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7 Key Actions to Drive Process Change

Rene Van Bosch Rene Van Bosch on November 8, 2017

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Changing a process within a business is not for the fainthearted, as Ronald Reagan once said:

“The future does not belong to the fainthearted; It belongs to the brave.”

Business-process owners must have the courage to embark on the journey to change the future of their business processes. This article aims to guide those organisations in making process change a successful reality.

1. Show the process vision

This is a very crucial first step that helps you set the scene for the future. This will ignite the desire to change, and make the organisation more willing to embrace change.  The most effective manner to communicate your process vision is to articulate it using a picture or a story. Remember: the process vision must help the stakeholders. It should help them:

  • understand what the future will look like
  • understand the benefits for them, their clients, and the business
  • understand the risk if the process stays the same, and
  • recognise how this process change will help the business vision/goals to be realised.

2. Understand the change required and its impact

Out of the process vision, the changes required to the business (people, process and technology) can be formalised. While formalising the business change requirements, the change impact and its severity on the people, processes, and technology should be determined. The following tools are just some of those that can be considered in helping you to do this.

  • Brown paper: The ‘brown paper technique’ demonstrates a team-building approach that uses the power of the team to develop views on where workload issues might be. It is a visual wall display (usually created on brown wrapping paper, typically 3 ft high and up to 60 ft long). It documents an entire process, or situation, by highlighting all activities, interfaces, decision points, and information sources. The ‘brown paper technique’ involves process analysis and documentation, client involvement and participation, as well as the critique and assessment of opportunities.
  • Day in the life of (DILO): A DILO approach documents the entire set of activities for a member of staff or role holder. It provides a high-touch way of showing the extent of someone’s role, highlighting the major areas of work and where their greatest volumes are created. It can be done for a single member of staff or a group of employees who have the same role or function, and can be a synthesis of all the individuals.
  • Fishbone Analysis: The Fishbone diagram (sometimes called the Ishikawa diagram, or cause-and-effect diagram) is used to identify and list all the possible causes of the problem at hand so as to identify its root causes. This is primarily a group problem-analysis technique, but can be used by individuals as well. The process is called Fishbone Analysis because of the way in which the information gathered is arranged visually—like the skeleton of a fish.
  • Force-field analysis: This helps a team understand the balance of the driving and restraining forces of a particular change. The driving forces push the organisation towards change; the restraining forces push against change. Based on this understanding, the team can identify appropriate restraining forces to remove, or decrease and identify appropriate driving forces to increase.
  • Six Hats thinking: The ‘Six Hat’ method was developed by Edward de Bono. He provided some new labels for thinking that signal the different directions in which thinkers can be invited to look. A ‘hat’ indicates a role, which can be put on or taken off with ease. A hat is also visible for everyone else to see. Although the hats are usually imaginary, a poster showing the different hats can be useful in the room where a group is working. The six directions are:
    • Managing Blue – What is the subject? What are we thinking about? What is the goal? Can look at the big picture.
    • Information White – purely considering what information is available. What are the facts?
    • Emotions Red – intuitive or instinctive gut reactions or statements of emotional feeling (but not any justification).
    • Discernment Black – logic applied to identifying the reasons to be cautious and conservative. Practical, realistic.
    • Optimistic-response Yellow – logic applied to identifying benefits, and seeking harmony. Sees the brighter, sunny side of situations.
    • Creativity Green – statements of provocation and investigation; seeing where a thought goes. Thinks creatively, and outside the box.

The method provides a way for groups to experience the power of parallel thinking.

  • Stakeholder mapping: A powerful stakeholder-alignment tool that allows the team to quickly and visually assess their stakeholders’ impact on the success of a change program. This will help develop strategies that increase stakeholder support. It is a different way of looking at stakeholders, and a means of focusing stakeholder discussions.
  • Risk probability and impact matrix: This is a tool to aid the project team in prioritising risks. It is based on the principle that a risk has two primary dimensions:
    • Probability – A risk is an event that ‘might’ occur. The probability of it occurring can range anywhere from just above 0 percent, to just below 100 percent. (Note: It can’t be exactly 100 percent, because then it would be a certainty, not a risk; and it can't be exactly 0 percent, or it wouldn't be a risk.)
    • Impact – A risk, by its very nature, always has a negative impact. However, the size of the impact varies in terms of cost and effect on health, human life, or some other critical factor.

This matrix allows you to rate potential risks within these two dimensions.

  • Cost-benefit analysis: This is a process by which business decisions are analysed. The benefits of a given situation, or business-related action, are summed—then the costs associated with taking that action are subtracted.This will help build the business case for the process change.

3. Commission a competent implementation team

An implementation team is accountable for making process change happen—therefore, it is important to choose your team wisely. These are the people who will ensure that effective interventions and implementation methods are used to produce the intended outcomes. It is important to understand the skills that are required to implement the change, as this knowledge will help select the right people for the team. A competent team will be able to:

  • develop a clear implementation plan (i.e. who is doing what and when to complete the right things at the right time), by only looking at the impact analysis and business change requirements;
  • think on their feet to adjust an implementation plan (and their actions accordingly) to ensure a fruitful outcome.

4. Foster crystal clear communication

The communication supporting the project (case for change, project status, impacts, etc.) must be clear, concise, concrete, and coherent—with NO jargon. When the change impact is high on the target audience, the communication should come from their direct line report. Therefore, empower the direct line report to deliver the communication. He/she knows the audience the best, and can give feedback to the implementation team on how well the message was received. People must feel that they are listened to regarding their fears and concerns. If any resistance is encountered, corrective actions/communication plans can be put in place. This will help change the behaviour/attitude of the team, and foster a more positive attitude to enabling their embrace of the change. 

The communication plan should be aligned to the implementation plan. The communication packs should be specific—configured according to each type of stakeholder’s information needs. Ensure the most effective channel to deliver the change message is selected.

5. Engage affected stakeholders

When attempting to implement process change, some of your colleagues will be against it and others indifferent. It is part of human nature to feel apprehension when asked to change the way things are done. Therefore, to successfully implement a change, all stakeholders must be engaged in a way that they can accept (but not necessarily be happy with) the proposed change.

The project should have a mechanism (e.g. a collaboration tool) where questions and concerns from team members can be captured, as well as a database for them to find answers to frequent questions/concerns about the project.

The implementation team must have a platform where they can involve stakeholders in the design phase as much as possible. The buy-in for the to-be process will be higher if the stakeholders feel they had a part in creating their own future way of working.

6. Stay on track

A key element for success is to establish an appropriate management structure (governance) for the process-change project. This structure should include:

  • A project sponsor, or an engaged executive sponsor, who has a vested business interest in the process change from kick-off to close. The sponsor should champion the project at the executive level to secure the buy-in. This can mean the difference between success and failure.
  • An effective steering committee that actively and overtly supports the implementation team by eliminating obstacles, and empowering them to deliver on the agreed outcomes.
  • A project manager who involves the entire implementation team in the development of the implementation and communication plan. He/she will ensure the project is on time, on budget, and within scope.

7. Sustain the change

Creating a group to support the target audience after the implementation is crucial for the change to be sustained. Additionally, it is helpful to implement a buddy system in which individuals are teamed up with a well-trained colleague. This will ensure everyone has a supporting structure and won’t have to call first-line support when they experience problems and need help. This will help to prevent people going back to their old process. People respond better to a face they know, someone who knows their pain, rather than a stranger they don’t know. The people best suited for the buddy role are those who where enthusiastic about the change from the start. Target them as ‘early adopters’, and educate them to fulfil the supporting role post implementation. These people can perform regular audits of the process-change project/status, and will be close to the target audience and able to give feedback to the process owner if some begin to revert to the old way of working. Immediate action can then be taken to ensure the business will still benefit from a successful implementation.

So, to sum up:

  • S – Show the process vision
  • U – Understand the change required and its impact
  • C – Commission competent implementation team
  • C – Crystal clear communication
  • E – Engage affected stakeholders
  • S – Stay on track
  • S – Sustain the change

Hopefully, this approach will be useful when your organsation is implementing a process change. Enjoy your process-change journey, and may it bring your business every success!

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Topics: BPM - Business Process Management

The Big BPM Project

Roger Tregear Roger Tregear on June 7, 2017

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Many articles have described the essential tools of achieving and sustaining process-based management. The Tregear Circles define the management meta-model that focuses on genuine, targeted, and evidence-based performance improvement. The 7Enablers of BPM describes how process-based management, via the circles, is enabled and embedded.

Of course, it’s not enough to just define the ideal state of two circles and seven enablers. To get to that target state requires a significant transformation project—the Big BPM Project.

Such an undertaking may appear quite daunting at first. It is complex to change the way an organization, its people, and their teams think about who they are, what they do, and how they do it. Thoughtful preparation and careful execution of well-defined work packages make a successful Big BPM transformation project eminently achievable.

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This paper describes a very practical approach to the Big BPM Project. It may be used as a reference model on which to base a specific project design. Figure 1 shows a high-level view, showing how the 7Enablers shape the required set of work packages ‘get the circles turning’, along with the establishment and preparation elements necessary to enable transformation to a mature process-based management operation.

Emphasis is placed on the establishment and preparation phases, since they provide the necessary foundation for other project activities, and are a prerequisite for successful transformation.

This is not a detailed project-management treatment of the Big BPM Project, since that material is readily available from many other sources. Rather, this paper provides commentary on those aspects that are unique or particularly important to the Big BPM Project.

To maximize project efficiency and keep all key stakeholders continually informed about progress and design decisions, having two project teams is recommended.

The development team is the core project team comprised of the people who will work on the Big BPM Project to deliver the work packages and related activities. Additional people, acting as subject matter experts, will be involved from time to time, participating in workshops and other discussions and reviews.

The reference group is comprised of senior managers and executives, the people who will ultimately make decisions regarding the project deliverables. This group is formed are to boost experienced management input, and to facilitate later decision-making and implementation of changes by keeping decision-makers continually briefed and engaged.

How long does it take to complete the Big BPM Project? Assuming the establishment phase to be complete, the rest of the project might take between three and six months. Note that this brings the project to the point where each of the enablers has been activated and related activity is ongoing and becoming commonplace.

Establishment phase[1]

An understandable desire is for immersion in project detail as soon as possible—to start building the architecture, assigning measures, running workshops, and doing the many other activities in the plan. However, to do this too quickly will bring failure. Without shared understanding and commitment at all levels, confusion, division, and apathy are inevitable.

The establishment phase is a vital preliminary step intended to create throughout the stakeholder group, especially at executive levels, a shared understanding of why the Big BPM Project is important, based on compelling reasons reflecting the realities of the organization.

A secondary, yet very important, objective is to assess the organization’s appetites and aptitudes for the prospective operational and cultural changes. Is the organization ready?

The foundational outcomes required for success in the establishment phase are:

  • organizational strategy clearly articulated and widely agreed
  • compelling reasons agreed and documented
  • comprehensive stakeholder analysis completed
  • communications plan, reflecting stakeholder analysis, agreed
  • documentation of decision-making guidelines complete
  • assessment of BPM culture completed and discussed
  • assessment of BPM maturity a completed and discussed
  • agreement to proceed supported by all key stakeholders.

Preparation phase

The preparation phase, possibly taking one to two weeks, is about arranging project logistics, and starting the project. The minutiae of project management are put in place in this phase: scheduling workshops and interviews, booking spaces, creating project libraries etc. Other sessions, workshops, and meetings may also be useful in properly starting the project.

Project work packages

Once the establishment and preparation stages are complete, it’s time to get into details of the work packages that will be the core of the Big BPM Project. The work packages for each of the enablers are discussed below.

For the purposes of description, the work packages are presented in separate and seemingly linear form, but in operation, they are put into effect largely in parallel as shown in Figure 1.

Work package #1: process architecture

Project objectives (WP1 architecture)

In the Big BPM Project, the objectives for the architecture work package are as follows:

  • Create and publish the first levels of the architecture.
  • Develop common understanding of a process architecture.
  • Begin development of maturity in the management and use of process architecture.

Project deliverables (WP1 architecture)

The key deliverables from this work package are:

  • an initial process architecture modeled to three levels of core processes and one level of management and supporting processes
  • short (fifty words maximum) description of each process identified in the architecture to provide information about its intent
  • presentation and communication material for informing and educating stakeholders about the importance and use of the process architecture.

Work package #2: process measurement

Project objectives (WP2 measurement)

The process measurement work package has the following objectives:

  • Assign performance targets to key processes defined in the process architecture.
  • Define how performance data will be collected and reported.
  • Create systems to make evidence-based decisions prioritizing process improvement.
  • Continue to embed process-based management by ensuring that all stakeholders understand the importance of process performance measurement.

Project deliverables (WP2 measurement)

The key deliverables from this work package are:

  • measures and targets assigned to the top two levels of core processes
  • measures and targets assigned to first level of shared management processes
  • measures and targets assigned to first level of shared supporting processes
  • measurement methods identified for all targets
  • where useful, explanatory notes to show reasons for selecting process measures
  • presentation and communication material to inform stakeholders about the importance and use of process measurement.

Work package #3: process governance

Project objectives (WP3 governance)

For the process governance work package, the following are the key objectives:

  • Ensure that active management of cross-functional process performance is based on evidence and assigned roles.
  • Ensure that process improvement deals with both performance anomalies and idea discovery for process change.
  • Take an important step toward enhanced process-based management maturity by bringing together the theory and practice of process architecture and measurement to form a practical management framework.

Project deliverables (WP3 governance)

The key deliverables from this process governance work package are as follows:

  • agreed role descriptions for the process owner
  • process owners appointed to Level 0 core processes, and possibly also to Level 1
  • process owners appointed to the key Level 1 shared management processes
  • process owners appointed to the key Level 1 shared support processes
  • support plans to assist process owners meet their role accountabilities
  • communication material to inform process owners and other stakeholders about the importance and operation of process-governance arrangements.

Work package #4: process change

Project objectives (WP4 change)

The change enabler objectives for the Big BPM Project are as follows:

  • Create an environment where continuous improvement, using a standard methodology, is common practice.
  • Ensure all staff are willing and able to participate in process improvement activities.
  • Create a consistent mechanism for prioritizing processes for analysis.
  • Establish of a way to track the realization of promised benefits.

Project deliverables (WP4 change)

The key deliverables from this work package are:

  • agreed, fully documented process improvement methodology
  • improved project selection prioritization scheme
  • process improvement curriculum and development plans
  • initial process improvement projects
  • communication material, to inform stakeholders about the importance and execution of process change.

Work package #5: process mindset

Project objectives (WP5 mindset)

The mindset work package has these objectives:

  • Embed process thinking in all stakeholders so they understand, and seek to optimize, their roles in process execution.
  • Develop a culture that values process measurement and continually seeks opportunities for improvement and innovation.
  • Engage the organization, its people, and their teams in new ways of thinking about customer service delivery.
  • Enhance widespread understanding of the cross-functional nature of value creation, accumulation, and delivery.
  • Involve all staff in the definition and execution of process improvement aspirations and initiatives.

Project deliverables (WP5 mindset)

The key deliverables from this work package in the Big BPM Project are:

  • comprehensive process change management plan to define and guide communications with all stakeholders
  • an appropriate ‘community of practice’ to support and nurture the process mindset
  • well-defined communication channels with plans for development and maintenance
  • effective system to stimulate and manage process improvement suggestions.

Work package #6: process capability

Project objectives (WP6 capability)

The Big BPM Project has the following objectives for the capability enabler:

  • Ensure all staff can participate in process improvement and management activities.
  • Enhance staff capabilities to deal with change and cross-functional working.
  • Support staff with access to process-based management information and systems.
  • Develop and maintain an accessible body of process knowledge.

Project deliverables (WP6 capability)

The key deliverables from this work package are:

  • documented learning pathways to define and deliver capability development
  • curriculum tailored to match different stakeholder requirements
  • accessible documentation about process methodologies, tools, and techniques
  • knowledge base related to process-based management theory and practice.

Work package #7: process support

Project objectives (WP7 support)

This project work package has the following objectives, to:

  • Improve process-based management capabilities by providing effective support.
  • Support staff in the analysis, improvement, and management of business processes.
  • Ensure compliance with standards and conventions.
  • Support process owners and the process council.
  • Monitor and improve the ‘process of process management’.
  • Enable efficiency and effectiveness in all aspects of process-based management.

Project deliverables (WP7 support)

The key deliverables from this work package are:

  • operational office of BPM providing initial services to the satisfaction of stakeholders
  • documentation describing the services available and how they are accessed
  • performance measures and targets for the operation of key office of BPM processes.

Business better than usual

At the end of the Big BPM Project, a process architecture has been defined and documented, process performance measurement has been established along with related governance mechanisms, and continuous improvement (change) methodologies have been implemented. In so doing, the process mindset and capability of the organization, its people, and their teams have been enhanced, and support facilities have been put in place.

The stage is set for successful ongoing process-based management. Completion of the Big BPM Project marks the start of effective, sustained process-based management.

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[1] This paper provides a high-level overview of the project phases and work packages. For a more detailed treatment see chapter 10 of the book Reimagining Management.

Topics: BPM - Business Process Management

Make Process Ownership Happen in Financial Institutions

Clement Hurpin on May 31, 2017

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Process owners, process steward, process custodians—many words you may have heard thrown around over the past few years. As the concept of process ownership is slowly getting traction across the board, organisations are appointing process owners more frequently than ever, and process ownership is starting to get included in role descriptions.

Why is that? Why do you even need someone to manage a process when it is intrinsically the objective of a company to perform as best it can? Because each individual trying their best to make a company succeed is not sufficient anymore: there is a clear need to layout, measure, and improve processes systematically—and, for that, someone needs to be responsible for those processes.

A wide array of definitions

Let’s start with the necessary step of defining process ownership. Perusing the interwebs provides many definitions of the concept, some with important differences. Let’s take, as a starting point, 6 sigma’s definition, the broadest one identified: “Process owners are responsible for the management of processes within the organisation.”[1]

Process Owners (POs) are responsible to manage processes. What does manage mean? This definition does not say.

Then follows two definitions with conflicting elements, illustrating well the potentially confusing nature of the process owner. On the one hand, the business dictionary defines it as “[a] person who has the ultimate responsibility for the performance of a process in realising its objectives measured by key process indicators, and has the authority and ability to make necessary changes.”[2] On the other hand, we, at Leonardo, think of the role as more of a facilitator, where the process owner is accountable for responding when process performance is outside of the accepted range (or trending in that direction), and when a change of target is appropriate. A seemingly small difference at first, it is a crucial matter when it comes to practical applicability.

Toothless tigers?

As my colleague Roger Tregear wrote in his paper Thoughts on the Conflicted Use of Process Language,[3] “differences in the definition of basic concepts in and around BPM are not just of pedantic or pedagogic interest, they cause a lot of wasted time and create confusion, which handicaps development”. There is a fundamental difference between having ultimate responsibility for a process, and being accountable to respond when your process does not perform as expected.

It boils down to the following: for a PO to be responsible for the performance of the process, he/she would need to:

  • be responsible for the performance of something over which they don’t have complete control of (i.e. in the case of cross-functional processes, one specific person would be responsible for the performance across departments);
  • have ultimate design authority (e.g. change whatever they like), which can be impractical and conceptually hard to sustain at lower levels.

Most companies are not ready to let their POs have such power within the organisation. This is why many choose to define the role as an addition to influence (in this way becoming less of a process owner, but more of a process custodian or steward), not an additional responsibility managers need to be worried about. But such POs can be perceived as ‘toothless tigers’, unable to truly effect change—which is why some organisations can give full responsibility and accountability for process performance to their process owners, the tooth-y tigers, if you will.

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‘Owning’ processes in financial institutions

With banks expecting more mergers and acquisitions around the world, and in Australia,[4] we are starting to see the emergence of many organisations with standardised processes under the leadership of a single-point owner. One of the keys to such an operating model is having process ownership for end-to-end global standard processes, with variations only determined by tax and legal requirements.

Combined with mergers and acquisitions, technological changes have been an important driver of change in Australian banking. The different software solutions used to manage any bank are already being pressured for more agility and reduced costs. However, with an expectation for financial institutions to always deliver more to their clients (in the form of phone apps, and online credit cards or loan applications) legacy systems may have to be radically transformed to provide the expected customer experience. We are not talking about just reducing the cycle time of an application to X weeks, we are talking about reducing it to X clicks. Another big change in the Australian banking technology landscape is, at the time of this writing, the upcoming release of the New Payments Platform (NPP), which is due in the second half of 2017. The new infrastructure will provide Australian businesses and consumers with a fast, versatile, data-rich payments system for making their everyday payments. Payments will be made quickly between financial institutions and their customers’ accounts. The system will enable funds to be accessible almost as soon as payment is received—even when the payer and payee have accounts at different financial institutions.[5] Managing processes just became more complex!

This is why the process ownership concept is becoming very important, as many of main processes of financial institutions are inherently cross-functional. Let’s look at one of the main revenue source for a bank: loans. Loans (be they commercial, personal, home mortgage, or even a small credit card advance) involve all, or almost all, of the organisation. The creation of a new loan type is a strategic decision made with the analysis of the finance department; the promotion of that product is done by marketing, while operations would process applications—and so on. Loans, though, are just one example, as many other core financial sector processes could benefit from process owners: transactions (deposits, withdrawals), financial advisory, foreign exchange, or investments (trading, superannuation).

The separate contributions of those various departments to eventually provide a loan to a customer requires cross-functional oversight. Why? Because localised (meaning inner silo) management and improvement could be done at the expense of the global loans process: marketing will be driven by sales; operations might be driven by cycle time to fulfil a loan request needed to deliver; while finance would aim at cost reductions. To orchestrate such complex process, a process owner is required.

This is becoming more crucial as banking regulators take a lot more interest in end-to-end process views: with different business lines, departments, countries, etc. Providing the right level of transparency to comply with regulations has been getting harder, but managing the risks (and related controls) of such processes has become increasingly complex.

‘Owners’ of intangible processes

It is particularly important, and beneficial, for the financial sector to appoint process owners, as the sector is quite prone (due to a lot of immaterial/intellectual work) to outsource people and non-strategic processes (reconciliation, basic accounting) in functional areas to drive costs lower. This can go beyond the sole operating structure that banks now must manage on top of their subsidiaries. Some products can be designed at the ‘main’ company, but are then packaged and sold through a subsidiary. Who then owns that process? Who ensures that it runs smoothly? Someone needs to be responsible to ensure all the connection points—between departments, physical locations, etc.—are looked after. Through process ownership, appointed key individuals (often C-level executives) are held accountable for building, standardising, and maintaining processes throughout that business’ operating structure.

So how do you make process ownership happen? This is no trivial task, but it does not have to be complex. Here are some tips to make PO happen at high level in banks and other financial institutions:

  1. Establish an infrastructure to ensure top-down support—with an executive sponsor, a cross-functional steering committee, and process owners.
  2. Start by appointing process owners for the first two or three levels of your process architecture, so they can manage the process and respond to the process’ KPIs. You can (and probably should) start small, but always top-down.
  3. After a few cycles and readjustments, propagate the concept to lower levels of the organisation as required. We found that meetings of process owners contributing to same value chain from different departments to be very useful in making process ownership pervasive in any organisation.

Conclusion

Banks are now primed more than ever to undergo a global transformation of governance infrastructure to align processes, people, and technology. They can enable optimisation by eliminating ineffective methods across their business units’ operating models.

With processes—and their governance through process owners—banks and other financial organisations can manage critical processes across departments, service centres, entities, or physical locations—ensuring connections points, and overall performance, are managed and improved.


[1] https://www.isixsigma.com/implementation/change-management-implementation/process-ownership-vital-role-six-sigma-success/
[2] http://www.businessdictionary.com/definition/process-owner.html
[3] http://blog.leonardo.com.au/thoughts-on-the-conflicted-use-of-process-language
[4] https://www2.deloitte.com/au/en/pages/financial-services/articles/financial-services-ma-predictions-2017.html
[5] http://www.apca.com.au/about-payments/future-of-payments/new-payments-platform-phases-1-2

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Topics: BPM - Business Process Management

Value Delivery is a Two-Way-Street

Roger Tregear Roger Tregear on May 24, 2017

Value Delivery Exchane.pngReaders in parts of the world where Christmas is celebrated (or is that selleberated!) well understand the rituals of giving and receiving. Santa Clause is checking inventory, supply chain managers are frantic, the transport pool is making final adjustments, and the naughty/nice lists are being debated and finalized. In other parts of the world, readers have their own celebration and remembrance festivals through the year. The giving and receiving of gifts, goodwill and grace are important parts of our lives.

This has me thinking, inevitably, about processes. Yes, I know – sad, but true!

It is common to say that business processes are the conduits through which every organization delivers value to its customers and other stakeholders. Therefore, business processes need to be thoughtfully managed and continuously improved to maintain an unimpeded flow of value. Many readers will agree that this is the essential premise of Business Process Management, the touchstone on which all other related process-centric management, governance, measurement and technology initiatives rely.

However, this is not complete. This view of a one-way flow of value is a distortion of what actually happens. It is not enough to deliver value, we must always exchange value. Of course, every organization exists to deliver some form of value proposition to customers and other stakeholders and we see these documented in Mission, Vision or other statements of strategic intent. Business processes are the pathways through which we execute that intent. But it’s not a one-way street. Organizations, at least the successful ones, deliver value and they must also be receiving value in return. Organizations are not infinite value generators, content to stream out value endlessly and for no purpose. There must be a return path.

Without adequate return, the operation cannot be sustained.

I have spoken previously of 'Balanced Process Management'. In that article I made the point that:

Satisfying, indeed delighting, external customers is vital but it’s not the complete picture. We must look at the whole process. It is a great idea to start at the external customer end of a value chain, but it would be dumb to stop there.

For a commercial organization, the exchange is easier to define. In the private sector, the most obvious exchange is that goods and services go to the customer and money comes in return. Value, as perceived by the customer, might go beyond the actual product or service. There may be some prestige, personal satisfaction, aspirational or lifestyle element to the value proposition. In the other direction, a high performance exchange will return more than just the payment. We want the customer to be a fan, to be so pleased with the exchange they tell their world about it. If there are any problems, we would also like to get that feedback so we can ensure it doesn’t happen again. In many circumstances we would also hope to have repeat business from the customer based on earlier experiences. So goods and services, aspirational and lifestyle fulfillment are delivered to the customer and we want payment, references, feedback and repeat business from the customer. Two-way streets must be managed in both directions.

The exchange is sometimes a little less obvious and direct in the public sector, but it still happens. Government Process Management (GPM) has important differences to Business Process management (BPM). An “operational” government agency, such as one that regulates the use of cars on our roads, provides a range of services: safety, security, vehicle identification, and contribution to road maintenance funding, for example. In the other direction, car owners provide money and information. In some areas of government, the key output is policy and the process value exchange involves more abstract issues related to the “public good”. In the Not For Profit sector there are similar elements for some processes.

Whatever the organization, whatever the process, it is important to have a balanced view about the two-way flow of value. It’s not just about the Customer Value Proposition; we should also define the Process Value Proposition. For each process we are analyzing, we need to define the value that should be received by the process. What do we need from our customers and other stakeholders, how much, how often? Who are the best performing customers? Not every organization has a choice about its customers; only some have the ability to “sack” a customer. In every case though, we should have a clear understanding about which customer/stakeholder groups need the most management and attention. These are issues about which we should have clear and measurable objectives.

What do you know about your customers’ processes? Some outputs of their processes will be coming to you as inputs? The companion to the process Receive Order is Place Order. Perhaps we too often focus on the first and forget the second.

The familiar adage says it is better to give, than to receive. For our processes, we should be saying it is best to give and receive. It’s the Santa clause.

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Topics: BPM - Business Process Management

Think First - Mindset then Toolset

Roger Tregear Roger Tregear on May 17, 2017

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From many personal experiences, positive and negative, of encouraging organizations and their teams and people with the idea of process-based management, I offer some thoughts in this article about one very important aspect – it’s a mind game, not tool time.

The achievement of effective, sustained process-based management is 90% mindset and 10% toolset. High levels of BPM maturity can only be achieved and maintained if the correct conceptual framework is in play.

Too often we are focused on the 10%, at the expense of the 90%. The tools and techniques are critically important, but they are not the main game. Having the right IT and other tools is a necessary, but nowhere near sufficient, condition for success.

Making the idea of BPM resonate within an organization requires deep engagement with the key challenges of contemporary management. If you don’t ‘think process’, you won’t ‘do process’. The likelihood that organizations, teams or individuals will adopt process-centric approaches to management depends on what they think will happen if they do.

Process-based management must give positive support to the achievement of organizational objectives if it is to have any value. Success is not measured in the number of models drawn, the cleverness of the process architecture, the number of process measures, the documentation of methodologies, or the sophistication of the automation. Success can only be claimed if organizational performance has been improved, and demonstrably so, as a result of taking a process view.

People will only buy-in to the idea of BPM if they can see that it is likely to solve some clear and present difficulty in a pragmatic, cost-effective, and sustainable way. When pitching the idea of BPM, we need to be thinking about As Is / To Be changes, not in processes, but in mindsets.

About now you might be tempted to suggest “Well, D’oh. Of course! That’s obvious”. Well, we might assert that it should be like that, but the evidence says that we have a long way to go.

In the BPTrends report, The State of Business Process Management 2016[1], it is reported that only 24% of respondents said that “their executives regarded BPM as a major strategic commitment.”[2] Another disturbing survey result says that in 74% of cases, managers were never, or only occasionally, “trained to analyze, design, and manage business processes”[3]. Even more worrying is the analysis showing that 73% of respondents said their process managers never, or only occasionally, “use performance data to manage their processes”[4]. There’s another way of doing that?

This suggests that we are a long way from having an effective process mindset in many organizations.

As always, to be sure we are talking about the same thing, I summarize my understanding of the BPM management philosophy as follows:

Business processes are the collections of cross-functional activities that deliver value to an organization’s external customers and other stakeholders. They are the only way that any organization can deliver such value. Individual organizational functional areas cannot, by themselves, deliver value to external customers. It follows that an organization executes its strategic intent via its business processes. Business processes are the conduits through which value is exchanged between customers and the organization. Therefore, business processes need to be thoughtfully managed and continuously improved to maintain an unimpeded flow of value between the organization and its customers and other stakeholders.

To achieve this outcome, we must start with the mindset, not the toolset.

It’s all in the mind

Minds are often hard to change, but it can be done. Once changed, minds are likely to stay changed for the same reason. Although the idea of having to do more than an impressive technology demonstration, might be daunting, it can also be reassuring. We have all seen, perhaps given, cool technical demonstrations that were exciting for an hour, and changed very little. Forget about the tools. No business has a problem called “we don’t have enough software”.

“What’s the problem we are trying to fix?” That’s the question, and the answer needs to be framed in terms of a mindset of real strategic, operational or tactical improvements if process-based management is to resonate with the gatekeepers.

Modeling mindsets

Different audiences have different mindsets, and require different messages. To understand the differences we should ‘model’ the mindsets. What are the key players really thinking? What are their current management challenges? Which of the process messages are they most likely to find attractive? What mindsets do they need to have individually and collectively to achieve high(er) levels of BPM maturity?

What do we need to do to close the gap from current to target mindset – a familiar As Is / To Be / To Do cycle.

Getting minds around “continuous”

Everyone signs up for “continuous improvement”. Great idea, why wouldn’t we go for that? Well, we also need to get our minds around the certainty that “continuous improvement” also means continuous measurement, change, challenge, activity and organizational friction.

Well worth doing, but what looks obvious and desirable on the poster, can sometimes prove to be quite difficult to endure in the live workplace. It requires an uncommon openness, a different way of thinking about daily workplace operations, relationships, fears and motivations.

Mind the gap

To improve a process, we need to find a gap between what is and what might be. In theory, we want to find big gaps so we can make big improvements. However, I regularly meet people who worry that openly “admitting” to a significant process improvement will be seen as a past failure rather than an ongoing success. They can see cost-effective ways to improve a process significantly, clearly a good thing to do, but the same mind that approves the change, has to acknowledge the newly discovered, but perhaps long unobserved, problem or opportunity.

What’s the mindset at your place of work? Imagine that a process is found to have been costing, for the last five years, a million dollars a year more than it needed to. Would that be seen to be a sackable offense, or a cause for celebration and congratulation? If you managed large parts of that process, would you be elated or nervous in announcing that bit of continuous improvement?

In Conclusion

We might argue that the mindset/toolset emphasis is 80/20 rather than 90/10, you might even convince me it’s 70/30, but it’s certainly not the reverse of any of those. To create a viral spread of the idea of BPM, tools and techniques alone won’t do it. We also need hearts and minds.


[1] Harmon, Paul. “The State of Business Process Management 2016”. Accessed May 18, 2013. http://www.bptrends.com/bpt/wp-content/uploads/2015-BPT-Survey-Report.pdf
[2] Ibid., p 12
[3] Ibid., p 18
[4] Ibid., p 20

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Topics: BPM - Business Process Management