Lean Six Sigma – Page 3

Proforma Conference Day 1: Geary Rummler x 2

Our after-lunch keynote on the first day was by Geary Rummler, co-creator of the well-known Rummler-Brache methodology and author of Improving Performance: How to Manage the White Space in the Organization Chart. In case you’re not getting the significance of this, the original swimlane diagrams are more properly called Rummler-Brache diagrams.

Rummler retired from Rummler-Brache a few years ago, then after “failing at retirement” as he put it, went back into practice the Performance Design Lab. His talk was a bit rambling, and he had 84 slides for a one-hour presentation, but I’m quite sure that he’s forgotten more about process than most of us will ever know.

He talked about how “as-is” process maps tend to drive out issues into the open, something that I have seen time and time again: management looks at what you’ve documented as their current process, and they say “We do that? Really?” One of the prime examples of this was a financial institution that I was working with on an BPM project a few years back. I documented all of their current processes on the way to the proposed processes, including their paper handling procedures. They sent the original of all transaction documents offsite in order by date, but made a photocopy of each document and filed it locally for reference by account number. Of course, we planned to replace this with a document scanning operation, but I felt obligated to point out a pretty major problem with their current process: since they were so behind in their local filing, the photocopies of the documents were just being boxed in date-order and stored onsite, which made the account-order files useless for any recent documents. Furthermore, they had stopped sending the originals offsite some months before that, so they now had both the original documents and a photocopy of each document, stored in the same order but in separate boxes, kept onsite. The management in charge of the area was truly shocked by what was going on, and I think that my fees were covered just by what I saved them in photocopy costs.

Back to Rummler, he showed a diagram of a business — any business — as a system, with financial stakeholders, the market, competition, resources and environmental influences as the inputs and outputs (since you can search the Proforma site and find the full presentation, I don’t think that I’m spilling the beans here to include one of the diagrams). I like this view, since it simplifies the business down to the important issues, namely the interactions with external people and organizations. He also spent quite a bit of time on the processing system hierarchy: the enterprise business model at the top, the value chain extracted from that, the primary processing systems derived out of the value chain, the processes from each primary processing system, and the sub-processes, tasks and sub-tasks that make up each process.

He went into organizational structure, specifically showing departments/resources on one axis and processes on the other, to illustrate how process cut across departments, but making the point that most organizations are managed by department rather than having true process owners.

There was one quote in particular that stuck with me: “Visibility is a prerequisite to optimizing and managing systems.”

We had a second dose of Rummler in the wrap-up panel on Day 1, where he joined Paul Harmon of BPTrends and one of the Proforma team who was filling in for the missing Aloha Airlines representative.

Harmon stated that none of the major business schools have any courses on process, but that they’re all function-based, and that most CEOs don’t see process as their primary concern. Rummler agreed, and made the point that being functionally-oriented, or siloed, leads to sub-optimization of the organization. Harmon’s initial comment led me to wonder if it’s necessary to have the CEO want to “do process”, or if a process approach is just an implementation detail, but Rummler ended up addressing exactly that issue by saying that it is necessary because methodologies are competing directly for the CEO’s attention, and it’s not always possible for the CEO to distinguish between the different methodologies at that level. Harmon made quite a rant against Six Sigma, saying that “Six Sigma people don’t understand high-level process”, blaming the widespread acceptance of Six Sigma on Jack Welch and GE strong-arming their suppliers into using it, and stating that Six Sigma people could be converted into a business process view, as if they were some sort of cult that had to be deprogrammed. I’m not sure that I would take such a hard line on Six Sigma versus a process-centric organization; “process” can’t be so easily pushed into an organization as Harmon implied since it’s not a methodology, it’s a pretty fuzzy concept that a lot of consultants like to bandy about.

At the end of the day, I’d have to say that I also disagree with Harmon’s assessment that BPMS is still very early market. Although it’s not a mature market, I think that to call it “very early” is ignoring the many successful products and implementations that have been done in this space over the past several years.

Proforma conference Day 1 quick look

There’s wifi in the conference room, but you have to sign up at the business centre for it ahead of time, which was just too much logistics for me to blog live. However, it’s 5am on Day 2 and my brain is still on Eastern time, so time for a few updates. I’ll do a more complete review of the sessions after it’s all over. First, let’s start with the other conferences that were running in the same conference centre,which you can see in the photo on the left.

Best quote of the conference so far: “I can DODAF FEMA!”, from Tony Devino, an engineer with the Navy, in his presentation about creating a process for quality control on temporary housing installations in New Orleans following Katrina. First time that I’ve heard “DODAF” used as a verb, and a bit funny (well, to EA geeks), especially when you consider that they use DODAF for weapons systems.

Best dance (not usually a category that I assign at conferences): Judson Laipply, a motivational speaker who gave a keynote, also happens to be the originator of the Evolution of Dance, the most-viewed clip ever on YouTube. He talked about change, which is the theme of the conference, then did a live, extended-play version of the Evolution of Dance for us at the end of his talk. I really would have hated to follow him on stage as a speaker!

Dr. Geary Rummler spoke at the afternoon keynote (yes, that Rummler), which was pretty exciting for those of us who have been around in process modelling and management long enough to have a view of his part in its history.

There was a bit of discussion about Proforma’s leading position in the new Forrester report, which is an amazing coup for Proforma when they’re up against a company that’s many times their size.

I’m left with a great impression of Proforma as a company. Although considerably smaller than IDS Scheer, their major competitor, they have an enthusiastic customer base, judging by both the customer presenters and the attendees who I’ve met, and a really nice corporate culture. I sat at the dinner last night with Dave Ritter, one of the founders and currently VP of Enterprise Solutions; we had a lengthy chat before we realized that we had (sort of) met on a Proforma webinar where he spoke several months back, and in some follow-up emails to that webinar. Michelle Bretscher, their PR Director, has given me completely red-carpet treatment, offering to set up meetings with any of the executives, and making sure that I have whatever I need. I don’t think that a lot of press shows up to their user conferences, but when you’re a one-person consultant/analyst/blogger organization, it’s nice to be treated with that level of respect, something that larger vendors could take a lesson from. I also had the most pleasant surprise when I turned to page 6 of the program and saw the watermarked graphic behind the print.

Sessions today include a lot of material from Proforma on their upcoming Series 6, and I’ve very eager to hear about their advances in zero-footprint clients and other Web 2.0-like features, considering my recent focus on Web 2.0 and BPM.

Gartner BPM summit day 2 in review

Hey, I finally made it to blogging about Tuesday, and it’s only Friday.

Tuesday was a pretty full day at the summit: sessions all day and vendor hospitality suites in the evening, a true test of a marathon conference-goer. The day started out with Daryl Plummer’s keynote on “How Do You Measure and Justify Business Agility” — this guy should be an evangelical preacher, he’s so passionate about his subject (and I mean that in a good way.) That was followed by the Six Sigma keynote by Mikel Harry that I left due to a severe lack of interest, although as I noted earlier, I found it odd that he seems to be using Six Sigma as a “brand” of sorts and distancing himself from the original statistical meaning. Certainly there’s some positioning going on with Gartner, BPM and Six Sigma.

In the afternoon, I attended Jim Sinur’s “When Will the Power Vendors Offer Credible BPM Solutions?”, which was fascinating but left out some tantalizing details (which can presumably be purchased from Gartner), and finished up the day at Bill Rosser’s “Creating a Business Architecture”.

The vendor hospitality suites were fun, although I had to lodge a complaint that Lombardi’s Blue Pomegranate Martinis (BPM, get it?) weren’t really blue but some sort of murky purple, and I could never figure out how to turn off the flashing ice cube that I picked up at another vendor’s suite so discarded it before airport security decided that it was something questionable. Between the vendor booths and the hospitality suites, I scored an alarming amount of swag: three jazz CDs from Lombardi, t-shirts from K2 and TIBCO, a 3-d globe puzzle from Global 360 that I’m afraid to take apart, a USB-powered light (perfect for lighting up your keyboard on flights when the overhead light causes glare on the screen) from Singularity, and a flash-when-it-bounces ball from Fujitsu.

The best part was after all the customers bailed out, and the vendors started to visit each other’s suites. I found the smaller vendors more likely to do this, possibly because they don’t have the sort of “us versus them” mentality about their competitors that is encouraged in larger companies, or possibly because they realize (consciously or not) that by next year they could be working together through job changes or corporate acquisitions. A particular thumbs-up to Savvion, whose suite became the “Switzerland of hospitality suites” (according to Rob Risany in their product marketing group) by the end of the night.

Gartner BPM summit day 1: Simon Hayward

After Sinur and Melenovsky’s welcome, Simon Hayward gave a great opening keynote yesterday, “Living in a process-centric world”. To quote the session description on the agenda:

Process is now gaining importance as an organizing concept for dealing with change at all levels. We live in a world of processes, becoming conscious of those processes and taking control of them can be the key to personal and corporate effectiveness.

As one attendee mentioned later, everything sounds more intelligent when it’s said with a British accent, and I have to admit to having a soft spot for anyone that says process with an “oh” rather than an “aw”. However, Hayward had some good content for us as well.

He started with the question of why we’re all thinking about process now, and linked it back to the fact that leaders in the industry became that way in part because of their focus on process — especially processes that touch their trading partners and customers. There are challenges around maintaining control over and having visibility into outsourced processes, as well as determining intellectual property rights in cases where the process itself may be a competitive differentiator.

Along the way, he floated the notion that agility (the ability to react to unexpected change) is becoming as, or more, important than innovation, and as I mentioned in a previous post, I interpret this to mean that reacting to market forces can actually be considered innovation if it’s done in the right way.

Another key point was compliance = explicit process management (taken from their 2005 Planning Guidance for Compliance report), which shows how process forms an integral part of compliance. I created a course on compliance for a customer last year, and process was a surprisingly large part of it: I found that if you can’t understand, control and report on your processes, you’re going to have a hard time getting compliant and proving it.

Then something came up for the second time that morning: Six Sigma. It appears that Gartner is making a strong link between Six Sigma and BPM at this conference (and likely in other research of theirs), although I found the Mikel Harry keynote this morning out of place, somehow, especially when he appeared to be using Six Sigma as a “brand” of sorts and distancing himself from the original statistical meaning. BPM certainly helps to provide a “closed loop” environment for Six Sigma’s Define, Measure, Analyze, Improve, Control (DMAIC) continuous process improvement cycle through the inclusion of process analytics and simulation, but I think that it’s a bit dangerous to downplay the statistical significance and rigor of Six Sigma to somehow make it friendly to the BPM crowd. Hayward later showed a graph of overlaid hype cycles that showed BPM as the current incarnation of trends that start with quality (process improvement) and migrate through process reengineering to BPM. I don’t disagree, but that doesn’t mean that BPM is the next “version” of Six Sigma somehow.

Getting back to Hayward’s talk, he had a good list of the IT disciplines needed for a process-centric environment, with a necessary focus on impact analysis and selective regression testing: if we’re putting all that emphasis on agility, we’d better be able to understand the ripple effects of changes and be able to test scenarios before deploying them. He talked about how to assess both IT and business for their current state of process centricity, and showed a chart of how to approach the various scenarios:

I like the “Reflect” quadrant, where the business is ready and IT isn’t: that’s when the business needs to do some serious prioritization due to the limited capacity of IT, or find some other ways to do things.

He finished up with a list of great recommendations including having less respect for silos and getting rid of baronial hostility that really point to one of the key issues in a process-centric organization: process is part of the infrastructure, not just embedded in some departmental systems.

Process isn’t going away

Tom Davenport posted last week about how process isn’t going away, in spite of some arguments against Six Sigma and process management. I couldn’t trace his reference to a specific entry on John Hagel’s blog (Tom, a direct reference to the post in question would be helpful!), but I agree with his assessment of Ross Mayfield’s The End of Process post as “silly”, mostly because Ross’ post assumes that business processes are static and (as Ethan points out in a comment on the post) confuses process and policy.

I especially like Tom’s last paragraphs on the balance between process and practice.

Operational Innovation

I don’t normally read the Harvard Management Update, so I missed an article back in April by Michael Hammer on operational innovation; however, there’s an excerpt here. In the excerpt, he discusses six steps to operation innovation:

process focus
process owners
full-time design team
managerial engagement
building buy-in
bias for action

I consider the first of these, process focus, to be critical. As Dr. Hammer points out, most companies taking on a business process initiative for the first time start with a smaller departmental or non-critical process. If you think this through, it’s obvious that a number of other problems are going to arise if you’re introducing BPM on a small scale: non-dedicated team members, lack of high-level ownership, lack of buy-in, and a host of other problems that are addressed directly by his second through sixth steps. These latter steps are no different than what we have to address with any IT initiative, but in the case of BPM, you can’t do the remaining steps until you’ve addressed the first step: get a process focus in the organization, and create “an enterprise process model, which describes a business’s operations in terms of a small number of value-creating end-to-end processes”, including performance metrics.

In other words, if you’re not addressing the mission-critical processes and all the participants that define an organization’s ability to succeed, then your efforts have a much lesser chance of measurable (i.e., relevant) success. It doesn’t mean that you have to implement all of these processes on the first go-around, but you’d better be considering them in the scope of what you’re doing. Improving business processes is not about automating every process, it’s about identifying and improving the ones that are critical to the success of the organization: a philosophy that will be familiar to Six Sigma and other quality advocates.

BPM, Six Sigma, & the Road to Process Perfection

An article in Business Integration Journal about using BPM to achieve Six Sigma objectives, by Carl Hillier, a former colleague of mine at FileNet. I first met Carl about 10 years ago when he was a FileNet systems engineer in London and I owned a professional services firm that helped customers implement FileNet systems, and I’ve always had a great deal of respect for his opinions (although not always for his choice of bosses): not only is he smart technically and knows more about FileNet BPM than just about anyone, but he can write beautifully coherent sentences about it.

Of course, he does give space to the FileNet party line in several spots, (“a robust BPM solution provides a fully integrated content repository” — I consider an integrated content repository to be “nice to have” but not essential), but he does hit the nail on the head when he talks about BPM helping to provide a “closed loop” environment for Six Sigma’s Define, Measure, Analyze, Improve, Control (DMAIC) continuous process improvement cycle through the inclusion of process analytics and simulation.