Art of successful BPM Implementation

Implementing BPM solution is projected as one of the most rewarding initiatives in and organization based on process excellence and cost savings parameters. While the ROI of BPM looks great on paper it is one of the most challenging implementation in enterprise wide scenario. The common difficulties or I must say pain of implementation felt across the enterprises is longer than life time for implementation resulting in inflated cost of implementation.

Look Beyond Mirage of Process Modeler

The most fancied part of BPM is drawing processes in process modeler enabling business people to implement business models, changing market scenarios and measuring metrics associated with changes. The fact that is ignored in envisioning the implementation by business people is graphical modeling tool doesn’t stand alone. The BPM solution has to be able to communicate with people (for the workflow steps) and it has to communicate with applications – both your enterprise’s applications and your trading partners’ applications in order to manage those multiple process steps in an automated manner.

Integrating with Enterprise Wide Application

The other misunderstood part is human centric workflows. The impression these workflow create is that they can be configured and run without development support. The fact is a complete BPM solution has to be able to communicate with programs – lots of programs.

The difficulty in this part of communication with programs is connecting with different set of interfaces which are more often not consistent. People often discover late that they are dealing with applications built at different times, by different people, for different purposes, using different component models, different communications technologies, different databases and different data models.

The way to address this problem is to build web services communication with the legacy application which is commonly called wrappers or adapters.The catch is you have discovered this rather late that you need to build wrappers for web services communication with your BPM tool.

You discover now we are talking of SOA .The other thing which now comes in to play which standard to use BPEL, XML or XPDL.

Closer Look at Adapters

Adapters serve as the conversion mechanism for those applications that expose their functionality and data via published APIs that allows the technology of the BPM solution to communicate with the technology of the application. For example, a BPM solution that can natively call Java APIs needs adapters that can place a “Java façade” on top of legacy applications.

The pain point here is not every legacy application publishes APIs – some were never intended to be called by another program. In those cases, you need adapters that can “screen scrape” the terminal-based interface of the legacy application, putting an API on top of programs that support user interaction via terminals.

In some few cases, you may use adapters that allow your BPM solution to call the legacy applications' databases and file systems directly. However, the editing and validation logic that you write as part of this direct data access approach is bound to be either incomplete or in conflict with the data access and validation logic that exists in your legacy apps. So it’s best to use this direct data access as little as possible.

Semantic Differences

Take one step further in your discovery of problems - you have now come across the problem of semantic differences between legacy and BPM application.

Every application that is used to run a major enterprise uses data elements (i.e., fields) with different element names (Do customer_ ref and customer_num refer to the same data?) and different element properties (Is the pin _code field numeric or alpha?) These data elements are managed within different structures (Do we have records with multiple phone numbers per address or do we have multiple records per address, each with a single phone number?) Finally, the semantics or meaning of the data varies from application to application (Does item-weight refers to net weight or gross weight? Is it expressed in kilograms or pounds?).

You now feel the need of data transformation code to convert the data from the style, format and semantics of your legacy applications to the style, format and semantics of the BPM solution.
Conclusion
The following conclusions can be drawn from the above discussion

• Never do the mistake of considering BPM as standalone implementation
• Plan BPM implementation considering the environment of your legacy application
• The implementation should be planned based on the services adapters that needed for integration with BPM solution. Semantic differences should also form part of your implementation planning to avoid any last minute surprises
• BPM implementation needs lot of custom development for implementation
• For effective implementation the core committee should comprise of owners of different legacy application and the IT people owning those application. This will help in visualizing a wholesome approach and avoiding the last minute surprises. The ownership of implementation must be shared with legacy application owners.
  
  
  
  

Paas and Saas models for BPM space

PaaS is a programmable or programming environment presented as rich internet onlineplatform completewith the application development, data storage and other tools required to run multi-tenanted, massively scalable application where as SaaS delivers the application as subscription service over the internet.

PaaS model is used by ISV to develop their apllication and SaaS model ismore end user oriented in terms of offering the developed application as service to the end user.

BPM offers a collbarative platform for IT and business user to rengineer ,optimize and monitor processes.The SaaS offering with customization to end user needs is better option in terms of BPM because of following reason

• The enduser see a process already mapped as per some industry norms where in he can figure out minor customizations and make it easily acceptable.
  
• The effort required is less both in terms of business user efforts and IT efforts

PaaS is a goof platform offering for develoing ground up application but the utility of PaaS from BPM standpoint is less as processes need to be monitored reengineered and optimized and if all these things has to be developed from scratch the cost is very high even on PaaS. This involves lot of time . SaaS is always a better choice to deploy already built up processes with slight customization with less effort and time.

Pricing Model for SAAS Model in BPM

The pricing of SAAS model is based on per user basis subject to minimum number of user subsscription required. This is the general method of pricing in SAAS based model.

However the roadblocks in case of BPM are :

• It is very difficult to come out with industry standard process which can be implmented and accepted by all . Every organization ahs its own customized way to implement their process.
• The security concerns are very high in terms of exposing the internal processes to third party service provider.
• The hosting can be managed by some other vendor tied up with the third party service provider which may add to further complication.

In view of all the pricing model I suggest can be based on following approach:

• BPM consutlting package wherin the BPM service provider will customize the process of their process template as per the requirement of the customer that isthey will provide BPM consultancy servcies . This service charge will come as a package.
• The second element will be the the charges calculated on the per user basis subjected to minimum number of users.
• The third element will add up based on whether the client wants a dedicated server or not. In case of dedicated server the price will go up and in case of connecting to common server it will be usual pricing.

The pricing should be based on the actual product pricing based on experience of particular BPM company providing the package. The minimum number of users and per user pricing should be decided in such a way that the whole package gives you the same revenue as you were getting in direct product sales. The benefit for the client is that he will save on maintenance cost and for you the next year usage charges will be banked revenue.

The one more criteria which can add up for the achieving the pricing can be the upfront agreement for extended period ie suppose client is willing to pay upfront for three years subscription .

The BPM solutions based on SAAS model with above pricing criteria will offer a complete package to the BPM users with price effectivenes.

SaaS & BPM

Copmaines are taking SaaS offering as an alternative delivery model for BPM solution offering. The claims processing applicationa in finanical services and helatcare industries is the most common example.
The most common use of SaaS is in providing the business process model as an user interface of cahnge across all phases of process lifecycle. The business analyst from client companies can directly change process flows ,rule definitions and user intefaces via modelling environment.
At present most comapnies focus on on premises implementation of BPM rather than go for SaaS supported solutions. The proceses supported by SaaS are often not included in process improvment efforts.

The companies like Appian ,Lombardi and Metastorm are offering the business process modelling via SaaS model. Appian and Fujtisu has also tried hands on BPM solution through SaaS model.The Reasons for SaaS not taking off are following

• The agility of process modelling and process reenigneering is compromised in the SaaS model as SaaS is low cost model for accessing (not owning) the functionality.
• The predefined range of rules ,process flows and user interfaces doesnot make it enticing for an organization inclined to use BPM as process improvement and optimization tool.

How to best Utilize SaaS for BPM ?

The organizations should adopt SaaS for processea which are well define din the organization. The users should be able to see the BPM artifacts of SaaS model and share their understanding and suggestions with SaaS provider for developing customized SaaS BPM scenario. The comapnies should implement SaaS understanding the their objectives of implementation based on set of well defined KPI'S. The need for changes in processes should be clearly articulated with SaaS provider.

SaaS can be implemented intelligently for BPM solutions to achieve low cost business scenario .The organozations should understand the limit of implementing SaaS based model. The use of SaaS based model for Business process improvement and optimization has still a long way to go.

Asset Managemnet using BPM

BPM provides a collaborative platform for designing and executing a workflow for the asset management of the company. The company used BPM for designing and implementing workflow for taking care of infrastructure and maintenance needs of company. The workflow was connected through sales and logistics database as well as infrastructure database. The typical process started with the request from a particular wholesale branch for increase in infrastructure assets or request for maintenance. The requisition was sent for approval to the competent authority in head office for infrastructure approval .The checklist was embedded in workflow which pulls out data from infrastructure database of last maintenance work /infrastructure enhancement .The request for new infrastructure/maintenance is also goes for approval to the sales head responsible for that area .The checklist for sales approval involves pulling out data from sales data bases in terms of increase in sales and subsequent increase in logistics cost. The additional information that needs to be put in is loss of sales due to lack of infrastructure/maintenance. The request when approve by both sales and infrastructure authority .The request is then sent to the region head for approval. The region head if approves the process it automatically triggers the process of calling tenders from third party vendors listed in the company. The communication is send to all the vendors via email asking them to respond with quotation within fifteen days. As soon as all the vendors place their quotations or then the processes of short listing tenders is triggered and the mail is send to all the tender committee members for which queue has already been created in the BPM platform. The members approve the tender of one particular vendor . The process of sending mail to the vendors is initiated stating tender process is closed and the name of vendor selected for work. The vendor who has been awarded work can send his bill via email which again triggers account payable processes which involves verification of task ,quality of task and approval for payment.

BPM and SOX Compliance

Compliance requirements in Sarbanes-Oxley

SOX has 2 important sections 302 and 404

• S 302 requires executives to personally certify the validity of financial statements
• S 404 requires complete documentation of financial controls and evaluation
  

Self-certification of internal controls and legal compliance requires an organization-wide compliance initiative as the managers of each function need to assess and certify the effectiveness of processes and controls that they are responsible for.

BPM enables organizations to address these requirements through document management features for creating a Compliance Framework, Compliance Workflows and Reporting and Monitoring.

Compliance Framework

BPM helps organizations to create a robust, scalable compliance framework consisting of:

• Owners and participants in the compliance initiative
  
• Risk Assessment procedures with Processes, risks and controls that are to be used for self-assessment
  
• Test Plans that are to be used to verify the operating effectiveness of controls
  
• Issues and Recommendations that are detected and defined during self-assessment
  
• Legal Compliance through management of tasks that require fulfillment of legal provisions under various acts
  
  

Compliance workflows

BPM facilitates collaboration by enabling execution of workflows for the following compliance activities:

• Self-assessment of design effectiveness and operational effectiveness of controls
• Workflows that enable tracking of issues and remediation plans to address flaws in controls
• Legal Compliance workflows to enable fulfillment of legal requirements
  

Reporting and Monitoring:

Before CEO/CFOs can certify the existence and effectiveness of controls, they need to view the results and status of the compliance initiative. BAM and Analytics provide powerful graphical dashboards and drill-down reports that enable CEO, CFO and managers to view the current status of assessment tasks and control effectiveness.

Risk Management in BPM

Business organizations are increasingly using business process management as an essential ingredient in adopting to agile business environment for optimizing the process and maximizing the profits .The business processes management covers the lifecycle of processdiscovery ,specification ,implementation ,execution ,monitoring and controlling.BPM projects are structured around the business needs of organization and often fail because of lack of risk management .The cost of failures is high as the impact is felt across the organization .

Different Phases of BPM Lifecycle
Process Discovery
The lifecycle typically begins with discovery of the processes for the business needs of organization. The requirements of the business needs are gathered and the process involved with ach needs are elaborated in this phase.
Process Design
The business ecosystem is elaborated in this phase with various processes and sub processes inside it. The overall business scenario is designed embedding in it parent and child workflows. The exception processes are also enumerated at different steps of processes to take care of exceptions .
Process Implementation
The process designed is now has to be implemented across the organization . This begins with educating training the end user about the process. The real life scenarios are visualized and the end users are trained to use the process to fulfill business needs of organization.
Process Execution
This phase deals with executing the process for fulfilling the business needs across the organization.
Analysis and Monitoring
The processes are not monitored for the performance and fulfillment of business needs. The KPI and business reports are generated at this stage.
Controlling Process & Reengineering
The bottlenecks in the process are identified and the processes are reengineered to optimize them and increase profitability.

Identifying Risks associated with BPM
The typical risks encountered in BPM projects are mismatch of methods employed at different phases of process lifecycle ,lake of clarity for responsibility for different phases and mismatch of process design ,automation and evaluation objectives.
The identification of risks helps BPM process mangers to address risks related to different phases and avoid failure of projects. The typical risks at various phases are
Process Discovery
The shortsightedness in foreseeing the business processes as part of business ecosystem result in crucial small processes missing .The different in opinion about the inclusion of processes in designing business ecosystem leads to conflict situation .The documentation is not having specified format resulting in improper documentation with scattered information which results in loss of knowledge.
Process Design
The designing of process needs some standard modeling language to be followed. The designing is often done with nonstandard language resulting in process semantics not being properly represented which makes it difficult to understand and implement. The lack of communication between process stakeholders and process designers is another area which leads to improper design of processes .The common mistake made by process designer is having process focus and ignore the organizational perspective of process .The risk handling mechanism is often missing in design.
Process Implementation
Processes are often implemented without educating the end user fully about the process. The training is also conducted in an abstract manner resulting in lack of knowledge in terms of implementation of process.
Process Execution
The stakeholders do not adopt to the process oriented work style and continue with informal approach to work. The system is unstable and error prone in the beginning leading to loss of confidence about process in end users. The new regulatory requirements need to many approval and become cumbersome for end users
Analysis and Monitoring
The monitoring strategies ,plans ,objectives and methods are not thought clearly in the beginning resulting lack of monitoring methodology. The stakeholders and regulations prohibit the transparency in the process .The quantitative perspective is lacking in monitoring. The end user fails to translate raw data in to useful information.
Controlling Process & Reengineering
The data is difficult to understand and cannot be translated in to useful information. The bottlenecks seems to arise from lack of knowledge making it difficult to identify the requirement for reengineering process.
Risk Mitigation
Risk management typically involves the identification of risks ,analyzing them and then mitigating risks. The following approach should be followed to mitigate the risks involved in various phases of BPM lifecycle
1. The documentation process should be well defined to document the processes discovered in discovery phase.
2. The scope of processes should be clearly defined in the beginning to avoid any transgression of business ecosystem
3. The process design phase should have Active involvement of process stakeholders to translate the process requirement in to process design.
4. The standard BPMN notations should be used for modeling to avoid any confusion among stakeholders about process.
5. The process designed should undergo a well defined review and approval process to avoid any mistakes.
6. The key persons responsible should have regular meeting to have clear understanding of processes going on.
7. The involvement of end user is necessary in the process management as he/she should feel himself/herself as part of it . The regular suggestion meetings and briefings bout process design will help this up.
8. The processes should be tested live in bets environment asking for inputs of end user before implementing them finally to avoid errors in real world scenario.
9. The training of end user should be scenario based detailing benefits of implementation of process making him feel the benefits of process.
10. The monitoring reports and KPI should be thought around the process in the beginning to avoid confusion while monitoring and analyzing.
Summary and Outlook
This paper has discussed the risks involved in BPM lifecycle and the ways to mitigate it. Risks are essential part of any processes and cannot be avoided but with careful forethought the risk can be mitigated to convert them as learning points in improving processes