Posted by: Filipe Pinto in Untagged on
Sep 04, 2008
I'm sure you noticed that on this past Wednesday, Michael Hammer died in Boston, from complications of a brain hemorrhage, at the age of 60. Along with Michael Porter, and Peter Fingar, they defined our vision of Business Process Management (BPM), so this is a less bright day.
To make it easier to all of us, here is the list of the 5 top contributions of Michael Hammer towards BPM.
1 - "Reengineering the Corporation", the book - this best seller book introduced, for the first time, the concept of "management process design" to the masses. The book was on The New York Times nonfiction paperback best-seller list for 41 weeks and took Hammer, in 1996, to Time magazine’s list of “America’s 25 Most Influential People.”
2 - Coined the end of Adam Smith era - Michael Hammer made the case that the division of labor, defended by Adam Smith (capitalism's high-priest), and masterfully put in place by Henry Ford in his assemblies lines, was not sustainable in a post-industrial era, characterized by changes in customer bases, competition and a high rate of change. A new organization (a re-engineered organization), had to re-emerge under the supervision of a strong leader with vision, who, using information technologies, consulting closely with suppliers to reduce inventories, and empowering employees, would build a more efficient organization . Hammer actually defended “the undoing of the Industrial Revolution.”
3 - Started shaping the modern process - Michael Hammer defended that corporation ought simplifying and reorganizing business departments by having workers break down their activities into logical, bite-size pieces, then take a “clean sheet” approach to reassembling their work for greater efficiency and productivity. This “clean sheet” was a less formal shape of what we call the PROCESS.
4 - Empowered the Information worker - Michael Hammer defended that in these new organizations (re-engineered organizations), managers ought to switch from supervisory roles to facilitators. They ought to become enablers, and mentors of those who they manage, empowering them to perform value-adding processes themselves, making sure their contribution would be recognize to those at the top. You may not know this but he once wrote - "I’m saddened and offended by the idea that companies exist to enrich their owners. That is the very least of their roles; they are far more worthy, more honorable, and more important than that. Without the vital creative force of business, our world would be impoverished beyond reckoning.”
5 - Educated us all about "powerful ideas gone bad" - as you so well know, reengineering became synonymous with downsizing, in which CEOs confused re-organization with ad-hoc automation. This misinterpretation led to the firing of workers in droves. In a Time interview, Michael Hammer declared - “It is astonishing to me the extent to which the term re-engineering has been hijacked, misappropriated and misunderstood,” adding that ideally, re-engineering should promote greater production and create more jobs.
You know this as well as anyone. Processes cannot be a faster way to do more of the same. You cannot be designing processes that are not able to keep up with the change. Your processes have to have CHANGE built-in.
I'm sure you already have your own recipe. Allow me to share with you, mine:
1. Use Business Rules - remove from the process any ability to make decisions. Isolate the expert systems outside the process.
2. Use Human Workflow - if the expert system fails to return an answer, escalate to a human and allow them to lead the process execution
3. Use Business Activity Monitoring - the only way to know where you heading is by tracking where you are over time. BAM is your map towards your objectives. Please see the the entry "How to pick bullet proof KPIs for BPM design ".
4. Log Exceptions and incorporate resolution - don't just track exceptions. Exceptions are the only way by which your system is going to be able to learn. Ensure that your design forces the user to enter its knowledge into the expert system of choice.
5. Make it simple - avoid long and wide processes. If your process is longer than two pages, or wider than one, you are probably doing something not very efficient. Usually it is an indication that you are including too much expertise inside your process. Put it out!
There other ways to built-in change by using systemics . If you're only now starting, I suggest you design your processes with this in mind. If you ready for the next level, I suggest you contact us. You will be surprised!
You have probably sometimes thought how nanotech is going to disrupt the future.You probably have not notice something remarkably.BPM, something you know so well, is for the IT industry, what nanotech is for manufacturing.Even though they have both been around for some time, few people understand how revolutionary they are (as in not evolutionary).
As one of my smartest blog readers, you know that nanotechnology brings a brand new world of possibilities (http://www.crnano.org/index.html).The question is then, how does BPM compare to it?
The question is simple - efficiency.Both BPM and Nanotech are a reminder of how much more efficient our day-to-day activities can be.Why submit cancer patients to radio and chemo therapies, if we can have a nanobots identify and destroy the cancer cell by cell?Why use steal to build very sturdy infrastructure when you can have it done using nanotubes?
BPM and Nanotech allow doing more with less and they both extend the abilities of humanity.Both are paramount for sustainable living in this planet.In a world of billions of middle class people, it will not be possible to continue to extract from nature what our societies need.We need to evolve from our current dependency of natural resources. We need to synthesize all our needs, from constructions materials to food, without ever touching the natural systems around us.
Whereas nanotech will deal with the very small, BPM will deal with the very large.They initially complement each other, up to the time that they, like so many other disciplines, will converge - http://www.youtube.com/watch?v=R-2Xw-GNkUQ.
The bottom line:
You have to remember yourself constantly that BPM is multidisciplinary.Focusing on the tree instead of the forest will prevent you from seeing the future.If you do not do it, others will.Those others may not be as you good, as I know you are.
You probably have asked yourself too many time what it means to model something from beginning to end. Where should your boundaries be when modeling a process?
This blog is going to give you my modeling axioms:
1. Do not look at traditional organization boundaries - traditional organization boundaries are set by the physical assets such as buildings. I do not use it at all. My boundaries are set by all those involved in the production of the organization's goods (products or services to customers). This means that when modeling I will include suppliers and customers, as well as employees… in other worlds, I include everyone and everything.
2. Awake sleeping dogs - modeling is about discovery which is an exciting process. Do not let the so called experts tell you there is such thing as an untouchable process. If you come across a process that "experts" tell you cannot be changed, try to know about everything about it. If the process cannot be changed then it should be able to prove it in a clear fashion.
3. Learn BPMN (really!) - use BPMN and tools to build BPMN diagrams. Maybe in the future, this will change but for now, BPMN is the best way to model business processes. Avoid coming across as an amateur by not knowing how to formally build a business process. In case you want to learn, we provide training classes .
4. Know your theory - process modeling is just one of the disciplines of BPM. I stop paying attention to those people that say that BPM is many things: enterprise application integration (EAI), enterprise service bus (ESB), SOA, etc, etc. BPM is nothing like that. BPM is about business, and technology is one of its most important disciplines. If you really want to be in BPM, you will have to know BPM from an economic standpoint. Get your definition of BPM straight. At M2MSys we have adopted one .
5. Engage your customer in a relentlessly hunt "pork - nothing will happen if you don't have the support of your customer. When you start your modeling journey, bring your customers along with you on a "pork hunting" journey. Tell them that you will find easy ways to save him money, and you will make him a star. When you discover major cost reduction possibilities, make it your customer idea.
6. You need top-down and middle up - too often, I heard that without executive sponsorship nothing would ever happen in BPM. Guess what? That is not true. In the idea economy you need bottom up to initiate at the catalyst but the turf war is battled by the "boots on the ground". That includes middle managers that are able to see ahead. Those will be your best allies to initiate the "revolution".
7. Modeling is revolutionary in nature (enjoy it!) - in case you have been too shy to say it out loud, I can tell you that you are correct. Modeling is revolutionary in nature. Your secret will be to disguise it in such way that you remove the edges of all your modeling. How do you do it? Simple, consider creating a sub-process for all those things that will have to be dropped in the future.
8. Make sure you are legally protected - if you are going to be excited about your work, you will for sure step on boundaries lines. Be aware of those, and try to avoid them at all times. Be aware that if you want to be true modeler expert, you will step on those. When that happens, apologize. If that doesn't work, make sure you are legally protected.
9. Look for patterns, techniques and catalog them - to be a great modeler you need to have your own patterns and techniques. For instance, my first pattern was "it isn’t finished until the fat lady sings". Briefly, this pattern lets me know that now event can be dropped until it was processed or retired by a responsible person. Then there's modeling techniques, which I will take on future blogs.
10. Seek awards - if you did a great job, no one will know you were the one that did it, because all great ideas were your customers'. So how do you get recognition? You simply investigate what awards your customer can compete with its new BPM application. Your customer will get great PR from the event, and you get recognition among your peers.
Do you have problems choosing KPIs during BPM design? You are not alone.
Picking the right KPIs can be a daunting task. Without your KPIs, you cannot track the evolution of your organization towards your goal. Picking the wrong KPIs may lead you in the wrong direction. This is a typical catch 22!
Over the years, I have developed a very simple way to overcome this problem. I listen to the Voice of the Customer (VoC). That is it. That is the secret! Simple and yet so many times forgotten.
Lets go over a common mistake. IT managers often pick 5-9s availability as their KPI. In their minds, availability is synonymous of quality. To the users nonetheless, performance is what really matters.
What you should conclude is you should never pick PKIs. Instead, schedule a meeting just to over all the different scenarios. Feel free to offer suggestion based on your own experience, especially if you have a lot of experience in a specific vertical.
You probably are thinking that there must be a catch. Yes there is. Like everything in life, too much of a good thing can generate the wrong results.
If you fail to maintain the balance between cost, technology and customer needs, you run the risk of getting the organization out of course. If a KPI costs too much, or it requires bleeding technology, you should reconsider the request of the customer, and try to adjust cheaper ways of doing it.
Like in anything around BPM, choosing KPIs is about t balance. Is about being able to separate the tree from the forest and is about being informed.
I hope this helps you. It sure has been helping me!
You probably have entertained this idea before. What would it be like, if all organizations shared the same processes and could only customize a set of parameters (presumably large). What would it be like the market if organizations were to compete with each other, in a world like NASCAR, where even though there are different engines, the rules on how the components work and are designed are pretty tight.
If you compare with what happens in Formula 1 where the rules are a lot looser (even though in the interest of the public things are changing), you see that the main differentiator is the significantly lower budgets. Technology has a lesser impact and competitive advantage is less obvious. The key differentiator is then the will to take more risks, strategy innovation and ability to adapt to the ever changing conditions.
Since John Adams capitalisms’ gospel that organizations have lived in a bubble isolated from its externalities. The business' business is (was) business. As you so well know, things have changed. Today we know that organizations cannot live independently of the community. The organization, and hence its processes, need to be externality-aware.
Curiously the same is happening in Formula 1 which is changing the rules to make it more appealing to the public (NASCAR continues to attract more fans). In this case, Formula 1 is finally recognizing that it cannot live without its public, no matter how innovative its cars may look like. Without competition there’s no public.
You may ask how this can be done. I believe that it will require the work from government to define processes that can then be adjusted by the organization. This will enforce that basic rules are met, without having to build layers upon layers of policing staff responsible to monitor how organizations meet or not their regulations.
Isn't that killing innovation? Isn't Formula 1 responsible for all major security innovations in the past 30 years in the automobile industry? Sure. I used to love Formula 1 ((things never were the same after Senna) and don't really appreciate NASCAR. The issue is that we as a species have grown to a size where we really need to be aware of what we do. If we don't we will soon be creating problems to our neighboring countries, and even to our own communities.
So know you know what the Universal Process Wizard is. This is the tool with which processes will be tuned to work specifically for one organization. This tool will open the door to a true global process market.
You may think that this will never happen. The government will never be able to do it. You maybe be right (you always are). The fact is that, it is a possible way to ensure that our kids can enjoy what we today take for granted.
I'm sure you also noted that this week there was an entry in almost every news portal that Edward Norton Lorenz had passed away. He was an American mathematician and meteorologist, and a pioneer of Chaos Theory. By the way, he is the second person I write about in a short amount of time. If you remember the other one had been Arthur C. Clarke .
Why is Lorenz important to you?
Lorenz is one of those special people whose work tunneled mainstream to academics. Like Poincaré (1899), Birkhoff (1927) and others before him, Lorenz studied systems of non-linear equations. As a meteorologist he used these equations to predict the weather. Unlike others before him, he was able to incorporate in his research a new and exciting tool at the time - the computer. In 1963 he proved that systems of nonlinear equations could behave in an unpredictable way. When in 1976 he used a pocket calculator and the logistic equation to demonstrate how an equation of utter simplicity could have such complex behavior, he finally allowed the world to see the power of Chaos Theory!
What is the Logistic Equation?
I know you know this (these are for the other readers that have to a little catch up). The logistic function is an S-curve that represents the growth of a generic set P (imagine P as Google's stock price). The initial growth is exponential; then, as saturation begins, the growth slows, and at maturity, growth stops.
The formula is VERY simple, and yet different combinations of the variable factors lead to extremely different results.
The phenomenal thing about this equation is that for specific values of a, m, n, and t it actually depicts real phenomenon such as biology or economics. For instance, population growth follows the logistic equation. Initially when resources are plentiful the population can grow extremely fast, and has resource diminish, the population growth diminishes.
Why is Chaos Theory important to you?
In a nutshell Chaos Theory is a discipline that tries to bring order out of disorder. It tries to study how apparent random phenomenon actually have a deterministic behavior, or in other words, can be represented by a mathematical equation. It also studies how constantly changing events influence the balance of a system.
What can we really predict?
Mutual fund managers believe that the future price of stocks can be predicted using Chaos. Certain people in government believe that by analyzing patterns of phone calls, they can predict when a new attack is eminent. Google believes that they predict what interest you, by analyzing millions of clicks that are done over billions of session searches.
You probably know a lot about BPM. Chances are you already have an on-going BPM project in your organization. But, do you remember how it all started? Do you remember you sold you on the idea? What is a vendor, or based on your knowledge? Do you remember how once you understood BPM how your organization meant so much more to you? You are a very lucky person. Nonetheless there are still too many people that haven’t yet joined the BPM group. This blog is for those you have for a long time tried to bring closer to us. Share it with them.
How much BPM information is available online?
Accordingly to Google there are 18 million pages about BPM. That's just too much information for anyone to consume. So if the internet is not the right place to start, where should you go?
Do you want to learn one of my secrets?
After years 12 years as consultant on the road, I have learned many lessons the hard way. Nonetheless, no one I praise most than this:
Knowledgeable senior managers make outstanding buyers. Knowledgeable middle managers, make great customers.
This is even truer when it concerns BPM. Award winning BPM projects depend on highly educated senior managers, and middle managers. The first are necessary as project advocates, the others as project managers. The success of the project depends of both
How are those lessons being applied?
It was based on those lessons that we created the BPM Mentoring and BPM Assessment . More recently we have decided to be more specific by implementing the Microsoft BPM Assessment and Intalio BPM Assessment . Together these services are guarantees for success because they give our customers. The mentoring allows for senior managers not only feel comfortable as BPM sponsors but also have fun doing it
Would you care to see the assessment in action?
You are probably asking how is the BPM assessment or the BPM mentoring can help you. To make my job a lot easier, I decided to include over here one of our last YouTube videos to show you how the Microsoft BPM Assessment can be used to prevent costly mistakes.
What should you take from this blog?
1. When implementing BPM a great sponsor and a great project manager are essential. 2. BPM Mentoring creates great project sponsors 3. BPM Assessment creates great project plans 4. If you are not sure whether you there or not, just contact us.
P.S. – If you want to do it alone, we also have the 30 minute video that gives you the BPM Executive Summary. Enjoy!
You probably remember a blog from January in which I spoke about the event-driven economy and FREE products.
This blog gives you in a lot more detail how the event-driven economy is going to impact your organizations.
Why is important that you understand what the event-driven economy is?
If you understand the event-driven economy it you will be able to prepare, adjust and prosper in this new market. You don't want to be a "sailing ship" in the steam age, or a "steam ship" in the plane age… you get my drift. I'm sure that a lot of the sailing ship skippers who looked with disdain to the steel ships didn’t pay too much attention, and found themselves unable to compete when steam became the norm. I’m sure that you will not do the same thing, and you will be able contribute so your organization is ready.
Weren't we suppose to be in the "global economy"?
The so called global economy is a product of the late 20th century. It is based on the imbalances in the workforce pay, currency value and commodity prices (among others). One doesn't need to use macro-economics (a subject about which I know very little), sociology or even ecology to see that something is changing with the global economy. Actually through engineering concepts, a topic about which I know a little bit more, that change becomes clear.
What characterizes the event-driven economy?
A new type of economy is emerging. This economy focuses NOT on the value of the product itself, but in the value added that its use brings to the user. This economy is about establishing long term partnerships with your customers, and bill them every they use your products to generate value. In this economy, your products will embedded with your customer value chain, and you will be able to have a better understanding know your products/services contribute to your customers wealth. This economy is based on the ability to collected massive amounts of usage information from how your products, so you can deliver a superior customer experience, and bill your customer in a win-win fashion.
Shouldn't the business charge as much as the market allows?
No organization is able to survive without partners. You will want to the same treatment from your partners. If you don't seek the win-win, and you get to be know as a bad partner, less organizations will want to do business with you. In the idea economy, you don't want to left to partner with the less talented people. Respect for your partners and customers (just another type of partners), is paramount.
What are examples of the Event-Driven economy?
Here are a few simple examples of the Event-Driven economy.
Wal-Mart
Gives away refrigerators in exchange for an exclusive agreement to sell and deliver groceries directly to your house. The refrigerator has a self-replenishment system that monitors all of your groceries and allows you to order new items as they become available.
Oil Companies
Give away cars in exchange for an exclusive agreement for you to buy their gasoline products. The cars communicate back to the oil companies places you like to be spend time, which they exchange with other organizations
Power Utilities
Gives away all house hold appliances in if you will use their kind of power rather than an alternative type – natural gas versus electric heating
Wait a minute… this is not new… telecom has always done it!
You are absolutely right. Telecom has been working in the event-driven economy for years. They give you the cell phone and you pay the usage. What you have to recognize is that there's no coincidence in the fact that they have been doing it for the longest of times. You see, they were the only industry that not only required their customers to be on-line to use their products but also needed to capture electronics records to charge them later.
Important note: if you wondering if this economic model is profitable, you should see the margins of the telecom operators, especially after their investments are paid for.... and please don't forget Google.
Welcome to the EVERNET!
Now for the really interesting part. With the EVERNET your products can be constantly monitored. This means that you can charge per usage instead of charging an up-front fee to all its customers. Can imagine how exciting that is?
What will it be required from your organizations in the event-driven economy?
The event-driven economybrings fantastic challenges and opportunities to your organization. We usually say that the event-driven economy is the "global economy on steroids". In this new economy your organization will collect, monitor, and correlate astronomic amounts of events to:
ensure the highest product quality, and exact customer specifications, during the production cycle
bill your customers during their use of your products
adapt your processes on the fly to follow market trends
Please don't forget that you will have to it ensure strict compliance with security and privacy laws.
What is M2MSys' role in the Event-Driven economy?
There are three key concepts in the event-driven economy: the event, the process and event-analytics™. In a nutshell, your organization will have to collect the event (M2M), perform event-analytics (Systemic) and adjust the processes accordingly (BPM).
Neal Walters, Lead Microsoft Architect attended a two day Intalio intro class. Why?
Have you ever started development when the business analyst was still writing requirements?
Have you ever tried to create an orchestration before the business processes have been modeled?
Imagine what it would be like if everytime you started a BizTalk orchestration, you had a fully modeled and approved business process diagram in front of you.
As you know, orchestrations implement business processes, and if you don't have documented business processes, then creating a working orchestration is just a shot in the dark.
I was searching for a good affordable modeling tool for our work on the Microsoft platform. Even with Biztalk 2006/R2, Microsoft's attempt to model business processes is still the rudimentary BPEL plug-in for Visio, which never did the job. BPMN (Business Process Modeling Notation) has become the defacto business processes modeling standard, and Intalio offers an open source BPMN 1.1 compliant design tool that you can download for free.
Why should you also care about BPMN?
We involve our clients as much as possible in our BPM projects, especially during process modeling. One of the biggest issues that we have while developing with the Microsoft BPM platform is that it doesn't have a worthwhile modeling tool. Microsoft's BPEL plug-in for Visio, that came out with BizTalk 2004 was supposedly for business analysts, but yet is so primitive that only allows the creation of simple workflow. It has no loops, no inter-partner communication, error handling, compensation, etc. which invariably leads clients to invent their own ad-hoc modeling techniques.
These home-grown and ad-hoc modeling techniques are difficult to understand by our BPM teams, and thus we must typically ask the client to attach a written explanation to the diagram. Sometimes, this leads to simple diagrams, with over 10 pages of text. The text then becomes a trap for the client, because invariably, the diagram gets out of sync with the text. To avoid all this complication, I often spend a couple hours to train the client on how to draw swim lane process diagrams on Visio. Because most people are not familiar with swim lanes, we end up doing the diagram ourselves at further cost to the customer. It is rather frustrating, mainly because one of the project's selling points was to empower the business community.
The panacea would be if Microsoft were to provide a tool, based on an open-standard, universal modeling language - BPMN (Business Process Modeling Notation). This standard has the ability to model any business process. After paying paying $25K per CPU (for BizTalk), a customer shouldn't have to pay another $2500 (per analyst) to license the Visio BPMN add-on from ITP Commerce. Furthermore, even though Visio is a great tool, not every developer or business analyst has a license for it. Getting Visio installed at a client site can even cause jealousy and slow the project down with further political issues.
I found the dream tool
Intalio is a open-source BPMS which comes with a free BPMN 1.1 designer. Yes, the tool is FREE! You are actually able to document your business processes in the latest version of BPMN (1.1) and still use BizTalk to implement your business processes. We believe that the future trend will be that most BPM companies will give away their BPMN designers in order to help upsell you to their full offerings.
A little more about Intalio
Intalio is an open-source BPMS which is built on open-source technologies, and you can download a free version called the "Community Edition". My advice is that you attend a workshop before you try to get give it a serious try. Certain features such as Business Activiting Monitoring (BAM) and a broader server/database support are only available with the enterprise support agreement. The "Community Edition" edition includes approximately 95% of the code contained in the Enterprise Edition. Intalio actually developed and contributed Apache ODE (Orchestration Director Engine) which executes business processes written following the WS-BPEL standard.
