BPM sustained transformation key note extract arkgroup (19th october 2010) ihc

Business Process Management Insights and Practices for Sustained Transformation Business Process Management – ASIA PACIFIC ARK Group – Connected Forum Thursday 19th October 2010 | SYDNEY

4 The Enterprise as a “Dynamic System” Strategy Results Value Realisation Enterprise Value Realisation Structures Suppliers Suppliers Process Technology Customers Customers People Supplier System Customer Partnership Relationship Culture Values BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

5   Strategically-aligned   Process-driven Strategy Results Value Realisation Enterprise Value Realisation   Structurally-sound Structures   Technology-enabled Suppliers Suppliers Process Technology Customers Customers   People-centric People Supplier System Customer Partnership Relationship   Results-oriented Culture Values   Customer-focused BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

6 Some Key Process Elements of BPM BE Framework How to evaluate our organisation as a system of inter-related processes BPM Maturity Model How to evaluate our organisation’s ability to manage processes BPM Framework How to manage processes as a central part of our business Process Governance How to ensure sustained transformation and improved performance Process Model How to context your key ‘value chains’ Process Technology How to automate and innovate your business processes Process Maturity Model How to evaluate individual process capabilities PI Methodology How to improve our processes Project Management How to mange our improvement projects BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

7 Process focus enabled by a Philosophy   ”Brilliant process management is our strategy. We get brilliant results from average people managing brilliant processes. We observe that our competitors often get average (or worse) results from brilliant people managing broken processes” Mr. Cho Vice Chairman of Toyota BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

9 BPM in context Business Process Management managing the enterprise as a system enterprise-wide capability to Process Management BPM continually improve and (re)design managing specific processes new and existing processes capability to continually manage and improve specific processes BPM Leadership Process Stewardship PM PI PD Process Improvement Process (re-)Design improving specific processes designing specific processes realise capabilities of new processes provide existing processes increased capabilities DMAIC DMADV “BPM is about managing and improving business performance through systemically and systematically focusing on the business processes that deliver value.” Hegedus: Business Process Management – Insights and Practices for Sustained Transformation (2008) BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

10 Process Improvement and Process Management   Process improvement, whether driven from external market forces, regulatory requirements, cost reduction, growth or even business survival, is a common starting point and, sometimes, the only way in which organisations know ‘process’… Public Private Rank Business Driver Sector Sector 1 Save money by reducing costs and/or improving productivity 1 1 2 Improve quality of processes 2 2 3 Improve management coordination or organisational responsiveness 3 5 4 Improve visibility and control of processes 6 3 5 Improve customer satisfaction to remain competitive 5 4 6 Improve management of resources 4 7 7 Improve existing products, create new products, or enter new lines of 8 6 business to remain competitive 8 Government or compliance requirements 7 9 9 Provide new revenue opportunities 9 8 10 One time event (merger or acquisition) 10 10 Question 11: What are the business drivers causing your organisation to focus on business process change? (Rank all appropriate) (Base=79) Table 1. Business drivers causing organisations to focus on business process changes “If there is a maturity gap between an enterprise’s ability to improve processes and it’s ability to manage them, then the sustainability of any of the improvements made comes into question.” Source: BPM Practice in Australian Organisations Harnessing the Potential of BPM BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

11 Australian Enterprises expect a 2-5 year Return on their BPM Investment   Enterprise-wide process-driven change, like all others, requires a methodology, significant investment, persistence, and patience 1 year 6% Other 30% 1 – 2 years 22% Dont know 9% Longer than 5 years 2 – 5 years 1% 32% Return on BPM Investment Source: BPM Practice in Australian Organisations BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

12 BPM Deployment Lessons   BPI provides immediate results while introducing concepts of ‘process thinking’   BPI embeds Process Improvement and Project Management skills and methods   Strategic PI projects emphasise the need for Process Management (and often for Process Owners)   Process Models, BPM methods, and Process Ownership can be developed using the knowledge gained from BPI   The need for BPM becomes clear once a certain level of process management ‘maturity’ is reached BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

13 The PI and BPM Partnership   Enterprises begin their ‘process journey’ by deploying Process Improvement methods   The sustainability of any Process Improvement (project) is dependant on the capability of the business to manage its processes   Improve only what you can manage   Continuous improvement is a function of the capability of an enterprise to both improve and manage its processes Manage to Improve BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

14 The role of the BPM CoE   Leading the strategy, design and deployment of the BPM effort. This will include the development of process methods and standards   Engaging the IT department and ensuring process-driven technology investment   Enterprise-wide focus to ensure strategic alignment, business relevance and integration with other business components   Process-centric focus to ensure the integrity and comprehensiveness of the BPM and PI activities   Prioritisation and program management of process initiatives BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

15 The BPM Centre of Excellence Strategy Results Value Realisation Enterprise Value Realisation Structures Suppliers Suppliers Process Technology Customers Customers People Supplier System Customer Partnership Relationship Culture Values Process-centric focus on ensuring the Systemic focus on ensuring the management and improvement strategic alignment and value of processes and the BPM effort to the BPM CoE (comprehensiveness, integrity, and accountability) for the all enterprise enterprise processes CEO Marketing Operations Finance Service Function Process Heads Owners Function-centric focus on ensuring Process-centric focus on ensuring accountability and performance of the visibility, accountability, and department through the enactment of performance of specific processes agreed process elements across all departments Source: Imre Hegedus Consulting Source: BPM – Insights and Practices for Sustained Transformation BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

16 BPM Governance: Accountability Insights and experiences   Rarely:   do the senior executive team fully appreciate what it means to be process-oriented when the BPM Executives or CoE are appointed   are Process Owners empowered or resourced appropriately   Is the organisational* change effort fully appreciated or well managed   Typically:   Lack of clarity around roles (BPM CoE, Functional Owners, Process Owners)   Business function managers feel threatened by the concept of Process Owners   Role of governance is multi-dimensional and changes over time (leader, convener, facilitator, enforcer) BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

17 BPM Governance Success factors Successful BPM Governance will be more likely when:   The CEO and the leadership team endorse and resource (human and financial) the BPM effort   The BPM Governance body is empowered and filled by senior executives   The structure and role of the BPM bodies are recognised   Decision-making methods and rights are defined   BPM methods and standards for the enterprise are defined and formally endorsed   The relationship with other governance bodies, such as corporate and IT are clear   An enterprise business model that contexts process activities is adopted and managed BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

19 Emerging Themes in BPM   The Enterprise as a Dynamic System   Enterprise (Business) Architecture   Executive Engagement   Continuous Improvement   BPM and BPI   Business Excellence   Governance   Technology - Discipline - Culture   The Cloud – Methods - Collaboration BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

20 BPM Perspectives: from Philosophy to Culture BPM Perspectives World View Collective Wisdom “this is how we see things” “this is how we do things” Philosophy Discipline Practice Culture Theories Frameworks Methodologies Values Concepts Systems Structures Behaviours Technologies and Structures Source: BPM – Insights and Practices for Sustained Transformation BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

21 Sustained Process Performance is dependent on the capability of the business to manage its processes Process Maturity The capability of specific processes Optimised 5 Managed 4 Defined 3 BPM Capability Gap Repeatable 2 Initial 1 The capability of the enterprise to manage processes BPM Maturity Source: Imre Hegedus Consulting Focus on the relative positions of Process and BPM Maturity to bridge the BPM Capability Gap BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

22 Sustaining Process-driven Transformation through Business Process Management (BPM)   Enterprises begin their ‘process journey’ by deploying Process Improvement methods   The sustainability of any Process Improvement (project) is dependant on the capability of the business to manage its processes   Improve only what you can manage   Continuous improvement is a function of the capability of an enterprise to both improve and manage its processes   All enterprises have processes. Whether they are visible, managed and improved as a primary mode of their operations is what distinguishes a process-oriented enterprise from one that is not.   The process-orientation needs to occur across the enterprise processes and through all levels of the organisational hierarchy… Manage to Improve “BPM is about managing and improving business performance through systemically and systematically focusing on the business processes that deliver value.” Hegedus: Business Process Management – Insights and Practices for Sustained Transformation (2008) BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

23 Improving Performance Seminars and In-House Training www.improvingperformance.com.au Deming’s System of Profound Knowledge   Partnering with Quality Learning Australia to design and deliver a series Appreciation of learning experiences based on: for a System   Quality improvement,   Change management, and   Process management principles System of Knowledge Theory of Profound about Variation Knowledge Knowledge   By taking a wholistic perspective to managing an organisation, we believe that sustainable transformation may be effectively managed Psychology ! Source: W. Edwards Deming BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

24 BPM Resources at: http://www.imrehegedus.com/resources/index.php Presentations “Business Process Management – Insights and Practices for Sustained   BPM: Aligning Business and IT Transformation” (2008)   BPM: Context-setting Models To Oder:   BPM: Key Elements P. (03) 9038 9007 E: report@imrehegedus.com Articles   BPM & Culture   Customer Value: The Business Discipline of BPM   Innovation and BPM   BPM & PI: Business Performance Partners (part 3)   BPM & PI: Business Performance Partners (part 2)   BPM & PI: Business Performance Partners (part 1) BPM – Insights and Practices for Sustained Transformation © Imre Hegedus Consulting – All Rights Reserved

BPM sustained transformation key note extract arkgroup (19th october 2010) ihc

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