Are we ready for Business Process Management?
Subham Sarkar, Consultant, Technology Advisory Services,
PricewaterhouseCoopers, details the factors that led to the birth of BPM and
how it can help enterprises
During the re-engineering wave many companies invested heavily
in it. In many such cases, what was supposed to be a 90-day initiative took
more than two years to complete. Many of these initiatives made the companies
that took them up anaemic.
At that time many successful re-engineering efforts improved
the concerned business to a better state, but one that was static. In many cases
with late adopters of re-engineering, the change in requirements came even before
the re-engineering process was through. However, more than 80 percent of BPR
(business process re-engineering) efforts failed.
As business requirements changed faster than ever, companies needed to adapt
and change before they realised their return on investment (RoI). These changes
were triggered by factors such as shrinking business cycles, commoditisation
of products and services, cost pressures, knowledge-based services, e-business,
globalisation, consolidation, extended value-chains, extended enterprises and
To cope with these challenges, businesses kept trying every means to optimise
processes, implement automation, and run radical management theories as increasing
costs put businesses at risk. This led to a tidal wave of change that saw downsizing,
rightsizing, outsourcing and restructuring.
The need to move on
Inability to meet these changes can constrain a business. Businesses often miss
out on new opportunities because changing business processes are often time-consuming
New strategic drivers are difficult to consolidate with existing business processes.
Often, small changes required for continuous process improvement which can be
incorporated at ease in an agile enterprise are deferred because of the dreaded
impact on existing processes. Thus, changes are compounded, resulting in a monstrous
Organisations often face a crisis where entities and business processes are
not all aligned with the companys goals. In many cases it becomes difficult
to minimise time-to-market because of the absence of agile processes.
With lessons learnt, ERP and a lot of other IT systems catering to more or less
standardised business needs with little customisation are being implemented.
(For example: SCM, SRM, Web-enabled services, e-procurement, and CRM.) Moreover,
many business-specific custom IT solutions were developed from scratch and implemented.
The automation trend was mostly driven by business-function owners with an IT
requirement going ahead and implementing an IT solution aligned specifically
to the process. This led to many disparate systems existing in an organisation
under one umbrella. These systems were tightly coupled, and in most cases, people
were trained and business processes were aligned as per the existing system.
System owners have been data- as opposed to process-centric. So when the requirement
of process change or collaboration came about, most legacy and modern systems
failed to deliver. A gap between process and systems surfaced. The traditional
approach of system implementation will definitely give a short-term solution
with tightly coupled integration, but the perennial problem of change still
This fuelled a shift from a functional mindset to process-oriented thinking.
A business process, by nature, is cross-functional, constantly changing, integrated,
and interacts with systems and people. This is where BPM comes in.
Advent of BPM
BPM encompasses the entire organisation, integrating critical
processes within and outside an organisation. It is often desired that the whole
organisation behave as a system. Earlier, there were technical limitations in
achieving this. However, powered by a strong mathematical foundation, BPM now
promises to deliver a single window from where strategies can be translated
into action across business processes.
BPM is not another form of automation or a revolutionary new philosophy. It
helps discover what we do, and then manages the lifecycle of improvement and
optimisation in a way that directly translates into operations.
Tailored for business
process, by nature, is cross-functional, constantly
changing, integrated, and interacts with systems
and people. This is where BPM comes in.
BPM is for business people. Designed
top-down in accordance with a companys strategy,
business processes can be loosely coupled with existing
IT systems, and the power of existing IT infrastructure
can be leveraged.
A business process consists of business functionality with IT and non-IT processes
that may be powered by people or otherwise automated. These business processes
change dynamically everyday, influenced by internal as well as external factors.
BPMs capabilities are derived from process modelling, application integration,
process analytics, rules management, and collaboration portals. It brings together
these elements on a single platform that manages the lifecycle of a process
from definition through deployment, execution, measurement, change and re-deployment.
At the heart of BPM lies a strong technology foundation provided by Service
Oriented Architecture (SOA). BPM is a philosophy which is a management discipline,
and focusses on continuous performance improvement around iterative process
improvement. SOA is a technology approach that delivers systems as a composition
of discrete and independent services, and which is orchestrated by rules.
Together these elements provide explicit process management which include:
- Modelling and simulation
- Rules engines
- Human interaction
- Application interaction / integration
- Process analytics.
BPM gives control of the business to the business people, and bridges the gap
between processes and systems. BPM systems provide solutions to a lot of integration
challenges that combine aspects of loosely coupled, coarse-grained asynchronous
integration with visual process definition and run-time process management.
Benefits of BPM
Implementation of BPM starts with the analysis of the top-level strategy of
an organisation and drills down to the core of its business process. The BPM
implementation is iterative, and processes are iteratively deployed as part
of the system.
Since Process Oriented Architecture provides plug-n-play support for processes,
the processes are deployed according to criticality. This iterative deployment
provides cost advantage, and the cost savings resulting from each deployment
can fund deployment of less critical processes.
BPM is a key that can unlock the potential of many a business. With BPM we can
harness the capabilities within an organisation to the maximum.
- Flexible process collaboration and configuration.
Earlier, systems were integrated using EAI tools which have been very
system-specific. Now processes can communicate with each other using
- Agile course correction. Organisations
will be able to adapt to changing business environments and change course
- Re-usability of existing systems. Businesses
do not need to scrap existing IT systems for new applications, thus
reducing the cost of migration. With advances in Service Oriented Architecture
and XML-based messaging systems, existing systems can be re-used.
- Re-usability of business processes. Till
now system functionality was re-used, but from the process perspective
we can re-use the business process module depending on the granularity.
We can re-use IT systems as well as non-IT processes.
- Integrates the organisation in real-time.
With all the business processes integrated, the organisation behaves
like a system in real-time.
- Simplifies deployment. Eradicates the
point-to-point integration and tight coupling which adds to inflexibility.
- Plug and play different technology providers.
With services now communicating in open standards, different technology
components can plug into the service model.
- Powering newer strategies. With BPM,
business processes will now be able to provide data in real time; it
can be fed into business analytics. This will provide a platform for
a real-time decision-support system, thus speeding up strategic analysis.
The organisation will then be able to align itself to new strategic
initiatives at ease.