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Forrester Keynote at Appian World: Realizing the Promise of BPM

It’s the last morning at Appian World, and Clay Richardson from Forrester is delivering the opening keynote on getting value out of your BPM initiative. He pointed out that the pace of change is accelerating, but the innovation of management practices has slowed. We have a mess of applications inside our business that have been put in place to address the change, but not very many good tools to manage how all those applications work together.

BPM provides language and tools for business transformation, allowing you to transform your business from traditional functional management to horizontal centers of excellence, moving from vertical/functional silos, to functional with process overlays, to processes with functional overlays, to a purely horizontal service and process-driven organization. Each stage of BPM evolution delivers great value: as you move from process modeling to execution, then monitoring and optimization. Not only does this increase value for the organization, but it moves the visibility of BPM up the food chain within the organization, so that the executives are using it as a measure of how well that your business is doing. To do this, it’s necessary to balance technology and methodology; as we all know, BPM projects aren’t purely technology, but they do need some technology to support the process discipline.

Forrester has developed a framework for looking at BPM’s economic impact, balancing the technology cost, the business value, the options that are created in terms of flexibility, all filtered by the uncertainty associated with any transformative initiative. They looked at five areas of benefits from the end solution, from cost savings to compliance, plus project factors such as increased business engagement in BPM projects to increase quality, speed and adoption of the new methods and solutions; increased developer efficiency; and reduced time to handle change requests. In their research, they found that process architects/analysts in particular had a huge impact on the success of BPM projects (which makes me, as a process architect, feel pretty good) because they can straddle business and IT concerns, and keep the focus of business on the KPIs of the process rather than irrelevant implementation details. They also considered several risk categories – implementation, impact, strategic and measurement – and how to mitigate some of the risks in a BPM project.

They’ve wrapped all of this up in a report on best practices framework for BPM suites (available for purchase from Forrester, of course), and Clay talked about some of the best practices around skills, including BPM-related certification programs that are available, and using the social enterprise to engage the right people in BPM discovery, development and runtime efforts. He also discussed the value of cloud computing to accelerating delivery and minimize risk.

These factors all come together to create highly evolved BPM programs, where a BPM center of excellence is responsible to the executive level, and helps to transfer some of the BPM project tasks such as analysis and modeling over to the business to accelerate BPM projects.

Appian World Cloud Case Studies: psHEALTH

We finished the cloud case studies with Abhishek Agrawal of psHEALTH. He used to work for Appian, so likely had a bias in that direction already, but they selected Appian since they wanted a complete cloud solution, plus for the strong process modeling capabilities, data security infrastructure, scalability and robustness. Lastly, they liked that they could create solutions without writing code: they wanted to be a case management solutions provider without being a software company, something that a lot of outsourcing companies struggle with.

That doesn’t mean that they haven’t built their own components, rather that they haven’t done that using the usual “lines of code”; Agrawal stated that their total lines of code = 0. They built a library of process application components within Appian, then can easily assemble those into custom case management solutions for their clients.

Looking at the before and after of one of their clients in deploying the Appian-based case management solution, they doubled the number of cases that a case worker could handle (from 40 to 80) by making it much easier to access, work with and transfer case files. They’re also working on some mobile applications, including support for their clients’ case workers and also for the end-customers (patients) with things such as a smartphone-based medication diary.

Data security was key for them, being in the healthcare industry, and they gained ISO27001 and SAS-70 Type II certifications for their Appian-based applications, which says a lot about the potential for high security in the cloud. They also were able to go to the market with a complete product solution that required only minor tweaks for each client, rather than a complete custom build each time, making it much faster to onboard a new client. For them, a cloud-based solution and the easy ability to build new applications from a library of components have been key to their success.

Appian World Cloud Case Studies: Clayton Holdings

Next up was John Cowles from Clayton Holdings, which does risk analysis for the mortgage industry.

Clayton has 240 users across 5 business units on Appian Cloud BPM, and they have only 5 primary resources for building and maintaining the 100+ processes that they have in production. They had limited IT resources and limited budget, and found that software-as-a-service fit their budget and resources well. Initially, they had no IT involvement at all: it was all operations, business analysts and process efficiency people. They found that Appian was easy enough to build applications without IT support, although now that they are undergoing some large back-end system changes, they do have a bit more technical input. They’ve seen an improvement in their BPM cultural maturity, and an increase in adoption rates as well as demand for new applications. Cowles now wants to do everything with Appian: he sees it as a general-purpose application assembly tool, not just a BPM tool. Interestingly, they did what I always recommend: limited or no system integration for the first implementations, then add that later on once they figure out what they really need, and start to see some process efficiencies. This lines up with their Agile philosophy of prototyping everything, and having frequent releases with incremental new functionality.

They have experienced huge efficiency gains due to their BPM implementation and other process efficiency efforts: 38% reduction in headcount in spite of a 6% increase in workload, time saved not doing manual gathering of user performance data, and process improvements in moving from email and Excel to BPM. The focus on change management and process management early on were important for their success. He also recommended collecting the reporting requirements up front to ensure that the necessary data are being collected by the process. Good points, and a nice success story for cloud BPM.

CME Case Study at Appian World

Who knew that the venerable Chicago Mercantile Exchange had rebranded themselves as the CME Group? Not me, so when I sat at the Appian dinner yesterday with John Verburgt, their Director of BPM, I probably sounded like a bit of a newb. Verburgt was joined on stage this afternoon by Brian Toba, their Director of Software Engineering, to talk about how they launched their BPM program. They were looking for BPM in the holistic sense – both methodology and execution – ranging from just wanting to get a better handle on how some of their processes work to supporting mobile workers.

They talked about their vendor selection process (without naming the other two vendors involved, although they did mention that they consider the leaders as specified by Gartner and Forrester), including a proof of concept installation and prototype. They did their pilot with Appian’s cloud BPM, and had the satisfying experience of going out for a couple of days training and coming back to a completely operational system – I really think that even for traditional on-premise vendors, cloud support for development and test is really critical for customer quick starts.

They had a really interesting chart showing their “collaboration meter”, indicating how much business and technology involvement was required for each of the project activities; the only thing that was purely on the technology side was architecture implementation (around shifting from cloud development to on-premise production), whereas all other activities were a blend. Process design, for example, was shown as 2/3 business and 1/3 technology.

They went live in January 2011 with more than 100 users, and are on track to deliver their third application in May. So far, they’ve implemented a new product launch process and an employee on-boarding process, and May’s release will be a co-location portal. They’re also using Tempo for mobile access.

Some good points on what – and who – it takes to get a BPM initiative up and running, and to sustain it as it moves from that first project into a multi-project program.

Malcolm Ross With Appian Product Update

Malcolm Ross was up next at Appian World to give an update on the entire product portfolio: not an easy task in 30 minutes. He had some updates on their on-premise solution, and some good information on their Appian BPM cloud platform; interestingly, they no longer seem to use the name Appian Anywhere for the cloud platform, but just position it as another deployment option for their BPM platform. To begin with, he shared a few statistics for their cloud BPM:

  • 99.99% up time in 2010 (can you say the same for your enterprise systems?)
  • > 30,000 unique logins per day
  • > 40% of Appian’s software revenue
  • integrated cloud/support team

They’ve beefed up the security in response to customer requirements, including encrypted HTTPS traffic, and even providing a secure VPN connection between their environment and your enterprise, if you need a highly secure environment.

Also interesting is some new packaging and pricing with their cloud starter edition, which combines cloud and on-premise deployments; I see this as a good fit for organizations that need to have their production system on premise due to security concerns, but want to use the cloud for development and testing in order to reduce costs and speed the time to get started. Appian Tempo iPad appIt uses a month-to-month subscription model, although I’m not sure if that includes the on-premise licenses as well, and the ability to quickly set up environments in the cloud with instant on and off control in order to control costs. For some time now, they’ve allowed a process application created in the cloud to be exported and moved over to an on-premise server (or vice versa), allowing developers and testers to use the cloud, then quickly deploy within the enterprise.

He spent some amount of time doing a live iPad demo of Tempo, showing how you can not only consume information, but spawn new activities and interact with events from a variety of systems, including Appian BPM, Salesforce.com and Twitter. As we heard from Matt Calkins earlier today, the Appian app can now be branded by any partner or customer; Malcolm gave us a bit more detail such as how they handle all the admin around things such as submitting it to the Apple app store. He also demoed some of the features that take advantage of the platform, such as use of embedded cameras to take a photo as an attachment.

Matt Calkins Keynote at Appian World

Matt Calkins, CEO of Appian, provided us with some vision around how BPM is changing, and how Appian is delivering on that. They’ve experienced significant growth in sales in the past year, and more than 40% of their business is on their cloud platform.

Their big news, of course, is Tempo: their process event streaming interface that integrates closely with their BPM platform as an alternative interface, and also allows inclusion of events from a variety of sources such as Salesforce.com or pretty much anything with an RSS feed. There are two significant things going on here: one is the ease of use of the interface, and the other is the enablement of mobile. This fundamentally changes how work can get done; I spoke with an Appian customer last night (who will be presenting later today on a panel) about how they will be using Tempo to enable fuel tank inspection operators to update a Tempo-based compliance checklist on their mobile device instead of using paper clipboards, then having to spend additional time back at an office filling out a spreadsheet and emailing it to someone. As we know, in regulated industries, it’s not enough to be compliant, you have to be seen to be compliant; providing this sort of immediate update of compliance data helps with the latter at the same time as you’re doing the former.

In their latest release happening now, you can brand your own application based on Tempo, so that the iPhone app uses your logo and title bar rather than being branded as Appian.

Appian Tempo iPhone appHe poked a bit of fun at how some other vendors are presenting their social business offerings as more about social interaction than getting business done: social may be the delivery mechanism, but the payload is business. Their social platform is focused on integration so that you don’t have your interaction in one system, then login to the “real” system to record what happened; integrating with their own process management plus many other systems means that Tempo *is* the real system, just an alternative, cooler interface to it.

He moved on to talk about the nature of work, that is, the spectrum between structured and ad hoc work, especially within the same process. I’ve talked a lot about this requirement to have completely unstructured portions within a structured process, and see it in almost every business process that I work on with enterprise clients. He sees this as something that is handled by social business; I see a distinction between dynamic and social, although there’s a correlation.

He did a good overview of the type of people in enterprise today relative to their mobile usage: executives (approvals, reports), headquarters workers (keep in touch), road warriors (initiate tasks, remote collaboration) and mobile task workers (execute tasks, access data). Enterprise applications provide varying levels of support for current business functions, by providing modern interfaces, making business events visible, having native mobile processes and data, and integrating social functionality. For those applications that don’t provide some of the more advanced levels of support, Appian is providing ways to add Tempo as an interface to bring them up to scratch. He sees BPM in 2013 as being focused on the mobile process enterprise: it’s more than just having organizations become process enterprises (which is enough a challenge on its own), but that these processes can be accessed from anywhere. Ambitious, but not undoable.

Gartner Keynote at Appian World: From Operational Excellence To Operational Resilience

The analysts are on the move this week: earlier in the week, we were all in Las Vegas for IBM Impact, now we’re all in DC for Appian World. I presented a BPM 101 session yesterday in the workshop day, and this morning Janelle Hill of Gartner is giving the opening keynote. I’ll be at the Gartner BPM Summit in Baltimore in a few weeks, so I might be seeing this talk again soon.

She’s talking about an upcoming BPM revolution (although it seems more evolutionary than revolutionary, but the R word allowed her to invoke some nice Egypt images) where we move towards resilient processes. By 2020, we’ll see more and more of unstructured processes, dynamic BPM, social BPM, context-aware processes and intelligent operations.

BPM is raising the bar for operational excellence; their basic definition “BPM is a management discipline that treats processes as assets that directly contribute to enterprise performance by driving operational excellence and agility” points to the required attributes of visibility, accountability and adaptability. Gartner predicts that by 2014, business process defects will topple 10 Global 2000 companies; these seems a bit too much like end-of-time predictions, but if you cast the net wide enough, there will sure to be some business failures that can be attributed in part to defective processes. What I do whole-heartedly agree with is that the biggest opportunity for improvements and differentiation are in unstructured processes: these are the ones currently live in email and spreadsheets, and contribute to non-compliance.

There are a number of factors that contribute to operational resilience:

  • Visibility into the pipeline of work allows a front-line worker to dynamically reroute work in order to achieve service goals. I would argue that some of this could be done with automated load balancing, not just manual rerouting, although the concept of visibility would cover that as well.
  • Dynamic BPM allows workers to change or create the process required in order to achieve a goal in a manner that was not envisioned by the process designer. This allows us to consider eliminating requirements (I could so get on board with that) since the creation, prototyping and productionizing of processes can happen so quickly; if this approach scares you, consider that the requirements and design can be a much more collaborative process that allows for continuous change. In fact, she characterizes the requirements-less approach as “fantasy”, whereas I characterize it as “Agile”. I don’t think that Gartner goes far enough here: fully dynamic BPM is possible in some scenarios (excuse me while I dig out my “Process for the People” t-shirt); Phil Gilbert of IBM/Lombardi has stated that we should just put process design in everyone’s hands. Obviously, this is going to be dependent on the types of processes and your corporate culture.
  • Social BPM, including both design-time and runtime, which is something that I’ve been writing and presenting on for 5 years now, brings enterprise social software concepts to BPM – good to see Gartner finally recognizing these ideas front and center. I think that they formerly had a lot of social collaboration ideas tied up in dynamic BPM, which are adjacent but slightly different concepts, but now seem to have split this out.

Her focus is really on challenging the audience on how they define BPM, and how they use it within their own organizations. This means building in resiliency, embracing dynamic processes, figuring out cloud strategy, and harnessing the social interaction that is already going on between people. To quote her closing point, “acceptance of the collective will determine your future”.

BPM Customer Panel #appianforum

The first day of Appian Forum ended with a panel of Appian customers – Archstone, AGF, Enterprise Rent-A-Car and Mercer Outsourcing – hosted by Clay Richardson of Forrester. Clay started with a question about which BPM project to do first: instead of the old “start small, think big, act fast” mantra, many organizations are choosing to start with a bigger project where they’re experiencing a lot of pain. Not, however, the organizations represented on the panel: they all indicated that they either started with a smaller project, or started with a big one and regretted it. I think that the key is balance: select a big enough project to be meaningful and use an iterative approach so that you don’t get swamped by it.

The discussion continued on to include data integrity/cleansing and return on investment, and the audience chimed in with questions on testing BPM applications to ensure correctness (getting a working system in front of the users earlier for validation and testing helps, as do frequent releases), production support (often done by original project team, which cuts into time for new development and CoE activities, but ideally project team is second line of support and leverages shared services support for underlying server and network infrastructure) and business change management/buy-in (requires communication, participation and vision). I think that my presentation on BPM centers of excellence that immediately preceded this had an impact: a couple of the questions directly referenced what I was talking about, particularly in the last question on process asset reusability across projects (difficult unless there is a CoE that manages an asset repository or otherwise governs reusability).

My job here is done: tomorrow is a more in-depth day for customer product training, so I’m headed back to Toronto tonight.

Benenden Healthcare Society BPM case study #appianforum

Ian Grant of Benenden Healthcare Society, a UK not-for-profit, user-pay healthcare provider with almost a million members. They had a need to improve their business agility, and identified that they needed a new case management system as well as better auditability of the decisions made within processes. They reengineered their processes first, then had their three short-listed vendors build out those processes to see how quickly (and well) it could be done; Appian was the unanimous choice of the selection panel.

They created Service Management System (SMS) to document and manage all interactions with members. Typically, when a member calls in, the service rep accesses all previous case data for this member, gathers some information about what is wrong with the member in layman’s terms – so that the service rep doesn’t have to be a clinical expert – then the rules and processes built into SMS present the services available to that member, and generates the necessary paperwork and follow-on processes. When they go live (soon), they expect to reduce their service rep training time from months to three weeks, and improve their customer satisfaction rating from 95% to 99%. They’ve created some lightly-customized user interfaces that allow for fast information gathering and problem resolution.

During implementation, they completely ignored the current state, and only considered the to-be processes and functionality. Although they had a waterfall requirements process up front with formal signoff, they moved into a more iterative prototype development cycle (although one that seems to have taken a year, so not so agile).

They’ve already achieved two million GBP in savings through renegotiations with their service providers based on their expected future-state process, as well as seeing some improvements across all processes. This is fairly common, since the act of examining and reengineering a business process almost always has the effect of improving it since many of the inefficiencies will be exposed and resolved even before any technology is brought to bear on the processes.

They have involved 85% of the entire user base in some way in the creation of the new system, which has resulted in a high degree of user buy-in since they developed the requirements themselves. They’ve already identified their requirements for the next phase, and are creating the development plan now to deliver that by the end of next year.

I’m left with the impression that there is still a lot of waterfall methodology at Benenden; whether that hinders their efforts will be seen once they’ve rolled out the first version.

Lean Process Improvement Revisited #appianforum

As with Jim Sinur, my schedule is overlapping with that of Clay Richardson of Forrester several times this month. This morning, I heard some new material from Jim, but Clay had much the same presentation that I saw him give at the Forrester Business Technology Forum a couple of weeks ago so I don’t have a lot to add here, although it’s worth reviewing the original post since he had a good presentation on the implications of Lean principles on BPM.

He did have a new bloated-lean-anemic case study about the Territory Insurance Office based on Tom Higgins’ presentation at the BTF; hopefully we’ll see a paper from Clay on this soon.