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Using a center of excellence to deliver BPM #GartnerBPM

Michelle Lagna of JPMorgan Chase, a Pegasystems customer, gave a presentation on their CoE as one of the solution providers sessions. Their CoE focuses on the use of BPM tools (primarily Pegasystems) to support their 30+ active systems. It was instrumental in allowing them to break down the departmental silos within the organization, establishing standard governance models, standardizing training and contributing to reusable assets.

The CoE supports all lines of business in planning and implementing BPM initiatives:

Creating and maintaining architectural standards
Centralizing and formalizing the housing and reuse of business-configurable assets
Promoting standard methodologies, tools and education

They use the Agile development methodology (and promote and educate on Agile across the organization), and believe that it is instrumental to their success by reducing time to market and aligning business and IT. They’ve made a gradual transition from waterfall to Agile in order to ease into the new methodology.

They’ve developed a standard engagement model (unfortunately depicted on the presentation slide in micro-print and low contrast colors):

Operational walkthrough and end-to-end review, including identification of process improvements and ROI
Impact analysis review, identifying execution gaps and automated solutions, plus IT and business sizing
Project initiation training, including both BPM and Agile training
Application profile, high level use case requirements and reusable asset review
Project setup and design review, including identifying assets leveraged from other projects, functionality specifications and a design compliance review
Environment build-out, including generating a base framework
Bootstrap session, which equips the project team to complete use cases on their own
Direct capture of objectives to elaborate use cases, design specifications and traceability matrix; this is specifically assisted by the Pega project
Identification of reusable assets, then harvesting those assets and making them available for reuse by other projects

The CoE is heavily involved in the early phases, but by the time that they get halfway through the project, the project team is running on their own and the CoE is just checking in occasionally to make sure that things are proceeding as planned, and to help resolve any issues. They had to make some organizational changes to ensure that the CoE is engaged at the right time and that siloed solutions are avoided.

She presented some of the key benefits provided by the CoE:

Common class structure for reusability
Library of reusable assets with tools to track usage
Standardized engagement model, including a “Perfect Start” training and certification stage
Monthly educational webcast
Improved release planning process (which I’ve seen listed as a key benefit of a CoE at other customers that use other BPM products)
Allowing for faster changes to improve business agility

The CoE has been backed by senior executive sponsors within JPMC, which has been key to its acceptance. They are run (and funded) as a shared service, so there are normally no direct chargebacks to the projects unless the CoE team is required to be onsite for an extended period of time due to a rush or urgent situation. Interestingly, the CoE is not all co-located: there are five offshore development resources that handle harvesting the reusable assets, although they are managed from an onshore resource.

Great case study, and a lot of material that is of use regardless of which BPM product that you’re using.

Hidden costs of unstructured processes #GartnerBPM

Elise Olding and Carol Rozwell kicked off the afternoon with a session on the hidden costs of unstructured processes: although a lot of focus of BPM efforts (time and money) is on structured processes, as much as 60% of an organization’s processes are unstructured – and probably also unmonitored, unmanaged, unknown and unruly.

Gartner defines unstructured processes as “work activities that are complex, nonroutine processes, predominantly executed by an individual or group highly dependent on the interpretation and judgment of the humans doing the work for their successful completion”, and notes that most business processes are made up of both structured and unstructured processes. Unstructured processes are costing organizations a lot of money in lost productivity, lack of compliance and other factors, and you can’t afford to ignore them. Although most processes aimed to meet regulatory requirements are structured, unstructured processes provide a company’s unique identity and often its competitive differentiation, as well as supporting operational activities.

In order to start managing unstructured processes, you need to get some visibility into them; start by understanding the critical path through the process. This can be a bit tricky, since as you start to map out your unstructured processes, there will be some points at which the process participant just has to wing it and make their own decisions. These are, after all, knowledge workers, and it’s not possible (or desirable) to map every possible process permutation. Instead, map the structured portions of the process, then the points at which it becomes unstructured, but don’t try to overengineer what happens in the unstructured parts. The unstructured parts can be modeled by the notification mechanism (how someone is notified that a piece of work requires attention), the information provided to the participant to allow them to complete the unstructured work, and how the outcome is recorded.

They presented a number of analysis techniques for getting to the heart of unstructured and folklore processes:

Observe work being done, and challenge tasks that don’t make sense. Keep asking “why”.
Use storytelling (“tell me what happens when…”) to uncover decision-making logic, methods and best practices: these types of narratives are not well-captured in standard process documentation.
Analyze the unstructured interactions between people (e.g., customers and CSRs) and extract the themes and patterns. Rozwell wrote a report “Business Narratives Supplement Traditional Data Analysis” that discusses one technique for doing this, although it wasn’t quite clear what it was from the discussion.
Get clarity around roles and who is the decision-maker in any given process.

There are a variety of different areas of knowledge that you need to consider when analyzing unstructured processes, from identifying what metadata is used for collaboration, to looking at alternative analysis techniques such as mind mapping and social network analysis. Understanding collaborative technologies is also key, since unstructured processes are often collaborative in nature, and make use of the participants’ social graphs.

Their final recommendations are to keep an eye on the technologies that can support unstructured processes, but not to go overboard on monitoring and managing these processes.

Navigating the BPM Wonderland #GartnerBPM

Alan Trefler of Pegasystems gave his traditional lunch address – entertaining as always, starting with a “White Rabbit” audio clip – with an Alice in Wonderland theme of how we have to chase our business goals down whatever rabbit hole that they disappear down. Continuing on the theme, he contrasted the “one pill makes you larger” end of the spectrum with monolithic applications, and the “one pill makes you small” end of point solutions, and how you need to look at something in the middle. Don’t be afraid to ask for advice (even from hookah-smoking caterpillars), watch for those delusional Mad Hatter software salespeople, and be sure to meet the needs of the Red Queen boss lady so that you don’t get your head chopped off in the process.

Trefler is a former chess champion, so it’s inevitable that he introduced an Alice-themed chess analogy when examining his recommended steps for implementing BPM:

Directly capture objectives, so that your BPM implementation is focused on business intents and goals.
Automate the programming: the computer can write code much better than human beings, which is much less expensive in the long run even if off-shoring development appears to make it cheaper up front. In other words, use a system that allows for model-driven development and zero-code (or near-zero-code) deployment.
Automate the work wherever steps can be automated.

I love the term that he introduced: “heritage systems”, which are just legacy systems that we like a little bit better, probably because we’ve wrapped them to allow them to be more easily integrated with other systems and processes.

Deciding on process modeling tools #GartnerBPM

Bill Rosser presented a decision framework for identifying when to use BPA (business process analysis), EA (enterprise architecture) and BPM modeling tools for modeling processes: all of them can model processes, but which should be used when?

It’s first necessary to understand why you’re modeling your processes, and the requirements for the model: these could be related to quality, project validation, process implementation, as part of a larger enterprise architecture modeling effort and many other reasons. In the land of BPM, we tend to focus on modeling for process implementation because of the heavy focus on model-driven development in BPMS, hence model within our BPMS, but many organizations have other process modeling needs that are not directly related to execution in a BPMS. Much of this goes back to EA modeling, where several levels of process modeling that occur in order to fulfill a number of different requirements: they’re all typically in one column of the EA framework (column 2 in Zachman, hence the name of this blog), but stretch across multiple rows of the framework such as conceptual, logical and implementation.

Different types and levels of process models are used for different purposes, and different tools may be used to create those models. He showed a very high-level business anchor model that shows business context, a conceptual process topology model, a logical process model showing tasks within swimlanes, and a process implementation model that looked very similar to the conceptual model but included more implementation details.

As I’ve said before, introspection breeds change, and Rosser pointed out that the act of process modeling reaps large benefits in process improvement since the process managers and participants can now see and understand the entire process (probably for the first time), and identify problem areas. This premise is what’s behind many process modeling initiatives within organizations: they don’t plan to build executable processes in a BPMS, but model their processes in order to understand and improve the manual processes.

Process modeling tools can come in a number of different guises: BPA tools, which are about process analysis; EA tools, which are about processes in the larger architectural context; BPM tools, which are about process execution; and process discovery tools, which are about process mining. They all model processes, but they provide very different functionality around that process model, and are used for different purposes. The key problem is that there’s a lot of overlap between BPA, EA and BPM process modeling tools, making it more difficult to pick the right kind of tool for the job. EA tools often have the widest scope of modeling and analysis capabilities, but don’t do execution and tend to be more complex to use.

He finished by matching up process modeling tools with BPM maturity levels:

Level 1, acknowledging operational inefficiencies: simple process drawing tools, such as Visio
Level 2, process aware: BPA, EA and process discovery tools for consistent process analysis and definition of process measurement
Levels 3 and 4, process control and automation: BPMS and BAM/BI tools for execution, control, monitoring and analysis of processes
Levels 5 and 6, agile business structure: simulation and integrated value analysis tools for closed-loop connectivity of process outcomes to operational and strategic outcomes

He advocates using the simplest tools possible at first, creating some models and learning from the experience, then evaluating more advanced tools that cover more of the enterprise’s process modeling requirements. He also points out that you don’t have to wait until you’re at maturity level 3 to start using a BPMS; you just don’t have to use all the functionality up front.

Patterns for Business Process Implementations #GartnerBPM

Benoit Lheureux from Gartner’s Infrastructure and Architecture group gave a presentation on process implementation patterns. I think that he sees BPM as just part of SOA, and presents as such, but I’m willing to give him a pass on that.

He discussed five styles of flow management in SOA:

Microflows: fine-grained services implemented via flows amongst software components. This is a process from a software development standpoint, not a business-level process: probably 3GL code snippets assembled into what we old-timers might refer to as a “subroutine”. 🙂
Service composition: coarse-grained services implemented by assembling fine-grained flows (microflows). This may be done with a BPMS tool, but is low-level service composition rather than business processes.
Straight-through process: automating business processes involving multiple services across systems, but without human intervention.
Workflow: pretty much the same as STP, but with human intervention at points in the process.
Semi-structured processes: a combination of structured processes with unstructured activities or collaboration.

He has some good strategic planning assumptions based on these four patterns, such as 75% of companies will use at least three different products to implement at least three different styles of flows. His primary focus, however, is on B2B, and how internal process connect to multi-enterprise processes, and the ultimate goal of shared process execution across enterprises. This led to the four B2B flow management styles:

Blind document/transaction exchange: loosely-coupled, with each partner managing their own internal processes, and no visibility outside their own processes.
Intelligent document/transaction exchange: visibility across the shared process to provide a shared version of the truth, such as a BAM dashboard that provides an end-to-end view of an order-to-cash process across enterprises. Although this isn’t that popular yet, it is providing significant benefits for companies that are implementing it, and Lheureux estimates that 50% of B2B relationships will include this by 2013.
Multi-enterprise applications: shared execution of a process that spans the enterprises, such as vendor-managed inventory. This may be hosted by one of the partners, or may be hosted by a third-party service provider.
Multi-enterprise BPMS and rules: centralized processes and rules, such as shared compliance management on a shared process. By 2013, he predicts that at least 40% of new multi-enterprise integration projects will leverage BPMS technology.

He showed a chart that I’ve seen at earlier conferences on identifying process characteristics, classifying your processes as case management, form-driven workflow, content collaboration, multiparty transactional workflow, participant-driven workflow, and optimization of network relationships based on the unit of work, process duration, degree of expertise required, exception rate, and critical milestones that progress work. Then, consider when to use BPMS technology rather than code when there are specific process characteristics such as complexity and changeability.

The final recommendations: don’t try to use the same tool to handle every type of process implementation, but be aware of which ones can be best handled by a BPMS (and by different types of BPMS) and which are best handled in code.

BPM in Times of Rapid Change #GartnerBPM

For the next couple of days, I’m at the Gartner BPM Summit in Orlando. Jim Sinur and Janelle Hill gave the opening keynote this morning on BPM in times of rapid change, starting with a view of the global economy: basically, it’s down this year, although not as bad as expected, and the leading economic indicators are starting to trend up.

Gartner did a survey of CEOs in late 2008, and found that their top priority is shifting back from cutting operating costs to increasing revenues, although only by a slim margin. The resulting message: the time to return to business growth is now, and leveraging BPM to assist growth can provide a first-mover advantage if the economy does trend up in 2010 as predicted. BPM still provides assistance in restructuring operations (including mergers and acquisitions) and cutting costs that goes along with a down economy, so you might as well leverage what you’re already using to cut costs, and start looking forward and repositioning for growth. In many cases (in my experience), improving business processes using BPM has the impact of reducing costs of the specific processes, which can either translate to reduced operational costs through reduced headcount, or increased revenues due to the increased capacity of the process to handle new business: these are just two sides of the same process improvement coin.

Going into 2010, most large enterprises have already completed their cutbacks – reduced headcounts, reduced infrastructure, renegotiated contracts and elimination of redundant technologies – but their budgets are going to be pretty flat. If you already have a BPMS in your organization, then this might mean some incremental expansion, but if you don’t, you need to look at how to justify the technology acquisition. Fortunately, that’s getting easier as the capabilities of the BPMS products expand: consider the value of process modeling (reduced redundancy and better use of people in the process) as well as process and application orchestration (automating the linkages between many existing applications) and composite application development environments (bringing together many applications into a single user view).

Focus on improving processes that defend revenue and cash without impacting customer experience, such as order-to-cash, sales processes, and customer service. Depending on your industry, this could also be the time to take some risks in order to gain that first-mover advantage: reconsider institutionalized behaviors and what you might think of as best practices, and see if there’s an innovative way to improve processes that provide a competitive edge. There should be no processes that are immune to change: challenge the status quo. I see this all the time with how companies are embracing social media in addressing customer relationships: the ones that are successful at it are those that throw away all the old ideas about how companies communicate and interact with their customers. These customer-facing processes are no longer about executing transactions, they’re about coordinating social interactions and developing social relationships.

The hot button these days is unstructured processes (which I’m sure that we’ll hear a lot more about this week), and how some new BPMS functionality allows for dynamic collaboration instead of, or within the context of, a structured process. This provides methods for gaining visibility into processes that might exist now only in email or other ad hoc methods, and likely aren’t managed well in their current state.

It’s not good enough, however, to use old-style BPMS/workflow products: you need to be considering products that have model-driven development, composite application development, process discovery and optimization, and customized dashboards for different roles and personas within a process. Otherwise, you’ll just be stuck back in the same old waterfall development methodology, and won’t achieve a lot of benefit from BPM. Interestingly, Sinur and Hill highlighted three specific products to show examples of what they consider BPMS innovation: Vitria’s composite application development, Pallas Athena’s process discovery and simulation, and Global 360’s persona-based user interfaces.

In the recession of the 1980’s, business process reengineering was a high-profile, strategic activity with top executives involved; as the recession eased, the executives’ interest in BPR waned. The same cycle will repeat now: executives are very interested right now in process improvement and BPM, but that’s not going to last when the economy starts to recover, so you may want to take advantage of their interest now and get something going.

You can track the Twitter backchannel for the Gartner BPM summit here.

No longer lost in translation

Thanks to Zoli, the 25% of my readers whose first language is probably not English (as indicated by the browser language setting) can now view this site in 50 other languages, thanks to a new widget in the sidebar.

If you read this through Google Reader, then you can set it to auto-translate there, instead: I do that for the few non-English BPM blogs that I follow, and it works like a charm.

Skelta BPM.NET

A while back, I had an email from Phil Larson, who I have known since he was at Appian; he has spent the summer in India as an MBA internship. One thing led to another, he connected me up with Skelta, and I fostered India-Canada relationships by getting up early for an online demo with Sanjay Shah and Arvind Agarwal of Skelta. They’ve published a corporate presentation if you want to take a look.

They started by creating OEM workflow components that were embedded in other products, then built that out into a full-blown BPM suite, BPM.NET, while retaining a focus on componentized, embeddable pieces. They have significant penetration into the Indian business process outsourcing (BPO) market, both as the BPOs’ product offerings and for their own internal processes. Because of the OEM nature of their product, they also end up embedded in SaaS BPM implementations, although white-labeled so you may not know that they’re there. This is much more like the Fujitsu model – create BPM primarily for the OEM market, then launch as a direct BPMS product – and Skelta has leveraged this into business that includes OEM and full product sales as well as multi-tenanted hosted BPM. Even their browser-based process modeler can be embedded as a component in another application, not just the run-time UI components.

As you might guess from the product name, they have a strong Microsoft bias: there is significant integration with SharePoint and other Microsoft products to capture and act on events generated from those systems, plus adapters for SAP, PeopleSoft and Microsoft Dynamics. The number of integration services that they provide is quite extensive, and is likely what has made their product attractive to the BPOs to use as a base upon which to build applications. These are available directly from the process modeler: there is a palette of SharePoint activities built in, as well as BizTalk activities and other integration activities.

The process modeler includes the ability to set up data points that will be used as KPIs in reporting. Queue filtering and prioritization can be based on multiple factors so that process participants see only the work that they should be able to access, served to them in the correct order. Process models are consumed directly by the process engine without translation.

They include an AJAX forms designer for creating task user interfaces, including scripting to control contextual behavior: the view on the form (and therefore the visible/editable fields) can change depending on which step that the process is at. The main processing paradigm has a user requesting the next item at a particular process step from a shared queue, which moves it to their personal work list for working with that AJAX form; escalation can be based on the time that a work item spends in a shared queue before selection, or in a user’s work list. The user’s view can have some monitoring graphs built in, since these are all components that can be assembled into a web application. The user can view the process map for the current instance, including a history of the process to date.

There is not a full rules engine as part of the product: expressions and rules can be built into the forms and process definitions, or rules services can be integrated using web services, calling BizTalk rules, or writing the rules in .Net.

There’s a big focus on components used to monitor processes and their SLAs: this is critical for the BPO market, since their compensation is typically based on meeting SLAs, and they likely have penalty clauses associated with missing them so need to monitor them closely. There are other needs of BPO vendors that Skelta is seeking to address: the ability to embed white-labeled BPM within other applications; multi-tenancy software-as-a-service infrastructure; and, for the Indian BPO marketplace, the fact that Microsoft infrastructure is cheaper to build and maintain in India than a comparable Java infrastructure. In some ways, BPOs have needs similar to that of large enterprises, such as quickly-changing user requirements that can vary widely across the user base, and the need to simplify training and roll-out of the system.

See me at the Business Rules Forum, Las Vegas, November 1-5

I’ve been invited to speak at the Business Rules Forum, which is taking place at the Bellagio in Las Vegas on November 1-5. I’m actually doing two speaking gigs there:

A presentation on BPM, collaboration and social networking, which I’ve been presenting on for a few years and has lately become a hot topic of conversation. That’s on Tuesday, November 3rd.
On Thursday, November 5th, I’ll be facilitating a workshop session on BPM as a service, and the challenges and issues involved in deploying BPM in the cloud. If you’re at the conference, please come by and take part in the discussion – this is intended to gather everyone’s opinions, it’s not a prepared presentation.

If you haven’t signed up for the conference yet, you can get a 10% discount by using the code “9SPSK” when you register.

Lots of great speakers lined up, including keynotes by Jim Sinur of Gartner, Stephen Hendrick of IDC, and James Taylor of Decision Management Solutions. There’s also Fun Labs, where you have the opportunity to test-drive vendor products.

HandySoft BizFlow BPM

I caught up with Garth Knudson from HandySoft a few weeks ago; I’ve looked at their BizFlow product previously, and they’re currently at version 11.3 so have a pretty long track record. Although HandySoft handles the same sort of structured processes as you see in most other BPMS vendors, they really focus on ad hoc and dynamic (unstructured) processes, where either a user needs to jump out of an existing process definition at a particular step to an unstructured flow and bring the results back to the structured process, or even create a new dynamically-defined process. Some processes just can’t be modeled in advance due to non-standard processes, changing roles and responsibilities, or process participants and actions being dependent on the participating user request: this is more like managing a project rather than a traditional process, but with BPM capabilities and structured applied to it rather than trying to manage this in email. These types of dynamic processes can form a huge portion of an organization’s processes: think of all the ad hoc processes that you have now in email, only with no control or monitoring. Some significant research efforts are underway on dealing with dynamic processes, as I saw at the academic conference in Ulm two weeks ago; Gartner and Forrester are all over this area as well, so I expect that we’ll see some advances from many vendors in this area in the next few years.

The structured parts of the process are managed by BizFlow BPM, whereas the unstructured workflow portions, whether spawned from a structured process or initiated directly, are managed by the OfficeEngine front-end application; in both cases, the process engine is BizFlow. Although you use an email-like interface to kick things off, and email is used as a transport for external recipients, this provides tracking of ad hoc processes that’s just not possible in email.

To start a completely ad hoc process, you create a task, specify properties such as instructions and deadlines, and attach any documents required or link to documents in a ECM repository using a URL in the rich comments field on the launch form. You use ActiveDirectory/LDAP or type in external email addresses to select participants, specify whether the participants can reassign the task further, and submit the task; then, the task is available for monitoring and you can see who has done what in a graphical view. Process participants receive tasks as calendar invitations, then click through to login to BizFlow and work on the task assigned to them, which may include adding other people to the collaboration. The web-based user interface includes a list of ad hoc tasks in which you are participating, a work list for your activities within structured processes, a launch pad for initiating new tasks or processes, and a graphical view of your SLA scorecard. From there, you can click through to the task monitor for ad hoc tasks that you have created, and see the state of each participant.

Since external participants can’t access BizFlow directly, they do their work outside the system and reply; replies from external participants are returned as a proxy, and an internal user must enter the response manually. This sort of one-step collaborative process – including multiple participants and reassignments – can replace the current practice of emailing around to multiple people for information or comments, then manually tracking to see who has responded. In an environment dominated by ad hoc processes in email, this provides a big benefit for tracking who is doing what, and when.

It’s fairly similar for launching an ad hoc task from a structured process: the structured process is modeled (using BPMN) in a similar fashion to other BPMS tools, and launched using a web form. From the participant’s UI at any step, however, you have an “Assign a task” tab that pops up the same form as was used for the purely ad hoc tasks; essentially, this allows delegating the structured process activity to the collaborative task, which can then include people who were not originally involved in the structured process. It doesn’t change the structured process; it just pops out to a collaborative task at this point, and when that completes, it returns to this step in the structured process and continues on. Just as with the standalone ad hoc tasks, this reduces the amount of unmonitored email activity that is prevalent in many structured processes where someone needs to request more information at a step.

In many BPM implementations, there is an attempt to capture all possible exceptions and collaborations as part of the structured process, but in reality, this just isn’t possible; they end up in email, phone calls and other untraceable activities. As Clay Richardson of Forrester pointed out in his vendor snapshot on HandySoft:

Traditional BPM platforms perpetuate the myth of neatly structured processes – with most vendors providing ample support for capturing reoccurring and well-defined workflows, but minimal support for managing unstructured and dynamic business processes. This chasm between the worlds of structured and unstructured processes forces teams to develop custom workarounds to handle ad hoc routing and collaborative interactions, ultimately increasing the time and cost to deliver BPM solutions.

Allowing an ad hoc, yet monitored, task to be launched from any point in a structured process has the effect of reducing the complexity of the structured process without sacrificing monitoring and auditability of the process. In BizFlow, launching an ad hoc task from a structured process causes an indicator to appear on the graphical view of the executing process to indicate that a task has been launched from that point, and the complete audit trail of structured and unstructured processes is maintained. If the ad hoc task isn’t completed within the specified deadline, that SLA violation shows on the structured process monitoring, and you can click to the OfficeEngine interface for detailed monitoring of the task.

On their product release agenda for later this year are a reporting service module – there’s already a fairly capable BAM functionality – and full rich internet application development capabilities to create more usable web forms for the user interface.