Business Process Management Goes Social
OK, the economy has fallen apart. Along the way, however, information technology has also reached a breaking point of complexity and inflexibility. Many organizations are taking an "enough is enough" approach to technology that threatens the notion of business as usual.
Information technology is radically being "aligned" to the business. This means technology that's faster, more agile, more flexible and, yes, more comprehensible. The most common way to achieve these advances is through coarsely grained business services that can be chained into business processes.
How Information Technology Evolved
Over the course of many decades, the business side has consistently abused the technology side, to the point that technology is now often portrayed as the villain. Essentially we must look at enterprise technology as an evolved information system — much like the human brain — one that evolves in discrete layers, each slabbed over the previous one.
The differing architectures of each layer has made maneuvering difficult. Business logic is scattered and trapped into many layers, and nobody really understands how all the systems work.
One of the biggest drivers of complexity in technology today is consolidation. As companies merge in the downturn, heterogeneity is the result — and a mass of competing interests arise that add to the difficulty of resolving the overall dilemma.
Many services-oriented architecture (SOA) efforts have to do with managing the resulting cost and complexity of variation that this evolution has produced.
Slabs, Silos, and Spaghetti
In my free e-book, SOA Adoption for Dummies, I talk about the complexity and redundancy of technology functions in terms of
- Slabs — historical layers of legacy technology;
- Silos — capabilities trapped by historical ownership domains; and
- Spaghetti — point-to-point, tightly coupled application integrations.
These are the patterns through which complexity evolves in the enterprise.
How Business Evolved
Business is pretty straightforward. Although business is subject to competition (the biggest driver of variation and complexity), much like nature, there are certain forms that seem to be very successful.
One such creature that seems to have established evolutionary success within its niche is the shark, the basic design of which hasn't changed in many millions of years. What can we say about sharks? They are constantly moving forward, food goes in one end and out the other (really not so different from many animals), and they assume a very hydrodynamic "streamlined" form.
Similarly, certain basic rules apply to the industrial corporation, although there are many "species."
All businesses must "eat" revenue, and they procure revenue through sales by managing customer relationships. By automating these processes (sales force automation), organizations achieve scale and predictability in managing their opportunity operations. Once a customer is "eaten," revenue recognition goes through a fulfillment process that is equivalent to a shark digesting its food. This is sometimes called the order-to-cash process.
In order to fulfill commitments, businesses assemble raw materials into completed products and services. Some of those raw materials include talent (the human resources onboarding process) as well as parts (supply chain management's procure-to-payment process). Of course in modern businesses, "parts" and "supplies" can be purely digital or a hybrid between digital and hard assets. Public companies manage processes such as investor relations and treasury management that manage the boundary between company stock, currencies, debt, and equities.
Processes are where the technology rubber meets the business road.
Historians will be able to trace the roots of business process management (BPM) back to the emergence of Toyota after World War II, with the automaker's development of its "Kaizen" philosophy that centered on 360-degree continuous process improvement.
Kaizen depends on everyone in the company collaborating to make sure that processes improve every day. Everyone — from the guy who sweeps the factory floor to the chief executive officer — each play a part in Kaizen to share observations and incorporate them into the optimal process.
Enter: Social BPM
Kaizen is already Social BPM — a term made exciting by the fact that, much like progress in computerizing BPM since World War II, Social BPM puts the collaboration technology in the cloud, where it belongs.
The big issue with the field known as process optimization is that there is immediately an argument about how you define "optimal process." Many of the high-value business processes mentioned above naturally touch many different siloed organizations. Because of this, each silo has its own perception of what an optimal process would look like. By locating the early stages of process models in the cloud, many different stakeholders can provide critical early input into the feasibility of any process improvement.
A social BPM utility in the cloud lowers the cost of collaboration across silos both inside and outside of the enterprise, both on- and off-premises. The ability to provide 360-degree input into process optimization takes the Japanese Kaizen model of continuous process improvement and enables groups separated by geography, platform, business unit, company, customer relationship, supplier relationship, regulatory relationship, stage of technology life cycle, or any other classification to join together to optimize processes — the goal being to define globally optimized processes that work for all stakeholders.
This dramatically improves the chances of project success.
About the Author
As Software AG's vice president and deputy CTO, Miko Matsumura is responsible for the company's technology strategy. His 12 years of experience in enterprise software and middleware technologies include positions as vice president of SOA product marketing at webMethods; vice president of worldwide marketing at Infravio; and chief Java evangelist at Sun Microsystems. Matsumura is also the founder and organizer of the SOA Link Interoperability Initiative, and the author of SOA Adoption for Dummies (Wiley). In addition, Matsumura — who has an MBA from San Francisco State University and a master’s degree in neuroscience from Yale University — has worked extensively with software start-up companies, raising more than $12 million in capital for Java start-ups. His blog can be found at www.SOACenter.com.
Software AG is the world’s largest independent provider of business infrastructure software. The company’s 4,000 global enterprise customers achieve business results faster by modernizing, integrating, and automating their technology systems and processes. With almost 40 years of global IT experience, Software AG has over 3,600 employees serving customers in 70 countries.
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For the rest of the June 2009 issue of CRM magazine — The Social Media Issue — please click here.