In this Process People interview we welcome Farrukh Humayun, vice president of information services at National City.  Farrukh was instrumental in the launch of the BPM initiative at National City, which is one of the nation’s largest financial holding companies.  In this interview, Farrukh discusses some of the challenges he faced when engaging the business, how he worked through those challenges, as well as providing some of his thoughts on funding a BPM initiative at the project and program levels.

Process People: What challenges have you seen engaging the business during the project and how have you tried to get the business more engaged in the projects themselves?

Farrukh Humayun: There have been lots of challenges. The first one is that the business is not completely aware of exactly what Business Process Management means. They don’t think in terms of managing their processes – they think in terms of managing functions or in terms of managing transactions and they also talk in terms of managing data. But it doesn’t take them long to start thinking or becoming more process-focused. Having visual tools which model the process up-front and get the business thinking about a process flow are also very helpful.

We also found challenges in getting agreement from the business to say what the actual process was, what were the quantifiable business objectives that they were trying to achieve, what were the service level agreements (SLA’s) that they wanted to build inside the actual process. It was also difficult, at first, to get agreement on who on the business side was going to be accountable for which activity or which sub-process within the overall process.

Process People: What do you see as the main challenges and difficulties of implementing a BPM project in a bank? What is it about Financial Services that adds obstacles or makes it easier?

Farrukh Humayun: Banks are very conservative in nature because we want to make sure every process and system that we implement is very secure, customer-centric and complies with all the regulations such as internal audit regulations as well as external regulations. The challenge that we see in a bank environment is that there are lots of stakeholders involved and getting all of them to agree on what the quantifiable business objectives of managing a process are going to be can be challenging.

Also, historically, banks grow by acquisition and some of the lines of business are fairly autonomous. So when we say that National City had over 370 systems for our lending systems alone, those were all one good idea at a time, and that can pose a lot of challenges for people who are trying to build a process across multiple systems where people are used to doing things one way or another.

Process People: When you get into a BPM project do you simply implement the base process as it exists and expect the optimization to happen later, over time, or do you try to optimize the process as much as you can as you build the initial project?

Farrukh Humayun: We have actually done both. I am of the firm opinion that the sooner you get started with a BPM initiative, even though your process is not optimized; the better it will be because you will have data sooner that can help you optimize your process.

We had a paper-based procurement process to get a laptop, and in one case it took months for them to figure out what went wrong with their process. In fact, it took 9 people to touch a requisition for us and pull a laptop. As soon as they saw a pictorial representation of the bad process, they immediately began questioning the value of their existing processes and started thinking about how to do things differently. You cannot optimize what you cannot see. Certainly the best way to do it is to optimize your processes first, but sometimes that can take so long and the business does not have the appetite for that.

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BPM project durations are usually measured in weeks-to-months - not months-to-years. With this velocity, you can’t afford to get stuck in the rut of traditional “define & design” techniques based on multiple rounds of 1-on-1 analysis meetings. In fact, I’d go so far as to label this as rework which increases a project’s cycle time!

I’m an enthusiastic supporter of the workshop format, where not only speed, but also quality, visibility and buy-in are greatly enhanced compared to the 1-on-1 approach. You could say it’s a way of applying process improvement methods to the way we carry out process improvement itself (or “PI²” as I like to call it).

In a previous blog, I shared some secrets of success for the “2 x 6 workshop“. One of the critical success factors is utilizing a facilitator - “an impartial, objective analyst to run the session, keep it crisp and in-focus”. Let’s dive into that a bit more. Why do we need the facilitator role, how does it add value to the process of process improvement, and how can it be done well?

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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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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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We just wanted to check in and report on the first day of our annual Driven User Conference here in sunny Austin, TX.

The day began with CEO Rod Favaron’s keynote, which was all about how we are now at “the end of the beginning.” The secret is out about BPM, attention and visibility are soaring to new heights, and we are now entering a new phase of adoption and maturity.

A big part of this progression is the move from Project to Program to Culture, as Rod put it — in the early days of course it was all about getting your first BPM project up and running successfully, and then it became all about growing that project into a full-fledged program. But the next phase that Lombardi customers and partners are moving into right now is one in which BPM begins to truly impact the culture of any and every part of the organization that it touches, indeed the organization as a whole. This is the true value proposition of BPM ultimately — the idea that BPM becomes part of your DNA, that process becomes an integral part of what your company does every day.

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