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Myron Bennett of 10 October 11

BPM Analysis Table of Contents

Abstract ...................................................................................................................... 2

Purpose .................................................................................................................. 2

Methodology ........................................................................................................... 2

Limitations .............................................................................................................. 2

Findings .................................................................................................................. 2

Introduction ................................................................................................................ 2

Case Study ................................................................................................................. 3

Steps Taken ........................................................................................................... 3

Benefits ................................................................................................................... 4

Recommendations .................................................................................................. 4

References ................................................................................................................. 5

Bibliography ............................................................................................................... 5

Appendix A ................................................................................................................. 6

Pulte Mortgage ....................................................................................................... 6

Loral Skynet ............................................................................................................ 7

District of Columbia Municipal Government ............................................................ 8

John Colbert, VP of research and analysis, BPM Partners In. ................................ 9

Appendix B ............................................................................................................... 10




Abstract

Purpose

The purpose of this paper is to gain an appreciation for what is required to implement

BPM. It should be understood how BPM has previously been implemented by

companies in the past. Concurrently, it should be learnt what mistakes have been

made. Finally, a proposal will be put together of how best to implement BPM by both;

applying common success factors and avoiding mistakes made in the past, from the

research conducted.

Methodology

Case studies and journals were examined that it was believed would give an insight

into BPM implementation. Diagrams were produced to represent the steps taken by

the business mentioned in each case. A comparison was done on the most relevant

material with a view to extracting the most common success factors.

Limitations

This paper cannot be considered to be comprehensive of exploring all the necessary

stages to carry out a successful (or otherwise) BPM implementation. It discusses key

success factors and identifies problematic areas but does not claim to explain the full

lifecycle. The suggestions in this paper may be used to supplement a BPM

implementation but it cannot be used alone.

Findings

The most prevalent success factor to come out of this was that of necessarymanagement buy-in. Whilst it is difficult to be confident of the sequence of actions

that are taken to implement BPM, a good understanding has been gained of what is

required.

Introduction

BPM has been reported to have failure rates of up to 60-80%. “Several papers [have]

tried to identify critical success factors („CSF‟) of BPM” (Trkman 2009). Although

there may be some sense in looking at previous BPM projects, it‟s not advisable to

“apply a blanket rule to BPM implementation” states John Colbert for Insurance

Networking News journal (Violino 2011) because "you have to look at each

opportunity separately, evaluate the existing processes and then determine where

the opportunities for improvement exist." “Jim Sinur, vice president at Gartner, notes

that…there are no…best practices for BPM” and that “training, incentives, and

methodologies, are increasingly what make or break BPM projects.” (Margulius

2005). That said, there are broad contributors that are usually considered

fundamental to BPM. The most prevalent of these is endorsement from top

management.




Case Study

Cases were looked at from three companies implementing BPM: Pulte Mortgage,

Loral Skynet, District of Colombia Mucipial Government (referred to as Colombia

Gov. hereafter), Meadowbrook Insurance Group and Farmers Insurance Group. The

latter two are taken from a journal which concentrates on the business areas andpositive successes of implementation (Violino 2011). Flowcharts have been drawn

up from descriptions of the first three as a speculation into the steps that were taken

prior to and as a part of implementation. (Margulius 2005). These can be found in

Appendix A.

Steps Taken

“Buy-in from top management” is one of the first steps reported in the case of Pulte

and this is backed up by the claim that “top management is often considered to be

the most important” (Trkman 2009). A BPM specialist (regardless of whether they

are from within the business or are contracted) will struggle to achieve uptakewithout strong support from top management. Decisions about funding will invariably

come from them but more importantly, staff directly involved in the processes will not

be enthused until direction is witnessed coming from the top. With this in place,

uptake will be easier to encourage. “BPM-systems…should preferably be initiated by

top management” adds strength to this point (Ravesteyn and Batenburg 2010).

The current business process were identified and documented. This is not usually

something that would be done by management as their perception of real activities is

rarely detailed. Also it will be a time-intensive process requiring detailed analysis. A

systems analyst may be able to direct the process but the best people to document

the core and detailed business processes are the operational members (employees).

Not only is it they who know the processes best but it involves the whole enterprise

from the outset. Ultimately when changes come in they will be more meaningful to

those that had a hand in the process that led to those changes. "We don't force

processes on people from the top down – everybody needs to feel like they're a co-

creator of the process." (Charles Bihler, process manager, Loral Skynet). It‟s this

active involvement of anyone whom subsequent changes are likely to affect which

seems fundamental to raising confidence levels as Trkman confirms. “BPM

challenges span from organizational, managerial, information systems and evensocial problems.” (Trkman 2009). Sanford Lazar, director of ERP at Colombia Gov. is

also reported to have said “It‟s about overcoming the scepticism” (Margulius 2005).

Once comprehensively mapped, the business area(s) in need of efficiency changes

are highlighted. There is then a subsequent selection of small area on which to begin

with implementation. “The primary challenge with any BPM effort is determining the

right functional area on which to focus and, within that area, picking the right project

to start with.” (Violino 2011). "Typically, you want to start small and build up from

there," says James Lee, IT manager at Southfield, Mich.-based Meadowbrook

Insurance Group. However it isn‟t always possible to follow a set of rules.




"Unfortunately, due to business needs, we had to tackle a fairly large project early on

in our BPM efforts" James continued. This goes back to John Colbert‟s statement

about not applying a “blanket rule” in that it is more important to tailor the methods of

analysis and implementation to the strategic stance of the organisation at the time.

There has been mention about the strategy of implementation and again this

appears to be subjective to the state of the business. “How can they best implement

BPM so that they gain the maximum payback? Additionally, when and where should

they apply BPM?” (Violino 2011). “effective organisations … not only have a proper

„fit‟ with the environment but also between its subsystems” (Ivari 1992). This is

perhaps why Paul Burger, director of commercial IT at Farmers, is reported to have

claimed that it‟s better to apply BPM technology “in tandem with a core system

refresh” despite actually applying it to existing processes (Violino 2011).

BenefitsProminent benefits of BPM can come in the form of increased sales, reduced

processing time, reduced staff time and more efficient data accessibility.

An online retailer is reported to have “45 percent in conversions, 20 percent in

revenue per visit, 50 percent in orders per visit and 100 percent in units bought per

visit” as a result of Mercado Software (KM world 2007).

Apparently Farmers Insurance have been able to “reduce the time agents and

underwriters spend processing commercial lines from 14 days to just 14 minutes”

according to a quote of Paul Burger. An agent “also can provide an umbrella quote.

This has resulted in increased sales” continues Burger (Violino 2011).

Recommendations

Extracting common factors from the cases studied and taking note of where

difficulties came about has resulted in the development of a suggested approach that

Special Metal Stamps should take to BPM. This can be found in Appendix B.

Specifically, BPM should not be treated as a set of rules by which to improve a

business‟s processes. Similarly, “many problems are related to the evolution of

business processes and their variability. This means that BPM is not a one-time

project but should be a continuous effort.” (Violino 2011).




References

AL-MUDIMIGH, Abdullah S. (2007). The role and impact of business process

management in enterprise systems implementation. Business Process Management ,

13 (6), 866.

IVARI, J. (1992). The organizational fit of information systems. Information Systems

Journal , 2 (1), 3-29.

KM WORLD (2007). Online retailer reaps results. KM world , 16 (1), 6.

MARGULIUS, David L (2005). Real-Worid BPM Formulas. InfoWorld , 27 (26), 41.

RAVESTEYN, Pascal and BATENBURG, Ronald (2010). Surveying the critical

success factors of BPM-systems implementation. Business Process Management

Journal , 13 (6), 492.

TRKMAN, Peter (2009). The critical success factors of business process

management. International Journal of Information Management , 30, 125-134.

VIOLINO, Bob (2011). BPM- Where When & How: Business process management is

helping insurers transform new and existing operations for the better. What's the trick?

Insurance Networking News , 14 (1), 12.

BibliographyABDOLVAND, N, ALBADVI, N and FERDOWSI, Z (2008). Assessing readiness for

business process reengineering. Business Process Management Journal , 14 (4),

497 –511.

KARIM, J., SOMERS, T.M. and BHATTACHERJEE, A. (2007). The impact of ERP

implementation on business process outcomes: A factor-based study. Journal of

Management Information Systems , 24 (1), 101-134.

KASSA, Kelley (2009). Interview with John Colbert of BPM Partners on Business

Intelligence Projects. [online]. Last accessed 02 11 2009 at:http://spotfireblog.tibco.com/?p=930

MACINTOSH, R. and MACLEAN, D. (1999). Conditioned emergence: A dissipative

structures approach to transformation. Strategic Management Journal , 20 (4), 297-

316.

http://spotfireblog.tibco.com/?p=930






Appendix A

Pulte Mortgage

Figure 1 - Pulte Mortgage - BPM Implementation

(Margulius 2005)




Loral Skynet

Figure 2 - Loral Skynet - BPM Implementation

(Margulius 2005)




District of Columbia Municipal Government

Figure 3 - District of Columbia Municipal Government - BPM Implementation

(Margulius 2005)




John Colbert, VP of research and analysis, BPM Partners In.

Figure 4 - John Colbert - BPM Implementation

(Violino 2011)




Appendix B

Figure 5 Suggested BPM Implementation Strategy

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