Everything in Order

Companies lack skills to optimize Business Processes – Gartner
by: Jerry Liao

The current crisis in the U.S. is likely to have a chilling effect on every industry worldwide. Growing economic pressures could lead to a lot of changes – from budget cuts to workforce cuts, all pointing to one direction – Savings.

Of course, that is just one way to address the problem at hand. Another way is to be more bullish and to revisit ones business process. The term business process refers to repetitive activities performed in the context of an organization’s normal, everyday operations. Companies should review their processes and make sure that everything is in order and are aligned to the organizations objectives.

To do this more effectively, companies can turn to technology to do this – one tool is called business process management or BPM which involves the use of appropriate tools and techniques to design, analyze, and manage operational business processes and, where possible, to improve those processes.

Technology research and advisory firm Gartner has identified 11 steps that will help determine whether organizations should implement and source BPM skills internally or externally:

Step 1: Establish a Holistic View of the Five Dimensions of Multisourcing —While it is advisable to always have a multisourcing strategy, it becomes even more imperative to address the five dimensions of multisourcing (sourcing strategy, market analysis and vendor evaluation, contract development and vendor negotiation, multisourcing management, and sourcing governance) when investing in external resources.

Step 2: Understand the Pros and Cons of Different Sourcing Options — Project-based services are the appropriate sourcing model for most organizations that haven’t fully established their own BPM competencies. Once an organization has established BPM competencies, it can supplement its resources through staff augmentation or even outsource some solutions.

Step 3:Establish a Big-Picture View of the Three Competencies Needed for BPM — Whether or not an ESP will be used to help with or to take over the BPM project, the organization does need to establish business process competencies to sustain BPM efforts over time. Each of the competency areas needs a mix of resources that have both IT and business skills. To ensure the success of BPM initiatives, the organization will ultimately need solid competencies in process skills sets, tools and process assets, and transformation skills.

Step 4: Identify the Roles Needed for a Typical BPM Project — A role is not the same thing as a job. A person’s job may require him or her to play more than one role on the BPM team. There are a number of key roles needed for BPM success, including BP champion, executive sponsor, BP director, BP architect, and application developers. ESPs can help with any of these skills, but an organization must ensure that its services contract with the ESP emphasizes knowledge transfer and mentoring, so it can eventually become self-sufficient.

Step 5: Target Candidate Business Processes and Agree on Nomenclature — Many organizations get mired in endless discussions about “what to call a process” or have no idea where to begin in their business process improvement efforts. Use an existing process framework to avoid these roadblocks. Use the ESP’s prebuilt business process models or templates to determine the vendor’s degree of industry knowledge and to assess the vendor’s insight into process best practices for your particular sector.

Step 6: Identify Who Implements Process Change and Frequency of Process Change — Organizations tend to underestimate the frequency of process change. Consider compensating for that tendency by setting expectations that the processes are more likely to change. To determine whether an ESP is focused on IT-driven or business-user-driven process change, check references in which the vendor has implemented BPM solutions.

Step 7: Determine the Magnitude of Process Change — BPM can be applied to a continuum of process change. The change may be a modest or incremental process improvement. The change may also be a more-substantial process redesign or even a large-scale business transformation. The transformation will more than likely alter your company’s structure and corporate culture, as well as the way in which your company interacts with its partners and suppliers.

Step 8: Decide Whether You Can Manage Change at Three Levels — To be successful with BPM, an organization will need to address change management at three levels: the top-down “push” model, the bottom-up “pull” model, and the peer-to-peer model or “middle-out model.” Determine whether the ESP is equally adept at top-down, middle-out and bottom-up change management when interviewing customer references. Find out who (what roles) the ESP interacted with and the way in which the ESP achieved “buy-in” for BPM adoption.

Step 9: Identify Your BPM Buying Scenario — Identify which BPM buying scenario is the best fit for your BPM project. Examples include an organization that wants a specific process-based solution, business buyers undertaking a continuous process improvement initiative, enterprises interested in moving to SOA or senior business executives looking to rethink their business processes and transform their business. Use the scenario to frame the expectations with internal stakeholders and ESPs.

Step 10: Conduct a Skill Gap Analysis — When conducting a skill gap analysis, an organization identifies which BPM skills it has and the skills that must be obtained from external resources

Step 11: Determine Which Sourcing Options Are Appropriate for BPM Skills — An ESP can help in any of the roles needed for a typical BPM project. However, an organization will need to develop its own competencies for most of these roles, which means that it needs an ESP that will provide advisory services and mentoring, via a staff augmentation or project services sourcing option.

In dealing with the current economic slowdown, rather than just staying afloat, a better attitute is to be more agressive – cautiously of course.

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