Case Studies Using Process as the Lever for Enterprise Change

IBM Global Business Services

Business Process Management g

From Strategy to Reality:Pulling tactical levers to realisePulling tactical levers to realise your business strategy

IBM Insight ForumAugust, 2009

© Copyright IBM Corporation 2008© 2009 IBM Corporation

IBM Global Business ServicesIBM Global Business Services

A ‘level-set’ view of BPM will help us to understand the context and business value of the approach

Business Process ManagementBusiness Process Management- Actively management- Continuous improvement focus

M ki f li it- Making process performance explicit

Processes aren’t documented

Bottlenecks prevent efficiency

Limited visibility into performance

Complex hand-offs crossmultiple processes

Process change is cumbersome

KPIs not defined

© Copyright IBM Corporation 2008© 2009 IBM Corporation2


BPM encompasses many things, such as methods and systems for process modelling, workflow, or performance management…..

“A discipline that optimizes the performance of end to end business processesA discipline that optimizes the performance of end-to-end business processes (interdepartmental functions, partners, suppliers and service providers)”

Business Process Business Activity M it i (BAM)

Business Process E ti (BPE)

Gartner 2009

Analysis (BPA) Monitoring (BAM)Execution (BPE)

Automate and orchestrate processes

across applications

Design and simulate business processes

Track performance, processes and operational

activity using keyacross applications and systems

activity using key performance indicators

Pre-built industry accelerators

Accelerate delivery of composite applications using process, services, and data assets

Processgovernance

Assess

Opt

ne

Envision

Established Methods, Standards and Governance accelerators


Execute

timize De

fine

Improve quality & agility, reduce risk, and manage change better


The three core BPM components can each deliver business value on their own, and aggregated value when used together

Business ActivityBusiness ProcessBusiness Process

Business user owned & led Business & IT collaboration Business user owned & led

Business Activity Monitoring (BAM)

Business Process Execution (BPE)

Business ProcessAnalysis (BPA)

Visualise, analyse, quantify & improve business operations,

Support alternate business

Leverage BPA models

Link back-end IT system

Execute automated processes

measures

Leverage Key Performance measuresSupport alternate business

views

Identify relationships

Single point of truth

Execute automated processes

Capture measures for Monitor

Administer automated process ti l

Graphical dash-board

Alerts triggered from measures

‘Actual’ operational metrics dataSingle point of truth exceptions, user roles, permissions and access rights

Accelerate IT deployment viabl t

Actual operational metrics data for continuous improvement

re-useable process assets

Start here to maximise business value and

Start here to automate process execution

Start here to automate process insight


business value and control of improvements

process execution ASAP

process insight ASAP


Why should organisations pay attention to process?

Link strategic intention andLink strategic intention and operational effectivenessLink organisation components –

l d t h l t ore

+

75thpeople, process and technology – to create performing organisationsDefine the organisation structure

+20%+8%

actic

es S

co75th

Percentile and above

needed to meet the organisation’s goalsLeverage synergy between process +2%0%ge

men

t Pra

25th

Percentile design and organisation change management with IT development

2%0%

Intensity of IT Development

Man

ag

+

and below

Intensity of IT Development +-75th

Percentile and above

25th

Percentile and below


Source: Dorgan, S.J and J. J. Dowdy (2004), “When IT lifts productivity”, McKinsey Quarterly, No. 4.


A staged BPM life-cycle provides the framework for business driven BPM

The BPM life cycle needs to be deployed with proven methods and standardsThe BPM life-cycle needs to be deployed with proven methods and standards for BPM development & governance



Case Study: Lands NSW – Industry wide change

State public sector land management authorityState public sector land management authority. Manages registry of land title information for the state covering 800,642 kms sq, 800,000 land transactions each yearabout 10,000 plans and 40,000 new titles.Operating the Torrens system since 1863.Operating the Torrens system since 1863.The industry includes:- the surveyor community,

land developers- land developers, - solicitors, - municipal government - intermediary organisations.

28% of dealings are lodged electronically.


Statistical data based on the Lands NSW 07/08 Annual Report


The challenge – how to bring a 19th century industry into the 21st

Technology advances allow cadastral information to be managed entirelyTechnology advances allow cadastral information to be managed entirely electronically. - Cadastral xml

i f t t d th t h l t ti- infrastructure and the technology automationThe industry structure is still based on the paradigms of the late 1800’s..The processes and expectations remain in the 20th century, the expectations of the public are 21st

centuryEntrenched interests have to be brought into the fold of the change



The possibility of the technology outstrips the expectations of the participants by a country mile

Cadastral databases have been able manage the land data for some timeCadastral xml and supporting applications enable transfer and management of data objects and the automation of a number of human tasksLong transfer times from regional centres unless electronic transfer isLong transfer times from regional centres unless electronic transfer is used –requires high standard broadband networksHuman examination lengthy and is subject to error. Automated examination is fast immediate and accurateAutomated examination is fast, immediate and accurate



In order to realise the potential of the technology, internal Lands NSW processes had to be updated to account for the technology

Approach Proof of Concept projectApproach - Proof of Concept project tied with an enablement - process mapping training using

WebSphere Business ModelerWebSphere Business Modeler- Principles of Process re-design and

Lean SigmaProcess Analytics- Process Analytics

- Joint proof of concept projectLinked BPI enablement with graduate d l tdevelopment Processes already linked to a technology development



Two processes were re-designed – this example demonstrates the power of linking process and technology

R l d t D ti d C t

$30.0060

Relodgment - Duration and CostsResource Duration Resource Cost

$20.00

$25.00

40

50

($ p

er p

lan)

on (m

inut

es)

$10.00

$15.00

20

30

Res

ourc

e C

ost

esou

rce

Dur

atio

-18%

Current State Future State -Relocate

Future State -SPAC

Future State -SPAC and

Email

e-Relodge 2009

e-Relodge 2013

$0.00

$5.00

0

10 RRe

-58%

-71%-88% 100%

EmailResource Duration 51 42 21 15 6 0Resource Cost $29.15 $26.08 $12.89 $9.06 $3.23 0

Relodgment Processes


NB: Does not include wait time


The results on the Lands NSW example are dramatic but are achievable in other operational environments

NZ Public Sector ClientNZ Public Sector ClientSAMPLE PROCESSES, INCLUDING COMBINED DATA

COSTS[D ll ]

ELAPSED DURATION [hrs]

RESOURCE DURATION [hrs]

CASES[ it ][Dollars] DURATION [hrs] DURATION [hrs] [units]

CURRENT STATE $358.74 2,088.62 12.53 3272FUTURE STATE $189.37 270.38 6.22 55% VARIANCE - 47.21% - 87.05% - 50.36% -98.32%

Australian Agribusiness Client- Conservatively, $9 million annually from a sub $100,000 engagement



BPM is the mechanism by which the strategy of the business is effected in the operational environment

Enabling your business to be process centric bl t t t b t i t tienables your strategy to be put into action

Integrating technology and process makes the machine work for youIntegrating the whole WebSphere suite significantly enables your capacity to manage your business process continually and be y p yresponsive to change
