For their recent InformationWeek Analytics 2008 Tomorrow’s CIO Survey, the well-known trade publication quizzed 720 corporate managers, including CEOs, CFOs, and COOs, as well as CIOs and VPs of IT-level executives, about the attributes most desirable for future business technology leaders.

IW’s John Soat then posted an excellent write-up of the survey’s findings, and I’ve been thinking about it ever since. John writes:

“Whether they know it or not–and most do–companies need an executive leader well versed in both technology and business processes. The CIO position is tailor made to take that role. . .the question is, which CIOs will step up to it?”

This chart (also below) based on the survey’s findings isn’t surprising if you’ve been looking at things from a process point of view as long as we have, but it’s not trivial that respondents noted “Need to manage or optimize business process” as the #1 priority as the CIO continues to strive to become more of a business leader.

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When your organization’s products are intangible, like an investment CD or a retirement plan, it’s sometimes difficult to identify waste or inefficiencies in your business.  Today I want to discuss some of the unique attributes of financial services organizations and how to look at these businesses through the prism of process to find problems that are often overlooked.

Financial services often tend to think of themselves as very different from other types of organizations.  For example, many firms have organically grown along the lines of “functional silos” based on different types of product, reinforced by separate IT applications supporting these product categories. Yet, every organization shares similar horizontal functions such as human resources, finance or accounting.  These functions alone offer more than enough opportunity for delivering business value through a BPM initiative.  But, I promise there’s more!

Financial services companies are generally very IT-intensive, and open to new technology and approaches to problem solving.  However, it can be difficult for these organizations to determine which solutions fit their needs the best - or even which problems to address - since their products are not tangible like a car or any product that you can hold in your hand.  If you can’t see your product, it can be difficult to see your problems like “defects” and “waste”.

Furthermore, regulatory monitoring & reporting requirements such as Sarbanes Oxley and Basel 2 have weighed heavily on this industry. Combined with global economic factors such as the credit crunch, there’s huge pressure on financial services companies to increase visibility, transparency and controls whilst reducing costs and simultaneously improving customer service.

In steps BPM…

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If you’ve been reading the Process People blog, you might have noticed that we talk a lot about an iterative approach to deploying BPM. What we haven’t touched on as much is that the iterative approach is an element of the overarching methodology. Looking in on the methodology from the highest level you will get a view of a three-phased approach – which ultimately results in iteration. But we want to provide a big picture of how all of the different parts of our methodology tie together, and how each point of emphasis leads into or loops back to key areas of the other two phases.

I realize that in some organizations, “phase” is a four-letter word. With BPM it is a must… it is the foundational element that leads to continuous process improvement and ultimately maximum business benefit. But don’t just take our word for it, just look at the countless customers who have used this methodology and achieve enormous success because of it.

Definition Phase

The definition phase is probably the most critical portion of the entire BPM adoption lifecycle. This is where you set the expectations for the BPM project, define metrics to measure the project and create a framework so that the focus remains on delivering business value throughout all three phases.

In this phase organizations should:

• Take the broader initiative and narrow it to a specific departmental level
• Define the business milestones and associated metrics
• Develop the business case
• Ensure that there is a common thread throughout the whole project (Business value)
• Get the business to drive this phase

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The best description of “executive level buy-in” that I know of is only 7 letters long:

F-U-N-D-I-N-G

Maybe that doesn’t help you as much as you had hoped, so I’ll provide some additional color around this one.  Funding is the absolute bottom-line when we talk about executive buy-in to a BPM initiative.  But funding has to reflect the iterative approach, which means that the project isn’t over when the process is deployed.  The project is really just getting started.

Funding has to map back to the methodology required to do the project right.  It has to reflect all three phases of a proper BPM methodology.  We’ve discussed this methodology on Process People before, and if you haven’t seen some of those posts, I recommend that you read one first!

In reality, executive buy-in also means you have to have an executive who’s willing to get up on a podium and endorse the process improvement program organization-wide.  It means that the executive has to be willing to commit funding in every manner necessary - money, people, time and so on.

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Ross Mayfield noted today that one of the biggest challenges with collaboration among distributed teams is actually agreeing on who is actually part of the team. Larry Irons quotes research from Distributed Work to that effect:

Of the twenty-four teams surveyed, not a single team was in complete agreement on its boundary: who was and who was not a member of the team. In fact, the average level of agreement within the sample was only 75 percent, such that any given team member was likely to disagree with the rest of his or her team on one-quarter of potential team members. 

We see this all the time in real world BPM projects. Agreeing on what the process is is often the easy part. Identifying the who is can seem nearly impossible, especially if a single team is attempting to define a process that is executed in many different locales all over the world.

A distributed, collaborative environment such as Lombardi Blueprint is key to solving this challenge. Having a structured repository to identify and maintain the players and relationships involved in a business process promotes visibility and knowledge sharing among those involved. Discovering the who in a process becomes far easier when all those that are involved can both document their own role and see how where they fit inside the grand scheme of things regardless of what office or time zone they happen to be working in at the particular moment.

In part one of this two-part Process People interview, we welcomed Raju Oak, head of process services at Kleinwort Benson in London. Raju is part of the transformation and systems services group within the company. Kleinwort Benson is a provider of banking and financial services to corporate and private clients in the UK and Channel Islands. In Part 2 we hear more about Raju’s key learnings from his BPM implementation.

Process People: How did Kleinwort Benson determine the metrics by which the company deems the project to be a success, both initially and on an on-going basi?

Raju Oak: It is important to note that our initial project was a pilot designed to first prove out the potential of the BPM approach. We faced several challenges during the pilot project that we had to negotiate along the way. Perhaps the biggest issue was that the pilot was being introduced through IT, and at that time IT did not have strong credibility with the business. At the same time the business did not recognize the connection between the challenges that it faced and the absence of a managed process infrastructure. We also had a strong skepticism about BPM within some parts of IT as well, based upon an earlier failed attempt to implement a workflow tool from another vendor as a point solution. There really was no experience of process engineering within the business. These challenges made it a complex and vulnerable project, with a long gestation, and its success depended upon strong leadership from the CTO.

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Showcasing the success of your initial BPM project is often times requested from other departments, but it’s also required to help drive adoption across the entire organization.

If showcasing your initial BPM deployment can help gain process adoption and ignite enthusiasm in other areas of the business, then you’ll get more and more value out of your overall BPM initiative. That being said, here is the first in a two part series of posts that will help you to showcase your BPM solution within your organization.

Get ‘em excited!

Everyone has had to sit in a presentation during their lunch break that seemed like a never-ending PowerPoint slide show. Now imagine watching someone explaining a process flow diagram that has no relevance to you. Then follow that with a “live” demonstration of someone clicking through a bunch of screens acting as a participant in the process that you didn’t get. Trust me, it can be very painful.

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Driven 2008 has come to a close, and we’re really thrilled with this year’s event. Many of the conference attendees stayed for the Lombardi golf tournament yesterday, which took place on the beautiful Fazio Canyons golf course at Barton Creek Resort and Spa. The weather was perfect and the golf was great.

On that note, I thought it might be timely to provide a quick recap of a session that Toby Cappello hosted on Wednesday. The session was called: “The Monday Morning Quarterback Discusses 10 Painful Lessons Learned.” Toby started things off with a golf analogy - one which he lived up to on the course yesterday!

The analogy went something like this: “BPM is like golf - you need to build muscle memory if you want to develop consistency and achieve success.”

In all honesty, I can’t really think of any other combinations of a technology (BPMS) and a discipline (BPM) that fits so perfectly with this analogy. It cuts to the core of Lombardi’s methodology. In fact, if you break it down even further you’ll see more uncanny parallels that help to visualize what exactly you’ll need to do to achieve success with BPM.

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While a complete enterprise BPM roll-out is a multi-year effort, this two-part series focuses on the Pilot as the crucial first step in an enterprise initiative designed to spread throughout the organization.

On first toeing the BPM waters, there is what we call the “Startup” phase. The goal for this phase is to demonstrate that your organization can adopt and benefit from BPM on a broad scale. Your Pilot project, hopefully, is a great success – and frankly, it usually is. Why? Because you have spent months laying the groundwork, aligning the team, building the business case and acquiring the technology. Your company – at least the part working on the Pilot — is aligned, dedicated, and singularly focused on a shared and common goal.

But now, with a single successful process under your belt – what comes next?

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Last week I talked about how you know who the right participants are with regards to a particularly complex Task Assignment and Routing implementation. I also talked about how you assign tasks and route information to them. But I finished by explaining why to a Business Process Developer, trying to implement a Task Routing rule, such as the example I gave, is a nightmare because of a lack of clarity around how to access the data necessary to implement the rule.

From the Process Developer’s point of view, the “right” answer to solve a complex routing problem like this is to develop a custom Task Routing Service to determine the list of users who should be given the opportunity to complete the task. If the conditions for eligibility are very dynamic (if they could change in a few minutes) then it’s also a good idea to develop a related service that will tell you if a specific user is eligible to claim a specific task.

When a task is ready to be performed, invoke the first service to get all of the eligible users.

When a user claims the task, call the second service to determine if they are (still) eligible, and return the task to the pool if they aren’t.

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Ed.: This is the first in a series of Q+A sessions focusing specifically on playback session best practices, with our in-house expert, Kris Komassa.

People like to talk a lot about collaboration between business and IT, but it seems like a playback session, as a collaborative, iterative process baked into the development environment, is where the wheel finally hits the road.

When you start any engagement, any project work, the existing tendency is for business and IT to split off fairly early, but I try to keep them in lock step as much as possible, which is important in order to be successful ultimately.

That first playback session is the first formalized opportunity to get everyone back in the same room and on the same page. We try to immediately do a level-set, making sure that everyone has the right expectations coming in, and a clear understanding what is going to be covered. We ensure that there is an agenda of what is going to be accomplished, both from a business and an IT perspective, and that both sides also know their roles and the various responsibilities for the playback.

Then once the playback starts, I’m really big on having an ongoing ad dynamic back-and-forth between business and IT, and typically at first it is driven by IT because they’ve been more hands-on to date in the first parts of the project. There are also instances, though, where the business side is driving because you’re doing more process flow at the first part of the first playback, which is important to note.

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Last week, the BPM industry - and two Lombardi customers - gained some very nice attention in the Financial Times. Steven S. Smith, CTO of Wells Fargo Financial, talked about how he achieved adoption from the business side of the company. Another, James Thomas, IT Director at University College London Hospitals (UCLH), discussed how they are using Lombardi Teamworks to reduce the time it takes for a patient to receive medical treatment after a referral. Impressive stuff.

But I think the really interesting thing here is that people can use this article to help evangelize the value that BPM can offer their companies in terms that business people can actually understand: efficiency, effectiveness and agility.

While BPM has been covered for some time in IT-oriented publications that dive deeper into the technology, this story is fairly unique in that it talks at a business-level about some of the biggest issues companies face with getting success with BPM. It provides examples of successful approaches that other companies took to solve meaningful problems while connecting with the business - and it comes from mainstream business press source - not an IT journal.

What it doesn’t do (too much at least) is get bogged down by technical points that make business people’s heads spin. And that is the problem with a lot of the press attention that BPM has received in the past. Many articles either get totally side-tracked with technical ‘in the weeds’ points or only discuss the broad market trends.

So the point I am making is that if you need help making the case for BPM with your executives, or if you need concrete examples of the benefits companies are acheiving, have them read the FT article - it should really help. And they probably won’t even make that funny face when they read it (you all know what I mean). Let me know how it goes!

Its been a week since SAP’s big BPM announcement. Not exactly an earth-shattering announcement. My summary - at some point in the future (2 years?), SAP-only shops will be able to more easily configure internal SAP application workflows. This is a SAP application workflow band-aid, not a viable BPM offering. I am not alone in this assessment - the reviews have ranged from unimpressed to downright negative.

Honestly, this is no surprise. The big software vendors - I call them Stackers - have been and continue to pursue the promise of BPM half-heartedly. Actually, they have done everything in their power to bury BPM deep in what they view as their real markets. You can’t blame them - BPM ain’t in their DNA. And it is really hard to change your DNA.

SAP wants you to buy applications from them. BPM to them is just some integration and workflow between their applications. Always has and always will be - no matter what the Netweaver BPM roadmap says. Not to get too cheeky, but SAP does not have the best reputation in this sense - see their public spat with Waste Management about non-delivery of promised functionality.

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I’ve been seeing a bit of blog postings lately on the reality of SaaS on Demand or SaaS BPM.

Last week, Jason Stamper at CBR included some commentary on a beta product that he had heard about through the Process Factory. And couple of weeks ago, Jack van Hoof - who writes on SOA and EDA, posted a well thought-out blog entry about the marriage of BPM and SaaS, including the possibilities and the complexities at hand.

I love seeing this kind of dialogue on the Web because SaaS BPM is extremely popular with our customers right now. However, despite the aspiration of many developers, SaaS and BPM is NOT an easy combination. Nor is it likely that the two will ever be completely married in the traditional integrated form.

We launched Lombardi Blueprint a little over a year ago. It’s a SaaS-based modeling tool that integrates with Lombardi Teamworks, which operates behind the firewall. What worked so well in this case was that anyone in an organization could access the modeling tool to help shape a BPM project during the discovery stage. It doesn’t need to be integrated into legacy systems and it doesn’t require IT to deliver company data to the hosted model outside the firewall.

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