The New Black

It's not news to say that the fragmentation happening in the world is not necessarily improving things. Disruption in the supply chain means disruption in the food chain for all too many folks. Multi-channel marketing, right-sourcing, right-shoring... whatever you call it, the result is disruptive for some, and empowering to others.

But regardless of the social and political implications, reducing costs in parts of your company's business life-cycle has increased complexity in others. We're able to do business anywhere, but is that really "scaling" our ability to compete?

Well now home entertainment was my baby's wish
So I hopped into town for a satellite dish
I tied it to the top of my Japanese car
I came home and I pointed it out into the stars
A message came back from the great beyond
There's fifty-seven channnels and nothin' on

- Bruce Springsteen, 57 Channels (And Nothin' On)

In a world where data is everywhere, it's harder than ever to get the right information. A few weeks ago, Business Objects revised earnings guidance downward on the Friday before earnings were announced... and then the next week they reported earnings within the original estimates. And they're a Business Intelligence vendor. What are the unintelligent to do? Overall we're probably worse than ever at forecasting near-term deliverables and results; while we have lots of data, we're still at a loss for information.

Again, nothing much new about that insight. But what have we done about it? Search engines don't solve the problem, although they tend to give a better framework with which to access data... i.e. we've improved the math behind finding relevance. But there's still something missing: context. For example, a search for "57 channels and nothing's on" yields #1 results on "scholarly articles" which have nothing to do with Bruce's song. And a search for "57 channels and nothing on" doesn't point to those papers at all. Data without context. If we add "lyrics" to the search, we get closer, but still a lot of noise.

Just The Facts, Ma'am

Similarly, data with the wrong context is just as useless (although probably more damaging). Simplistic frameworks with which to "analyze" data tend to provide a false assurance and are more likely to simply be used to reinforce an existing opinion. Today, for example, we see people with wildly different opinions about the fight against terrorism use identical facts to support their opinion; the exact same facts are interpreted to mean different things. All of our goals are the same, but we have no common framework, we have no agreement on tactics and those tactics' milestones (metrics), therefore when tactical results appear, we can use them however we want.

The exact same thing is happening today, in your company. Interests are aligned at strategic levels (even at the incentive level), but there's no agreement on the tactics. These "details" are left to individuals and are largely invisible, except for the unstructured reports you get at the management meeting.

Data, without context. Or data with the wrong context. Either one reduces our ability to make sense of this more complex world, and deal efficiently inside it. Even when we're aligned on common goals, the tactics of execution - and the interpretation of the artifacts of those tactics - elude our vision.

We need a new idea. We need a system of record for tactics - a corporate "to-do list," if you will, where we will agree what actions (activities) are required in order to achieve our common goals.

BPM is the system of record for those tactics. It gives visibility into a company-wide "to-do list" and it helps direct those to-do's toward desired results. Everyone's informed. Everyone's aligned, on the strategy _and_ the tactics.

Sorry, Steve, BPM Had A Time Machine Before Leopard

When you have alignment on tactical implementation (a model for execution), combined with the historical results of using that model and/or predictions about that model, you then have the ability to:

--> interpret past behavior and understand its impact on strategy to-date.

--> interpret historical results and track them back to behaviors that generated them.

--> predict (simulate) future behaviors and understand their possible impact on long-term strategy.

--> interpret behaviors-to-date on work-in-process and predict - based on historical results or simulated changes - how the near-term future will unfold.

This, then, is the promise of business process management. It's a time machine that allows you to travel from the past to the future by linking behaviors and results, for the first time. Explicit in this requirement is access to real-world historical data, which is why BPM requires execution (it's not simply modeling) and also explicit is the ability to effectively communicate the tactics to _everyone_ which is why BPM requires modeling (it's not simply coding). And you need analysis which ties together the model (the shared understanding) with the execution artifacts (it's not simply BI pointed at transactional systems of record).

What Is Your Market Cap Compared To Best-In-Your-Industry? Why?

Ultimately, modern notions of business process management are being put in place to deal with these problems. Companies today realize that while they may or may not be "in the technology business," technology is the principal solution to understanding themselves. Technology, the movement of bits, is now more determinative of whether they are efficient, and therefore competitive, than any other single factor. The other issues have, by and large, been dealt with. Human labor has moved to low cost areas. Shipping optimizations have, by and large, been put in place (although this has lagged production and is the next big 'physical' cost to be dealt with).

It is now the touch points that hook together the disparate human functions that create friction in the machine. BPM is the oil of the white collar machine.

Dealing with this complexity is what Business Process Management is, ultimately, about. It is the ERP for the new world. ERP was founded upon old notions of proprietary processes and information. Something new is needed. Something that deals with more inputs, more outputs, more flexibility in use, re-use, implementation, and discovery. And not necessarily in that order, or any other order.

Not Your Mother's Process

In Sunday's New York Times, Verlyn Klinkenborg notes that The Television Has Disintegrated. All That’s Left Is the Viewer.

It seemed, in fact, as though the very idea of television itself was disintegrating. Televisions have always contained two devices: an apparatus for displaying the picture and a tuner for receiving the broadcast signal. And yet they have always seemed like single things, as unitary as a light bulb. You plug them in, turn them on, and there is the old familiar glow of “Laverne and Shirley” beaming down out of the skies. But this new television is nothing like that. It is a town square, an ecumenical gathering place for signals of all kinds. There are all the usual connections, of course, plus ports for a computer (which plays DVD’s), a game controller (which plays DVD’s too), a video iPod (which plays downloaded videos), and a separate port for something I have never heard of called “Service.” There’s a tuner in the TV and also two in the TiVo box. So where, exactly, is “the television”?

I think the answer is that we are now the television.

Well, you are now the company. The "service economy" means every big company is, if not a technology company, at least a white collar company. This is where the barriers to efficiency lie. In the article about his new television Verlyn, oddly, gets to the heart of today's "process." Completely ad hoc. Lots of inputs, lots of outputs. Highly interactive. This isn't your father's process.

Back in the Fifties... even in 1976 when Laverne & Shirley were in their prime... process was primarily thought of as the rigid implementation of policies so that a given set of activities could "scale." But that's not today's process. The impact of globalization is that most of the things that needed to be rigidly implemented - the relatively routine jobs in either the blue- or white-collar worlds - have been eliminated, outsourced or offshored. They're out of time and out of mind. They're off the balance sheet and maybe even off the charts. You can't see 'em, but you sure do need 'em.

Those costs are probably at historical lows in relation to the total cost of producing a product. What is higher is the cost of the glue that hides the ugly seams of this dis-jointed organization. Old ERP systems basically assume you own all those processes and probably all the people are employees (or full-time contractors). But you don't and they aren't, anymore.

BPM: This Century's Black

The new world's ERP is called BPM, and it is meant to help you run your company today, as opposed to 1985... a company who's ability to compete means you have the ability to change partners faster, respond to customers quicker, and, most important, see the tasks (behaviors) that everyone in your company is doing in real-time using the framework of an agreed process, so that you not only have real-time visibility into what's happening today, and what happened yesterday... but what will happen next week, next month and next year if the behavior's not changed.... the ability to understand the elasticity of change certain behaviors engender.

BPM is the means with which to understand, improve and, ultimately eliminate the complexities introduced into your business model over the past 20 years. And because the most invisible aspect of this new model are the human behaviors outside your visibility (and, therefore, control), the principal value proposition of BPM is making what is invisible visible. You were blind, and now you see.

Complexity lies at the heart of today's organization. In addition to structural changes in the business model, increased complexity comes as a result of speed - things are moving faster today, whether it's new product introductions or customer volatility. And BPM is the lens through which you can see these things more clearly more quickly, as well as come to understand what behavioral levers have the most direct impact when things change or go wrong.

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