Document-centric BPM and the emergence of case management, Part II

Document-centric BPM and the emergence of case management, Part II

By Alan Earls , 12/16/2010

Editor’s Note: In Part I of this special report, technology journalist Alan Earls examines whether document-centric BPM is morphing into case management. Here, in Part II, he describes the power-and the complexity-of case management BPM.

Case management BPM –also sometimes known as dynamic BPM, or, in IBM parlance, advanced case management-has been getting lots of attention lately.

With its roots in document-centric BPM, case management BPM can be a natural evolutionary direction for some organizations. But with its much greater complexity and higher ambitions in terms of what it seeks to accomplish, it’s not for everyone.

One key driver for developing and adopting case management BPM: extremely high payroll costs for knowledge workers in developed countries, according to IDC analyst Maureen Fleming. Knowledge workers tend to work on lots of projects, with the concept of the “case” as an underlying core principal. As a result, organizations interested in understanding processes tied to this often highly unstructured work need to gain a better understanding of case management to better understand how to make their knowledge-centric work more efficient and systematic.

“Case management BPM is expensive from the larger vendors and relatively immature for lower-cost BPM suite vendors,” Fleming warns. Furthermore, there are often skills gaps on the professional services side that present their own set of challenges. “Depending on who you talk to, case management is either huge or just a subset of the BPM software market. In other words, there is a lot of variation in how vendors view this as an opportunity,” she notes.

Customers, of course, view it more in terms of the problem at hand. “Enterprises that view case management as a content-centric problem look for different types of solutions than companies that view this as a process problem,” Fleming says.

In her view, case management is inherently an integration-or a mashup-of multiple content and data types driven by requirements. While that concept is straightforward, getting there isn’t. “With a BPM suite, there is often a discovery phase that helps the process actors articulate linear workflow, but I’m not seeing the same level of sophistication for case management, which is highly process-centric but only partially linear,” she adds.

As with any application, Fleming notes, there are multiple potential pitfalls and risks. One is the possibility of adopting a system that is relatively inflexible, making it difficult to adjust to meet evolving needs. Another is underestimating integration requirements.

Still, Fleming says that IDC expects decision-centric BPM, including case management, to grow faster over the next few years than classical BPMS-based process applications, though from a smaller base. “In general, we believe decision-centric automation will grow faster than most types of applications and middleware over the next five years,” she says.

Automating the right tasks in the right way

ebizQ contributor James Taylor, a specialist in decision management and related areas, also focuses on the complexity of this flavor of BPM. “There was a convergence around the idea that some processes had complex data, multiple documents and lots of people involved,” says Taylor, who is CEO and principal consultant at Decision Management Solutions. “Some approaches are very technology-centric, focused on integration, and some were more focused on people.”

In other words, in its evolution, BPM had already shown that many processes had work activities that could be highly automated. However, those processes still sometimes had exceptions as well as tasks that did not lend themselves to an automated approach.

Now, advanced case management solutions (the term that Taylor prefers to use) can provide automation that prompts for human intervention when needed but then continues to automate for better efficiency. “For instance, you now see insurance companies automating the claims process and banks automating loan origination in a way that integrates straight through processing and complex case/exception management,” he explains.

“These kinds of systems monitor the process, apply rules and predictive analytics to make decisions and know when to escalate an issue for intervention,” he says. “The system does what it is good at and lets people do the things, like talking to other people, that they are good at in a seamless whole.”

 

Document-centric BPM and the emergence of case management, Part I

Document-centric BPM and the emergence of case management, Part I

By Alan Earls , 12/10/2010

Some application categories are short-lived. Capabilities change, business conditions morph and buzzwords fade away. But in the instance of what’s currently called (at least by some) document-centric BPM, there’s a remarkable degree of consistency between the old and the new.

According to Sandy Kemsley, an independent BPM consultant based in Toronto, its roots go back some 30 years.

In the early 1980s, new document-imaging and workflow approaches were emerging. “BPM was always part of document management, but then it started to become a separate discipline in the late 1990s,” Kemsley says.

Big analyst firms came in with new theories and terminology proliferated. Now there was human-centric BPM, integration-centric BPM and, of course, document-centric BPM.

Where does that leave decision-makers who are considering a document-centric solution–or living with one they already own? Kemsley says that despite being in a somewhat “muddled” state, document-centric functionality is a well-established winner. When it comes to systems that handle things like transactional documents, the value is clear: the ROI comes from reduced need for data re-entry and reduced head count. “That has been the case for the past 30 years and nothing has changed that,” she says.

What has changed is the emergence of additional flavors of BPM, especially case-management-centric BPM (sometimes known as dynamic BPM), which offers potential efficiencies for workers handling complex semi-structured or unstructured processes.

“A current challenge is to know your problem and then figure out how to map requirements into structured or unstructured workflow—and if it falls in between, you may need to do both,” says Kemsley. For example, she notes, an insurance claim may start off very structured and then quickly get into unstructured case management territory, where processes and solutions have to be invented or applied uniquely. It is still the same “case,” but having the right tools makes for better management.

Case management can also be thought of as a form of customer service, she says: “One person can now see everything that is being done and what stage everything is at.”

Document-centric BPM has revolutionized processes in many organizations and case management offers similar potential. “This kind of system means people don’t have to be at their desk, they can start to work at home or wherever,” Kemsley says.

Adds Gartner analyst Toby Bell: “If you are doing document-centric today, you should look to leverage that toward a case-management, human-driven approach in the future.”

‘People-driven’ BPM

When explaining what case-management-centric-BPM is and why organizations need it, Kemsley says simply: “You want to get away from people having notes about clients stuck to their monitors.” Elaborating on the difference between the two BPM flavors, Kemsley notes that document-centric BPM has focused mostly on enhancing repeatable, process-oriented activities, traditionally built around paper documents. In contrast, its offspring–case-management or “dynamic” BPM–links documents, people and all kinds of social media to enhance the messy process of addressing an insurance claim, a government benefits appeal or a legal case. “In situations of that type, when people are able to more effectively share and track information, it benefits the individual and the company gets benefits, too, so they can incentivize the individuals to participate,” she says.

A 2009 Forrester Wave report (“Dynamic Case Management – An Old Idea Catches New Fire”) contends that demand for case-based or “people-driven” BPM products is an outgrowth of the service sector’s adoption of many of the Lean and Six Sigma approaches long used in industry.

The result has been the gradual elimination of many tasks through automation, outsourcing or process improvements. Analyst Craig LeClair, who wrote the Forrest Wave report, uses an insurance industry claim as an example. “Scanning in claims documents and entering data into a claims system is where traditional [document-centric] BPM would coordinate activity among the submission, underwriting, policy creation, claims and customer service,” LeClair says. BPM would also traditionally extract metadata from core processes and make it available to better serve customers across all lines, he notes.

Exceptions to the rule

What’s left, increasingly, is “exception management” – handling the more complex tasks that can’t be fit into a preformed solution. In other words: case management. “Today’s knowledge workers have a greater variety of tasks to deal with and they aren’t locked down in one place, like the production workers traditionally served by document-centric BPM,” LeClair says. The tasks left over are more diverse and require a broader level of information support and even analytical support.

What the new processes look like might be “snippets of structured functionality” as well as social technology to get access to expertise. “Image capture and document management are still very important, but case-management capability is where the big, high-value developments are,” says LeClair.

If you’re considering a case-based BPM system, LeClair recommends thinking about it from a business-process vantage point. One key distinction between the document-centric BPM system you might currently have and a case-based system is that all “exceptions” are carefully scripted in document-based system, he says. In contrast, in the dynamic or case-based world, the business outcome becomes the driver. For that reason, “companies need to involve their business process analysts early,” LeClair says. “They should try to align desired business outcomes in their existing BPM system with the strategic goals of the organization, and then use that as the basis for moving forward to dynamic, case-based BPM.”

In his report, Le Clair notes that the rapid emergence of dynamic BPM may spur acquisitions among industry players and could bring in others, such as Oracle, which has relevant ECM and BPM assets. And, he warns, BPM pros need to keep in mind that case management needs to be considered as a “lean approach for automating processes,” but with much more control given to the “worker.” Indeed, he urges a “design for people” approach that incorporates Web 2.0 approaches.

And, he recommends: “Reengineer the process first, then pick the tool. Focusing on the tool too early is a huge pitfall.”

 

Taking an Enterprise Architecture approach to BPM

Taking an Enterprise Architecture approach to BPM

By Peter Schooff, Contributing Editor, ebizQ , 12/17/2010

In this Q & A, Peter Schooff speaks with ebizQ contributor Dr. Alexander Samarin about corporate BPM strategies. Samarin, chief enterprise architect of the African Development Bank, is author of “Improving Enterprise Business Process Management Systems” (Trafford Publishing, October 2009).

PS: Why should a company consider BPM?

AS: For me, BPM is three complementary things. First, there’s the BPM discipline, how to use processes to better manage an enterprise. Second, [there’s] BPM software [and] technology from many, many vendors. And third, [there’s the] architecture of a BPM enterprise system that is built to manage, to govern, execution of the processes within enterprises.

Together, they’re very powerful tools and [a] primary force to make an understandable, explicit and executable coordination between systems, employees, customers and partners. With such coordination, it becomes possible to monitor the dynamic of various indicators, values and risks, and it helps people for better decision-making. In addition, it helps with the evaluation of feasibility and impact of future changes.

PS: What are some problems that companies face when they go to BPM?

AS: Typical problems at first [involve questions about] “What is it?” A lot of efforts are spent to explain BPM. Usually within a company, there is a mixture of opinions from the Internet. So [building] a commonly agreed-upon understanding about BPM is a must.

Second

: “What does it do for me?” [It’s necessary to explain] to everyone how BPM will address his or her concerns and how his or her current working practices will be changed for the better. Of course, it’s not necessary to talk to each of the thousand people within a company; instead, be prepared for talks with about 20 groups of people.

[A third question involves project size.] BPM projects usually start small, without a bigger view or understanding of how to grow. [I] recommend considering BPM as an enterprise-wide initiative from the very beginning.

The last typical

is: “How do we change it?” By definition, any BPM solution will be changed…So [my recommended] approach is to architect flexibility because many, many changes will be carried out.

PS: Is an enterprise architecture approach important for companies that are considering BPM?

AS: Yes, both enterprise architecture and BPM are enterprise-wide activities or programs, and you don’t want them to collide. At first look, they’re very different. Enterprise architecture is about [going from] this state to this state as a transition, and the typical lifespan is [measured in] years. BPM, on the contrary, is talking about continual improvements and a typical time span is weeks or months.

But the two may be very complementary and enrich each another. For example, enterprise architecture does a great job in describing the enterprise genotype, or full nomenclature, of enterprise artifacts. And there are many techniques to evaluate enterprise phenotype, a set of observable characteristics such as performance. But enterprise architecture cannot answer how enterprise genotype defines enterprise phenotype. From the BPM side, it’s very strong with executable models of relationships between artifacts. And in this way, it can form some kind of a bridge between enterprise genotype and enterprise phenotype.

Actually, your enterprise architecture team should be the best friend of your BPM initiative and vice-versa.

PS: Essentially we’re talking about processes that are human processes. So what is exactly the social aspect of BPM?

AS: English is not my mother language, so I [looked] at the different meanings of this word “social” and took some of those meanings.

First, [it is] affordable to everyone. BPM and new tools are now more affordable for small and medium enterprises and governments. Second, [it involves] public or common ownership. Right now, this is mainly organization of work and provisioning of convenient access to different artifacts, which is a common practice in modern BPM tool.

And the third meaning, which is the simplest, [involves] human-initiated interdependent relationships with others…Of course, that last meaning is the most interesting for clients of BPM.

PS: You touched on this in the first question, but to drill down a little bit more, exactly how does BPM help companies solve their problems?

AS: BPM mainly helps companies through managing the common understanding of work. One aspect [is] coordination. Coordination is externalized from people’s heads, applications, quality documents and habits in an understandable and explicit form. One of the forms is the well-known BPMN [Business Process Modeling Notation] diagrams.

Then this explicit coordination is used through the whole improvement lifecycle: plan or model, implement, do or execute, check or control, and act or optimize. In many enterprises, those phases are carried out by different roles and often different languages are used…And each time information is moved from one role to another, there are some translation errors, explicit coordination in BPM removes the source of those errors.

Then BPM helps people to express coordination the same way, so that different people within an enterprise are solving the same problems in very similar ways, thus improving reusability.

And finally, BPM makes your enterprise information more flexible because executable coordination serves as a way to assemble bigger services from smaller ones. So BPM helps companies to make some kind of breach, glue or guidance between strategy and execution.

PS: What do you see ahead for BPM?

AS: I can see that it should [include] better understanding among BPM experts, more practical standards, easy comparable business cases, more commonly agreed-upon knowledge, better interchange been tools from different vendors. We know that BPM is a vendor-driven market right now; I see it [becoming] more customer-driven in the year ahead.

This Q & A was excerpted from a recent ebizQ podcast. It has been edited for editorial style, clarity and length.

 

How to Combine Lean Six Sigma, SOA & BPM To Deliver Real Business Results

Managing Waste and Improving Efficiencies

In the current economic market, organisations are often forced to seek innovative ways to save time, money and reduce waste. This is typically achieved through reviewing waste management and understanding where there may be efficiency gains. Sadly, this activity is not given the attention, time, effort or resources necessary to deliver long-term business benefits. The end result is often poor management decisions, redundancies and “quick & dirty” cost-cutting initiatives leading to low morale across the organisation.

What’s the Solution?

 

Organisations should invest time in reviewing how they can adapt their SOA/BPM strategies to include Lean Six Sigma techniques.

Lean Six Sigma (LSS) produces real results in difficult economic times by uncovering process waste, reducing non-value adding activity, and increasing productivity. The benefits are even felt in IT. According to the consulting firm McKinsey & Company, “companies can reduce application development and maintenance costs by up to 40%.” That application development productivity can be improved “by up to 50%” by applying LSS techniques, freeing budget for needed investments.

 

 

Business process management (BPM) and service-oriented architectures (SOAs) combine with LSS to accelerate improvements and results. At the same time, they increase organizational flexibility and technology enabled responsiveness.Many successful companies have found that the linkages are clear. Early adopters who have worked their way past cultural and organizational barriers are seeing impressive performance and financial results:

 

 

 

  • Improved responsiveness to market challenges and changes through aligned and significantly more flexible business and technical architectures
  • Improved ability to innovate and achieve strategic differentiation by driving change into the market and tuning processes to meet the specific needs of key market segments
  • Reduced process costs through automation and an improved ability to monitor, detect, and respond to problems by using real-time data, automated alerts, and planned escalation
  • Significantly lower technical implementation costs through shared process models and higher levels of component reuse
  • Lower analysis costs and reduced risk through process simulation capabilities and an improved ability to gain feedback and buy-in prior to coding 

     

 

The rewards can be great, especially for those who take action now.

Lean Six Sigma (LSS) produces real results in difficult economic times by uncovering process waste, reducing non-value adding activity, and increasing productivity.

Business process management (BPM) and service-oriented architectures (SOAs) combine with LSS to accelerate improvements and results. At the same time, this combination increases organizational flexibility and technology-enabled responsiveness, key to positioning the company for growth as the economy improves.

Process improvement experts are uniquely positioned to play a key role in this transformation as they are able to leverage their business and technical knowledge in combination with the tools and techniques of Lean Six Sigma.

Examples will be provided along with recomendations for getting started.

Recommendations

  • Understand the basics of Lean Six Sigma and how BPM and SOA support the Lean Six Sigma methodology
  • Understand how to use data to select the right improvement project
  • Understand how Business Architects and Business Analysts can play a role in accelerating results

The presentation is available for download here was provided by Hans Skalle an esteemed colleague from IBM’s Global Business Integration Group.

Hans Skalle specializes in Business Process Management (BPM) solutions, business process modeling, and the development of financial models and business cases to support BPM and integration software investments. He has worked directly in the Information Technology industry since 1980 including 8 years as a Business Analyst. He is the lead author of an IBM Redpaper: Aligning Business Process Management, Service-Oriented Architecture, and Lean Six Sigma for Real Business Results. 

Hans has more than 20 years of hands-on process improvement consulting experience and is a past Master Evaluator for Minnesota’s Malcolm Baldrige-based Quality Award in the US. He has in-depth knowledge of various performance improvement methodologies including Six Sigma, Lean Sigma, ISO 9000 and other tools and techniques used to drive and sustain continuous improvement and competitive advantage through change and innovation.

Combining Lean Six Sigma and SOA/BPM

Reducing Operating Costs

Today the pressure is on the CIO and the IT organization to identify, enable, and create new business opportunities while dramatically reducing operating costs. In virtually every industry, aggressive, more technologically agile competitors are now offering new products and services faster or are executing processes more efficiently, to win customers, market share, and profit.

Thankfully, advances in technology and technical standards, specifically SOAs, are now allowing IT budgets to be reclaimed and the organization to be repositioned. New technical tools and capabilities complement traditional BPM methods and even unlock existing application functionality to greatly accelerate process improvement and innovation.

Leading firms are using BPM technologies to accomplish the following tasks:

  • Choreograph human and system interactions
  • Provide real-time visibility into key performance indicators (KPIs)
  • Manage escalations in the event of failure or missed targets
  • Provide the foundation for continued process improvement and optimization

However, on their own SOA/BPM do not address waste management or efficiency considerations. This is where Lean Six Sigma can help.

Step Back – Definitions & Terms

Lean Six Sigma (LSS) produces real results in difficult economic times by uncovering process waste, reducing non-value adding activity, and increasing productivity. The benefits are even felt in IT. According to the consulting firm McKinsey & Company, “companies can reduce application development and maintenance costs by up to 40%.” That application development productivity can be improved “by up to 50%” by applying LSS techniques, freeing budget for needed investments. 

Business process management (BPM) and service-oriented architectures(SOAs) combine with LSS to accelerate improvements and results. At the same time, they increase organizational flexibility and technology enabled responsiveness.

Many successful companies have found that the linkages are clear. Early adopters who have worked their way past cultural and organizational barriers are seeing impressive performance and financial results: 

  • Improved responsiveness to market challenges and changes through aligned and  market and tuning processes to meet the specific needs of key market segments
  • Improved ability to innovate and achieve strategic differentiation by driving change into the and respond to problems by using real-time data, automated alerts, and planned escalation
  • Reduced process costs through automation and an improved ability to monitor, detect,higher levels of component reuse
  • Significantly lower technical implementation costs through shared process models and improved ability to gain feedback and buy-in prior to coding
  • Lower analysis costs and reduced risk through process simulation capabilities and an improved ability to gain feedback and buy-in prior to coding

Recommendations

Lean Six Sigma (LSS) and business process management have much in common. Both methodologies use iterative improvement and design techniques to deliver financial and performance benefits through better managed and optimized processes.  

By combining key concepts from LSS with the capabilities of BPM (including process modeling and analysis, automation, and executive dashboards that deliver real-time performance metrics to process consumers), a company can ensure that its people are focused on the most meaningful value-added work. SOAs add increased flexibility so that processes can be quickly assembled from reusable Lego-type building blocks of technical functionality.

Companies that successfully bring together LSS, BPM, and SOA initiatives will realize a competitive advantage.

To fully understand the linkages between BPM, SOA, and LSS, and fully realize the benefits of these linkages, it is important to establish definitions and list key concepts for each initiative.

Conclusion

Process improvement experts are uniquely positioned to play a key role in this transformation as they are able to leverage their business and technical knowledge in combination with the tools and techniques of Lean Six Sigma.

Take Aways

  • Understand the basics of Lean Six Sigma and how BPM and SOA support the Lean Six Sigma methodology
  • Understand how to use data to select the right improvement project
  • Understand how Business Analysts can play a role in accelerating results
  • Consider embedding Lean Six methodology into your SOA/BPM strategy as part of your overall Enterprise Architecture

The rewards can be great, especially for those who take action now.