Brainwaves, the official e-newsletter of the Business Performance Management (BPM) Forum, is distributed quarterly to Forum members, content requestors, and e-newsletter subscribers. Our objectives for Brainwaves are to provide relevant information, stimulate new ideas, and help improve your decision-making regarding business performance management initiatives, strategies and execution. Let us know how we can improve this publication to help you achieve your goals. Enjoy.

By the way, if you’re not already a member of the BPM Forum, submit your nomination for free right now: http://www.bpmforum.org/nomination.htm

Let me start, though, by making a simple point about acronyms –those abbreviations we often use to understand, distinguish and communicate complex subjects, airports, company names, etc. While acronyms are certainly useful, there is always room for confusion caused by overlap.

For example UPS (United Parcel Service) and UPS ( uninterruptible power supply) are the same three characters but have two very different meanings. One UPS is the world’s largest package delivery company. The other is an industry standard reference to a large battery used to power a computer when electricity is unexpectedly turned off. The differences are a no-brainer.

However, let’s consider BPM (business performance management) and BPM (business process management). These two acronyms are relatively new, referenced in the same industry context, and have close relationships in terms of business/IT synergy and results, and are causing some confusion for people who tend to think and communicate with acronyms. Here’s a little advice if you sometimes find yourself questioning B P M (performance) and B P M (process):

Get used to the fact that there is more than one meaning for “BPM” and there is a significant relationship between business performance management and business process management.

To this point, Dr. Ash Rofail, President and Chief Technology Officer of Santéon, touches on some of the synergies and relationships between BPM and BPM in his Member Mindset article, Process Lens: The Business Performance Management Game Has Its Rules Tool. Meanwhile, Dr. Thomas J. Buckholtz, a business and executive coach, weighs in on some of the change management challenges of implementing Business Performance Management in his article, People Lens: Optimize Employees’ Support For Your Business Performance Management Initiative.

Before you dig into this issue of Brainwaves, please take a moment to answer the question below in our new BPM Pulse Poll. You’ll see immediate results in your web browser. Then read, think about, and share this issue of Brainwaves with your colleagues.

We try to provide information that is helpful for BPM Forum members and influencers who care about advancing performance accountability in large organizations. If you would like to contribute to Brainwaves – kindly email us your ideas and suggestions.

Regards,

Erick Mott
Editor
www.bpmforum.org

The competitive landscape in technology and telecommunications has changed dramatically in the first decade of the 21st Century, but U.S. executives may not be taking all the right steps to keep pace with the changes. Those are among top-level findings in a new report entitled, "Crunch Time: Global Competitiveness Audit," which is now available for you to download.

The full report is based on a survey of more than 300 executives conducted in late 2004 and early 2005. One important insight coming out of this study is the need for U.S. companies to do more to formally assess and monitor their competitiveness on a company-wide level. This successful research effort was sponsored by BPM Forum in concert with the global management consulting firm, A.T. Kearney. Download the full report (free)

Software Economics Council (SECO): Software in the enterprise has become the essential, common thread that automates and accelerates modern business processes across operations and geographies including, for example, communications, finance, supply chain management, sales and customer service. Today’s enterprise systems decision makers –organizations that invest billions of dollars annually in infrastructure and application software development and deployment –are very concerned about enterprise software quality, integration, lifecycle management costs, value and performance issues. Learn more about the SECO. 

Process Lens: The Business Performance Management Game Has Its Rules Tool

By Dr. Ash Rofail

Any business performance management (BPM) expert will likely tell you that maximizing process efficiencies within and outside organizational boundaries – and helping to facilitate rapid changes in business rules and operations – is necessary for sustaining a high-performing, agile and competitive organization. The linkage between business performance and process management is indisputable. Why? Organizations are becoming more automated with IT systems that replace human-managed tasks with electronic transactions and services. Instead of people making decisions and completing tasks, systems are assuming more responsibility for managing, measuring, and reporting processes that operate with pre-defined rules accessible in the background.

Integrated systems across internal and external functions permit today’s organizations, of all sizes and complexity, to rethink what rules should apply, and how to best automate operations to lower costs and improve business performance. Case in point, the State of Maryland in 2004 faced a challenge of complying with new HIPAA regulations to accept healthcare claims in EDI format. Their challenge was compounded by new requirements to fit diverse processing and claims’ needs that are unique to each of the program groups. A system was required to communicate electronically with partners outside of the State Enterprise boundaries, as well as connect with the State’s internal legacy system such as the Financial Management Information System (FMIS) and the Medical Management Information System (MMIS) without disruption to these systems or reinventing logic which has been maintained for over 20 years. The solution for the State of Maryland, in short, consisted of four key components:

• A new Electronic Claims Management System (eCMS) for receiving and routing HIPAA compliant transactions – with greater speed and efficiency
• Custom processes for each program group, supported by eCMS, and based on group needs
• Intelligent forms for personnel to interact with and respond to claims, enabled by dynamic business rules
• A Web-based portal for State personnel and providers to access, manage and monitor the flow and disposition of claims

In this situation, the State of Maryland was able to use their new system and process-approach to comply with HIPAA government regulations and achieve significant improvements in claims-related performance and return on investment. Performance improvements included:

• time and cost savings
• reduction of errors
• increased customer satisfaction
• higher quality auditing and reporting

In a dynamic business environment, process rules change all the time. In fact, they change more often than processes and organizations often find it extremely difficult to keep up with the amount and frequency of changes. Organizations that are not adequately prepared for these changes will experience performance issues. For example, a bank that promotes a home mortgage offer with an adjustable interest rate, will undoubtedly need to modify their Web-based promotion and transactional systems in real-time as interest rates change on a periodic basis. Many organizations that choose to automate their processes for operational performance advantages now rely on technology that can help them better respond to rapidly changing business conditions. In addition, process modeling is highly recommended for identifying all levels of process integration and associated rules, as well as helping to simulate process breakdowns, before they occur, that can cost organizations millions of dollars in lost revenue.

If you’re in a position of adding value in your business performance management initiative by focusing on process improvements and integration, it’s highly recommended that your organization apply a “continuous improvement” approach and start by employing a process modeling discipline. Further, consider these guiding principles:

• Design and communicate business performance goals and objectives early on in the initiative; revise as necessary
• Quantify the return on investment by including the required tools, and be clear about the costs
• Apply a “standardization mantra” to reduce associated errors and costs

Performance management and process management go hand-in-hand. Modeling to define process flows and efficiencies is a recommended best practice to adopt. And defining business rules may not seem necessary or be desirable, but it’s a discipline that is required for improving business performance, from a process perspective, in today’s digitized organizations.

Regardless of size, measured by the number of employees or scope of operations, organizations can improve their business performance by simultaneously wearing a process management hat. The return on investment of reduced processing time, error reduction, human resources savings, increased productivity, customer satisfaction, and new business value far outweigh the performance and process management costs–if the right strategy is executed.

The Author : Dr. Ash Rofail, President and Chief Technology Officer of Santéon (www.santeon.com), is an active member of the BPM Forum ( www.bpmforum.org). Dr. Rofail is a thought leader in enterprise software and is: a member of Microsoft’s Visual Basic advisory board since 1997; a patent holder for artificial intelligence technology; an author of 6 software engineering books on topics such as XML, .NET, COM/DCOM, building n-Tier Applications and Service Oriented Architectures; and Adjunct Professor at the Johns Hopkins University School of Business. Dr. Rofail holds a PhD in Artificial Intelligence and an MS in Computer Science.

People Lens: Optimize Employees’ Support For Your Business Performance Management Initiative

By Dr. Thomas J. Buckholtz

Are you certain your business performance management (BPM) initiative is on the right track? BPM endeavors can be complex, especially when they include a wide variety of employees and consultants that assume a myriad of essential roles including, for example, sponsor, program leader, metrics designer, modeler, technology selector, systems procurer, trainer, BPM-systems user, and business-decision maker. How can you quickly and intuitively spot potential risk in activities and thereby begin mid-course adjustments for your initiative? For any activity or role, look for the following behaviors:

• “Red” – Employees do not follow appropriate processes
• “Yellow” – Employees follow appropriate processes for fulfilling their own roles, but not for supporting other people’s related work
• “Green” – Employees follow processes that support their own work, other people’s work, and the improvement of BPM practices and organizational decision-making

For example, a sponsor of your initiative may make supportive remarks, but not provide needed funds or people. Such Red sponsorship puts your program at risk. Successful implementation likely requires coordinated support from various sponsors (Green). How about technology selection, acquisition, and deployment? Hopefully, your implementation will follow proven procurement processes (at least Yellow). If not, your organization risks confusing its employees and its BPM vendors. Indeed, anything less than full teamwork (Green) increases risks of choosing inappropriate technology, delaying progress and exceeding budgets.

You can learn significantly by characterizing your organization’s information-usage and decision-making behaviors that are based on the following BPM processes:

• Business transaction processes for running day-to-day business operations
• Business intelligence processes for analyzing and optimizing business operations
• Business collaboration processes for communicating and sharing information about business operations

Perhaps you will observe larger proportions of Red or Yellow behavior as you shift your focus from transactions to intelligence to collaboration. Yet, successful decision-making based on collaboration within and beyond your organization may be a major goal of your implementation. Generally, any work that is not Green can be a cause for concern. Likely, people need to expand their focal point and integrate their work with that of appropriate other BPM-program implementers, BPM-information users, or business-decision makers. How can your organization move toward Green behavior? Look for Red or Yellow work. Then, address relevant challenges regarding procedures, skills, knowledge, attitudes, proclivities, fear, work culture, or rewards. Possibly, you will need to utilize “change management” or “organization development” services.

Applaud Green behavior. Consider actively trying to establish such a culture – throughout the groups and job levels in your organization. Will your implementation struggle or succeed? Perhaps it’s time to turn key aspects of BPM implementation and usage, and other pivotal facets of leadership and management, from Red or Yellow problems into Green opportunities. Take charge. Certainly, you can minimize the struggle. Almost as certainly, you can improve the success.

The Author: Dr. Thomas J. Buckholtz, a business and executive coach, helps enterprises and individuals define and achieve business strategies, develop and market products and services, augment corporate culture, and work effectively. Tom’s web site is www.human-landscaping.com/buckholtz/. He can be reached at (650) 854-7552 or TomBuckholtz@aol.com. His “Direct Outcomes” books are available via www.embeddedcomponents.com/buckholtz/

With a growing membership, new Forum programs, and thousands of web site visitors every month, the BPM Forum site was updated in April 2005 to improve:

• The overall user experience
• Program communications
• Access to survey, research and newsletter content
• Visibility of BPM Forum sponsors and opportunities
• Awareness of our Privacy Policy
• Search engine results for BPM Forum content

Take a look at the new site: www.BPMForum.org

The BPM Forum encourages its members and web site guests to share articles or white papers that relate to current issues and developments in corporate governance, compliance (Sarbanes-Oxley, Six Sigma, etc.) and topics associated with business performance management strategies, execution and results. Approved content will appear on the BPM Forum’s web site and/or will be featured in an upcoming issue of Brainwaves.

If you would like to submit an article or recommend one, please follow these guidelines:

• Business performance management focus: people, process, policy, technology, methodologies, best practices and business innovation
• Pictures, illustrations and charts to support your submission are welcome
• Include a brief biography with relevant credentials
• Maximum 850 words

Email this issue of Brainwaves to senior executives in finance, operations, technology and business innovation roles who are interested in or expert with business performance and sustainability. Subscribe to Brainwaves at: http://www.bpmforum.org/newsletter_form.htm