Flexible Process Management
1 March 2007 Rod Favaron
Taking BPM from the IT department and handing the power to rewrite processes to the experts can transform your company. Lombardi's Rod Favaron tells Jim Banks how he sees the future of business process management.
Business processes are increasingly automated, mapped and analysed by technology. This has led to a shift towards orientating businesses around their processes, and there is great potential for better products catering to a growing market of professionals who understand business process management (BPM) and want a greater role in defining their tools.
While BPM tools have grown to meet basic demand, there is room for vendors to improve their products, in particular by targeting non-IT professionals. And, although customers appreciate what BPM can offer, these attitudes could be more sophisticated. BPM improves understanding, visibility and the continuous improvement of business processes.
Rod Favaron, president and CEO at Lombardi, a BPM software provider, says: "We are seeing serious evolution of process-orientated management among Fortune 2000 companies, driven by competition and regulatory compliance."
Lombardi's BPM software, TeamWorks, is built on open standards and aims to provide greater visibility and control of business processes to improve efficiency and decision-making.
Favaron has seen BPM vendors adopt approaches similar to those used in technology development, which typically comprise tools that enable a team to model, simulate and then automate a business process. This casts BPM as merely a more efficient means to develop applications, but Favaron believes it can offer much more.
Early adopters of BPM, notably in financial services, healthcare and government, have experience of the technology and are learning where it might lead them in the future. Manufacturing and other product-related verticals are also catching up and Lombardi sees this as an opportunity for vendors to take a fundamentally different approach that will address what these companies now want from BPM.
Favaron says: "Customer attitudes are generally more mature, but there are certainly some organisations that are leaders in adopting BPM. The winners will be those who become process orientated with a view to transforming their businesses."
For Lombardi, the BPM sector has not gone far enough to help firms achieve this transformation. In fact, Favaron believes that a fear of business transformation is hindering investment. Smaller vendors often focus on solutions for specific industry verticals or developing niche applications and even though large companies, such as IBM, Oracle and SAP, are working to build their share of this market, they adopt an IT-centric approach.
Favaron believes that while the larger developers can get some traction in the market, there is a need to go beyond a purely IT focus, and that Lombardi is ahead of the game in this regard.
BPM aims to improve process efficiency by reducing duration, cost and the amount of reworking required. It also improves effectiveness, which is not just about reducing the number of steps in a process, but also about delivering better service. The final goal is agility – the ability to adapt processes as needs change.
Lombardi believes that TeamWorks delivers better performance than competing technologies in all three of these areas, although it specifically emphasises agility.
Favaron explains: "Production processes change every 12 weeks on average, but can you change SAP applications that frequently? The reality is that processes change all the time; not because companies want them to, but because regulations change, or someone in the company has a better idea, or an organisation wants to add new services." TeamWorks puts process improvement in the hands of the people who use those processes every day, and most Lombardi customers upgrade their processes every six to eight weeks until they stabilise.
This approach is rapidly winning support among the Global 2000, and Lombardi saw its business double last year. Its sales went up by a remarkable 171%, the third year of triple-digit growth, and its software sales surged by 243% in the fourth quarter. Favaron says: "2006 was a fantastic year for Lombardi and we fully anticipate our performance doubling again in 2007."
POWER TO THE PEOPLE
Lombardi believes its model could set the tone for future BPM development. TeamWorks enables users to shape processes as they see fit, putting power in the hands of the people who understand business processes.
Lombardi feels that giving users outside the IT department the ability to shape the processes that they deal with every day offers a key advantage.
Favaron says: "We are approaching this from a very different angle to the IT shops. They simply break monolithic services down into a library of IT services. The real challenge is to look from a process point of view and IT systems don't work that way.
"We are looking to unleash those people in an organisation who are tech-savvy, but are not programmers. We get businesspeople to do the work on refining processes."
Getting such people involved in process development has two main advantages. Firstly, they are best placed to know why certain processes may be failing, as they use and observe those processes daily. Secondly, it removes some of the bottleneck created when process changes go solely through the IT department.
Favaron says: "We are building software for the 99% of people who are not programmers. For six years we have been helping non-IT people to optimise their processes by offering a solution that is as easy to use as Excel, but is useful as enterprise software."
PROGRAM FOR CHANGE
The future of BPM is wide open, and Lombardi feels well placed to face the challenges ahead.
Consolidation among vendors, with enterprise software companies buying smaller, niche BPM players, is likely to be a feature of the market in the coming years. Lombardi, however, feels that it is ahead of game, as it is not tied to any one industry vertical.
Lombardi claims to deliver real results within a short timeframe if companies take a broader view of how BPM can be implemented. It also urges firms to experience those benefits firsthand because it feels that this will encourage further investment.
Favaron says: "The days of re-engineering products are over. We advise customers to start with something really important and painful. A successful project can really change the energy in a company. BPM and business transformation are not technology problems, they are about behavioural change. BPM is a way of life, not just a technology. Our technology solves half the problem, but the rest is down to skills and enabling the workforce to optimise processes."
In fact, senior executives are already sponsoring more evaluation teams, which include not only IT professionals, but also those people who understand specific processes. According to Favaron: "In five years, the adoption of BPM will be like the adoption of ERP systems today. We will move towards the ultimate aim of connecting specific processes to corporate goals, linking executive decisions to day-to-day activities."
Improving BPM is certainly the next step, but what form this will take is yet to be seen. If Lombardi gets its way, the power to redesign process management will be placed firmly in the hands of the people who deal with processes on a daily basis.