"IT matters if it addresses business processes and only if it addresses business processes," says Howard Smith, CTO at CSC Europe and co-chair of the Business Process Management Initiative (BPMI.org).
Speaking at a CSC business process management (BPM) briefing in Johannesburg last week, Smith said BPM had become an important topic for the whole IT industry. Companies should strive to put business processes in place that persuaded people to come back to do business with them again and again, he said.
Smith advocated a BPM model that can be layered across an enterprise, combining business processes rather than replacing them. Business reengineering, he said, had proved "painful", as its approach was to "chuck out" existing processes and replace them with new processes, rather than combining and improving existing processes and developing new ones where required.
Smith said the need for a BPM approach was evident. Citing statistics from Gartner, he said 85% of IT projects failed to meet objectives, with 32% being cancelled outright. In addition, on average only 7% of software functionality that was paid for was actually used, and IT projects often suffered from a prolonged delay in realising value; an average of 18 to 24 months.
Given that between 1992 and 2001, US-based companies had spent $2.7 trillion on IT and research had shown little correlation between IT spend per employee and return on shareholder equity, something had to change, said Smith.
"Something has to shift us into a new IT model... We can`t have a situation where IT thinks progress is learning a new technology," he said.
Smith believes this "something" is BPM. The challenges faced here, he said, included the fact that few people actually understood what a business process was. "Processes are very misunderstood. We need to go beyond a shared language between business and IT towards shared facilities...Today we are asking the wrong people to do BPM. We are asking IT. They should be supporting BPM but business should be developing these processes."
In addition, there were over 110 vendors claiming to have BPM software "and none of them really do".
Smith believes that one of the major problems is that traditionally IT had been focused around data and not around business processes. Citing Gartner again, Smith said the research house has given BPM the "triple crown" as it saves money, saves time and adds value. Gartner, said Smith, had also stated that while 73% of process projects provided business benefits, 75% of application development projects failed.
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