Through the fog... Getting your business processes finely tuned

There are way too many three-letter acronyms (TLAs) in the world of IT but that's not to say they can be ignored. This week Quocirca senior analyst Clive Longbottom guides us through the maze that is getting business processes right...

It seems that every vendor out there has now decided that it is, in one way or another, a major business process management (BPM) company. No matter whether you are approached by a systems integrator (for example a CSC or IBM GS), a workflow vendor (a Staffware or FileNet), an EAI vendor (a Tibco or WebMethods) or a BPM company (a Metastorm or PegaSystems), you get a common message as to how they (and only they) can propel your business into the pre-eminent market position through managing your processes for you.

Alright, so a proportion of the message will be true – but there will be the normal amount of drivel spouted as well. We do all have processes but not all processes are equal. If we start at the bottom, we can see that there are a set of business processes which are essentially common to the overwhelming majority of businesses out there – payroll, bookkeeping and so on – that are essentially best to outsource, so let's bring in our first TLA of BPO (Business Process Outsourcing).

Within a specific vertical, there will be common processes that need to be followed – for example, the financial markets will have a high degree of processes to do with the FSA, whereas the pharmaceutical industry will have a set of processes to do with COSHH and so on. Here, we come up against our first TLA problem – these are also prime candidates for BPO – but here, we are looking at business process optimisation (BPO), enabling us to do these 'hygiene' factor processes as cleanly and as rapidly as possible to get them out of the way and allow us to concentrate on what we should be doing – which is core business competencies.

Now, the processes that underlie our core competencies define how successful we can be – and here is where we have to bring back that 1980s horror of BPR – business process re-engineering (BPR) – which was misunderstood by the majority of end users and mis-sold by all the practitioners. To successfully change, implement and utilise BP changes within our organisation, what should we do? Well, get the TLA dictionaries ready and here we go:

Stage 1: BPD1 – Business Process Discovery We need to start with actually finding out what processes are actually being used – and you won't find this already on any computer, never mind written down anywhere. The majority of business processes are carried out almost as second nature, are highly person-centric and can take an age to actually uncover properly. In this stage, the job is just for someone to go around and try to identify the business processes themselves – not to write down what actually happens but just what the aim of the process is.

Stage 2: BPP – Business Process Prioritisation After Stage 1, we probably have a list of a few thousand business processes – not a good number to work with to try and model successfully. Therefore there will need to be a high degree of weeding carried out – we would recommend that this is carried out by one person within the organisation – don't try to discuss things too much at this stage.

Stage 3: BPM1 – Business Process Modelling Now we have the top 10 (say) processes that we will be working with and we now need to model them. This is where the fun really starts – trying to find all the links that matter in a process. At this stage, it's better to be generous – put in the link that says "Joe/Jo deals with this – we don't know what they do but it always happens…"

Stage 4: BPD2 – Business Process Discussion Get a representative group together for each of the processes and sit down and get ready for the fireworks. Why does this process occur? What is the real aim of the process? Why is this link in? Lots of ideas as to how the process can be changed will be brought forth – capture these but at this stage we are looking for bottoming out whether the process is necessary and how we can improve the efficiency of the process, not the effectiveness.

Stage 5: BPR1 – Business Process Re-engineering Now we have to understand the difference between efficiency and effectiveness. Being able to do 100 items of work where 50 were done before – whether the items were done correctly or not – is efficiency. Being able to do 100 items of work where we have a 1 per cent error rate against doing 120 with a 10 per cent error rate is effectiveness. BPR looks at how a process should be carried out for the maximum effectiveness, without any boundaries of cost, time, resource and so on. It's ivory tower, blue sky, pie-in-the-sky dreamland stuff – but it works. However, you need the right people, you need open minds and you must not get this confused with optimisation.

Stage 6: BPO1 – Business Process Optimisation (First Pass) With all of the information we now have, we have the capability to look at how we can optimise a process to ensure that we have the optimal mix of efficiency and effectiveness – and now we are reaching the point where real market differentiation is possible. At this stage, we can make decisions on whether the process is outsourced and this decision can help to free up effort for managing the 'unique' processes we have - the ones that keep us at the forefront of our market.

Note that we are now half way through the overall BPx process – and we haven't majored on any technology yet. Business processes are part of the business – and, as such, the major part of any BP project will involve working with people to manage expectations, uncover processes and to decide whether the process is valid and how it should be done in the future. As with all technologies, BPx technologies are a facilitator – they cannot solve the process problem for you.

Stage 7: BPTI - Business Process Technology Identification Now we reach the techie bits – we have to choose the technologies we want to manage, measure, analyse and report on the processes we automate, and we need to identify the technologies we need to bring in to enable the automation of the process itself.

Stage 8: BPI1 – Business Process Implementation Having identified the technologies involved, we need to implement the BPx engines, as well as the ancillary technologies on which the processes will now run. We need to glue everything together – whether this be through web services, EAI or other means – and we need to ensure that this is all kept flexible, and that the humans are still involved where they need to be, primarily where exceptions to the process occur.

Stage 9: BPM2 – Business Process Management We need to be able to manage the process. In today's markets, windows of opportunity are short, and we need to be able to change the processes rapidly, securely and for specific groups. The BPx engine must have this capability to enable us to evolve with the market.

Stage 10: BPA1 – Business Process Auditing We need to know what is happening within a process – what paths people, transactions, messages and so on take and we must be able to recall this information, both for commercial and legal reasons.

Stage 11: BPA2 – Business Process Analysis With all of the information we gather on the processes, we then need to be able to look at what was really happening, and so build up pictures of trends, of best practices and so on.

Stage 12: BPR2 – Business Process Reporting Now we can send reports into the business – what have these processes led to as far as marketing is concerned, what has the impact been on sales, do we need to change the product and so on?

Stage 13: BPO2 – Business process Optimisation (Second Pass) It will be rare, even with all the work we have done so far, to get it right first time, every time and for the process then to remain static. We need to re-introduce optimisation at this stage so that we keep the process clean and reflecting the company's needs.

Stage 14: BPI2 – Business Process Iteration And so, finally, we're back to the beginning – well not quite, as we don't then go back to the discovery stage for processes we have already mapped and automated. From here, we would generally go back to Stage 7 – but we should also then identify the next 10 process in the priority list, so we should always have 10 or so processes going through stages 1-7…

And as for the rest of the alphabet, we shouldn't forget BPA (Business Process Automation), BPB (Business Process Baselining), BPC (Business Process Connectors). The list goes on but I can't – but I'll keep working on the authoritative BPx dictionary – watch this space…

**Quocirca is a leading, user-facing analyst house known for its focus on the 'big picture'. For a full summary of its activities see www.quocirca.com, or reach the company's founding directors by emailing quocirca@silicon.com.

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For Quocirca's 'What's the fuss about...?' series for silicon.com, see this page

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