolio.
  • Visionaries, a mere 1%, who are actively replacing on-premise applications with SaaS wherever possible.

She showed these plotted out on two axes: comprehensive strategy versus IT ability to execute. Pragmatists are low on comprehensive strategy but high on IT ability to execute; beginners are low on both, masters are high on both, and visionaries are high on strategy but low on ability to execute (since they don’t need to have internal IT skills). I really like this segmentation, since I think that it provides a good way to characterize SaaS customers in general, not just SaaS BPM customers.

She went through the list of current BPMS SaaS vendors, split out into business process modeling, process-based applications, and BPMS as a service. The SaaS modeling vendors are Lombardi, Metastorm and Appian; BPMS as a service is offered by Appian and Fujitsu. Process-based applications are typically offered by companies who have taken a commercial BPMS and built a specific vertical application on top of it; the underlying BPMS is not necessarily offered as SaaS directly, and in most cases, the BPMS vendor is not the one providing the service (with the exception of DST, whose BPM product grew from their own mutual fund back-office application), since most of them are not in the vertical applications market. There are going to be more entrants into all of these spaces in the near future, as well as changes to the multi-tenancy models offered by the vendors; you’ll want to keep your eye on what’s happening in this space if you’re considering BPM via SaaS, and start to consider how you’re going to handle process governance when your business processes aren’t running on your own systems any more.

She also showed a chart of different SaaS services types (BPO, application outsourcing, hosting, traditional ASP/SaaS model, process-based applications using BPMS/SaaS, BPMS as a platform, BPMS as SaaS-enabling platform) mapped against operating characteristics (operational cost, degree of customization, process agility, cost of process agility, number of suppliers): for example, BPMS as a platform has high process agility, whereas a traditional ASP/SaaS application that likely doesn’t include a BPMS has low process agility.

There was a list of do’s and don’ts of using SaaS for process agility, such as using BPMS via SaaS for pilot projects in order to make the business case for on-premise systems. Of course, if you do that, you might just find that you like the SaaS model well enough to stick with it for the long run.

Gartner BPM: Opening Keynote

I arrived a bit late, transferring from the Ritz out in Tysons Corner down to the Gaylord in National Harbor (which Google Maps still thinks is a construction site), but caught the last half of the opening keynote with Janelle Hill and Michelle Cantera.

They started with some of the forces affecting business, both business and technology. Technology forces of change include having to balance enterprise-class and global-class computing, by which it appears that they mean custom, heavy-duty, special-purpose applications versus mass consumer applications: she makes the analogy between a custom, craftsman-made desk for the Oval Office versus an Ikea desk for the rest of us. Business forces of change include globalization, regulatory oversight, the evolution of the workforce (this is sort of a rerun of Connie Moore’s message of yesterday), and the complex value chains created by collaborative enterprises.

Since we’re here to talk about BPM, the next part was on how BPM helps us to cope with these forces of change. Their current BPM definition includes management practices, a structured approach using the management practices and software tools, and a cultural transformation (this last one is new in their definition, and long overdue). Overall, BPM is a set of disciplines plus technologies; it both encourages and enables continuous change in response to external forces, with a focus on optimizing end-to-end processes rather than specific functions. A key part of the approach is iterative (not phased), time-boxed, agile delivery, which I agree is critical but rarely see in practice.

BPM is being used heavily by companies that need to cope with frequent process change, usually in their customer-facing processes: from changes several times a year down to weekly or even daily frequency, plus ad hoc changes to executing process instances. What you need to think about, then, is how BPM changes your planning practices: Gartner suggests planning on shorter cycles and making plans dynamic and more transparent, with explicit guidelines for business outcomes rather than an explicit path by which those outcomes are reached. BPM also changes your organization and leadership by empowering employees (that’s a bit of a tired expression) and encouraging more fluid, virtual teams. It’s not clear that BPM is the real contributor here, however: I have the sense that they could take this same slide and present it at a number of different technology conferences (e.g., Enterprise 2.0) without changing anything but the title.

To use BPM effectively, you have to take advantage of monitoring and optimization, which is hopefully built into your BPM solution. This allows for better alignment of goals, metrics and results.

They finished up with a discussion of the skills and competencies required to build a BPM center of excellence (or as Gartner calls it, a center of competence), and a flying tour of their business process adoption and maturity model. Surprisingly, this tag-team presentation went way over time, not a good start for the day.

Not much new and exciting here — pretty much what you expect from a keynote — but a good overview of BPM in the context of business for the newbies in the crowd.

Appian Forum: Mercer

Chris Gardner, VP of Development at Mercer (who provide HR consulting, HR outsourcing and investment management services), presented the last session of the day; Mercer Outsourcing, with which he is affiliated, provides HR benefits administration.

They rolled out their first 3 processes in April of this year, with the BPM projects involving IT, their operational effectiveness practice and the operational units. Their key drivers are to drive out costs through increased productivity, increase automation of process steps and integration between systems, and standardize processes. Previously, it was difficult for them to reuse or even standardized processes across clients, and many processes required that disparate systems be integrated through human effort. Although in many cases, they thought that they had standardized processes, forcing them onto a common platform exposed their process variability and allowed them to address it directly.

Their benefits from implementing BPM include reduced errors, reduced cycle time, increased SLA attainment (hence reduced penalties for violating SLAs), and greater user productivity (and therefore reduced staffing requirements per client, key since their business in expanding). Automating steps and standardizing processes also allows them to offshore some parts of their processes, reducing costs even further.

Unlike most of the other case studies today, which focused on the human workflow side, they make extensive use of web services for increased automation and, where possible, straight-through processing. One of their projects was an unattended data extraction and file transmission application, where data was extracted from their system via web services calls to an ETL tool, PGP encryption, and FTP of the resulting file to the appropriate third party. Now, the only time that a person is involved in this process is for exception handling, and they have it rolled out to 60 client teams transmitting more than 500 files per week, with 85% of the transmissions being completely hands-off. This creates very different process design challenges than with primarily human-facing processes, such as handling web service unavailability. Even for the hands-off processes, they generate various reports directly from Appian as input to their compliance requirements.

The second application that they’ve implemented manages inbound data files, where Appian acts as an orchestration engine coordinating tasks spreading across their own proprietary systems and other commercial systems. They surface many of the errors and exception handling through Appian, which is  exactly what you should be using an orchestration engine for.

He was very excited to hear about Appian’s earlier announcement about ShareBase, since he feels that they have a lot of intellectual property that they share without compromising their own proprietary methods and processes, and encouraged other clients to participate fully in this.

Appian Forum: Accelerating BPM Adoption Through An Integrated Business Framework

I skipped out on the breakout sessions this afternoon, but am back here for Michael Melenovsky — formerly with Gartner, now senior BPM leader at Satyam — discussing how to accelerate BPM adoption through an integrated business framework: more of a methodology framework than a code framework, however.

He listed the three ways in which BPM projects are initiated, and how that influences the approach to be taken:

  • Executive leadership, where an executive goes to seminar or reads an article on BPM, and says “hey, let’s get us some of that”. The objective is strategic alignment and increasing corporate performance; because it’s very top-down, it’s only possible to push down the ideas so far, and often they’re not implemented.
  • Middle management, with the goal of operational improvement and cross-departmental coordination, with the BPMS seen as a tool for modeling processes and standardizing work procedures.The key challenge here is getting buy-in from both the top and bottom.
  • Line of business management, with the objective of improving productivity, decreasing costs, increasing quality, and providing greater agility. The BPMS is seen as a development platform, and 80% of these projects are driven by the IT department. There is no comprehensive vision, and implementation can take a long time.

He points out that the process layer makes explicit the role that people and systems play at each step of the process. Instead of a world where the IT organization must interpret the process, there is little visibility beyond a department’s boundaries, and it takes a long time and technical resources to change a process, the addition of a process layer makes the process model explicit and allows the model to drive the process execution, with process changes made by non-technical people.

There are three different perceptions of BPM, between business people, IT people and process people in terms of what creates the competitive differentiation and the best way to approach BPM. Each of these has a bias, and it turns out that the process people are the best ones to own a process, not the business people as is commonly assumed. The process people can form a bridge between IT and business, and keep the focus on the process rather than either the people or the systems involved in those processes.

He presented some sample requirements that might be included in a BPM project:

  • Business analysts and IT can collaborate around a single executable process model
  • Business can simulate the performance of the process for optimization purposes
  • Real-time monitoring and analytics
  • Task analytics guide human resources in task prioritization
  • Automated human workflow with simple to use task routing
  • Search capabilities for operations to review standard work procedures
  • Task user interfaces that are built quickly using an integrated composite application framework
  • Business rules and policy management for non-technical users to manage and modify

BPM provides value to both business and IT: we usually focus on the business benefits, but IT benefits through reduced solution development time, a more comprehensive architecture (usually in conjunction with SOA initiatives), reduced application maintenance costs, and shifting attention to higher-value topics instead of always being down in the code trenches.

He listed six critical success factors for BPM:

  • strategic alignment
  • culture and leadership
  • people
  • governance
  • methods
  • information technology

These aren’t specific to BPM, of course: any project with a significant technology component will rely on the same factors.

He showed a pyramid with a strategy layer at the top, followed by processes, applications, transactional systems, and tools; most companies are missing the process layer, hence try to go directly from strategy to applications, with high-level business executives stating that they need a specific solution, rather than stating their requirements in terms of a business process.

He walked through the participants in a cross-functional BPM project team, and finished up with getting started with BPM:

  • identify key stakeholders
  • define BPM in the context of benefits
  • determine the phases of value that BPM will deliver
  • develop a 3-year BPM roadmap

Satyam, of course, offers strategy and solution frameworks for BPM projects.

Appian Forum: AGF

John Jarrett, director of BPM at AGF Trust, spoke next about their Appian implementation; they’re the trust subsidiary of AGF Management Limited, a mutual funds company in Canada — very familiar territory for me, since the system integration company that I used to run implemented about half of the mutual funds imaging and workflow systems in Toronto in the 1990’s.

AFG Trust initially leveraged the parent mutual fund organization’s back office imaging and workflow system (either Jewelstone or Unisen, I believe, which were owned by AGF), but license expiry required that they look for another solution and they decided to strike out on their own with respect to systems in order to get something that was more suited for their specific needs. Instead of the document-centric solution that they were used to, they decided to take the BPM approach and focus on visibility, flexibility, agility and excellence in their processes. Their goals were to gain a more complete understanding of their own business so that they could understand the bottlenecks and inefficiencies; they also had to deal with the issue of a huge temporary workforce hired for a couple of months during tax season when there is a large influx of transactions as consumers scramble to invest in their retirement accounts before the tax-year-end deadline.

They’ve seen a number of benefits, both hard and soft:

  • increased control over business processes
  • process change and improvement flexibility
  • improved risk management and compliance practices
  • support of continued business growth
  • control expense growth

They selected Appian because of the ease of use and human-centric collaborative approach, the flexibility of having the process designers within the business unit, and the fact that the Appian product included all of the functional components that they required. The project team was positioned as a BPM center of excellence between IT and the operations group where the system was used, with Jarrett and 5 business process designers drawing on some IT resources and some business subject matter experts, plus Appian professional services as required.

They used a less agile approach than some of the other customers that we heard from today, documenting the to-be processes and requirements in great detail before starting implementation. Although he didn’t specify the implementation time, I suspect that this waterfall-style development approach took longer than an agile approach. Their pilot launch was in January of this year, with 1 product and 25 users, then a second launch in April for 3 product lines and 250 people (almost their entire user base within their loan and mortgage business). A third launch is coming up in October, adding more specialized products and lesser numbers of users, and they’re planning for other lines of business. They launch about 250,000 processes per month, since many business processes spawn multiple executing processes in order to complete.