establishing a business process management center of excellence - impact 2012
DESCRIPTION
Speakers: Benny Higdon, Prolifics; Howard Webb, Prolifics Description: Introducing a new technology in to an enterprise may be fraught with problems. The same is true for Business Process Management (BPM), which are both a technology and a methodology. Establishing a properly staffed and empowered Center of Excellence (CoE) can improve your chances of success. Learn the considerations for setting up a BPM CoE in your organization.TRANSCRIPT
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Establishing a BPM Center of Excellence
Best Practices & Case Study
Howard WebbDirector, BPM Advisory ServicesProlifics
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INTRODUCTIONS
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Howard Webb
Director of BPM Advisory Services – Prolifics
Over 25 years as a consultant, trainer, facilitator, and speaker on the topics of Business Process Management (BPM), data architecture, and project management
Founded the Midwest BPM Users Group
Published articles on BPM and enterprise architecture
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ABOUT PROLIFICS
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Prolifics at a Glance
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W h o A r e W e ?
S t a b i l i t y, L o n g e v i t y & G r o w t h S o l u t i o n L e a d e r s h i p
Off-Shore Development CenterHyderabad, India
Application TestingSanta Clara, CA USA
SOA solutions and appliances for connectivity Business Process Management for business optimization Portal, Collaboration and Content Management IT Security for Applications and the Enterprise Monitoring and Managing Applications Testing, Governance and Methodology Information Management for Data Cleansing, BI & Dashboards Technology Migrations to the IBM Software Platform
A Corporate Group of 1,200 Employees Worldwide specializing in the expert delivery of end-to-end IBM Solutions
New YorkBostonPhiladelphiaWashington DC
OrlandoSan FranciscoLondonHamburg
Over 30 years in business, Prolifics is an end-to-end systems integrator specializing in IBM technologies
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Prolifics’ Customers
G o v e r n m e n t
E d u c a t i o n
R e t a i l & D i s t r i b u t i o n U t i l i t i e s
I n s u r a n c e
F i n a n c i a l S e r v i c e s
H e a l t h c a r e
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WHAT IS BUSINESS PROCESS MANAGEMENT?
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Business Process Management
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A top-down methodology
A systematic approach for improving a specific process
A set of software technologies
The same thing as business process reengineering
Some definitions…
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Business Process Management
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“Business Process Management (BPM) is a holistic management approach that encompasses all aspects of a business including Strategy, People, Processes and Technology, in order to delivering value to customers
and other stakeholders.”
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BPM IS A JOURNEY …
You never arrive.
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AS SUCH…
It requires coordination to keep the Journey moving forward smoothly.
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BUT HOW DO WE DO IT?
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Challenges Limited resources
Competing priorities
Standardization (methods, technologies)
Increasing demands from both the business and customers
Management demand to show ROI
Gain process maturity and foster an environment of continuous improvement
Struggling with complexity and change13
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Complexity
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“Change is linked to complexity. Complexity increases both when the rate of change increases and when the amount of things that are changing around us increase.” Theodore
Modis
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WHAT IS A BPM CENTER OF EXCELLENCE?
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The BPM Center of Excellence
A centralized organization focused on the enterprise-wide coordination of process activities
The Hub for all things BPM
A Steward of methods and standards
A link between strategy and execution
Agent of change
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WHY ESTABLISH A BPM COE?
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The Need for Coordination
The only way organizations can deliver value to their customers is via cross-organizational business processes
Business strategy is therefore delivered and executed by means of business processes
To ensure the business strategy is being delivered as desired, process initiatives must be coordinated, managed and controlled
Few organizations have a centralized structure dedicated to this objective
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Traditional Management Model Redundant activities/duties
Misaligned incentives/ compensation
Isolated measurement model
Limited reuse Multiple breakpoints Multiple moments of
truth No cross-organization
control
Corporate
Dept A Etc.Dept B
Departmental Silo Perspective
TraditionalHierarchical
Management
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Process-Oriented Model Begin and end with the customer experience in mind
Incentives based on end-to-end process performance
Fewer handoffs, fewer breakpoints
Few moments of truth Process measures
providing visibilityCorporate
Function A Etc.Function B
Cross-Departmental Perspective
Customer
Process 1
Process 2
Process 3Customer
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Poorly Coordinated BPM Program
Redundant standards Competing priorities Sub-optimized
operations Inefficient use of
technology More handoffs, more
breakpoints Multiple moments of
truth Limited or no cross-
organization control
Corporate
Dept A Etc.Dept B
Process Silo Perspective
Sub-Process
Sub-Process
Sub-ProcessCustomerCustomer
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The Customer Experience
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Discontinuous thinking leads to disjointed customer experiences…
How many people or departments did I have to talk to just to get my issue resolved?
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Current Trends
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“Broadly speaking, investing in better coordination and management of process work has been on the rise, while incremental approaches are slowly declining, or at least
being integrated into larger, organization-wide BPM initiatives..”
*BPTrends, 2012, The State of Business Process Management, Celia Wolf, Paul Harmon : www.bptrends.com
bpm six sigma Lean six sigma business architecture
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Operating Model
Leading by example Gaining support Small, early successes
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Influencing Directing Setting policy Determining what projects
to do Have a seat at the Strategy
table
Where your COE falls on this spectrum depends largely upon your environment
How much power and authority the COE is granted Not likely to start as a Directing model
Maturity
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Structure
Strategic organizational perspective
Coordination of activities Track and monitor benefits, ROI Support the use of tools and
technologies Development of standards,
methods and techniques Integrate with Project Office Customer surveys Process maturity assessments
Process modeling Facilitation Coaching Project management Business analysis Data analyst
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BPM COE Management
Process Management
Process Improvement
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Staffing
Business Architect Customer segmentation Delivery channels Revenue streams
Trainer/coach Methodologist Business Rules Specialist
Project manager Process modeler Data analyst IT analyst Facilitator Statistician
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BPM COE Management
Process Management
Process Improvement
Some roles can be virtual, tapping expertise as needed.
Office administration Communications coordination
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Funding
Centrally Funded Project Funded
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BPM COE Management
Process Management
Process Improvement
Centrally Funded
Without central funding, staff could be ‘reallocated’ to other duties or continually be searching for funding.
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Positioning the COELocation of the BPM Group 2011 Survey results
We do not have a formal BPM Group 36%
Our BPM Group is at the Executive level
18%
Our BPM Group is at the Divisional or Departmental level
16%
Our BPM Group is located within IT 15%
Our BPM Group is located within HR or Training
1%
Our BPM Group is located within Finance
4%
Our BPM Group is located within Quality Control
5%
Other 6%
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*BPTrends, 2012, The State of Business Process Management, Celia Wolf, Paul Harmon : www.bptrends.com
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OTHER CONSIDERATIONS…
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BPM Maturity Model
Assessment Criteria
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Role-Based Organizational Structure
RACI Chart
Service Catalog
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BPM COE Intranet
Three Year Roadmap
Discipline Roadmaps
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CASE STUDY – HORIZON HEALTHCARE
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Who is Horizon Healthcare Services? Horizon is New Jersey’s oldest and largest health insurer.
Horizon traces its history back to 1932, when Associated Hospitals of Essex County, Inc. began selling multi-hospital pre-payment plans for $10 a year covering 21 days of in-patient care.
The company was one of the first health insurance companies in the nation and also one of the first Blue Cross Plans.
Today, it serves more than 3.6 million members.
In 2010, the company processed more than 57.6 million claims totaling more than $13 billion for its members.
The company has more than 4,800 employees and is headquartered in Newark with offices in Harrison, Wall Township, Mt. Laurel, and West Trenton.
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Why Horizon Decided to Get Involved in BPM
Horizon defined a comprehensive systems strategy and plan to achieve the following goals:
Complexity reduction
Sources of truth for core business information
Flexible and agile platforms to respond quickly to change
Business model shift to self-service and the Internet
Catalyst for change
Industry trends requiring faster business response
Shift to the individual consumer
Shifting demographic to technology sophisticated customers
Increasing healthcare costs forcing operational excellence
Increased reliance on business partners
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AgileCompetitive Pricing
Event DrivenStandardization
Responsive
Cost Reduction
The Horizon Multi Year Strategy
Journey to Agility
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What Horizon Expects from BPM?
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From Here To Here
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LESSONS LEARNED
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Key Considerations
Executive Sponsorship is Key Startups take vision and investment BPM is a big investment … Hardware, Software, People,
Project Costs It’s a business ... financial benefit to the Organization
needs to be documented Communication … do it early … do it often
Surprises … Communicating the Reference Architecture to the Business is important
Your peers don’t know what you have not shared with them … until you tell them three times
You don’t know what your team has not told you … Communication will create demand … do you have the
capacity?
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Key Considerations
Demand comes quickly … get your capacity ready Recruit … Recruit … Recruit … get help You need a diverse set of skills …
Setting up a new business takes a LOT of energy … Plan for change … and stress Work to stay aligned to your plan (“Plan your work and
work your plan”) Work to get others aligned to your plan …
communicate Setting up the Infrastructure and Base Platform installs
is a massive project • Development, Test, Pre-Production, Production
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Good Things Happen Along the Way
BPM & SOA lead to reuse
Reuse sometime pops up unexpectedly … especially when focused on core processes
Example … Our pilot had to do with managing the process and data for customers with multiple insurance policies.
Currently using two claim systems but working to converge to a single one.
We reused knowledge, services, and processes to accelerate and ensure consistency for the migration.
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BPM & Web 2.0 Mash-Ups = Cycle Time Improvements of 20x
Consolidation20 Letter Systems to 1
BPM Automations10% Increase in FPR
Integrated Medical Record ManagementTimely Resolution of Complex Claims
Horizon BPM Success Stories
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CRM & SOA = First Call Resolution
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WRAP UP
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Summary
Cross-organizational coordination of process initiatives is critical to success
Implement your Center of Excellence sooner vs. later
Properly staff and fund the Center of Excellence with the appropriate roles and skills
Don’t burden individual process improvement teams with defining standards and methods
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Next Steps
BPM Readiness Assessment
Setting Up and Configuring A BPM COE in Your Environment
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For more information:Contact: Howard WebbEmail: [email protected]: 646.380.2948
And visit these useful links on the Prolifics Web site:
Case Studies: http://www.prolifics.com/case-study-technology.htm Webcasts: http://www.prolifics.com/webcasts.htm Podcasts: http://www.prolifics.com/podcasts.htm Service Brochures: http://www.prolifics.com/service-brochures.htm Technology Blog: http://expert-tech.blogspot.com Twitter: http://www.twitter.com/prolifics Prolifics TV: http://www.youtube.com/prolificstv