Archive for the ‘Business Process’ Category

The difference between IT specification and business requirements

Thursday, October 25th, 2007

I had a rude awakening this week when visiting an important customer.  We were trying to persuade this customer to buy more Blue Prism software to automate new processes, and early in the meeting we were stunned to hear a really negative reaction.  “Of course, I am really keen to do some more work with your product but we will have to persuade the business users who are very negative about your current solution”.

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BPM versus the people

Thursday, October 11th, 2007

I read Ann All’s post about putting a human face on BPM this morning which is understandably pro-BPM, but I started to get confused about whether there is a move towards automating everything, bringing people back into processes to enable process improvement, or there is just a “horses for courses” thing going on.

I am definitely in the latter camp.  BPM is about managing processes.  If there is a need for consistency and accuracy, but the process cannot be automated then it can at least be managed, and people undertaking the process can be guided to the right actions.  This can be a powerful way of ensuring consistent customer service, or to meet compliance requirements for example.

But what if the process is rules based?  Why does that need any management?  Surely it just needs automating?  Well, perhaps this is where the process improvement comes in.  Even automated processes need to be monitored and can (and should) be improved.  At a minimum there is an ongoing requirement to change automated processes to meet new laws, regulations, marketing initiatives etc and this means that the automated processes need to be both visible and flexible.

So where does this leave the people then?  Just managing some super BPM dashboard like a modern day Joe 90?

Of course people have a role to play in business processes.  The example mentioned in Ann’s article was the new hire process.  I don’t believe the world is ready to see this fully automated yet, since there is always a judgmental element to the process on both sides and this necessitates human contact.  However, in the UK and US at least, there are detailed and highly complex laws relating to recruitment and selection to ensure no discrimination occurs, for example.  This means the process lends itself to being managed by a BPM system.

Other processes are simpler and rules based.  For example, lost and stolen card blocks.  When a bank receives notice that a customer has had their bank cards stolen, a clerk has to trawl round the various systems blocking the various cards.  Accuracy is essential here to prevent fraudulent use of the cards, but the process is entirely rules based with no room for judgment.  This is a process that should be automated.

So horses for business process courses?  People are good at negotiation and expert judgment.  Computers are good at munching through rules based processes.  I’ve seen nothing yet to persuade me that the implicit negatives of those two statements are any less true.

Banking on process improvement

Friday, September 7th, 2007

It is becoming ever apparent that Financial Services companies, and in particular banks, in the UK are adopting process improvement methodologies from the manufacturing sector.

One bank that I know well, specifically refers to its back office as “the factory”.  I was at another bank last week meeting the Director of Business Process Re-engineering (BPR).  The very appointment of this title at such a high level is an indication of the importance of process excellence in the financial sector.

Just about every UK bank I am aware of has some capability based around Lean/Six Sigma or similar flavour and many of the recruits are coming from manufacturing, retail, and other service companies.

There are big gains to be made since (although the banks wouldn’t like to admit it) they are horribly inefficient.  A further concern is the cost/income ratio.  Most senior executives have some target set around this ratio.  Major investments in technology can take years to pay back.  This increases costs in the short term and brings any benefits way down the line, which adversely affects the cost/income ratio in the short term.  Call me cynical but most senior execs will have moved on by that point, so they will not see the benefits in their bonus payments.  So there is a degree of short-termism and BPR fits the bill because it is about making low cost investments in continuous improvement.

I would argue that this actually benefits both the short and the long term, and you have certainly heard me argue before in favour of incremental rather than big bang projects for a whole range of reasons.

So it is clear to see why they are doing it.  What about how?

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UK Banks are not as evil as you might think

Tuesday, August 7th, 2007

When you work in an industry as highly regulated as financial services (and I have worked there both directly, and indirectly) you come to expect the odd scandal.  Pensions mis-selling, current account charges, ATM usage fees are just a handful of the recent uproars from financial services customers in the UK.

The latest decent sized revolt has been over “unfair” bank charges imposed on customers whose accounts have gone beyond their borrowing limits.

There is a danger of victimless crime syndrome here.  People who say “the Government should pay for our rubbish to be recycled” conveniently ignoring the fact that the Government is funded by us, the taxpayers.  People who make bogus insurance claims believing that “the insurance company has loads of cash and can afford it”, conveniently ignoring the fact that if everyone took that view, then the insurance industry would implode, meanwhile the do-gooders suffer ever increasing premiums.

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“New” mashup platforms taking over the enterprise? Not yet.

Monday, July 23rd, 2007

Wow, Dion Hinchcliffe at ZDNet has looked at the enterprise mashup space in much more depth than I did a couple of months ago.

He raises some interesting issues, though, about why some of these tools are struggling to gain acceptance in the enterprise.  I believe that there are some unique features that need to be addressed to meet enterprise requirements:

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Business process centric architecture

Monday, July 23rd, 2007

I am feeling quite pleased with myself for managing to get the word thrice into my last post.  Such a fine word don’t you think?

This post comes to you with the word analyst.  A dirty word in some parts of the blogosphere.

I have never paid an industry analyst but I am thinking of doing so.  Not to write some white paper promoting my company’s solutions and position us positively against our competitors.  I can write that free of charge and just as many potential customers will ignore it as if an analyst had written it.

What I actually want to achieve is to look at a wider industry trend.  I want to test whether today’s view of IT architecture is really becoming business process focussed.

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BPM and SOA at a local level?

Thursday, July 19th, 2007

More interesting coverage on alignment of BPM and SOA from Jean-Jacques Dubray got me thinking about what a large undertaking it would be to make such an implementation enterprise wide.

I am not trying to open up the bottom up versus top down argument here, already eloquently covered by Todd Biske.  Rather, I am trying to think of things as central or local.

I like the idea of tools that can implement local solutions to local problems.  Clearly central control is required or the IT infrastructure will run out of control.

However, IT departments are struggling to meet the ever growing number of change requests and have only blunt tools and scarce resources to address them.  So the business users get “wait for the strategic solution” (read between the lines “some months/years away if successful at all”).

Is it possible to provide solutions that are powerful but temporary?  Should these solutions be capable of fitting into a future architecture based around BPM and SOA?  Should business users have the privilege of not having to wait years for strategic solutions but be able to capture key process benefits right now?

Thrice yes in my view.

Indian wages rise – off-shoring ROI evaporates

Tuesday, July 17th, 2007

Interesting piece in the UK Independent today reporting rising Indian wages rising to 75% of the US level (20% only two years ago).  This is good news for Indian developers but bad news for companies who have off-shored purely and only to save cost.  No wonder US companies are finally starting to bring software engineering work back to their shores.

In the UK where IT off-shoring has been prevalent but not quite to the same degree as the US we wait to see if the same trend emerges.

Maybe we are getting to the stage where work will be placed for reasons of skill, geography, culture, convenience, service and team motivation – not just for cost reasons.  Or maybe work will just start transferring to the Far East, Russia, and Africa.  UK and US universities have plenty or representatives from these regions so the skills must be emerging.

Of course, I am referring only to the IT sector.  The Independent reports Indian call centre wages still significantly lower than in the West, although staff turnover is starting to spiral.  Smart companies who have outsourced important customer service operations (to the detriment of customer service), should take note before this turns into another wage spiral and eats up their ROI.

BPM is a workaround then, or is it SOA?

Tuesday, July 10th, 2007

This press release landed in my in-tray this morning.  The basic premise is that enterprises are turning to BPM because the major systems (ERP, CRM etc) have not delivered the required flexibility in business processes.

There is a long held belief in the Build vs Buy debate that you either build and have a system that perfectly (or nearly) matches your business processes, or you buy a packaged application and change your business processes to what should be best practice.

But best practice (at least as determined by the software vendors) has some conceptual problems.  Firstly it assumes that all businesses are the same (they are not!).  Secondly it assumes that business users will accept the new processes (and so will their customers).  Thirdly it broadly ignores the existing IT infrastructure which varies enormously company by company.  Finally, it doesn’t acknowledge the massive amount of necessary change in business processes on an ongoing basis.

I think what we are seeing here is a user rebellion against large “benchmark” systems and the users are trying to address this with their own workarounds, or with BPM or similar.

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Too much too soon?

Wednesday, July 4th, 2007

Ann All has an interesting piece commenting on David Taber’s views on the use of process improvement techniques such as six sigma.

I think David is absolutely right to suggest that using six sigma too early can stifle innovation and reduce the chance of new product success.

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