Is BPM coming of age?

"Business process management is not a new concept," says Rainer Gaier, Managing Director, Ovations. "It is a technology that has come of age.

"With business process management companies can now experience the benefits of cross-border processes and can realise the true value of end-to-end," he says.

According to Gaier, companies increasingly have to reduce their costs, and increase their service levels while leveraging their investments. With a predicted 17% increase in the business process management (BPM) space, it appears companies are more mature and have bedded down their existing technologies. "Companies are now strategising how they can capitalise on what they already have," he says.

While many organisations have well organised processes within separate business silos (departments), there is often no link from one silo to another. "BPM addresses this," says Gaier. "It is a powerful business enabler, facilitating the transformation of companies to becoming business process enterprises thereby creating end-to-end processes."

As a business process enterprise, utilising BPM as a tool, a business`s processes will support the business strategy and measure the organisational performance by simultaneously addressing processes, structures, people, culture, technology, performance and systems.

"Processes are owned and controlled by `process owners`, who are responsible for their definition, design and implementation," Gaier explains, adding that these processes extend end-to-end across all relevant divisions.

In contrast, a non-business process enterprise is generally structured in silos. "Each silo has its own business process, resulting in different processes across the entire value chain," says Gaier. "Processes are neither end-to-end nor uniform, and silos are disconnected. Because many organisations do not know what their overall processes look like, they are unable to manage them and they generally do not have tools in place to map them either."

With an inherent high cost base, duplication of sub-processes and an inability to realise synergies, the silo approach does not allow organisations to fully leverage their investments. "These enterprises typically create channels, such as call centres, for each silo, instead of creating one channel across the organisation," Gaier explains. "Furthermore, a separate strategy extends from the business level to each business unit.

"From an IT perspective, the business runs multiple automation programmes across silos, resulting in resource and skills constraints, slow business delivery and potentially a dissatisfied customer. As there is no handshake between each silod system, effort is duplicated and individual processes are independently implemented," he says, adding that where architectures differ, components cannot be reused, training is required for each system and costs cannot be reduced.

"Using BPM, however, enables processes to be owned at a process manager level where continual improvement and reengineering can occur. Process optimisation affords the business agility, enabling it to react quickly to both internal and external changes. Operational expenses are more accurately budgeted because the organisation knows the costs and measurements for each process," explains Gaier.

BPM results in activities no longer being owned at silo level and individual silos no longer requiring their own business plans and processes. "The organisation is principally process centric resulting in greater synergy within the design of the business strategy and processes."

The implementation of single, instead of multiple systems, eradicates duplication, thereby lowering the organisation`s cost base. "The single system is easier to maintain, enhance and integrate, and allows the business to respond quickly to mergers, acquisitions, new products and changes," says Gaier. "Uniformity in systems architecture throughout also ensures there is consistency in terms of design, implementation methodologies, deployment and tools."

In a BPM environment implementations are done within a common framework thereby increasing productivity, reducing time to delivery, limiting development duplication and streamlining the need for IT resources. "Over time minimal `from scratch` development is required," adds Gaier.

With XML as an enabler, BPM is also successfully bridging the gap between different systems, both internally and externally. "It provides a common communication framework, enabling data to be passed between systems," he says. "XML is powerful, affording systems the flexibility to integrate changes and new elements."

Gaier agrees that increasingly BPM is forming part of a company`s strategic agenda. "It provides benefits that companies are looking for, namely, minimising risk and exposure by processing end-to-end; standardising and improving existing processes across all divisions; centralising processing and achieving economies of scale; delivering products and services that result in real benefits to customers; accurately measuring performance across the value chain; and eliminating the duplication of work."

BPM results in lower costs and improved efficiencies. But, despite the importance of systems, Gaier emphasises that a business process enterprise initiative involving BPM must be driven by the business and not by technology. "The objective of the project should never be to implement a workflow solution - the focus must rather be on business drivers.

"Implementing BPM is not about discarding existing processes or radically changing the business," says Gaier. "Organisations can have different appetites for change. They could be minor (automation only), moderate (re-engineering) or major (business enterprise).

"The issue, however, is not whether they should be doing it, but to what extent," he concludes.