Business Process Management (BPM) is a powerful management discipline for driving efficiency and innovation, as well as achieving strategic imperatives. However, BPM as it has been practiced up to now has failed to reach its potential and support strategy execution.
Although senior management teams have developed powerful sets of tools to focus on processes, most of these tools do not focus on affecting business outcomes or how value is created and destroyed within the business.
By focusing on creating or adding value, BPM can help senior management teams better (1) align execution with strategy (2) focus efforts on the most important problems (3) increase transparency in the most important areas of the business and (4) improve agility in adapting to new market conditions. This value-driven approach results in the organization making immediate and lasting improvements that deliver sustainable value because strategy is translated into execution via the organization’s processes.
The modern business world is increasingly becoming complex and more risk-prone. Population growth, changes in technology, challenges in energy markets, environmental concerns, health and terrorism risks, uncertain financial markets and globalization are all posing a challenge on strategy management and execution. For example, the way and rate at which technology is evolving is making it difficult for management to align IT with business. An organization that is process-centric and committed to value-creation is able to evaluate with precision the role of current and new technology needed to improve specific processes.
In order to improve enterprise performance by driving operational excellence and business agility, organizations should treat their business processes as invaluable enterprise assets and develop a process-centric culture. To develop this process-centric culture, senior management must:
- Develop new way of thinking: Adopting value-driven business process management goes beyond just putting in place tools, techniques, content and a repository. It is about fundamental business transformation; changing the way people think about processes and making people explicitly responsible for processes. Management must develop a shared awareness about how processes organize the way things are done and help the organization react to problems.
- Support BPM initiatives: The conversation of BPM must move to a higher, more strategic level. The focus must be first on value and outcomes, then on the linkages between the organization’s strategic imperatives and its processes. Without full support from senior management, most BPM activities focus on wrong things and tend to be just like any other activity-based programs.
- Apply BPM to every part of the organization: A value-driven approach will bring Finance, Accounting, HR, Marketing and other mature management practices to work together, focus on the details and big picture as well as provide a point of view about how a specific area of the organization should function. In a process-centric culture, people should not just focus on their own tasks and talk about what they do. They must also talk about the impact their tasks will have on other people involved in the process.
- Establish a BPM unit: To ensure a lasting impact and to create a process-centric culture, management must establish a value-driven BPM unit. This unit must own BPM initiatives and improvements, at the same time be devoted to promoting the effective use of value-driven BPM throughout the organization. Just as the HR department helps the rest of the company manage personnel and related issues or the Finance department provides a set of budgeting and accounting practices, a process for making capital allocation request and mechanisms to spend and allocate money; the BPM unit will help the rest of the organization deal with all aspects of process management.
Closing Thoughts: Creating a process-centric culture is never something that happens overnight. Gradual changes have to happen at each step forward and other aspects of the organization need to change to support the practice and make it a permanent part of the way your organization functions.