Business processes and the rear-view mirror

I have a growing appreciation of why certain financial institutions have got themselves into so much trouble. Attempting to manage a business, supervise minute-by-minute trading and review brokers' activities is hard enough, but its made even more challenging by the fact that many firms still attempt to do this by the human study of exception reports. I say 'study', because that's what it looks like: some very talented people picking through printed reports line by line, looking for patterns or anomalies. In some cases this is essential - a necessary step in what is being done is to review the past. But as the recent TV ad from IBM shows, and a range of software companies have hinted at in the past, running your business looking in the rear-view mirror is not only tricky, its downright dangerous.

So what do you do? Well, one approach is to take the printed exception reports and re-make them electronic. Keep them in a format where some clever software can supplement the clever people and look for the obvious patterns, based on predefined business rules, and the less obvious patterns, based on some seriously smart heuristics. But the rear-view mirror is still your issue. You are catching errors after its too late to do much about them - much beyond making a correction, apologizing heavily and reprimanding the employee that messed up. 

The second approach is to revert to the old days of decision making: a person makes the decision, but there is an approval process before any decision is actually executed. Great - its hard to screw up - and harder still to get anything done. For financial services that depend on the trading of smart, bullish individuals, running in near real-time, that just doesn't fly. But as the business rules management guys will tell us, even for less challenging environments than securities trading, automated business rules management is still not widespread enough in business. Why? Because for them to work as part of the whole, they need to be part of the overall business process. Not just tacked on the side where they can be bypassed easily, but fully embedded and completely enforced. And for that you need a system in place for managing the business processes in which the rules are enforced. A system for doing this is not email, its a real system that guides the correct flow of work, its delivery (between human beings, business rules and other systems). It doesn't have to be a multi-hundred thousand dollar BPMS / SOA / software vendor's ticket to paradise. But it does need to exist and start to become part of the workings of the business.

For now, making the rear-view mirror work better, while giving intelligent people more time to lift their heads and look ahead is my goal for clients. I will help them get to the next step when they have time to see the value of doing things differently.

A post from the Improving It blog

Old approaches to business process management are failing companies

We all know that companies of all sizes are facing tough economic challenges at the moment. These challenges are coming from one of the toughest directions possible: customers are not spending money, making it more important than ever to convert the few available prospects into profitable customers. Improving business processes is a powerful way for companies to work better, but the old business process management (BPM) approaches companies often rely on just don't fit the current challenges.

Companies invest in business process management from two direction:

• methodology - the way a company can fix its problems
• technology - applications helping people work in a more structured way

The reasons for doing this were all reasonable in an economy with plenty customers with cash in their pockets:

• reduce headcount
• do more work with the same resources
• improve the quality of a product or service

In the current economy, these types of improvement are not enough. Whether a company is a bank, a manufacturer or a law firm, the challenges facing the business is that the economy is making it harder to attract new customers and retain them.

This is where modern business process management solutions kick in. First, they offer a faster startup time with more focused analysis of problems, which means less money is spent on teams of expensive consultants trying to build strategies for things that don't matter. Second, the solutions offered already include a range of business templates, helping companies to build to a tried and trusted plan rather than always reinventing the wheel. Finally, and possibly most importantly, the methodology focuses on iterative improvement, rather than trying to get every little thing right first time. When the tools are designed to adapt to this types of constant change, the company can improve based on experience rather than luck.

With this lightweight approach to business process improvement, the flexibility to change processes based on experience and best-practices allows companies to do something that in the past was really difficult: 

• treat each customer as an individual rather than force fitting them into a standard model of a customer
• allow the processes that serve customers to extend and adapt based on circumstances
• help the business owners introduce new improved processes rapidly and with minimal cost

Business process management can help companies meet the challenges of the current economy. Companies that adopt new methodologies and technologies can become known for great customer service at a good price. In these times when social media is the marketing machine, and word of mouth spreads corporate reputation like wildfire, companies can attract and retain more customers than ever before.

A post from the Improving It blog

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Rescuing struggling business processes from the back office

I have a short article just published on ITBusinessEdge talking about how business processes in offices can be so much harder to rein in and control than manufacturing work with a production line:

So much has been written about efficiency in manufacturing that its is time for the masses of us office-bound companies to get a look in. A production line in a manufacturing company works so well to improve efficiency of building widgets because it constrains the way the half-completed widgets move, who gets them next and what they do with them. In the back offices of companies, things aren't so easy, so it can be hard to see why there is lots of activity with minimal productivity.

Take a read of the rest of the article to find out how I think that simpler online / SaaS solutions may often be better than complex and expensive enterprise software, even for the big enterprises that can afford it. This is just part of my white paper for rapid process improvement: Seven Steps to Escaping Process Chaos.

A post from the Improving It blog

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When documents and processes come together

I'll admit that the coming-together of processes and documents (BPM+ECM) has been a common theme of this blog for the four years that I've been spouting-off here. My background was imaging and workflow, then I got trapped along the way in understanding records management and even more trapped when process improvement became BPM suites, and more about the process than the stuff in it. I can not avoid feeling that I've heard this all before, but still wasn't satisfied.

Yesterday, a forum on ebizQ brought together some of the opinions about the question "Is it inevitable that BPM and ECM will be integrated into one system in the future?". For companies running both of these technologies in house, the answer is probably a no-brainer. ECM and BPM are already integrated, because the customer did it themselves. For vendors, nobody has worked out really if they can make money from it.

I've included some quotes from the forum that I think sum up the range of opinions, though its worth reading through the whole thing if this topic interests you:

Ian Gotts of Nimus: "The two are inextricably linked already. If I want to perform some task such as sign off a PO then I probably need to access the Purchase Policy document which will be part of ECM."

Malcolm Ross of Appian: "There's a definite need to unite the features of these two worlds to create more powerful content and process systems."

Doug Mow of Virtusa: "From the customer, patient, subscriber or end user perspective I want a seamless UI that doesn't distinguish between any class of functions. "

Brian Reale of ProcessMaker: "It is one thing to route a document or a PO, add a signature, and then store it in a DMS. It is another thing to start a process in a rich contextual environment and have that environment intelligently populate with the pertinent information based on attributes like user, place, time, and company policies. "

Peter Evans-Greenwood: What's a document/record anyway? A page in a wiki? An email? SMS? A tweet? Defining the scope of BPM and ECM as processes and documents ignores the ongoing erosion of boundaries between organisations and communications channels, and existing solutions are too intrusive to push into these new channels. 

I'll quote my own response in full:

The short answer is this: in any business that uses BPM in critical applications, BPM is already integrated with ECM. I think it unlikely that we'll see anyone but IBM and maybe EMC really producing a credible E-BP-CM suite. 

Why do I believe this? Well, its important to ask why ECM is so important to businesses... Its not the collaborative-Sharepoint-less, "let's be happy and work together" stuff. Its the fact that in real business, at the end of everything we do in a business process there needs to a record of the transaction, the decisions or whatever that formed the outcome. Of course, that does not need ECM if the data we were work with at every step was fully structured (an online form producing structured database records). But for the real world, documents do exist, and ECM provides a way to handle them. 

As Doug says we must interact with documents, and as the vendors hinted, document management ain't that hard for BPM vendors. The problem is that throughout a process, documents will form part of the final business record. BPM vendors rarely manage to focus on understanding the complexities of electronic document and records management, therefore they rarely do much more than routing documents -- plain old-fashioned 'imaging and workflow'. 

What is really needed from BPM is a final step: registering the records and the decisions of the process in the corporate records management system, keeping the context of everything that was done. Working with documents and process context appears in some of the marketing around case management. Though more often than not people get more excited about how processes can change dynamically, than how they can be recorded permanently. So I expect adaptive case management (ACM) to be another missed opportunity. 

It really is a shame that records management has such a 'stodgy' appearance, since it is such an important part of business processes.

This is one of those tough areas where the integration of technology for vendor gain often eclipses the needs of the end customer. Careful consideration is required on what is needed for any particular business, and navigating the options depends largely on experience.

A post from the Improving It blog

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Cases crystallize out of chaos

Coming via the bp3 blog by Scott Francis, Frank Micheal Kraft talks about Patterns of Knowledge Work. His discussion hits the point that many activities performed that are not 'production line' processes are really based on the activities of a knowledge worker: a person who is knowledgeable about what they do, and builds up structures around their work to keep stuff organized.

This ties into my discussion a week or two back that in my own client work, I've started to see how I can examine the records of business activities, the documents and paper reports, and track back through them. In doing so I build up a view of where the major business processes in an organization live, who does them, and at a high level at least, what the activities performed are. Amazingly, the often overlooked org chart helps me in seeing order in the chaos. It is interesting to me to see that there is a natural order to processes and information in business.

For Kraft, he talks about the three ideas he has come across:

1. 
   

   Managing my own knowledge work. As I wrote my own Adaptive Case Management system for my own knowledge work, I was able to organize my own work. As the number of cases increase – 3000 now including sub-cases – I become aware of patterns.

2. 
   

   Feedback from my first pilot. This was very interesting, because the main focus for my pilot is usability. Usability is strongly interwoven with these patterns of knowledge work.

3. 
   

   The things I always wanted to model, but never was able to. I governed the modeling of thousands of models of structured processes from all areas of business processes. But because the modeling language was only able to model predictable processes, I never was able to model unpredictable processes.

In my view, he has done with these three points what many business people have had to do -- build a mechanism for structuring his own work in a way that allows him to be productive and get value out of work he has done before. For many people, this is a matter of building a filing system, putting together checklists and tasklists, maybe even putting together an Access database recording people or indexing their files. Oh that, and never going on vacation, as nobody else can quickly pick up the structure and work with it.

Kraft has written his own Adaptive Case Management system, probably because he felt he could put some structure around the work he was doing, and that structure was adaptable enough to help others in their own work. With my own consulting and software work I have done a similar thing. And as Kraft says: "As with all knowledge work the result of my effort is not completely predictable. But I am making good progress.". 

I couldn't agree more. And with every new client or process I hit, more structure and flexibility crystallizes into something that benefits the next client down the line.

A post from the Improving It blog

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BPM taking off should not be about software vendor profit

If you have ever followed a Group on LinkedIn, you'll recognize that most of the discussions fail to pick up steam. A few people drop by, lob in their short comment to try and get noticed, then step away again. The discussion Why do you think BPM could not take off like ERP or CRM? apparently caught some attention. Its up at 80 comments, the vast majority well thought out and directed from individual opinions that are not just shameless plugs selling a product. Beyond its size, the discussion is interesting since it highlights the follow points:

• There is little agreement on whether BPM is a management methodology, a class of software, or just a bunch of marketing garbage
• The methodology people and software people can not accept that the other side has a right to exist
• BPM as a software is too complex, expensive, and lacking in appeal to CxOs to ever be as successful as ERP or CRM
• Success seems to be measured by the amount of profit the software vendors make, rather than the positive impact on a business

For most businesses, there is room to organize information, processes and people better. There is a need to keep client files electronically, relying less on paper and making savings on printing, copying,filing and offsite storage. There is a need to be able to simplify and control repeatable business processes, so that they take less time and less brain-power to complete, reducing the cost and number of errors. And there is a need to make it easier to track work that is not necessarily repeatable, but is easy to lose inside email inboxes. In short, with well thought out BPM, businesses can do more work, more accurately, with fewer errors, happier customers at a lower total cost.

This is what my kind of business process management would solve. Either the guy holding the purse strings gets the value of what is offered, or he moves on. No need for constant bickering between vendors that their spin on a product is better. The software and methodology says what it will do, without a vast education of needs. I like that form of business process management.

A post from the Improving It blog

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Another natural order to processes and records

Just a couple of weeks back I talked about how you can work backwards from corporate records to get a clearer view of the high-level business processes being run in an organization. The approach here basically was saying that if you can identify the records of business transactions in an organization (and in any fairly mature organization this should be relatively easy), you can step backwards through the processes that created them, avoiding all the rat-holes and exceptions that muddy the picture. This is great, but what happens when you don't have a clear view of where records are created? Well, this is where I'm going to aim for a quick win and get "two for one". And, yes there is a reason for the incredible animated image.

As you are reading this, bear in mind that I have the benefit of working with a financial services firm as my client of the moment. This tends to make things easier for me, since the regulators have always insisted on a decent structure for record keeping that means I'm not working from a completely blank page when trying to identify records. But still it is true that many firms don't have a corporate file structure that shows a heat-map of where records are produced and what they contain. So I can walk around the building talking to the owners of the business functions, or I can consider an alternative starting point. As much as I love talking to people, many of them have real jobs to do.

This is where the org chart kicks in. Yes, many employees wonder why it is so important for companies to build that 'tree' of people, beyond inflating the managerial ego. In my case, the org chart is an incredible tool to help me get started understanding not only where business functions are performed, but it gives me therefore the starting place to look for filed records and the business processes that created them. Its like the computer generated fractal pictures (the crazy animation) that follows natural effects. You jump to the major focal points, then drill down in a never ending fashion into the details of the business and the records that are produced. If I was really detailed-oriented, this type of work could keep me occupied for years. Even though I'm not, there is a certain natural order to things that yet another holistic view of the organization can provide. Perhaps the organizational studies will not result in a beautiful image, but there should be a nice structure that helps keep things organized.

A post from the Improving It blog

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Fractal image found on Wikipedia at Phoenix(Julia).gif

'I hate working with documents on-screen', and other issues we reinforce

You've heard the phrase "Knowledge is Power". There seems to be a human character trait that says by keeping documents close at hand, preferably within steps of my office chair, I am more powerful. Filing cabinets for individuals, and "working copies" of client files are everywhere in offices. Take that easy access to information away and people fight back. You are removing some of their ability to hoard information, all of which is a duplicate of something available elsewhere, but it exposes a frailty that leaves them uncomfortable. "What if somebody else has the file the one time in a million I actually need it?", or, "What if I'm caught off-guard, a client calls and I don't have their information to hand?". This is just one of the ways employees resist the introduction of enterprise content management (ECM), case management and business process management (BPM) solutions that try to limit the amount of paper moving and filed in the organization.

I have had the 'exciting' opportunity to spend some time working with lawyers over the last couple of years. From helping smooth immigration paperwork to cleaning up company contracts, it doesn't seem to matter who I work with I experience the same thing: paper. When it comes to the workings of a law office, I am frustrated by the apparent waste of paper (and the subsequent charges for photocopying applied to my account). When I think about it though, the issue is obvious with a lawyer because the multiple copies of documents happens typically right in front of you, while you're sitting there in the office. Although not so obvious, regular offices experience the same issue. Most of us I'm sure have seen the pervasive footer on emails, "Do you really need to print this email?". There is no way to know how much paper is wasted on unnecessary printing and copying in offices, because it is not charged per page.

For the 14 years I've been working with electronic imaging technologies, I've always encountered the concern that it is hard to work with text on a screen, but early on companies worked hard to limit the concerns of employees. In the UK at least, as a user of a screen and keyboard, an employer was required to ensure your working area was set up to avoid discomfort and to improve your posture. Companies investing in document imaging put in place minimum specifications for screens, and usability requirements for applications to make it easier and more productive for people to work without paper. These lucky people of the 90's working with electronic documents had it good.

Now when I visit clients, it is not unusual to see LCD monitors in every cube. Screen technology has progressed to a level where great quality should be available on every desk, but we have instilled the concept in the heads of employees that it is hard to work with documents on screen.  Why, beyond an aversion to change, does this persist?

I think that the problem comes not from the screen, but from the documents. Many regular people think of Word documents when reading on screen. Word is an editor, not a document viewer, and it does a terrible job of making documents easy to read. People remember this. Adobe Viewer for PDFs presents nicely prepared documents beautifully. But so often we end up reading marketing brochures prepared in multiple columns for glossy printing, needing to scroll around with every paragraph read, that we learn to hate it. The same with the trend to scan documents to PDF. The viewer does a generally poor job of making scanned documents appear attractive and clean.

My feeling is that companies wanting to become more paperless need to concentrate on the underlying issues of the documents they try and have people use. If your scanned documents look ugly on screen, people won't want to use them. If you force people to use daily reports by scrolling around left, right, up and down, they complain of RSI and general reduced performance. If you archive Word documents for constant reference and record-keeping you're asking for trouble in so many ways. As an aside, I saw a Word document archived in a large government agency that was unreadable, because the pretty font used by individuals was no longer available. This applied to thousands of documents.

Maybe it is time for companies to focus on how they can make the information that gives people the power to make good decisions not only available, but easy to use. This isn't just document scanning. Good application design and recognizing that people want to organize information their way will help people work better. Companies need to focus their investments in document management, business process management, and case management on making users actually want to use the new applications, since this desire to use the application is so important to getting paper off everybody's desk.

A post from the Improving It blog

Pigeon-holes are for the successful

Unfortunately this 'fun' discussion wasn't as a result of something I blogged, but its worth a look. According to Adam Deane:

My view is that Case Management should be implemented by ECM vendors, not BPM vendors.
Case Management revolves around data, documents and data therefore should be dealt by ECM professionals.
ECM requires a different set of skills than BPM.
It would be in the customer’s best interests to have separate systems for BPM and ECM.

I personally believe that it doesn't matter where Case Management sits. Its the business value that this type of solution can bring to businesses that is important. And until my business, or somebody else's is as synonymous with the that specific category of solution as SAP is with ERP, we all need to just accept that the industry is a bunch of pigeon-holes.

Follow along with the comments on Adam Deane's blog. Its getting fun...

A post from the Improving It blog

Avoiding rat-holes by working backwards

I'm working on business process improvement with a client in a way that some people would consider to be 'backwards'. I'm not starting by obsessively picking at a business process being performed and constantly refining it so that it works better. I'm actually looking at all the records of transactions generated by the company, which are filed and stored off-site, and I'm working my way backwards into the business processes that created them. For me at least, this is a great way to approach things.

So many times, in business process improvement, especially when selling or implementing BPM software, we already have been told which business process we are working on. A client contact has already made a business case to fix up a specific part of a business process, as she owns the particular department affected by that piece of the puzzle. As much as BPM'ers love to believe they think holistically with end-to-end business processes, the reality of the situation is that they really are just rubbing ointment on a sore spot to take the pain away in that area. Less pain for their primary stakeholder signifies success for the BPM solution, and everybody is happy - except for the fact that the organization as a whole is suffering.

My current backwards view of an organization is turning out to show a stunning landscape of interrelated business processes and information. At this point I'm not talking about 'enterprise architecture'. Oh no, nothing that technical yet. From looking at all the printed reports, paper forms, photocopied documents, Excel spreadsheet and printed then scanned emails, I'm seeing an amazing interconnectedness of activities that is hard to get at when you look at a process as just a series of tasks to be performed.

Now that I've convinced myself that the organization is like one living organism and Mother Nature has overtaken my client, how does that help me actually make things better? Well, there are two approaches to mapping out the way to take process improvement: I can ignore this new view and select a business process that appeals, starting to fix it up, digging in from the 'request' in my diagram; or I can follow the paper trail backwards, from the final result of all the work that is going on (the record), back through all the high-level activities that produced the result.

What I'm finding is that by working backwards, I'm getting a clearer picture of the best-practice straight-line business processes I'm hoping to nurture than working start-to-finish. By working from the absolute end result of the process, which is the records to be kept that are evidence of a successful transaction, I can track back through all the activities that were performed to get there. For a start this allows me to discard the waste output that is often filed because nobody really knows if they can throw it away. More importantly, working backwards tends to hide the rat-holes, exceptions and distractions that typically appear from working the other direction (the benefit of hindsight?), allowing me to see what I really need: what a successful, streamlined business process is supposed to look like within the context of the whole organization. I can then use that information to select the most valuable business processes to focus on fixing, while already having a great view of how they should work.

I like this approach to starting a business process improvement project, although I know I'm going to have to avoid confusing my client with what appears to them to be an ass-backwards view of the world.

A post from the Improving It blog