1. Assistance for student revision efforts
BA 553 Course Review
Assistance for student revision efforts

2. Identify Process Improvement Projects
From session 8
How can we identify the most useful improvement projects?
Once KPIs and strategic plans are developed, the next step is selecting improvement projects that will help achieve these goals and targets
A starting point is the value chain, which can help identify process areas where change is likely to lead to improved KPIs
Once that part of the value chain is located, use the process architecture to narrow down the list of processes that need to be improved
The alignment of the process and performance metrics can help confirm the specific process(es) that contain the metrics that will most impact the KPIs and targets where improvement is desirable
BA 553: Business Process Management

3. Aligning Strategy, Measures, and Processes
From session 8
In order to get where you want to go and achieve the organization’s goals, you need to be looking ahead
The budget needed to accomplish the goals should be allocated according to the new direction for this year, not based upon what was done last year
Management assesses industry, market, company performance - then clarifies the firm’s vision
Management team formulates specific strategies needed to propel the firm towards its vision
Strategy dictates resource allocation priorities: the budget reflects the strategy
Managers implement and measure strategic performance, then realign strategies; the process repeats, as needed
BA 553: Business Process Management

4. What Other Resources Need to be Aligned?
From session 8
In addition to the annual budget, there are other resources that need to be aligned properly in the organization
These include:
Personnel
Support processes
Infrastructure
Policies
IT resources
Job descriptions
Training
BA 553: Business Process Management

5. How to Develop a Process Enterprise
From session 8
There are many different models available for developing a high performance process enterprise, however, their basic components are usually the same.
Align strategy with processes (sessions 4 and 5) and process metrics (session 8)
Develop a process-oriented culture (session 9)
Create a BPM Group or Center of Excellence
Develop infrastructure to support a process enterprise
Establish a process or BPM community of practice (COP) (sess. 10)
Assign process roles and responsibilities in the organization (session 10)
BA 553: Business Process Management

6. Create a BPM Center of Excellence (COE)
From session 8
A Center of Excellence is a work group responsible for the overall BPM effort for the organization
It is similar to a functional group, in that it has a senior manager and employees focused on a specific discipline (in this case, BPM)
The BPM COE is responsible for activities such as:
Governance
Ensuring BPM efforts are aligned with strategic plans
Integrating process change efforts
Assessing BPM maturity/capability and closing needed gaps
Knowledge development and retention
Developing and providing training in BPM methods and tools
Hiring and managing BPM professionals
Documentation
Maintaining the process architecture (network)
Collecting and documenting process metrics
BA 553: Business Process Management

7. BPM Group Core Processes
What Does a BPM COE Do?
From session 8
BPM Group Core Processes
Assemble information on existing processes
Document new processes
Identify processes needing improvement
Conduct strategic planning effort
Collect daily / monthly data on process performance
Hire/promote new managers within the business
Develop job descriptions for process role s
Identify requirements for BPM professionals
External demands for process documentation and measures
A. Create & maintain the enterprise business process architecture, maintain proc. inventory/repository
Maintain up-to-date process architecture
Work with strategy group to estimate implications of changes
Undertake BPM projects
Report on corporate process performance
Identify problems and recommend solutions
Develop plans to address process maturity gaps
Manage process owners’ BPM scorecards and evaluations
Train new managers in BPM
Acquire BPM tools
Manage BPM projects
Prepare reports for Sarbanes-Oxley and ISO 9000 documentation
B. Identify, integrate, prioritize, and scope BPM projects, and manage process change resources
C. Help create, maintain & manage the process performance measure-ment system, and assess maturity
D. Help create and support the process manager/owner system and provide training
E. Recruit, train, and manage BPM COE professionals, standardize on BPM methods and tools
F. Manage risk / standards / compliance reporting and documentation
Note: items in blue have been covered previously, items in red are in this class session, green is in future sessions.
Harmon, Paul (2007), Managing the Process-Centric Organization, presentation, BPMTrends.
BA 563: Business Process Management

8. Integrate BPM Projects
From session 8
In most organizations undertaking process documentation or process change efforts, the high-level enterprise process network and process inventory have not been established
In these situations, it is common that the various process efforts will involve some overlap
This results in inefficiency and potential conflicts, as parts of a larger process may be undergoing changes by multiple groups within the organization
In order to achieve the full potential of the investment in process change, it is critical that the organization first identify and document the existing process efforts and any overlaps among them - an example is shown on the next two slides
Once overlaps or conflicts are identified and analyzed, some efforts may need to be redirected or stopped - this will need to be discussed with the team members involved
The next step is to ensure the integration of future process efforts by aligning them with the process inventory and the organization’s strategy
BA 553: Business Process Management

9. Integrating Enterprise-Wide Improvements
From session 8
While non-BPM company projects may have a primary purpose of changing systems or infrastructure, they are also likely to result in process changes
For example, installing a new IT system or software will often change the processes of end users, including their performance
The resulting process changes need to be documented as the new way of doing things, and put into the process library
It is therefore critical to ensure that, if the Project Management Office and the BPM Center of Excellence do not fall under the same management structure, there is at least a requirement for regular integration between the groups to ensure there is no conflict or overlap in their activities
It is useful if the governance bodies of the two groups have common members
This integration is made much easier if all of the change efforts for the year are identified as part of the organization’s strategic planning effort
In cases where they are identified later in the year due to changing circumstances, they must be aligned with the existing strategy
BA 553: Business Process Management

10. Steps in Establishing a BPM COE
From session 8
Attain executive sponsorship (session 9)
Define goals and success criteria (sessions 3 and 4)
Define governance structure (session 10)
Establish BPM framework, tools, and standards (session 10)
Set up the BPM library/repository for process architecture (sess. 5)
Define BPM COE approach for managing process change (sess. 8)
Develop inventory of documented processes
Integrate existing improvement projects (this session)
Prioritize process improvements based on strategic objectives (session 8)
Start executing BPM projects
Company publication (2010), Process Center of Excellence, white paper, Progress | Savvion.
BA 563: Business Process Management

11. What is organizational culture?
From session 9
Culture is a consistent and supported pattern of behaviors which are acquired and transmitted by symbols and actions
It is embodied in the institutions, environment and artifacts held to be important by the corporation
Major characteristics of culture:
It has historical roots within the corporation
It includes ideas, patterns and values
It is selective and exclusive in nature, it is learned, it is based upon symbols and supported by symbolic actions
It guides behavior, and yet it is a product of behavior (self-perpetuating)
BA 553: Business Process Management

12. Traditional vs. Teamwork Culture
From session 9
Command and Control Culture Teamwork/Learning Culture
Risk adverse Risk taking
Closed-minded Open-minded
Don’t mess with success Achievement motivation
Past oriented Anticipative / future oriented
Self focus Group focus
Direct authority Influence
Hierarchical Flat
Acquiescence to authority Empowerment
Unilateral decisions Consensus
Restricted information Free information
Compartmentalized Holistic
Short term Long term
Rules / procedures emphasis People emphasis
BA 553: Business Process Management

13. Items that Influence Culture
From session 9
Primary
What leaders pay attention to, measure, get emotional about, or ignore are important to others, and become the expected norm
Leader’s reaction to critical incidents
Myths, legends about important events and people
Deliberate role modeling, coaching, teaching
Criteria for allocation of rewards and status
Criteria for recruitment, selection, promotion and excommunication
Secondary
Organizational structures and systems embed culture. These are also controlled by the leadership
Design of physical spaces, etc.
Formal statement of work
BA 553: Business Process Management

14. A Process-Oriented Culture
From session 9
What does it look like?
An emphasis on process as opposed to hierarchies, a process- oriented way of thinking
A cross-functional culture focused on the customer rather than the boss
An emphasis on teamwork and personal accountability
Measures aligned with processes rather than simply outcomes
Why develop a process culture?
Aligns employees around delivering value to customers
How can a process live up to its potential if the company measures performance as it has always done and rewards people for focusing on narrow, functional goals?1
1 Hammer, M. (2007), “The Process Audit”, Harvard Business Review, Vol. 85 Issue 4, pp
BA 553: Business Process Management

15. How to Achieve a Process-Oriented Culture
From session 9
The focus on processes must be pervasive, permeating all aspects of the organization, including:
Strategy: plans for achieving many of the organization’s strategic objectives rely on the implementation of process changes
Information systems: information systems help cross-functional processes work smoothly rather than simply support departments
Roles and responsibilities: managers oversee processes instead of activities and develop people rather than supervise them, and employees work in self-directed process teams
Decision-making: decisions are made by front line personnel (and managers provide the support and information needed to accomplish this)
Training: training for employees is process-based
Reward and recognition systems: reward systems are focused on processes as well as outcomes
Information systems will be discussed further in session 12, and roles and responsibilities will be discussed further in session 8
Hammer, M. (2007), “The Process Audit”, Harvard Business Review, Vol. 85 Issue 4, pp
BA 553: Business Process Management

16. Culture Transformation Process
From session 9
Establish a shared vision of the “to be” character
Foster behaviors and actions consistent with desired character
Influence attitudes
Establish norms and values that align with “to be” character
Culture
BA 553: Business Process Management

17. Example of Culture Shifts Created on Process Improvement Projects
From session 9
This slide and the next document actual changes from surveys completed by front-line workers on two separate projects undertaken by the professor.
Organizational Culture Factor
Change
The readiness of employees to risk doing things a new way
+ 41%
Employee belief that improvement efforts have the ability to really cause positive change
+ 42%
The degree to which the organization takes time to understand the underlying cause of problems rather than the symptoms
+ 54%
The degree to which the organization has driven fear out of the work environment
+ 29%
The level of trust the members of your work group have in your supervisor
+ 39%
The degree to which employees feel proud to work for the plant
+ 59%
The degree to which employees are enthusiastic about being at work
+ 63%
BA 553: Business Process Management

18. Establish a BPM Community of Practice
From session 10
A COP is a voluntary group that meets regularly to share knowledge and advice on a specific topic, related to items such as:
Tools, templates and models
Methodologies
Case studies
Lessons learned
If senior management are supportive of a COP, employees will usually be able to meet during work hours (billable time)
A BPM COP usually consists of employees at various levels who are (or expect to be) working on process efforts of various types
The BPM COP helps to ensure process efforts across the organization are better integrated, as participants become aware of each other’s efforts
BA 553: Business Process Management

19. Examples of Process Roles in the Business*
From session 10
Strategic roles: responsible for providing direction
BPM Sponsor/Champion
BPM Steering Committee Member
Operational roles: responsible for process documentation and performance
Process Coordinator/Manager
Process Owner
Process Analyst/Modeler
* Note: process roles and their titles vary among different BPM models – these are just examples
Carolan-Brozy, S. (2005), Living Process Management: Process Management Maturity Assessments, Siemens.
BA 553: Business Process Management

20. Process Roles in the Organization
6. Establish Process Roles and Responsibilities
Process Roles in the Organization
From session 10
Focus
Business Roles
BPM COE Roles
Strategic
BPM Sponsor/Champion
BPM Executive
BPM Steering Committee
Operational
Process Coordinator/Manager
Process Expert
Process Owner
Process Analyst/Modeler
BA 553: Business Process Management

21. Governance: What, Why, When, How
From session 10
What is governance?
Governance is derived from a Greek word which means “to steer”
System of policies, rules, and controls
Provides models and methods for direction, coordination, and control of the organization
Why is BPM governance important?
When is BPM governance needed?
When in the BPM lifecycle to implement governance
Governance during phases of process change
How is BPM governance implemented?
Governance critical success factors
Governance frameworks
BA 553: Business Process Management

22. Why is BPM governance important?
From session 10
BPM Governance Activity
Benefit
Establish governance groups, roles, and responsibilities (session 10)
Identifies ownership of and accountability for BPM activities
Establish BPM annual lifecycle approach (session 8)
Ensures alignment with planning and budgeting lifecycles
Establish methods for BPM project portfolio management
Ensures integration with enterprise project portfolio management
Establish methods for documenting and controlling process architecture (session 5)
Ensures revision control of flowcharts, and integration into value chain
Establish BPM rules, policies and standards (session 10)
Ensures compliance with applicable regulations, and control
Establish BPM measurement approach (session 7)
Ensures alignment with KPIs and identifies decision-making authority
Establish BPM tools, models, and methods (session 10)
Ensures consistency of BPM efforts and integration with other company activities
BA 553: Business Process Management

23. How is BPM governance implemented?
From session 10
Select a BPM governance framework:
Assess the organization’s current process capability or maturity (session 11)
Determine the level of management structure that is appropriate for the organization’s culture
Determine the level of centralization that is appropriate for the organization’s culture (example on next slide)
Identify the level of resources (people and budget) the organization can dedicate to BPM at this time
Decide on a governance framework based upon the above items (examples in this presentation)
Establish a BPM growth model, if the current BPM approach is not at the desired level (session 11)
BA 553: Business Process Management

24. Examples of Commonly Used BPM Standards
From session 10
Kaplan and Norton’s Balanced Scorecard (BSC) and all related spin offs/ modifications (session 3)
Framework used to document, categorize and align financial and non- financial enterprise performance metrics with strategy and process initiatives
Supply Chain Council’s SCOR framework (and the DCOR/CCOR variations, collectively known as SCOR+)
Used to document and evaluate multi-company supply chain processes, including benchmarking assessments
VRM and eTOM are similar to SCOR+ (eTOM is specifically designed for the telecom industry)
EFQM (European version of the US Malcolm Baldrige Award)
Used for overall assessment of organizational quality, not just a BPM tool
SEI’s CMMI (covered in session 11)
FEAF: used by the US government, usually (but not always) as an IT standard
BA 553: Business Process Management

25. Integrating Processes With Other Information
From session 10
As the enterprise builds maturity in its BPM efforts, the process documentation can be integrated with other information in the organization
There are three types of software tools that were designed to assist in this integration:
Business process modeling tools
Workflow tools
Enterprise application integration tools
BA 553: Business Process Management

26. Steps in Selecting BPM Technology
From session 10
Establish a technology selection team, comprised of process owners, BPM COP and COE members, steering committee members, and IT personnel
Identify current and future needs to be fulfilled by the software package
Develop a specification for the technology
Describe each item in the specification as a product feature
Develop weightings for each feature (how important are they?)
Identify potential technology packages to include in the selection process
Modify the features and weightings based upon new information
Have technology selection team members each rate potential technology packages against the features, on a scale (say 1-10)
Multiply the average ratings by the chosen weightings for each feature
Add up the scores and identify the recommended choice
Document the reasons for the selection and provide them to management, including any additional pros and cons of the selected package
BA 553: Business Process Management

27. Potential Selection Criteria for BPM Software
From session 10
Integration with other BPM components (e.g., a BPM suite)
Ease of use
Performance (speed, quality, etc.)
Cost of purchase / licensing
Cost of ongoing maintenance contract
Ability to modify or tailor software in-house
Integration with current enterprise software (e.g., ERP system)
Ability to import existing documents from (and export to) other applications
Quality of support, and ability to support multiple users
Scalability (ability to increase user base without overloading)
Reputation of the vendor
Availability and quality of customer references
Historical improvement of technology by the vendor
“Business Process Analysis Tool Selection Criteria,” Gartner research white paper, 7 November 2005.
BA 553: Business Process Management

28. Additional Tools Related to BPM: ERP
From session 10
Enterprise Resource Planning (ERP) applications are intended to collect and integrate business information to assist in business planning throughout the organization
Most of the large organizations are using some brand of ERP software to manage their activities
As with any software that helps with business planning, ERP software is better understood, and decisions regarding it are made better, if done in the context of the business processes
If you plan on implementing either ERP or BPMS in an organization where the other already exists, it is critical that you identify and address potential conflicts or duplication of effort, or you could end up with a very large problem
BA 553: Business Process Management

29. ERP and BPM Work Together Well
From session 10
BPM can help ERP:
ERP information is more useful if understood in the context of the organization’s business processes
If the ERP information isn’t what’s desired, it may require a process change
ERP can help BPM:
Provides the KPIs that help identify potential process problems, which are inputs to the executive dashboard
Assists with process design or redesign
Our guest speaker will explain more about ERP systems
BA 553: Business Process Management

30. Variations of BPM Assessments
From session 11
Many areas can be measured with process assessments:
Individual employee process competency
used to help identify gaps in knowledge, and to select candidates for process jobs within the organization
Process health or maturity
used to measure the effectiveness of a selected process
Organizational process capability
used to measure the process capability of the enterprise as a whole
BA 553: Business Process Management

31. Process Health or Maturity: Signs of a Healthy Process
From session 11
1. Adoption – A process that no one uses is a process that is clearly not working. Granted, many processes don’t need to be referred to on a regular basis but adoption is about adhering to the defined business process without deviation.
2. Clarity – An ambiguous process is a potential sign that the process has not been well thought out. This will hamper productivity and the successful completion of the activity.
3. Collaboration – Healthy communication leads to a healthy process. Multiple memos may seem like a sign of an immature process, but in actuality, it shows evolution, interest, and commitment to improve.
4. Ownership Participation – Having process owners take responsibility means accepting accountability for the outcome of the process. Without that commitment, there is little assurance that the process will achieve its intended goals.
5. SME Participation – Having the right people contributing their knowledge to the process design or improvement is critical to organizational performance. Having ongoing contribution by the most experienced guarantees staying on track.
6. Best Practice Adoption –Take advantage of lessons learned by countless others.
7. Updated and Valid Metrics – A truly valuable process is one that can be measured. One could argue that a process that directly influences leading/lagging indicators defines the success of your business.
8. Continual Improvement – A process is never complete. There will always be a better way to do something. Failure to capture new ideas, changes in business, and evolving roles will lead to process that loses relevance.
Nimbus (2007), 10 Signs of a Healthy Process, internal document provided to clients.
BA 553: Business Process Management

32. The CMMI Process Maturity Assessment
From session 11 1 2 3 4 5
BA 553: Business Process Management

33. PEMM Assessment Areas From session 11 There are five process enablers…
Design: The comprehensiveness of the specification of how the process is to be executed.
Performers: The people who execute the process, particularly in terms of their skills and knowledge.
Owner: A senior executive who has responsibility for the process and its results.
Infrastructure: Information and management systems that support the process.
Metrics: The measures the company uses to track the process’s performance.
…and four enterprise capabilities
Leadership: Senior executives who support the creation of processes.
Culture: The values of customer focus, teamwork, personal accountability, and a willingness to change.
Expertise: Skills in, and methodology for, process redesign.
Governance: Mechanisms for managing complex projects and change initiatives.
BA 553: Business Process Management

34. OLC’s Process Definition Assessment Areas
From session 11
Process Definition Assessment Areas
Establishing Process Scope/Objectives and Process Requirements
Preparing Systems Diagrams
Developing Flowcharts
Preparing Activity Tables
Assigning Process Management/Improvement Roles and Responsibilities
Process Improvement Assessment Areas
Establishing and Utilizing Process Measures
Identifying and Prioritizing Process Problems
Performing Root-Cause Analysis of Process Problems
Identifying and Prioritizing Possible Process Improvements
Implementing Process Improvements
Process Management Assessment Areas
Establishing the Organization’s Process Framework
Linking Process Measures to Organizational Performance Measures
Monitoring the Network of Processes
Aligning Improvements with the Organization’s Strategy
Improving the Organization’s Process Network
BA 553: Business Process Management

35. Planning the Approach to Assessment
From session 11
Whatever tool or model you choose to use (or combination thereof), you will need to develop a plan for the assessment
This activity includes:
Step
P2DCA
Identifying the requirements for the assessment before developing the plan
Purpose
Developing the assessment plan
Plan
Selecting the team and preparing for the assessment Do
Collecting and analyzing information
Reporting the results of the assessment
Planning for next steps based upon assessment results
Check, Act
Documenting and closing out the process, and noting lessons learned, as input to continuous improvement
BA 553: Business Process Management

36. What is Sustainability?
From session 11
“The ability to maintain into perpetuity” (en.wikipedia.org/wiki/Sustainable)
In the business world, it is most often discussed as sustainability of a society or an organization
The sustained success of an organization is demonstrated by its ability to satisfy needs and expectations of its customers and other interested parties over the long term and in a balanced way.
From ISO 9004:2009
Try to identify fundamental principles of the so called “Visionary Companies” who survived for at least 50 years through various product life cycles, technological evolutions and revolutions, various management theories and generations of active leaders.
“Built to Last”, Jim Collins and Jerry I. Porras
We will discuss three types/levels of sustainability in this session:
Organizational sustainability
BPM COE sustainability
Process sustainability
BA 553: Business Process Management

37. B. BPM COE Sustainability
From session 11
Developing a sustainable approach to BPM is crucial to the sustainability of the organization as a whole
Activities to achieve BPM COE sustainability:
1. Identify the future state for BPM and the major steps in the pathway to get there (session 11)
2. Establish governance groups and mechanisms responsible for approving BPM activities (session 9)
3. Create tracking tools and metrics for tracking BPM COE activities and BPM progress (session 11)
4. Develop a culture of continuous learning within the BPM COE to ensure skills and knowledge are constantly updated (session 5)
BA 553: Business Process Management

38. Example BPM COE Journey
B. BPM COE Sustainability
Example BPM COE Journey
From session 11
Current state mapping
Tools and templates
Governance
Capabilities
Assessments
Identify
areas for
improvement
Future
state
Conduct
process
assessments
Develop
process
assessments
Train all
in tools and
methods
Hire internal
process
personnel
No assess-
ment tools
in place
Review BAs
for potential
apprenticing
Establish
governance
body
Current
state
Develop
prioritization
methodology
Few skilled
process
personnel
Examine
prioritizastion
methods
Integrate
tools across
enterprise
Opportunities
reviewed on
their merit
Develop
facilitator’s
instructions
Develop
improve-
ment tools
Process
templates
created
Complete
process
specification
Document
“as is” into
network
Complete
missing
“as is” maps
First round
of “as is”
maps done
Year 0 Year 1 Year 2 Year 3
BA 553: Business Process Management

39. Example BPM COE Models and Templates
B. BPM COE Sustainability
Example BPM COE Models and Templates
From session 11
Process Specification Model (BA 563)
Enterprise Process Framework: Value Chain and Process Network (session 5)
Enterprise Process Inventory Template (session 5)
Process Maturity Model (this session)
Enterprise Maturity Model (today’s class)
Five-Phase Approach (session 12)
Process Change Deployment Model
Project Status Communication Template
BA 553: Business Process Management

40. Example BPM COE Tools and Methods
B. BPM COE Sustainability
Example BPM COE Tools and Methods
From session 11
Tools
Process Modeling Tools (covered in BA 563)
Process Improvement Tools (covered in BA 563)
Process Measurement Tools (including SPC)
Process Management Software (session 10)
Process Information Library
Training Materials for Process Roles
Methods/Processes (most covered in BA 563)
Process Project Prioritization Method
Process Improvement Approach
Process Design/Reengineering Approach
Lean Sigma Process
Improvement Suggestion Process
Improvement Team Selection Method
Process Owner Designation Method
Change Management Processes
BA 553: Business Process Management

41. Characteristics of a Sustainable Process
C. Process Sustainability
Characteristics of a Sustainable Process
From session 11
As mentioned previously in class, every process has its own lifecycle
Processes that have a longer lifecycle and are sustainable:
Reinforce or help achieve the organization’s strategy
Are focused on meeting the needs of its internal and external customers
Are documented as part of the organization’s process architecture
Have process performance metrics, and are regularly measured
Are streamlined (steps that add no value are eliminated where possible)
Are designed so process problems are quickly identified and addressed
Are conducted by fully-trained and qualified personnel
Are flexible and agile:
Enable employees to use some judgment to meet customer needs
Are redesigned as needed to align with company strategy
Are modified (or eliminated) when technological advances are made
Some content from AMA (2007), How to Build a High Performance Organization, from
BA 553: Business Process Management

42. Success Criteria for Process Sustainability
C. Process Sustainability
Success Criteria for Process Sustainability
From session 11
Identifying Process Owners (session 10)
Ideally, Process Owners are identified early in a BPM project so they can be involved throughout the development of the process models
Near the end of the BPM project, the process models will be handed off to the Process Advisors for ongoing maintenance and continual improvement
Linking process efforts to the annual planning cycle (session 8)
Governance of processes (session 10)
Locating process modeling expertise
It’s important to keep the process model current after the project is complete
It is necessary for the organization to have access to someone who is skilled in the use of the process modeling tool – in some cases, this may be the Process Owner – if not, the next item is even more critical
Embedding process training into the company’s training programs
Reinforcing critical process behaviors (session 9)
BA 553: Business Process Management

43. Five-Phase Approach to Achieving a Process Enterprise
From session 11
Phase 1: Gaining a Shared Vision of a Process Enterprise
Phase 2: Trying it Out - Pilot Projects
Phase 3: Creating the Foundation for High Performance
Phase 4: Building a Bridge to Tomorrow
Phase 5: Sustaining the Effort
BA 553: Business Process Management

44. Five-Phase Approach Example
From session 11
Phase 1: Gaining Phase 2: Trying it Phase 3: Phase 4: Building Phase 5:
a Shared Vision Out - Pilot Projects Foundation the Bridge Sustaining
Self-sustaining capability level
Phase 1: Gaining Understanding
Attending meetings and workshops
Phase 2: Trying it Out
Undertaking pilot projects
Phase 3: Building the Foundation
Developing a shared vision and improvement capabilities
Phase 4: Building the Bridge
Developing self-sustaining capability
Improved process for setting goals
Planning group skill development
Information to support ongoing improvement
Projects to achieve 2003 objectives
Project on job skills training
Training in process improvement and developing a process enterprise
Employee participation in setting 2003 objectives
Planning Group Certificate Course
Increasing Capability in Areas Needed to Sustain Performance
Participation in Professional Meetings and Workshops
Pilot improvement projects
BA 553: Business Process Management

45. Components of the Sustainability Picture
From session 11
To continue to make progress, BPM must be integrated with:
Organizational culture (covered in session 9)
Roles and responsibilities (covered in session 10)
HR systems, including hiring, training, and performance management (appraisal) systems
Reward and recognition systems
Business planning, including strategic planning and budgeting (covered in sessions 3 and 8)
The organization’s infrastructure and key systems (covered in session 10)
BA 553: Business Process Management

46. Understanding Sustainability
From session 12
Defining sustainability:
Using methods, systems and materials that won't deplete resources or harm natural cycles (
Sustainable development: The concept of meeting the needs of the present without compromising the ability of future generations to meet their needs. Sustainable development refers to doing something with the long term in mind
Many of the definitions of sustainability relate to living systems
This is interesting, as organizational processes should be considered organic entities that can be adapted to changing circumstances: otherwise, they will become stagnant and unused
BA 553: Business Process Management

47. Additional Requirements for Success
From session 12
Sustain: “To keep in existence; maintain.” Is this our goal? (
For long-term success, an organization must also grow
In order to survive, it must be able to adapt quickly to changing circumstances: this is what is referred to as “agile”
Agile: “Characterized by quickness, lightness, and ease of movement; nimble.” (
Business agility is the ability of a business to adapt rapidly and cost efficiently in response to changes in the business environment (
BA 553: Business Process Management

48. Agility Can Lead to Improved Performance
From session 12
Research conducted at the Massachusetts Institute of Technology (MIT) suggests that agile firms grow revenue 37% faster and generate 30% higher profits than non-agile companies.1
BTM Corporation has conducted a number of studies on the value of placing an emphasis on business agility. Their researchers have queried companies that are considered agile and reported the results. Overall, the findings show that companies with highly mature business agility characteristics – the Business Agility Leaders – exhibited superior financial performance:
13% to 38% performance advantage in capital efficiency and value
10% to 15% performance advantage in margins
Up to 5% performance advantage in revenue and earnings growth
And this advantage has been shown to be sustainable over time based on monitoring of these companies during both 1-year and 5-year timeframes.2
The Economist, Ibid.
“How Agile Companies Create and Sustain ROI” accessed 11 March 2012.
BA 553: Business Process Management

49. Seize the Opportunity From session 12
Improvement efforts are often driven by an urgent need to improve the organization’s bottom-line results (called a “burning platform”)
This need provides an opportunity to change the way work is done in the organization
Management can seize this opportunity by using the improvement effort as a vehicle to help employees learn new ways of doing work
This is the larger purpose
Organizational learning is starting to be linked with agile BPM1
At an organizational level, agility is the ability to grow, change, or innovate at or above the speed of one’s own market. Anything less cannot be considered agility.2 Does this language sound familiar?
Connect back to competitive advantage at the beginning of class.
“Toward a learning agile organization”, accessed 11 March 2012.
Clark, T. and Gottfredson, C. (2008), In search of learning agility: assessing progress from 1957 to TRClark LLC, accessed 11 March 2012.
BA 553: Business Process Management

50. Agile Process View of the Organization
From session 12
Change
Some changes are caused by external forces, as shown in this example, and others are the result of internal activities to continuously improve the organization
See if anyone can explain this slide first, before going to the next set of slides. The large bubble is the organization, and the smaller bubbles are the organization’s processes, which overlap and connect with each other.
Identifying change
Preparing for change
Adapting to change
BA 553: Business Process Management

51. Agile Process Enterprise: Adapting to Continuing Change
From session 12
Change
Change
BA 553: Business Process Management

52. Innovation and Process Design/Redesign
From session 12
Innovation is necessary for coming up with new ideas for improving existing processes and for developing new ones
Innovation facilitates process re-engineering by applying creative ideas and perspectives to organizational systems and processes
“Process innovations tend to involve a business model which may develop shareholder satisfaction through improved efficiencies.” 1
“A process innovation is the implementation of a new or significantly improved production or delivery method. This includes significant changes in techniques, equipment and/or software.” 2
Innovation, accessed 15 February 2010.
OECD (2005). Oslo manual: Guidelines for collecting and interpreting innovation data. Paris: OECD.
BA 553: Business Process Management

53. Innovation and Standardization
From session 12
“The fact is, innovation and standardization MUST co-exist; you can’t have one without the other … In many ways, standardization forms the foundation from which innovation can occur.”1
“Standards help promote innovative products and services by building confidence among industrial users and consumers and creating a large scale market.” 2
“If innovative technologies are to generate return on investment, create jobs and have a broad impact on global society, it is vital that the technologies can access global markets early. It is now widely agreed that the best tool to ensure this is standardization, addressed at the earliest possible stage. 3
“Can innovation and standardization co-exist in business?” Chevron intranet, accessed 13 February 2007.
“Standardization supporting innovation and growth”, European Standardization Organizations, European Innovation Summit, October 2009.
Ibid.
BA 553: Business Process Management

54. Innovation and Learning
From session 12
To create an environment that enables innovation to take place, there must be a culture supportive of learning and change
Employees need to be able to experiment and learn from mistakes and they need to be able to make decisions and act on them
“The rate at which individuals and organizations learn may become the only sustainable competitive advantage.”
Ray Stata, President
Analog Devices, Inc.
“We must find ways to tap into the creativity and talents of all our company members if we are to survive.”
Chester L. Jones
Oklahoma Gas & Electric
“In a time of drastic change, those who ‘know’ find themselves equipped to live in a world that no longer exists – it is those who ‘learn’ who will inherit the future.”
The Systems Thinker
BA 553: Business Process Management

55. Requirements of An Innovative Environment
From session 12
Shared vision
Shared values
Risk taking, trust, open communications
Close link between business goals and innovation
Crossing departmental boundaries
Local autonomy - decentralized resource allocation and control
Having sponsors - access to people and tools
Self-organizing (people take the initiative)
Tolerance of small beginnings
Perseverence
Questioning the status quo
Willingness to experiment, willingness to learn
Mutual respect
Recognition and rewards
BA 553: Business Process Management

56. CIO in Some Organizations is Changing to the “Chief Innovation Officer”
From session 12
Apply technology to deliver business value
Lead enterprise transformation
Enable collaborative innovation
“CIO 2.0”
Standardization
Stove-piped
IT project milestones
Back office
Infrastructure centric
Cost justification
Presides over IT
Client-centric management system
Role-based enablement
Globally integrated
Business benefit delivered
“Outside in”
Process focused
Value realization
Knows the business
BA 553: Business Process Management

57. What is Being Innovated?
From session 12
Most of the discussion up to this point has been on innovating the organization’s products and services
However, to create an agile process-centric organization, it is also imperative to innovate the organization’s processes and culture
One early proponent of this was Ricardo Semler, who wrote the book Maverick: The Success Story Behind the World’s Most Unusual Workplace
The book is about Semco, a Brazilian industrial equipment manufacturer that supplied marine pumps to the shipping industry and centrifuges for the vegetable oils industry
BA 553: Business Process Management

58. Semco: Results Achieved
From session 12
The company increased from $4M in revenue in 1982 to $240M in revenue in 2007
Semco, a Brazilian company with 3,000 Stakeholders, made washing machines in 1951, but is now in multiple industries including real estate, banking, and web services
In a 10-year recessionary period in Brazil, Semco's revenues still grew 600%, profits were up 500%, productivity was up 700%, and for the last 20+ years, employee turnover remains at an incredibly low 1-2% per year.
BA 553: Business Process Management

59. Semco and Innovation From session 12
In most companies, bureaucracy is a barrier to innovation. Semler said, “The desire for rules and the need for innovation are, I believe, incompatible.”
At Semco, employees are encouraged to spend 15% of company time to work on projects of their own choosing.
In addition, Semco introduced a work unit called the Nucleus of Technological Innovation (NIT). This work unit, comprised of a three- member team, is charged with:
“inventing new products, improving old ones, refining market strategies, uncovering production inefficiencies, and dreaming up new lines of business … By the end of the first six months, NIT had 18 projects underway, and over the next few years they uncorked an array of inventions, changes, and refinements (one of my favorites is a scale that weighs freight trains moving at full speed).” (HBR, p.6).
Maresco, P. A., & York, C. C. (2005). Ricardo Semler: Creating Organizational Change Through Employee Empowered Leadership. Academic Leadership–The Online Journal, 2(2).
BA 553: Business Process Management

60. Semco’s Infratructure Innovations
From session 12
On his first day, Semler fired two-thirds of management and eliminated all secretarial positions
He dismantled managerial structure to eliminate "corporate oppression" and encourage core business values of employee participation, profit sharing and a free flow of information
He then tried the matrix management structure, but found it too constricting, and designed the lattice organization
Under this program, self-managed groups of six to ten manufacturing employees were placed in charge of all aspects of production. To promote a sense of true ownership of the process, the groups were charged with setting their own budgets and production goals. Tying salaries to monthly budget and production performance aligned employee and organizational goals. With the implementation of the lattice, unit production costs fell dramatically while employee productivity soared
Some items from this slide and the next: Killian, K. and Perez, F. (1998), “Semco Unique Self-Organization”, Thunderbird: American Gradate School of International Management,
BA 553: Business Process Management

61. Semco’s Process Innovations
From session 12
Semco is often called one of the most interesting companies in the world. And it is actually so. There are no job titles, no written policies, no HR department, or even, the present time, no headquarters
There is still a CEO, but half a dozen senior executives pass the title every six months. All other employees are Associates. People set their own salaries and working hours
Semco uses the idea of “open book management”: every employee receives the company's financial statements, so that all team members can better participate in decision-making
Under Semco’s profit-sharing system, about 25% of a unit’s profit is disbursed to employees, and each employee gets an equal amount (not a percentage based upon their salary)
“The key to management is to get rid of the managers. The key to getting work done on time is to stop wearing a watch. The best way to invest corporate profits is to give them to the employees.”
This slide and the next are from Maverick! and from Semco’s website: Additional content from
BA 553: Business Process Management

62. Semco’s Cultural Innovations
From session 12
Freedom and personal responsibility:
A company based on innovation, Semco does not follow the standards of other companies with a predefined hierarchy and excessive formality. At Semco, people work with substantial freedom, without formalities and with a lot of respect
At the Semco Group, each person controls their own working hours. This is a method of transferring responsibility to each person
Leadership:
Many positions of the company involve the use of authority. Pressure, tactics that involve people working while afraid or any type of disrespect are considered incapable leadership and improper use of authority
Everybody is treated equally, from high-ranking executives to the lowest ranked employees.
Every six months team members fill in a questionnaire and say what they really think about their immediate superiors
"The purpose of work is not to make money. The purpose of work is to make the workers, whether working stiffs or top executives, feel good about life.”
Quoted in interview with CNN:
BA 553: Business Process Management

63. Status of BPM Implementation in 2013
From session 13
BPTrends, the website founded by the author of the course text, Paul Harmon, has conducted a survey on the status of BPM every two years, starting in 2005
The most recent survey was done in the fall of 2013, and involved 309 respondents from companies in every industry and size, and in most geographical locations around the world
The survey has historically involved participants mostly from the US and Europe: in 2013, the survey had its first respondents from India and China
The questions have remained the same since the first survey, and the answers to the questions have been fairly consistent over the 8 years: there has been little change or improvement in the results
In 2013 the overall pattern of responses is very much like it was from the beginning
This slide and the next: Harmon, P. and Wolf, C. (2014). The State of Business Process Management 2014, BPTrends.
BA 553: Business Process Management

64. Recently Developed Tools Related to BPM
From session 13
SOA (makes task automation applications available to process designers for speedy implementation)
ECM (manages the lifecycle of information and documents used in the process)
SaaS (hosts software and information)
Cloud computing (supports many of the other items listed here)
Social media and collaboration tools, Web 3.0 and Enterprise 3.0 (enable better and faster interactions regarding process design and process changes)
ACM (models dynamic, knowledge-based processes)
As you can see from the Appendix to this presentation, many of these tools are interdependent
BA 553: Business Process Management

65. The Future of BPM
From session 13
Continued growth in BPM market: $8B global market by 2020
Mergers and acquisitions of BPM software companies
Increased social BPM offerings
BPM and cloud growth
Expansion of mobile offerings
Automating cloud governance processes
PaaS / SaaS / AaaS BPM offerings *
Intersection with Web 3.0 (Linked Data, etc.)
Increased use of BPM to empower business technology
* PaaS = platform as a service, SaaS = software as a service, AaaS = analytics as a service
accessed 7 April 2015.
BA 553: Business Process Management

66. What is Professional Development?
From session 13
Professional development is the series of activities a person undertakes to attain skills and knowledge for both personal development and career advancement
It encompasses all types of facilitated learning opportunities, ranging from college degrees to formal coursework, conferences and informal learning opportunities gained through experience
It has been described as intensive and collaborative, ideally incorporating an evaluative (assessment) stage
There are a variety of approaches to professional development, including consultation, coaching, participation in communities of practice, lesson study, mentoring, reflective supervision and technical assistance
accessed 26 March 2012.
BA 553: Business Process Management

67. Pursuing Professional Development
From session 13
As MBA students, some of you will end up working a company’s HR program
One of the goals of any HR program is to ensure that employees are sufficiently skilled to do their jobs, and are up to date with technology and methods used to develop the company’s products and services
Because of this, many organizations have a formal professional development program, including a requirement for professional development plans (PDPs) as part of the performance review process
However, the items in these plans are often not “stretch” goals, as they are tied to employee evaluations and bonuses
In addition, these plans are often only related to development activities that enhance your current role, or possibly your next role – they don’t focus on your career in its entirety
Therefore, it is crucial that you consider developing and maintaining your own professional development plan
BA 553: Business Process Management

68. Some Professional Development Activities
From session 13
Formal education
Get an advanced degree
Get a degree in another field
Take “continuing education” courses for CEU credits
Non-university learning opportunities
Attend online workshop
Attend conferences or seminars: after the seminar, report to your boss or other people in your organization, what the most important things are that you learned from the program
Read professional and academic literature related to your subject, as well as other areas of interest
Join online forums and groups – read the blogs and respond to them
Obtain certifications in areas related to your field
For all learning experiences, whether it is reading, seeing, thinking or attending, apply the R2A2 formula to the learning areas: Recognize, Relate, Assimilate, and Apply - these actions will help you grow in the direction of your goals
BA 553: Business Process Management

69. Some Professional Development Activities
From session 13
Experience
Do a CPT or internship
Volunteer for new tasks in your workplace (e.g., improvement teams)
Ask for and accept lateral moves in the company to learn about the entire operation (Chevron example, HP example)
Request temporary assignments to other units or departments in the company
Participate in your company’s mentor program: request a mentor if there is no program
Request work on projects requiring coordination across the organization
Conduct a “lessons learned” assessment for a failed project
Work in different sorts of organizations to get broader experience
Networking
Join professional societies in fields related to your career, as well as areas of interest
Join a Community of Practice
Write a published paper, speak at a conference, or do keynote speech for a local group
Join a community organization as a Board member or Council member
Develop a "master mind" group of four or five people with whom you can openly discuss ideas in a nonjudgmental way
BA 553: Business Process Management