Business process management aims to take the pain out of process inflexibility

Rethink IT, Oct, 2004

* In an IT industry renowned for its ubiquitous use mind-boggling jargon, a prime contender for the 'most confusing term' award must be business process management (BPM).

This modish expression means many things to many people and has been appropriated by software vendors of every persuasion to describe their integration offerings in the hope of making them more appealing and getting an early lead in an emerging market.

The problem is, however, that no one supplier currently has an end-to-end BPM product suite and the corporate culture necessary to truly embrace BPM is simply not in place in most organizations.

So what is BPM and why is it provoking so much interest? According to David Metcalfe, vice president and research director at Forrester Research, BPM enables enterprises to "design, execute and optimize cross-functional business processes that incorporate systems, processes and people".

This definition includes hath internal company-specific processes and ones that extend beyond the corporate firewall to enable collaboration with partners, suppliers and customers.

Due to the complexity involved in making this happen, however, BPM technology comprises a raft of very different tools. These range from process modelling, execution, management and measurement offerings to workflow and rules engines, enterprise application integration (EAI) software, portals, performance management and business intelligence applications.

Willie Appel, senior vice president of executive directions at Meta Group, explained: "No one vendor yet provides all the necessary tools in a single integrated form, and there is no single solution out there because you need so many different technologies to do BPM. You're talking about an engineered environment with multiple suppliers each playing their part."

As a result, software vendors from very different disciplines are all jumping into the fray and patting their own spin on BPM based on past strengths as they strive to broaden out their offerings.

Traditional EAI providers such as webMethods and Tibco are key players here as are application platform vendors such as IBM and BEA, while even enterprise application suppliers such as SAP and Siebel are jumping on the bandwagon. A raft of pure play BPM vendors such as Fuego and Intalio have also emerged, meanwhile, although they are smaller and less established than their more mature rivals.

Metcalfe explained the rationale behind this apparent market zeal: "In the past, enterprise applications offered reliability and control, which is why they were sold to CEOs and CFOs--they helped them control the business. But while this is helpful, it also created a process straightjacket."

BPM is seen as the way forward, however, as it is about "untying that straightjacket and allowing organizations to be more flexible in how they design and operate their business processes both across the enterprise and across other organizations. You don't have to do a return on investment study to feel the pain of process inflexibility," Metcalfe said.

While this pain is being felt pretty much across the board, to date very few, if any, companies have initiated large-scale BPM implementations, with the focus currently being on fixing specific internal processes such as claims management, mortgage and insurance processing in the financial services world or billing in the telco space.

Sorting out the supply chain and introducing customer relationship management have also been areas of interest for many businesses and specific vertical markets such as automotive, hi-tech, consumer packaged goods manufacturers, aerospace and retail have been particularly motivated to evaluate BPM's potential.

Gareth Lloyd, chief executive of consultants Glue, said: "It's a relatively immature market and the technology is not proven for large-scale end-to-end process management initiatives. But organizations are starting to find little homes for it to prove the concept and use their experiences to understand the technology better."

These pilot projects, which he says "are currently more akin to workflow management or procedural initiatives than enterprise-wide BPM projects", are also being used to prove the value case and to evaluate the possible return on investment to be gained.

The big problem with even small, let alone end-to-end, BPM projects, Lloyd added, is not so much a technology as a cultural one, however. Most organizations are functionally-based and operate in a silo structure. They also employ few, if any staff with experience of modelling and managing processes on an end-to-end basis and likewise fail to reward them for taking this approach.

As a result, "if you don't feel you own a cross-functional process, why would you stand up to the CEO and accept responsibility for it. It's a chicken and egg situation and business change has to come first to create an environment where business sponsors will be prepared to pick up and drive technology innovation," Lloyd warned.

This means it is critical to identify those areas of the enterprise that offer the biggest potential for competitive advantage or operational excellence and focus initial efforts there, the aim being to pique the interest of board-level members by showing them the potential for concrete business benefits.