Texas Education Agency’s Process Transformation Journey

After a somewhat lengthy introduction by Marie Wieck from IBM’s middleware group, Rick Goldgar, CTO of the Texas Education Agency, talked about their process transformation. This was mostly about good software development practices – componentize, use a shared bus, agile methods, providing tools that empower the users to create their own solutions – but also about focusing on business process rather than UI when first prototyping. They start with a business process model of all business activities, then an implementation model to show what will be automated, then an operational model that translates directly to BPEL for execution. This idea of different perspectives on the process model is key to success at process modeling, but I hope that they’re using tools that allow for a shared model or some sort of automated translation, not having to recreate the process model three times.

In addition to their core WebSphere process modeling, they had the happy accident of using products that were eventually bought by IBM, such as ILOG and Cognos, so IBM is actually doing some of their integration for them as the product portfolio matures. Goldgar pointed out that it’s critical to choose technologies that integrate well; a timely comment after hearing a presenter from Scotiabank at a seminar earlier this week say that “most vendors integrate really well with themselves”. 🙂

In response to an audience question about the speed of system changes, he responded that many of the changes now are not limited by the technology – they can enact a change a business rule or report format in minutes – but by the users of the technology, who may need to be trained on the changes, or consider the full business impact of the changes relative to governing regulations. That’s the way it should be: the speed of technology change shouldn’t get in the way of the speed of business change.

Medco’s Agile Enterprise

Kenny Klepper, president and COO of Medco, gave the second keynote at the Forrester BP&AD Forum today on their business transformation. I saw him speak at PegaWorld earlier this year (and Pega even published the video), so this was a good update on what they’re doing – check out those reference for background on Medco and more information.

They’ve created an enabling architecture – frameworks, service bus, data fabric, data management and data warehouse – that enables their agile enterprise, and he believes that this level of supporting technology just couldn’t have been created a few years ago. We’ve reached a tipping point, where the technology has empowered the business for self-service, leading back to the themes from the opening keynote earlier: they’ve moved hundreds of people out of their IT groups and into centers of excellence, turning them into mentors and innovators rather than just back-room techies. What’s key is that they didn’t create some new group for the fancy new technology, but changed the roles of their existing people to allow them to take on the challenge. This resulted in business process centers of excellence, business innovation and agility centers, core IT centers of excellence, and operations centers, all working in concert. They don’t see this as a technology play, however, it’s financial: he sees these four centers as key to their return on invested capital, and an earnings-generating activity.

They use embedded “imagineers” with no technology constraints and rapid prototyping tools to rethink their business processes, not just apply some incremental process improvement techniques. This links up the market view of the business innovation and agility centers with the internal view of their operations centers, then pushes the innovations back through the business process and core IT centers of excellence. The result: they’re seeing business changes in days, not weeks or months.

This new agile enterprise structure has changed how they deploy and manage capital: they allocate capital both for growth and productivity, rewarding agile methods in order to incent movement away from legacy projects and into the new infrastructure. Interesting idea: choke off the funds going to the old legacy development, and people will start to focus on moving off the platform.

This has obviously been a huge success for them, both financially and in the enthusiasm of the people in their organization: the video clips that he showed were mostly of the business people who are impacted positively by this, one of whom claimed that you would have to “pry [the system] out of my cold dead hands”. We should all have such passionate stakeholders.

Forrester BP&AD Forum Keynote: The Empowered Future

I’m in DC at the Forrest Business Process and Application Delivery Forum – always a good conference in my experience – and Connie Moore opened the event with the morning keynote on business transformation and IT transformation. She showed some really great imagery about agility: a video clip of running water to represent where we should be, moving easily within a fluid environment, then a still shot of boot-covered feet mired in concrete. Also a good quote from someone at Linklaters:

Business transformation is not a series of discrete process improvement efforts.

That’s a great point, since we sometimes get too focused on a specific process improvement project and lose sight of the bigger picture of improving our entire organization.

Up next were John Rymer and Mike Gualtieri to talk about succeeding – and leading – in the empowered future. Empowerment is a big theme here, which I’m sure isn’t exactly a coincidence, given the recent release of Empowerment by Forrester’s Josh Bernoff and Ted Schadler. They talked about the rise of social media in empowerment, such as how Heather Armstrong kicked Whirlpool’s butt over a new broken washing machine via her hugely popular blog (although they neglected to mention why she ended up with 1.5 million Twitter followers, which is a great story on its own), and about finding the empowered people within your company and your customer base. They point out that empowered people accelerate everything; by creating crises (I admit to doing that sometimes myself 🙂 ) and by publicly promoting those who respond appropriately. We need to have empowered (or rather, empowering) technology and empowered employees in order to properly engage with empowered customers; otherwise, we risk missing out on the conversation altogether and allowing an empowered competitor to take over.

For many organizations, the old non-agile ways haven’t been working all that well. Business is going around IT to get things done, and innovation is at a standstill. They have four recommendations for achieving a newer, more responsive organization:

  1. Design for faster change. This allows you to change at the pace that the business requires it, which virtually assures business-IT alignment. The keys here are flexible platforms and tools that enable continuous transformation, and allow business professionals to share the responsibility of delivery. Create ever-evolving programs that deliver streams of value.
  2. Get passionate about people experience. Experiences need to be useful, usable and desirable, allowing people to accomplish their goals, easily perform tasks, and enjoy their tasks. That’s right, enjoyment of the experience actually makes a difference, both for your customers and your employees.
  3. Deliver smart solutions. This is about creating solutions that have a lot of flexibility built in to allow the business people to configure and extend them, through goal-driven processes rather than strictly structured processes. Events and analytics have a big part of this, by delivering key information at the right time to process participants, using suggestions for guided experiences as well as awareness of the process context. The result: huge productivity gains, both for IT (who do less development) and business (who can do more without having to wait for IT to change the applications).
  4. Make proposals to the business. Innovation comes from a combination of business and technology knowledge, and IT needs to learn the business in a very deep way in order to be able to recommend new technologes that will really make a difference. I can personally attest to this: my work with clients, which is a lot about helping implement BPM technology, relies on me having a deep understanding of what the business does; otherwise, I can’t visualize a solution that will have a significant impact on their business. That means that by the end of a project, I can do the job of half the people in the business area: knowledge that I’m unlikely to use everyday, but invaluable in helping them to innovate their business. To generalize, the right combination of analytic skills, technology know-how and business knowledge allows IT professionals to propose breakthrough innovations that the business just won’t come up with on their own because they didn’t even know that they were possible.

They were directly addressing the IT professionals in the crowd; given that this is also a conference on business process, I’m not sure that’s all who’s here, but great suggestions nonetheless.

They finished with some thoughts on changing language from the old school IT speak as part of creating the new empowered ways:

  • “User” becomes “Person” to stop some of the alienation between business and IT
  • “Project” becomes “Program”, which requires a change in focus as well as language
  • “Application” becomes “Business capability”, since the iPhone has ruined the word “app” for us 😉
  • “IT (Information Technology)” becomes “BT (Business Technology)”, since it’s really about the business, not just the information underlying the business
  • Industrial metaphors becomes creative metaphors, since we’re not just cogs in the wheels of business – a message on the Twitter stream suggested that we do away with “Lean” while we’re at it

This was a call to arms for IT to do things better, and lead us to the empowered future.

Untamed business processes #BTF09

You know that you’re getting near the end of a conference when the number of people on the panel is almost as many as the number in the audience. The last session of the day is a breakout, and I attended a panel with Craig Le Clair, Chip Gliedman and a third analyst (George) who was substituted in for Paul Hamerman, but for some reason they had not spent the necessary 10 seconds to update the title slide.

They classify processes into “tamed”, meaning those that are so structured, they’re embedded within packaged applications such as ERP and CRM; and “untamed”, including everything else, including all those processes that we implement in BPMS. I’m not sure that I agree that some of their untamed processes are not structured; rather, a packaged app doesn’t provide the right degree of flexibility, or the market for the process is small enough that there isn’t a packaged app to deal with that process.

Forrester has an interesting format for this type of panel, where each of the analysts takes on a persona and a set of opinions that I don’t think necessarily represents their own opinions: although I like the light-hearted back and forth conversational manner, this has too much of the air of a high school debate club where anyone can argue any side as required rather than analysts who actually hold opinions on this subjects. I found this one to be too distracting to focus on the content.

That’s it for the Forrester Business Technology Forum; all in all, a lot of great content in a fast-paced two days. There could have been more on Lean business process improvement rather than Lean software process improvement, especially considering that half of the vendors in the showcase were BPMS vendors, but I still gained a lot of value from the conference.

Social media and business activity monitoring #BTF09

James Kobielus and Natalie Petouhoff presented at a breakout session on social media as a method for gaining visibility into your customer service processes: customers will react on social media channels such as Twitter, Facebook, review and community sites, and blogs if they have either a good or bad customer service experience. I’m not sure that this fits into the classic definition of BAM, but it does provide insight into how well you’re working with your customers.

They referred to the “witness factor” that social media has on business transformation: if people within the company know that they are being watched and commented upon, they often change their behavior in order to make those comments more favorable. Social media provides one window for a company into their customers’ impressions of the company and products; since people are much more likely to comment if they have a bad experience than a good one, those are overwhelmingly negative, but still represent valid complaints.

One problem with many current BAM applications is that they’re trapped within a BPMS framework, and are focused primarily on the data and events generated by that BPMS. Instead, we need to move towards a more comprehensive monitoring environment that can accept information from a number of different sources, including social media channels. Just think of tweets as events that can feed into a monitoring dashboard, allowing a customer service representative to review and respond to those in the context of any other customer-related events and information. Kobielus mentioned that there is little integration of social media into traditional BAM tools, but I think that we’ll see this sort of functionality being offered by other tools, such as more forward-thinking CRM.

This seemed to be a bit of a disjointed presentation, with social media on one side and BAM on the other, but there are ways to bring this together: in advance of this session, I started a discussion with my fellow Enterprise Irregulars about Twitter being used for customer engagement (not just one-way PR blasts), which has resulted in a fascinating stream of messages that weave around these same issues. After I’ve had a chance to digest those a bit more, and think about how this impacts on business processes, I’ll bring some of those ideas forward.

Lean application development strategies #BTF09

Dan Carmel from SpringCM gave the second keynote today, focused on his premise that SaaS = Lean. Although I would agree that many SaaS applications are Lean from a customer’s standpoint, that’s not true with all of them. Yes, using SaaS applications potentially has a much leaner footprint for a customer since there is no hardware or software on their own site, but you also need to consider the efforts to integrate with other systems, including on-premise systems. If the SaaS app (or any on-premise app, for that matter) can be reconfigured and integrated with a minimal effort, then things continue to look Lean; if it’s closed and requires custom kludges to integrate, then not so much.

He went through some good examples of Lean and extensible SaaS environments, such as Salesforce.com and Webex Connect, then pointed out some areas where on-premise systems can be a big challenge, but SaaS can provide sufficient business value even at lower volumes: ECM, for example (no surprise, since that’s what SpringCM sells), where high initial costs tend to keep all but large companies from deploying internally.

He then introduced Joe Graves of Stratus Technologies (a SpringCM customer) about their journey with SaaS. They started using Salesforce.com about five years ago, deploying to 170 users worldwide in a matter of weeks from the start of the project. They use a number of applications integrated with Salesforce.com, and when they needed ECM for contract management, they selected SpringCM because it’s tightly integrated and because they were already sold on the value of SaaS. He outlined their benefits: lower upfront costs with no capital outlay, quicker implementation time, reduced operational issues such as storage management and disaster recovery, and allows IT to focus higher up in the value chain rather that fussing with operational issues that don’t improve competitive differentiation. Although many people have concerns about customization and integration, security, and uptime of SaaS apps, Graves pointed out that there are ways to deal with all of these when you’re working with a properly built app, and that as long as it meets your functional and operational requirements, there isn’t a problem. [As I like to point out to people who use the highly publicized downtime of SaaS apps such as Salesforce.com and Gmail as justification for not using SaaS: your internal systems go down too, it’s just not publicized across the internet; in fact, the level of transparency that a SaaS provider has around their failures can increase customer commitment.]

Forge your Lean process improvement game plan #BTF09

After an intro by Mike Gilpin, Clay Richardson gave the first keynote of the second day, focused on Lean process improvement. We were visited by the ghost of BPM past being Michael Hammer and business process reengineering, focused on mass production but forgetting the people; essentially, it became a euphemism for downsizing. The ghost of BPM present, although it has moved beyond that frightening past, is stuffed full of consultants, books, tools and certification programs, to the point of confusion. The ghost of BPM future, however, envisions an empowered front line and engaged customers.

There’s a greater demand for BPM than ever – 66% of those that Forrester surveyed want to do more with BPM – but almost no one has increased budget to implement it. ROI might still be used to sell BPM projects (necessary in these budgetary times), but the final metrics will be business value-based, since ROI doesn’t necessarily measure the actual business improvement.

Lean is shaping the new world of process improvement: processes are moving from standardized to flexible, and the focus is moving from ROI to value since the old IT-centric metrics just don’t work any more. From an implementation standpoint, Lean is about moving from waterfall to Agile, and shifting from on-premise to cloud computing environments.

In order to develop a process improvement game plan, it’s necessary to understand your approach (methodology, tools) and your strategic intent; he had an interesting Lean process improvement (LPI) measure where looking at the correlation between those two factors could diagnose whether an enterprise’s process improvement efforts are bloated, lean or anemic. From there, each of those ranges has a specific plan: if bloated, then you need to connect your process to strategy, and eliminate waste from the BPM technology portfolio (which could mean eliminating some of the tools that you use); if anemic, improve process governance and your process improvement talent pool.

Any process methodology needs to be customized to your specific environment and requirements, and you need to assess gaps in your skills (particularly process analysts) and work towards empowering the business. Process improvement has to be connected to your value drivers, including the center of excellence.

Interesting discussion following between Richardson and Gilpin, especially about BPM mashups (Richardson is just as hot about social BPM as I am): he says that the key to a successful mashup environment that will be used by business people is to make it look like Microsoft Office 2007. He also mentioned that closely pairing a process analyst with the developers can reduce bloat on the project since it reduces the amount of miscommunication across that critical boundary (this, of course, assumes that the process analysts comes from the business side and not part of the development team to begin with).

End of the day, on to the evening #BTF09

Jim Haney, CIO of Harley-Davidson, presented on how they’re taking the Lean principles that they already use in manufacturing, and applying to their IT operations. They’re obviously focused on their customers: he started with a picture of a grey-bearded biker in bandana and shades, and pointed out that they do everything for him. 🙂 However, it was the end of the day and I didn’t find the rest of the talk sufficiently compelling to blog about.

Today’s been a bit of a marathon, especially following on the heels of 2-1/2 days at Gartner in Orlando earlier this week, and it’s not over yet: I’m off to the reception on the vendor show floor, then to a special event for women executives to discuss building personal brand, sponsored by Lombardi. Although I’m typically not a big fan of women-only events because I think that they just emphasize the divide, this looks like it will be an interesting panel and I’m looking forward to add in my two cents worth.

Designing compelling customer-facing user experiences #BTF09

For the last breakout of the day before the final keynote, I attended Mike Gualtieri’s session on designing customer-facing user interfaces. He started with the idea that application developers have to be involved in user experience design, and not just leave it to the designers (which is, of course, exactly what we did in the bad old days of development when there was no such thing as a user experience designer). Forrester defines user experience as “users’ perceptions of the usefulness, usability, and desirability of a Web application based upon the sum of all their direct and indirect interactions with it”, and propose that a great UX is useful, usable and desirable.

User experience impacts how your customers feel about you, and it’s also not just about the interfaces that the customer works with directly: a second-hand interface can also impact the customer experience, as you know if you’ve ever waited ages while a hotel desk clerk clicks their way through a complex interface in order to check you in. A good UX can increase purchases, retain customers and attract more customers; leaving it to chance hurts your conversion rates, alienates customers and increases your development costs due to redesign and redevelopment.

Gualtieri argues that UX design is Lean (although you could argue that only good UX design is Lean), and sets out best practices for good UX design:

  • Become your users, by listening to their needs, observing them in their natural habitat, creating personas, and empathizing with them. Users typically don’t articulate their needs fully or accurately so it’s not sufficient to just listen to them, but they will demonstrate them if you watch how they do their work. This type of user research is not the same as gathering requirements from business stakeholders; remember the Henry Ford quote: “If I asked people what they wanted, they would have said faster horses”. Forrester uses personas in their own materials – for example, representing an application development manager, complete with picture and name – and I’m seeing some companies such as Global 360 use these for BPMS user interface design.
  • Design first, and understand constraints and potential areas of change as well as the different personas that you discovered in your user research. Keep in mind that you have to serve business goals by serving user goals. Create rough prototypes first, and don’t rush into development or lock into a design too soon. There is some amount of art UX design, so don’t assume that tools can do it for you. Keep the basic principles in mind: useful, usable and desirable.
  • Trust no one: test your designs. It doesn’t matter how many experts review the designs, there is no better review of some features than testing the UX with a range of intended users. Remember that this is not just about usability, it’s also about usefulness and desirability.
  • Inject UX design into your software development life cycle. Everyone on the team should understand why UX design is important, and be incented to help create great UX. UX design should be part of your development process, and requires someone on the team to own the UX design efforts. You still need to use the same techniques as discussed in the other best practices, not just do the design in isolation from the users, but having it integrated into the development team will improve the overall software design.

He finished with the ideas that your development efforts are essentially wasted if the user experience isn’t done right, but it doesn’t have to add a lot of time or money to your project. Good UX design is the mark of a great application development team.

Can packaged applications ever be Lean? #BTF09

Chip Gliedman, George Lawrie and John Rymer participated in a panel on packaged applications and Lean.

Rymer argued that packaged apps can never be Lean, since most are locked down, closed engines where the vendor controls the architecture, they’re expensive and difficult to upgrade, they use more functions than customers use, they provide a single general UI for all user personas, and each upgrade includes more crap that you don’t need. I tend to be on his side in this argument about some types of appls (as you might guess about someone who used to write code for a living), although I’m also a fan of buy over build because of that elusive promise of a lower TCO.

Gliedman argued the opposite side, pointing out that you just can’t build the level of functionality that a packaged application provides, and there can be data and integration issues once you abandon the wisdom of a single monolithic system that holds all your data and rules. I tend to agree with respect to functionality, such as process modeling: you really don’t want to build your own graphical process modeler, and the alternative is hacking your own process together using naked BPEL or some table-driven kludge. Custom coding also does not guarantee any sort of flexibility, since many changes may require significant development projects (if you write bad code, that is), rather than a package app that may be more configurable.

It’s never a 100% choice between packaged apps and custom development, however: you will always have some of each, and the key is finding the optimal mix. Lean packaged apps tend to be very fit-to-purpose, but that means that they become more like components or services than apps: I think that the key may be to look at composing apps from these Lean components rather than building Lean from scratch. Of course, that’s just service-oriented architecture, albeit with REST interfaces to SaaS services rather than SOAP interfaces to internal systems.

There are cases where Lean apps are completely sufficient for purpose, and we’re seeing a lot of that in the consumer Web 2.0 space. Consider Gmail as an alternative to an Exchange server (regardless of whether you use Outlook as a desktop client, which you can do with either): less functionality, but for most of us, it’s completely sufficient, and no footprint within an organization. SaaS, however, doesn’t not necessarily mean Lean. Also, there are a lot of Lean principles that can be applied to packaged application deployment, even if the app itself isn’t all that Lean: favoring modular applications; using open source; and using standards-based apps that fit into your architecture. Don’t build everything, just the things that provide your competitive differentiation where you can’t really do what you need in a packaged apps; for those things where you are doing the same all every other company, suck it up and consider a packaged app, even if it’s bulky.

Clearly, Gliedman is either insane or a secret plant from [insert large enterprise vendor name here], and Rymer is an incurable coder who probably has a ponytail tucked into his shirt collar. 🙂 Nonetheless, an entertaining discussion.