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Improving Business Operations:

Improving Business Operations:
The Ambition/Maturity Gap and
the need for BPM

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    The ambition maturity_gap_report_june_2012_final_final The ambition maturity_gap_report_june_2012_final_final Document Transcript

    • Improving Business Operations:The Ambition/Maturity Gap andthe need for BPMA European perspectiveA Vanson Bourne survey
    • ContentsSummary of key findings 1 Businesses are under pressure to improve and progress 1 IT departments are being tasked with enabling business transformation 1 IT departments are struggling to meet the needs of their businesses 1 The reasons for IT departments struggling to deliver as required are both technical and organisational 2 The strained relationship between business and IT can have significant consequences 2Introduction 3 Objectives 3 Themes 3 What is the Ambition-Maturity Gap? 3The demands faced by businesses and the pressures on IT 4 The need for change 4 Implementing change 5 The changes required are time-critical 5 The processes required are challenging 6IT is struggling to meet the business need 7Why is business change challenging and what are theconsequences? 9
    • The reasons 9 Bypassing the IT department 10The Ambition-Maturity Gap 11 Further evidence of the Ambition/Maturity Gap 11 Bridging the Ambition/Maturity Gap 12Appendix 14 Research Scope 14 About Vanson Bourne 14 About Cordys 14
    • Summary of key findingsBusinesses are under pressure to improve Furthermore, the transformation required isand progress far from simple. Almost six in ten (57%) business decision-makersAlmost every business interviewed as part of acknowledge that current business improvementthe survey process indicated that they are projects are challenging.operating under increased pressure, with96% of business decision-makers reporting Nearly all (92%) IT decision-makers describe thethat they have business priorities for 2012 achievement of business or process transformationthat have become a greater focus as a result as challenging.of the current economic and competitiveenvironment. IT departments are struggling to meet theThis is having a significant impact on the demands needs of their businessesof business decision-makers on the resources andinfrastructure available to them; 92% require Both business and IT decision-makers do notimprovements to the way their business functions. think the standard of IT that is currently delivered is adequate.IT departments are being tasked with More than seven in ten (72%) business decision-enabling business transformation makers believe that their business’s IT is NOT facilitating their need to achieve their priorities forAll IT departments interviewed are feeling the 2012.impact of the increased pressures underwhich businesses are operating; all report Four in five (80%) IT decision-makers admit thatthat they have been asked by areas of their their IT does not perform well in supporting orbusiness to make operational improvements. delivering certain functions key to an efficient, competitive business.Similarly, almost all business decision-makers areaware of IT’s workload; 92% knowing of projects In addition, IT is not enabling the businessunderway or planned, to improve operational transformation that is required.effectiveness. Two-thirds (65%) of business decision-makersFor the majority of businesses where report that their business’s IT is NOT helping themimprovements are planned or underway, achieve the business improvements they require.there is an urgency attached to these tasks. Similarly, two-thirds (67%) of IT decision-makersThree-quarters (74%) of business decision-makers are of the opinion that their business colleagues dodescribe exisitng or planned projects to improve not believe that their IT systems are helpful.operational effectiveness as time-critical. Almostsix in ten (57%) IT decision-makers believe thatthey are being asked to deliver IT projects morequickly due to the current economic andcompetitive environment. 1
    • The reasons for IT departments struggling absorb and react to their needs in a timescale thatto deliver as required are both technical matches their expectation.and organisational Almost half (45%) of IT decision-makers believe that their business tends to set unrealisticBusiness process transformation, although timescales, not appreciating the work involved.time-critical, is not happening within therequired timescales. Almost six in ten (58%) business decision-makers would NOT describe the process how the businessMore than a third (36%) of business decision- and IT work towards business or processmakers who regard as challenging the task IT has transformation as a collaborative one.been set of delivering business processimprovement or transformation, do so because Almost six in ten (57%) IT decision-makers wouldtheir experience is that those tasks usually take NOT describe the process how the business and ITlonger than planned. work towards business or process transformation as a collaborative one.As evidence of this, more than half (52%) of ITdecision-makers report that business or process The strained relationship between businesstransformation tasks take longer than planned. and IT can have significant consequencesLegacy IT systems restrict the process of Where business departments feel that IT isbusiness transformation, making those not meeting their needs, there are those whotransformational tasks more challenging. are using the availability of cloud services toMore than a quarter (27%) of business decision- bypass their IT department, furthermakers who regard as challenging the task IT has complicating IT’s task of managing businessbeen set of delivering business process processes and business use of IT.improvement or transformation, do so because of Almost a quarter (23%) of business decision-the inflexibility/insularity of IT systems. makers in organisations using cloud, are doing soAnd in the IT department, more than four in ten to bypass their IT department.(44%) IT decision-makers believe the Nearly six in ten (56%) IT decision-makers believeinflexibility/insularity of business systems causes a part of their business has already adopted abusiness or process transformation to be cloud-based solution and bypassed the ITchallenging. department.The relationship between business and IT More than four in ten (42%) IT decision-makersdepartments in many businesses is not who think that their business has bypassed the ITconducive to achieving a common goal. department through their use of cloud, believe thatAround one in six (17%) business decision-makers it is because they need the systems up and runningwho regard as challenging the task IT has been set quicker than they would be otherwise.of delivering business process improvement ortransformation, report that its hard to get IT to 2
    • IntroductionObjectivesThe main objective of the research was to examine the demands and pressures under whichbusinesses and their IT departments operate and the impact on the relationship between them.The research established a significant disconnect between the needs of businesses and IT’s current abilityto meet them. This disconnect has been defined as the Ambition/Maturity Gap.ThemesThere are four clear themes that run through the research:  The demands faced by businesses, and the pressures on IT  IT’s struggle to meet business needs  The reasons for, and consequences of, IT’s struggle to meet business needs  The Ambition/Maturity GapWhat is the Ambition-Maturity Gap?The research demonstrates that whilst businesses are operating under intense pressure toprogress and change, and have the ambition and desire to implement this change, ITdepartments are struggling to deliver.Therefore, these is a disconnect between the ambition of businesses and IT’s ability to matchthis ambition.This disconnect can be described as the Ambition-Maturity gap.However, in this report, there is also evidence that a small minority of IT departments are demonstratingthis maturity, to a greater or lesser extent, matching the desire and ambition of their business colleagues.Significantly, this minority comprises businesses that have invested in Business Process Managementsoftware. 3
    • The demands faced by businesses and thepressures on ITThe need for change This demonstrates the extent to which businesses are having to adapt their goals and re-evaluateNow is not a time for complacency or simply their plans in accordance with their circumstances;doing things the way they have always been agility and speed of reaction are essential.done. Therefore, businesses require a wide array of improvements to the way they are operating,The vast majority of the businesses surveyed are including employee productivity/empowerment andworking under pressures that have become more how information systems work together; indicatingintense due to the prevailing economic and the role of successful working relationshipscompetitive environment; 96% of businesses have between colleagues and also across corporate IT.priorities for this year that have become more of afocus for them because of the environment in The improvements required by businesswhich they find themselves currently. The priorities departmentsthat are most likely to have become moreimportant recently are that of improving customer Employee productivity/empowerment 74%service/customer engagement and cutting costs;representative of recent business attitudes of How the information systems youneeding to achieve more whilst spending less. use work together 71% How departments, locations,Businesses’ priorities for 2012 that have increased functions collaborate across the 68%in importance business Improving customer service/ customer engagement 70% Business processes 67% Cutting costs 70% Access to the business information required to make decisions 65%Trying to be more productive and efficient to "do more with less" 67% Figure 2: The percentage of businesses that want to see Looking to grow new revenue 65% improvements made to these areas of fundamental streams in new markets productivity Getting products/services to market quicker 62%Dealing with an increased burden of regulation and compliance 54%Figure 1: The percentage of businesses where these2012 business priorities have become more of a focus, asa result of the current economic and competitiveenvironment 4
    • Implementing change micro scale; it demonstrates how integral IT departments are to achieving business success.Business departments’ demands are havingan impact on the workload of the IT However, where all IT departments surveyed reportdepartment as they are required to address that operational improvement projects arethe mounting the needs of their colleagues. underway or planned in the current year, respondents in business departments are lessEvery IT department surveyed reported that they certain that this is happening (figure 4). Evidentlyhave recently been tasked with enabling business departments are not always aware of theoperational improvement in at least one area of work being undertaken or planned by their ITtheir business, be it improving business processes department, which suggests a lack of(the most requested), or improving the availability communication between the two.of corporate systems on mobile devices (the leastrequested). Most, but not all business departments are aware of the changes being implemented by ITThe operational improvements being implementedby IT departments Business processes 56% Business processes 62% How departments, locations, functions collaborate across the 49% business Cutting costs 58% Employee productivity/empowerment 43% How departments, locations, functions collaborate across the 49% Access to the business information business required to make decisions 40% Access to the business information required to make decisions 49% How the information systems you use work together 34% How the information systems you use work together 48% None of them 5% Employee productivity/empowerment 46% Dont know 3% Improving customer service/ customer engagement 35% Figure 4: The percentage of businesses reporting that projects to improve operational effectiveness for theGetting products/services to market quicker 35% above areas are currently underway or planned for 2012 improvement in the areas above.Getting corporate systems available on mobile devices 27% None 0% The changes required are time-critical An additional factor when it comes to theFigure 3: The percentage of IT departments being implementation of business and processengaged by their busines to make operational transformation is how quickly it is required.improvement in the areas above. Around three-quarters (74%) of the businessFigure 3 shows the wide variety of tasks being decision-makers surveyed describe as “time-undertaken by IT departments at the request of critical” the projects, currently underway ortheir business colleagues, on both a macro and planned, to improve operational effectiveness within their company. This shows just how 5
    • important and urgent they are, and gives a sense The processes required are challengingof the pressure being placed on the IT departmentstasked with implementing them. In addition to being required quickly, these essential changes are difficult to implement.Business departments reporting improvement The majority of business departments recogniseprojects to be time-critical that the changes they are asking IT departments to How the information systems you make are challenging, with almost six in ten (57%) use work together 74% reporting as such.Access to the business information required to make decisions 72% Business departments recognise the Employee improvements they seek are challenging productivity/empowerment 71% How departments, locations, functions collaborate across the 51% business Business processes 68% Access to the business information How departments, locations, required to make decisions 47% functions collaborate across the 63% business How the information systems you use work together 47%Figure 5: The percentage of businesses describing theoperational effectiveness projects listed as time-critical Business processes 47% EmployeeThis pressure is also reported by IT departments 44% productivity/empowermentthemselves, with nearly six in ten (57%) reportingthat they are being asked to deliver projects more Figure 7: The percentage of businesses that regard theirquickly because of the prevailing economic or improvement projects as challenging.competitive enrvironment. Only around a quarter(28%) of IT departments believe that they are Similarly, IT departments acknowledge the scale ofgiven sufficient time to accomplish the work they the task they face, with more than nine in tenare set. (92%) admitting that the process of business or process transformation can be challenging.IT departments are being given less time IT departments also find it challenging Yes 15% 8% Yes No - they recognise the timescales we suggest 28% 57% No - they have always No wanted delivery to be fast 92%Figure 6: Have prevailing economic or competitiveenvironments caused business departments to want IT Figure 8: Can achieving business or processprojects to be delivered more quickly? transformation be challenging? 6
    • IT is struggling to meet the business needThe type and nature of the changes that arebeing demanded, coupled with the fact that Businesses that report that IT is NOT helping them make the changes they requirerespondents from both camps describe theprocess as challenging, makes it hardly a Access to the business informationsurprise that IT is struggling to deliver. required to make decisions 41%Almost three-quarters (72%) of business decision- How departments, locations, functions collaborate across the 41%makers are currently of the opinion that their businesscompanies’ IT is NOT facilitating them in their aimto achieve at least one of their business priorities Employee 38% productivity/empowermentfor this year. Business processes 38%Businesses believe IT is NOT facilitating theachievement of business priorities How the information systems you use work together 36% Looking to grow new revenue streams in new markets 46% Figure 10: The percentage of businesses to answer that Dealing with an increased burden their business’ IT is NOT a help when improving the of regulation and compliance 41% processes above. Getting products/services to market quicker 41% Tellingly, IT departments are aware of these Cutting costs 40% failings, with eight in ten (80%) reporting that there is at least one area of IT’s support to the Improving customer service/ 37% business that is NOT functioning well. When these customer engagement areas are so critical to the success of their Trying to be more productive and business, this level of failure is difficult to justify. efficient to "do more with less" 33% The areas where they are most likely to beFigure 9: The percentage of businesses to answer that struggling are:their business IT is NOT a facilitator in achieving thebusiness priorities above.  Managing highly interactive, ad-hoc, unplanned customer interactions (45%)Furthermore, two-thirds (65%) of business  Delivering a single view of a business “need”,decision-makers believe that their company’s IT is e.g. customer, risk, fraud, product (44%)NOT helping them make the changes they requireto their business; changes that, as previously  Providing data to mobile devices (43%)shown, are considered critical to the success oftheir business. 7
    • In additon, two-thirds (67%) of IT departmentsthink that the business systems they deliver areNOT regarded as a help by the departments thatuse them.IT departments recognise their failings IT is NOT seen by the 33% business as a help 67% IT is seen by the business as a helpFigure 11: A business IT systems can be a block to or afacilitator of change. What is your impression of thegeneral opinion that the business has of its IT systems? 8
    • Why is business change challenging and whatare the consequences?The reasons Why IT departments consider business improvement projects to be challengingBusiness decision-makers are not short of views onwhy business or process transformation is Business or processchallenging; the main reason is that tasks take transformation tasks usually take 52% longer than plannedlonger than planned. Business tends to set unrealistic timescales (doesnt appreciate the 45% work involved)Why business departments consider businessimprovement projects to be challenging The inflexibility/insularity of business systems 44% Business or process transformation tasks usually take 36% longer than planned Business or process transformation tasks usually run 43% over budget The inflexibility/insularity of business systems 27% The proposed solution is always complex 20% Its hard to get IT to absorb and react to our needs in a timescale 17% that matches our expectation. Figure 13: The reasons why IT departments consider business improvement projects to be challenging Business or process transformation tasks usually run 15% over budget A lack of communication and a failure to appreciate The proposed solution is always 5% the needs of the business and the capabilities of IT complex are also evident in how they describe their working relationship when it comes to businessFigure 12: The main reason why businesses considerbusiness improvement projects to be challenging improvement projects.IT decision-makers are most likely to report the Business departments would not describe the process as collaborativesame reason as their business colleagues, that thetasks take longer than planned. Their second-ranked answer, that business departments set It is a collaborative process 29%unrealistic timescales – illustrates a lack ofcommunication and visibility of these processes 42% It is driven by ITbetween business and IT. 29% It is tasked to IT by the business Figure 14: Business decision-makers’ description of the process of achieving improvement projects 9
    • In the case of both business and IT decision-makers, only a minority describes the process as“collaborative”.IT departments would not describe theprocess as collaborative It is a collaborative 19% process 43% It is driven by IT 38% It is tasked to IT by the businessFigure 15: IT decision-makerss’ description of theprocess of achieving improvement projectsBypassing the IT departmentA direct consequence of the apparent inability of IT,the lack of communication between business and ITand the resulting tension between the two, is thatbusiness departments are seeking solutions to theirproblems without the IT department’s involvement.A quarter (23%)of business departments that usecloud services, do so in order to bypass the ITdepartment. This creates an IT infrastructure thatis even more difficult to manage and integrateeffectively.IT departments are very much aware of this issue;more than half (56%) of IT decision-makers believethat a part of their business has bypassed the ITdepartment by using cloud. 10
    • The Ambition-Maturity GapThis report demonstrates that: A lack of maturity: the execution, running and measurement of business processes  Businesses are under pressure to create change ... We build the processes into our 49% applications/systems  And have the ambition and desire to We have built our own workflow implement this change … tool 26% We have purchased or are looking  IT departments are aware of this to use a Business Process 14% requirement of their business … Management software We dont execute processes in the way you describe 11%  Yet they are struggling to deliver…  Causing additional complications. Figure 16: IT departments’ methods of executing, running and measuring business processesTherefore, there is a clear disconnect betweenthe ambition of businesses and the maturity Similarly, fewer than one in ten (9%) IT decision-of IT systems being provided to businesses. makers appear to have the breadth of vision toThis disconnect has been defined as the consider innovative solutions to the delivery of aAmbition/Maturity Gap. single view of informatin across their business.Further evidence of the Ambition/MaturityGap A lack of maturity: the delivery of a single view of information across the businessDemonstrating how IT departments are not We have moved to a datakeeping pace with the business’s ambitions warehouse that contains this 44%with their use of IT systems, is their approach information for the business to get their single viewto a number of tasks and processes. We have integrated togetherFor example, only around one in seven (14%) IT numerous systems and expose 30% services to get this informationdecision-makers use or plan to use BusinessProcess Management software to execute, run and We dont deliver a single view inmeasure business processes. the way you describe 17%This means that six in seven businesses areshowing a reluctance to consider alternative We use or are planning to use 9% Master Data Management (MDM)solutions to the problems they are experiencing,particularly the 11% who do not execute theirprocesses in such a manner at all. Other 1% Figure 17: IT departments’ methods of delivering a single view of information across their business 11
    • The sense that only a minority of IT decision- Bridging the Ambition/Maturity Gapmakers are willing to adopt new solutions to tackletheir current challenges is reinforced when we look The small minority of IT departments using aat how they model and represent business BPMS appear to be experiencing key benefits,processes. illustrating that use of such a technology can bridge the gap between business ambitionOnly one in ten (9%) IT decision-makers are using and IT’s ability to deliver.a Business Process Management Suite (BPMS) tomodel and represent their business processes. Users of a BPMS are more likely to report that their IT is performing well when compared to non-users.A lack of maturity: the modelling andrepresenting of business processes BPMS users’ IT performs better than that of We model them in Visio, non-users PowerPoint 41% 33% We document them and model them in a format such as UML 21% We model them in a Business 19% Process Analysis tool such as Aris 18% We use a Business Process Management Suite (BPMS) 9% BPMS non-users BPMS users We model them on paper 7% Figure 19: The percentage of IT departments to report that their IT is performing well in regard to systems they Its not something we have need. attempted to do 4%Figure 18: IT departments’ methods of representing and It comes as no surprise that having IT systems thatmodeling their business processes are seen to perform better, and an IT department that is perceived to have a greater ability to deliver the systems needed, leads to IT departments being better valued within their businesses. BPMS users’ IT is more helpful than that of non-users 53% 31% BPMS non-users BPMS users Figure 20: The percentage of IT departments to report that IT is considered to be a help by their business. 12
    • The use of a BPMS also improves the workingrelationship between business and IT; users of aBPMS are more likely to report that they have aneffective, collaborative and aligned business and ITrelationship.BPMS-using IT departments have a betterrelationship with business departments 83% 61% BPMS non-users BPMS UsersFigure 21: The percentage of IT departments to reportthat they have an effective, collaborative, alignedbusiness and IT relationship.Use of a BPMS also provides specific IT benefits,such as when handling complex system integration.Users of a BPMS are three times more likely todescribe their handling of complex systemintegration as excellent, than non-users.BPMS-using IT departments are betterequipped when handling complex systemintegration 83% 61% BPMS non-users BPMS UsersFigure 22: The percentage of IT departments to reportthat they they handle complex system integrationexcellently. 13
    • AppendixResearch ScopeIn February 2012 Cordys appointed specialist technology market research house Vanson Bourne, toconduct 650 interviews in Europe. An equal number of interviews were conducted with IT and businessdecision-makers.The targeted countries were as follows:  UK  France  Germany  NetherlandsThese organisations have at least 500 employees and fall into the following sectors:  Financial services  Manufacturing  TelecomsAbout Vanson BourneVanson Bourne is, a specialist research-led consultancy, carrying out user research within a technologycontext. Vanson Bournes clients range from start-ups to well-known companies that need expert guidance,delivering robust and credible research-based analysis. More info: http://www.vansonbourne.comAbout CordysCordys is a global provider of software for business process innovation. Global 2000 companies worldwidehave selected Cordys to achieve performance improvements in their business operations, such as increasedproductivity, reduced time to market and faster response to ever-changing market demands.Headquartered in the Netherlands, Cordys has offices in the Americas, EMEA and Asia-Pacific. More info:http://www.cordys.com.Copyright © 2012 Vanson Bourne and CordysMay be used free of charge. Selling without prior written consent prohibited. Obtain permission before redistributing. In all cases thisnotice must remain intact. 14