Tag Archives: re-engineering

The Leaning of America: The Case for Small Business Process Management is Unequivocal

As a consultant to small and mid-sized business, non-profits and government agencies (with a particular focus on healthcare), I often engage executives on the merits of BPM. Said executives wonder aloud if their time is well-spent documenting, analyzing and re-engineering work and processes.  The common refrain is that they believe they have bigger fires to fight and that their people simply need to be managed to be more productive. Other excuses involve blaming external factors such as unfair competitors,  legislators, suppliers, and fickle customers.

There’s no doubt that the economy is in terrible shape. All of my clients are struggling. However, the data is incontrovertible: organizations that run lean, slick, flexible processes in every dimension of their operations are doing well compared to their less BPM-savvy peers.

In retail, Wal-Mart is peerless. Japanese and European automakers have survived whilst GM and Chrysler went bankrupt. Amazon continues to disrupt the entire universe of commerce. Kaiser has revolutionized healthcare and health insurance. Tata is helping India’s GDP grow while the institutionalized first-world back-slides. The tech sector as a whole has fared better than most other sectors. The only incongruities are the BPM-centric banks that demonstrated ethics, morals, risk-taking behavior and greed can and will outsmart BPM any day.  While there are many factors at play in the world of business and global economics, it pays to study the common traits among the winners and apply them at home.

Think Small and Lean

It’s simply undeniable that investments of time, energy and money in becoming process-centric will pay off in a number of important ways. It is also a fact that the US economy is a function of small business. Our challenge is not in doing more to demonstrate how swell BPM serves multi-national, multi-billion dollar, multi-tech corporations. There is no question that aerospace and supply-chain giants know what they’re doing.

The great challenge lies in packaging BPM approaches, tools and methodologies in right-size, right-time, right-cost portions for healthcare, social services, job training, housing and other sectors. Government and non-profit organizations are crucial participants in our economy and generally suffer from a lack of process savoir-faire.  This is especially true at the local level. Small government and small business must become process-enabled.

This call to action is all the more reason to simplify and de-code the way we talk about BPM. The more cryptic and foreign something sounds, the more geeky the approach, the less accessible and more expensive it becomes in the minds of government and small business leaders. Similarly, the more BPM is a product of software developers and the more is aimed strictly at automation, the less attractive it becomes. Electronic medical records (EMR) are a terrific example. Software developers sell software in a way devoid of attention to the most basic workflow and implementation issues; 60% of implementations fail; and today a dismal 2% of hospitals and 10% of doctors offices have a fully-functioning EMR in place. No matter how badly our country needs EMR proliferation, if our approach is tinged with greed (which it is), the initiative will stall (which it has). Compare that performance to the spread of VistA (the VA’s answer to open source, simplified solutions to the same problems). VistA is standard across the DoD, VA and many other public health domains today and spreading quickly.

Lean Initiative

True, government, social service, health, and non-profit sectors – who are often smothered under the weight of social and economic pressures in ways you and I can’t relate to – need to modernize, get lean and automate. However, so long as the architects of change speak a foreign language and offer up expensive software solutions, progress will be glacial. I propose that this country needs a Lean Agenda as much as it needs a Green Agenda. Frankly, we need lean to get to green. But it has to happen in all sectors, fields, industries and domains. And in order for that to happen BPM ambassadors need to come back to Earth and engage people in a multi-cultural fashion. We should all be painfully aware that big business relies upon small business and affordable health and social services. Unhealthy, unemployed, uninsured, homeless and penniless people make lousy customers. Get real.

BPM Requires Will & Leadership: Part 2 – The Solution

The Solution: Leadership and Management for the 21st Century

I am suggesting a rather radical approach to the process re-engineering required to pull ourselves and our organizations out of the pits and back into the game. Frankly, it begins with leadership. We have to be led out of the dark places we now inhabit. The problem with leadership is that it is – in business, non-profits and government – totally antithetical to our political system and philosophy. Our democracy is in much better shape than our economy so perhaps there is a lesson in there for us.

Identifying and Appointing Our Leaders

Our business leaders are very rarely elected by virtue of their competence and performance. More often, they are; dictatorships (sole proprietors); family-owned monarchies where the crown is passed to heirs; pseudo meritocracies where high performers are imported by the board from outside the company; or corrupt, criminal gangs that promote the most manipulative con-men from among executive ranks only. I hate to be so cynical but make a list of the organizations you know who hold elections for executive post and share with us. I dare you!

The democratic process is our most cherished accomplishment yet we fail to recognize the irony of its absence in business leadership.

Gary Hamel challenges us in the current issue of Harvard Business Review (February, 2009) to acknowledge and develop 25 modern management practices. It’s a brilliant proposal. Most of the 25 have direct and immediate implications for the future of BPM so I urge you to read the article. Here’s my brief summary for your consideration:

  • Promote interdependence by encouraging the formation of smaller business units that participate in multiple internal as well as external networks
  • Reinvent management at the individual level and provide everyone the data they need (within their small business units) to know how they are performing in real time. Transparency will ensure that only the strong survive. There will be no hiding from the truth when you leverage information.
  • Recast the organization as a social system where leaders are social architects who provide everyone the time, space and resources to collaborate and innovate.
  • Celebrate and harness divergence of ideas and diversity of tactics.
  • Minimize the tendency to recede to the way things have always been done. Recessions are born out of retrenching.
  • Innovation and invention will provide for the variety, selection and deployment required for evolution.
  • Spread the responsibility for strategy and direction throughout the hive, herd or flock. “Buy-in” is a notion that involves a sales job. Aim for participation instead.
  • Democratize information. When leaders hoard information, they are feared instead of trusted.
  • Enable the revolutionaries and measure the number of new ideas people bring to the table. Find your renegades.
  • Promote experimentation and accept small, failed pilots as proof that people are trying to find a new and better way to make your widgets.
  • Include people of all ranks in the engineering of the work they do. Defining one’s work incites a deep sense of ownership and passion.
  • Retrain leaders and managers so they can acquire the tools and practice management in complex ecosystems.

Is Present Reality (Current State) a Prerequisite for Design of the Future State?

Once in awhile, a riddle so obscure and enigmatic comes along that it baffles and stumps most of our brightest thinkers and deepest philosophers, qualifying as a Zen koan. Like the sound of one hand clapping or the sight of your face before you were conceived, the answer cannot really be found in any conventional sense. Well, in my humble opinion good people, the tension between current state and future state and the need to document and analyze the “as-is” prior to taking on the “to-be” doesn’t qualify as a Zen Koan or a crossword puzzle for that matter. There is no question. You have to understand the present dynamics and process in order to sensibly develop something new.

I know that I will offend some of the business process management wizards and high priests by saying as much but my position is one of firmly believing in the value of documenting and analyzing the current state to ensure a high quality future. Frankly, jumping into the design of the future state without regard for a rather precise current state is irresponsible. Not unlike asking someone how they’d like to perform in graduate school without first ascertaining whether they can read or not. Or promising someone full health without first diagnosing their diabetes. The present state in business tells a vast and deep story that shapes the possible and potential future.

Dangerous “Experts”

I attended a conference recently (devoted to the adoption of EMR in physician practices) whereupon I was able to listen to a discussion at our lunch table between a woefully ignorant doctor who wondered aloud what it would take to implement such a thing as an electronic medical record and an “expert” across the table who piped up and assured him that he needn’t worry about how things are done in in his practice today. He would only be required to imagine what life would be like with his new system. What a  load!

Notwithstanding that particular “consultant” and his advice to the good doctor, it got me wondering, “How many of my colleagues would suggest the same?” I wish I could survey all of my BPM brothers and sisters out there. Do you honestly think you can account for all of the business rules, decision-making, forms, customer preferences, suppliers, and key metrics involved in a process without concerning yourselves with the current state. Do you really think you can skip that step and begin modeling the future state without compromising quality or any other vital business attribute? I think not.

Change without consideration for the present is invention

Don’t get me wrong. I love to invent stuff and get wickedly creative when given a chance to roam free. However, invention cannot capture all of the good reasons why my system dynamics are what they are and cannot account for the benefits and value inherent in my current state without first elucidating them. Failing to harvest and capture the good, the rules, the data, the preferences, and the logic and simply launching into invention risks losing a lot including compliance with standards of all kinds. The risks involved can cause an invented business process to become fatally flawed in short order, grinding business to a halt.

Take your time and carefully document what you do today and how you do it. Inventing the wrong thing, failing and trying weeks or months later to return to an undocumented state is fools work.

BPR and BPM: Some Important Distinctions

The BPM (business process management) space is very active, populated by sophisticated software vendors, led in part by talented engineers and consultants and financed largely by IT budgets. Entire suites of BPM and BPA (business process analysis) applications are broadening into SOA (service-oriented architecture) capabilities. All of this is very exciting, enabling rapid transformation of enterprises and radically folding what used to be “IT” – the distinct geek department – into a business services environment. All of this is also IT-intensive and relatively expensive. I say “relatively” because BPM-mature organizations with revenues greater than $500M are not going to be particularly intimidated by BPMS (BPM Suites) that can run $3,500-$10,000 per seat (and then some). The rest of us are going to think twice. That’s what concerns me.

BPR (business process re-engineering) is about discovering opportunities for value-creation, efficiency, quality improvement and – yes – even automation. However, it is not strictly in service to software and application development. That isn’t to say that BPMS is strictly in service to software development. That would be an over-simplified conclusion. My experience and some persuasive research by Nathaniel Palmer (www.bptrends.com) gives the impression (not a scientific conclusion) that BPMS is tending and trending toward being an IT tool much more so than it is an operational improvement tool. At least that’s how large organizations are tending to use the tools. In essence, the tools are not gaining as much traction among operations and management teams as one would think. Having used some of these tools as an operations type, I find it a shame but it is what it is.

What to do?

Don’t lose sight of the value of workflow analysis and BPR! Your organization may not count itself among the bigger, richer shops that are equipped with BSAs (analysts) and BPMS sophisticates. That’s not a reason to abandon workflow documentation and process improvement. From an operations standpoint, there are dozens of fabulous reasons to adapt to your constraints. Simplest among them is hiring a well-equipped consultant to do it for you. Secondly, you can invest a few hundred bucks in Visio and do it yourself.

Simplified Workflow Analysis and BPR

If you happen to work in an organization that doesn’t see the value in process improvement, business rule management, value creation, efficiency gains and the like, then I suppose you have an entirely different task ahead of you. Send your leadership some books for Christmas. If the interest to improve is there but the budget isn’t, develop a keen sense of the reasons why your organization ought to pursue the skills and tools. Above all, develop the culture and discipline.

Create a Workflow and BPR Circle of Excellence

Call it what you want – a Circle of Excellence, SWAT Team, Process Improvement Team, Workflow Design Ensemble – the point is, you’ll need a cast of champions that cut across organizational silos and functional areas. Select your SMEs (subject matter experts), send them to training (1-2 days should do the trick) and have them do a little homework on the web (Wikipedia is a great resource if you’re on a budget). Buy at least one Visio license for every major functional area (finance, IT, customer service, sales, operations, etc.) and learn together. You might designate one person as the “super-user” to run ahead of the curve and serve as a mentor for others.

Assimilate

Challenge yourselves to learn the language of BPR, integrate the principles into your strategic planning, measure impact, pilot various projects and recognize/reward improvement. When you’re beginning to climb the learning curve, remember to accept failure as opportunity. Don’t allow cynics to pull the plug on your initiative simply because you encountered failure.