Back to the future with BPM

Business process management, a concept with roots that plunge more than 20 years into the past, is finding new roles in helping agencies through tough budget times.

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In early 1990s, business process re-engineering captured the imaginations of many technology executives. It was a time of recession and budget shortfalls — the $290 billion federal deficit in 1992 was a record at the time. BPR offered a way to boost efficiency and save money through process improvement and smarter application of technology, which often meant radical change.

The late Michael Hammer, the computer science professor credited with founding the re-engineering movement, urged organizations to "stop paving the cow paths" — in other words, not to layer IT on top of outdated and convoluted business processes.

Re-engineering, at least in Hammer's formulation, was strong medicine. In his July 1990 Harvard Business Review article, "Re-engineering Work: Don't Automate, Obliterate," he wrote: "Re-engineering cannot be planned meticulously and accomplished in small and cautious steps. It's an all-or-nothing proposition with an uncertain result."

BPR, however, proved to be a bit too revolutionary. It was time-consuming, disruptive and expensive. Over the years, it morphed into business process improvement (BPI) and, eventually, business process management.

The BPM approach also aims to boost the efficiency of an organization's processes, but it differs from BPR in that it fosters continuous and incremental improvement rather than sweeping change. It tends to break down projects into small chunks instead of taking BPR's "big bang" approach to improvement.

Why it matters

The tactics of process improvement have changed, but the current fiscal situation bears a strong resemblance to conditions 20 years ago. In the 1990s, Congress was pressuring agencies to operate with fewer dollars, and the most ardent re-engineering supporters were the ones under the greatest budgetary stress. Similarly, today's tight budgets have sparked heightened interest in BPM.

"It has been an interesting journey," said Craig White, a principal in Deloitte Consulting's Federal Strategy and Operations division. "The federal government has been on a path to increase process optimization for a couple of decades, but the pace of change has really increased with the current budget constraints. We see even more activity and interest."

Mitch Ross, director of the National Oceanic and Atmospheric Administration's Acquisition and Grants Office, said his team first began process improvement under the BPR label. The original impetus, like today, was financial constraints.

"It was driven largely by budget cuts," Ross said. "We were looking at legislative caps on our corporate services budget, and the acquisition and financial assistance function was ... hit very hard. We had to find a way to adapt to what is today, as we all know, a continuing trend."

What's Next

Business process management tools continue to evolve. Here are three directions they are moving in:

1. Mobile extensions. Software vendors are expanding their tools to accommodate mobility. Appian, for example, permits mobile access to tasks and actions via native apps for iPhone, iPad, Android and BlackBerry.

2. Cloud delivery. As with many software categories, BPM now comes in cloud form. A forecast by Research and Markets predicts rapid growth, with the market for business process as a service climbing from $1.09 billion in 2013 to $7.12 billion by 2018. That's a compound annual growth rate of 45.55 percent.

3. New process representations. Flowcharts are the traditional way of visualizing and building business processes. As an alternative modeling method, BP Logix offers Process Timeline, which addresses the "need to measure and predict process execution times," according to the company.

 

Sequestration and the budget outlook are "really forcing agencies to think about bringing innovation into the way they deploy IT and really take a look at where they are spending their money," said Chris O'Connell, vice president of federal sales at Appian, a BPM software vendor.

"There's continued and immense pressure on federal agencies," agreed Yogesh Khanna, vice president and chief technology officer at CSC's North American Public Sector. "Budgets are flat or declining."

He added that his company is seeing an increase in the number of clients asking for BPM-related meetings and proposals.

The fundamentals

Ross said BPR, BPI and BPM represent different approaches, but stem from a common motivation.

"Those terms...all come from the same point of view in reaching a goal of improvement and creating a more efficient and effective process to get the job done," he said. But with BPR's successors, "we found we could go faster and we could be a little more evolutionary rather than revolutionary."

BPR advocated a top-to-bottom overhaul of a business process and called for a detailed mapping of the "as is" process and the desired "to be" environment. The method did not allow for stepwise improvements, and the to-be process sometimes required an entirely new system. In addition, Ross said, BPR involved large expenditures on retraining the workforce. He said his organization found that it could not afford traditional BPR.

"We had to come up with a different model that was a little more affordable," Ross said.

NOAA's Acquisition and Grants Office began making the transition to BPM in 2008. The new approach allows for incremental change and the ability to take smaller bites of the process improvement apple. Ross said the model lets the office separate contract formation from contract administration, for example. That way, it can address elements such as acquisition planning under the formation umbrella and leave administration for another day. Similarly, changes to a property management system could occur in pieces — starting with warehousing, for instance.

"It is much easier if you make it a little more flexible...and be incremental about it," Ross said.

NOAA's grants office has created a number of systems using BPM, including acquisition planning and the Grants Online tool. The Commerce Department, NOAA's parent organization, has embraced the latter system departmentwide, Ross added.

Software is typically part of a BPM project. Such tools aim to help organizations define and automate business processes, and they create workflows that enforce a customer's business rules. Vendors include Appian, BP Logix, IBM, Microsoft, OpenText and Oracle.

The National Institute of Mental Health, for instance, uses BP Logix's Process Director to automate the workflow associated with the numerous electronic forms and approval processes the agency must manage. CIO John Harris said NIMH began using Process Director in 2008 and now has about 50 applications running in it.

The agency's automated processes include telework program enrollment and approval, and waivers for security exceptions. Travel is another area that is ripe for workflow automation.

"We are going to do an upgrade to our travel and conference requests to meet some of the new government requirements wrapped around those types of activities," Harris said. The Office of Management and Budget issued those new travel and conference restrictions last year after the General Services Administration's Las Vegas conference scandal.

Before BPM, NIMH's document routing and approval cycle involved email or interoffice mail. The agency spans several buildings in the Maryland suburbs of Washington, D.C., so interoffice delivery proved a slow way to conduct business. Reliability was also an issue.

"It became quite clear that things were getting lost, and it was hard to account for when things had been done or if they had been done at all," Harris said.

The use of BPM has boosted speed and accountability. Harris said processes that used to take days can now be wrapped up in a matter of hours. From an accountability standpoint, BPM makes it possible to know who has done what and when, and to zero in on where a given process becomes stuck.

The hurdles

Harris advised organizations new to BPM to avoid tackling big, complex problems out of the gate. "Start with some of the easier processes first," he said, such as automating basic processes and electronic forms. More sophisticated projects can come later.

Working on more simplified processes — a request form for business cards, for example — helps officials gain knowledge that they can apply later when setting up more complex workflows, Harris added.

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He also recommended standardizing the business processes before attempting to automate them. "We had to work hard with the users and the business sponsor to get some consistent processes in place," he said.

Ross identified another, related pitfall: failure to follow through on business rules. An agency might determine that a particular software package best suits its needs, but the people who own that process might be unwilling to modify their business rules to take advantage of the software. One option is to modify the software, but heavy customization could make the vendor's future upgrades impossible to deploy.

He said it is crucial that BPM leaders instead persuade process owners to change the way they do business.

That type of consensus-building can make BPM tough to implement. White pointed to top-level leadership support as an important factor in BPM success.

"Make sure you have...leadership buy-in from the beginning, so [the entire] organization is learning about the journey you are getting ready to take," he said.

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