Many organizations are attempting to move forward from simply improving and/or re-engineering processes, which were considered 1990's best practice, to managing them across the various functions in the organization using BPMS programs. In so doing, these companies have recognized that it is the power of process thinking which enables firms to answer the question “Which of our key processes need to be improved, and by how much, in order to perform for our customers?” In turn, this prepares the organization to then ask and answer, “Which of our key processes need to be improved, and by how much, in order to achieve our strategic goals?” That’s what enables execution.  

Making this transition is not easy. To take best advantage of the power of process, organizations must overcome a set of traditional leadership beliefs and behaviors. Why is it that companies struggle in shifting management practices from the traditional paradigm to a more customer centric view? There are several underlying reasons.

- Myopic measurement practices. Traditional financial measures of revenue, expenses, earnings, and cash flow dominate. The qualitative metrics that really matter to customers: on time receipt of product or service, complete, defect free, an accurate and user-friendly invoice, rapid and courteous responsiveness, often don’t make it to the front page of the executive dashboard or scorecard. Even when they are monitored, the next level of diagnostic measurement is usually missing and the infrastructure for corrective action is either lacking or flawed. The impact of these myopic measurement practices is compounded by misaligned recognition and reward systems. Recognition and reward systems are not aligned with providing customer with ‘more for less.’ Instead, recognition and reward systems are designed according to what is being measured, that being the traditional financial metrics.

- No accountability. Far too often, no one is accountable for the end-to-end flow of activities that truly matter to customers. Often, the end-to-end activity flows are neither concisely defined, nor understood in the same way. No one is tasked with the performance monitoring and continuous improvement of the entire flow of activities from receipt of order to delivery of the firm’s product or service. No one is tasked with the stewardship of the end-to-end flow of activities form idea generation to successful commercialization of a new product or service. Instead, the common practice is to assign accountability solely according to business unit, departmental or functional parameters.

- Lack of focus. In the absence of a compelling business model, combined with myopic measurement practices, most firms launch more concurrent projects than they can successfully execute. Valuable resources are deployed on overlapping and sometimes even redundant projects. This is particularly true of essential information technology resources which in this day and age are invariably part of practically any improvement effort.

The root cause of myopic measurement, lack of accountability, and lack of focus are attitudinal. These factors are symptoms of thinking in piecemeal fashion and failing to view the organization systemically.  As any coach of a major sports team will tell you, having the right attitude is just as essential to winning as is having the right skill sets, or aptitude.
The development of the right attitude or mindset remains one of the major challenges in viewing the enterprise in terms of the broad, cross-functional activities that create value for customers. In many organizations, the traditional functional view of the enterprise remains the predominant perspective. In this paradigm, activities and success is perceived in terms of power and authority defined by the organization chart. This is largely due to the simple fact that most leaders have a strong functional bias which has been nurtured by both their academic and business experience.

Accordingly, instead of focusing on a shared understanding and the deliberate improvement of the firm’s large cross-functional processes managers tend to view processes at a micro level as ‘‘procedures’’ which represents the bias of their traditional functional management view.

This traditional view promotes a set of values and beliefs that stand in the way of customer centricity, adaptability and agility. It underpins an ‘inside-out’ view of how the business works. It lends emphasis to the misguided perspective that we really know what our customers want – without actually asking them. It tends to reinforce a short-term focus on making money as opposed to gaining clarity on the firm’s principal purpose. It promotes the constant search for the ‘silver bullet’ which will kill the werewolves of the competition.

There are also certain skill deficits when it comes to having the aptitude to consciously and effectively manage the cross-functional activities involved in developing and delivering products or services to customers.
The principal skill set most frequently lacking is the means to develop an enterprise level view of the business in terms of the cross-functional activities that create value for customers. Such a view or schematic is an essential ingredient in shifting the leadership perspective from a traditional functional view to more of a customer centric perspective. That is what the firm’s leaders need in order to develop a shared understanding of the company’s performance in terms of its value-chain, or capabilities or processes.

IT leaders have a strong potential role to play in assisting the organization in moving forward from simply improving and/or re-engineering processes to managing them across the various functions in the organization using BPMS programs. From a senior management perspective, there is very little wrong with IT that a healthy dose of business process thinking by senior line executives and IT practitioners wouldn’t go a long way toward fixing.

If you agree that it’s time that executive leadership share accountability for the deployment of IT, then there are several aspects to a new and more effective way of thinking and acting:

- Articulate the firm’s strategy in terms of the performance of its end-to-end, enterprise business processes
- Define the observable and quantifiable improvement to business process performance and assess the deployment of enabling technology accordingly
- Create a certain degree of shared accountability by business unit and technical executives for the deployment for information technology

While each of these is essential, articulating the firm’s strategy in terms of the performance of its enterprise business processes is arguably the absolute prerequisite. Of course this requires that the leadership team make the time and energy to define the firm’s cross-functional, end-to-end business processes at the enterprise level and define current measures of performance for each – both from the customer’s and the company’s perspectives. This exercise allows leaders to explore answers to vital business questions such as: What output does a given business process provide to customers? What do customers expect? How are we doing relative to customer expectations? What are the major steps and handoffs in these large cross-departmental enterprise business processes? What are the interdependencies with other business processes? What implications are there for technology, training and communication? Only when answers to these tough questions are postulated is it possible to set the stage for a tight integration of IT investments to strategy.

The deployment of enabling technology must then be defined and assessed in terms of the observable and quantifiable improvements to business process performance. Again, this requires a shared understanding of which business processes need to perform at what levels in order to deliver on business goals. Again enabling technology decisions require asking and answering a series of key business questions including: Which projects are likely to have the greatest impact on achieving current strategy? What is the best sequence for deploying enabling technology? Are we clear on how IT initiatives will be measured in terms of the value added to business process performance with metrics around improvements in time, cost, quality and productivity? Is technology selected based on a pre-defined improvement objective and the extent to which it will support the people doing the work? How many concurrent projects can the organization reasonably sustain? Which projects are worthy – but simply cannot be done at this time?

Although commonsensical and straightforward, this level of process awareness is significantly different from organizations managed according to traditional functional lines.

IT leaders can be the catalysts in making the transition from simple one-time improvements to small business processes to managing core processes across the various functions in the organization. To assess your progress in this respect simply ask and answer the following questions.

1) Does the CIO actively participate with the executive team in formulating strategy?
2) Has strategy been expressed and broadly communicated in business process terms?
3) Are decisions around IT investments made based on the expected and clearly documented improvement to operating performance?
4) Does the leadership team take some reasonable degree of shared accountability for the success of IT initiatives?
5) Are IT initiatives judged and expressly measured in terms of the added value to business process performance with metrics around improvements in time, cost, quality, productivity?
6) Have business processes been analyzed for improvement opportunities based on non-IT as well as IT solutions?
7) Is technology selected based on a pre-defined improvement objective and the extent to which it will support the people doing the work?
8) Are measurement methods for process improvement designed before the IT-enabled process improvements are made?
9) Are IT systems designed such that they make best use of knowledge that people doing the work already possess?
10) Are IT projects generally staffed with cross-functional representation?

About The Author: Andrew Spanyi

Andrew Spanyi is the Managing Director of Spanyi International Inc. He is a Director with the Association of Business Process Management Professionals (ABPMP), where he is the chair of the Education Committee. Andrew is an internationally recognized conference speaker on process management topics. He is the author of numerous articles on BPM and the book ‘Business Process Management is a Team Sport, Play It to Win!’ 

This article relies heavily on material in Andrew Spanyi’s