Borner's Corner

Organisations can derive these benefits from technological solutions, but can they meet these short term needs (downsizing for lean-ness and moving towards centralised control for agility) whilst also addressing long term strategic aims that prepare them to exit recession better equipped for the future than they were when they entered?

I believe that they can. This is having one's cake and eating it, and a solution to this dilemma is Business Process Management.

BPM is getting a lot of attention. Forrester Research estimates that BPM license, services and maintenance revenue will grow from the $1.2 billion we saw in 2005 to more than $2.7 billion by 2009 "an adoption trend vendors and practitioners alike can't ignore".

BPM has come a long way from the workflow systems of the 1990s; those old workflow systems managed document-based processes where people executed the workflow steps of the process.

Today's BPM systems manage processes that include person-to-person work steps, system-to-system communications or combinations of both. In addition, BPM systems include integrated features like enhanced (and portable) process modeling, simulation, code generation, process execution, process monitoring, customisable industry-specific templates and UI components, and out-of-the-box integration capabilities along with support for web-services-based integration.

All of these ingredients translate to increased interest today in BPM suites because they bring businesses a higher level of flexibility for business processes while reducing risks and cost. Think of BPM suites as offering a way to build, execute and monitor automated processes that may go across organisational boundaries.

But the key here is higher level of flexibility and reduced cost. Lean and agile. Just what we need now, in turbulent times, and to set ourselves up for the future.

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My premise is that firms achieve growth through the use of information technology to scale their business processes more effectively than their competitors. So how do we measure the strength of a firms IT capability?

I use an "IT Scorecard," based on an original framework developed at Microsoft, to measure and track IT capability in five key business functional areas: sales and marketing, finance, operations, empowered professionals, and IT infrastructure.

Typically a firm that does well on the IT Scorecard has a high capacity for business process scalability. That is, their processes tend to be able to scale to meet the needs of a rapidly changing business environment. For example, through good process knowledge and standardisation they can more easily manage the complexities involved in growth; they are able to streamline their operations and achieve grow without significant additions to headcount; they are flexible and able to respond quickly and take advantage of new opportunities and they have good visibility into their critical business processes.

Interestingly, firms that have a high capacity for business process scalability often do not realise that they have this capability. However, results can be off the scale for firms that understand their capabilities and embrace the business process scalability they have developed because they are able to identify the specific process changes needed to drive each business lever and then quickly and efficiently implement those changes in their BPM system.

 

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I read yesterday's article in Silicon's online magazine entitled "SAP sales drop as credit crunch looms large" with interest. It is clear from the article that the current economic climate is hitting the 600lb Gorillas hard. SAP shares are down 16% (the biggest drop for 12 years) and Oracle are down 7.6%. Shares in Microsoft, Cisco and EMC are also reportedly down.

The article reports that Henning Kagermann, SAP co-chief executive, said of the third quarter: "The market developments of the past several weeks have been dramatic and worrying to many businesses. These concerns triggered a very sudden and unexpected drop in business activity at the end of the quarter."

My experience is that there is a tendency to increase spending on IT during times of economic downturn. This is because smart business leaders see it as an opportunity to streamline and position for the future. The Businesses that "get it right" are those businesses that ride the recession and come through it stronger and better placed to handle the up-turn.

So, if the major Hi-Tech firms are seeing a downturn, where is this investment going?

I would hope that firms are looking towards pure play Business Process Management technologies like Lombardi, PegaSystems, K2.net, Global360, Appian and Savvion because coupled with a strong iterative approach they can provide quick wins and give business visibility and ownership to make a difference in the current fiscal year. If a major SAP deployment goes wrong it can very easily become a job loss/annual report write down issue. Through fast, agile BPM projects, the lessons learnt in the initial deployments can lay the foundations for larger "Building the Future" projects that deliver significant longer term benefits.

 

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