1st Edition
Strategy and Business Process Management Techniques for Improving Execution, Adaptability, and Consistency
This book prepares readers to master an IT and managerial discipline quickly gaining momentum in organizations of all sizes – Business Process Management (BPM). It describes how BPM treats processes as a portfolio of strategic assets that create and deliver customer and shareholder value and adapt, when necessary, enabling competitive advantage through consistent performance.
Strategy and Business Process Management: Techniques for Improving Execution, Adaptability, and Consistency defines the planning framework and managerial mindset necessary to craft and drive highly effective business process improvement projects and continuous improvement programs. Readers will learn specific techniques used by industry leaders to formulate and execute business strategy that adapts organizational behavior, business processes, and information technology as a dynamic system designed to assure consistent performance and achievement, even when challenged with unexpected changes or opportunities.
BEST PRACTICES USED IN STRATEGIC PLANNING
Prologue
: The Management Team Is SummonedThe CEO Speaks
Running a Business versus Running a Business Well
Using Best Practices to Align Strategy and Resources
Overview of the Best Practices of Industry Leaders
Using Best Practices to Innovate and Compete
How to Compete: Competitive Strategy
Competitive Strategy: The Classic Approach
Five Forces Model of Industry Competition
New Entrants
Intensity of Rivalry
Pressure from Substitute Products
Bargaining Power of Buyers (Customers)
Bargaining Power of Suppliers
Determining a Defensible Position
Competitor Analysis
Building on Porter’s Best Practices
How to Focus Operations: The Discipline of Market Leaders
New Rules of Competition
Operating Models
Operational Excellence Operating Model
Product Leadership Operating Model
Customer Intimacy Operating Model
Defining Value
Building on Treacy and Wiersema’s Best Practices
How to Manage Performance: The Balanced Scorecard
Performance Measures from a Customer Perspective
Performance Measures from an Internal Business Process Perspective
Performance Measures from a Learning and Growth Perspective
Strategy Maps
Summarizing Kaplan and Norton’s Best Practices
Building on Kaplan and Norton’s Best Practices
How to Adapt: Adaptive Enterprise
Adaptive Loop
Modular Organization
Commitment Management Protocol
Building on Haeckel’s Best Practices
Section I Conclusion: Strategic Planning—A Process, Not An Event
EXECUTION—BEST PRACTICE USE OF STRATEGIC RESOURCES
How to Structure Organizational Behavior for Strategic Execution
Workforce Collaboration
Collaborative Objectives
Managing Responsibility and Accountability
How to Structure Business Processes for Strategic Execution
Defining Processes
Operating, Support, and Management Processes
Operating Processes
Support Processes
Management Processes
Control Processes and Competitive Advantage
Business Rules and Process Controls
Core and Noncore Processes
Preparing to Organize Processes as Assets
Managing Processes as a Portfolio of Assets
Business Process Portfolio Management
Business Process Portfolio
Business Process Inventory
Introducing Business Process Reference Models
Evaluation Dimensions
Next Steps
Analyzing Inventoried Processes
Managing Process Execution
Performance Measurement
Selecting Key Performance Indicators
General Rules about Selecting and Crafting KPIs
Measuring Variance
Using Trend Analysis
Using Benchmarking
Performance Control via Event Management
Exception Management and Resolution Management
Enabling Event Management
Improving Execution through Process Modeling, Analysis, and Simulation
Selecting Processes for Improvement
Symptomatic versus Strategic Process Improvement
Symptomatic Processes
Strategic Processes
Continuous Process Improvement Program
Dealing with Complexity
Simple versus Complex Processes
Assessing Process Complexity
How to Structure Technology for Strategic Execution
IT Trends That Influence IT Strategy
Applications and APIs
Workflow and EDI
ERP
ETL
EAI
Business Process Modeling and Analysis
Business Rules Management
Internet
Open Source
SOA
SaaS and Cloud
BPMS
BAM and BI
Assessing IT Readiness
IT Capabilities Enabling Process Change
Overall IT Readiness
Crafting a Process-Centric IT Strategy
Petitioning for Process-Centric IT Strategy
Investing in Process-Centric IT Architecture
IT Portfolio Management
Objective Evaluation and Financial Analysis
Objective Evaluation
Financial Analysis
Competing for IT Budget
IT Portfolio Budget Structure
Funding Availability
Funding Sources and Accounting Methods
IT Budget Management: Resource Perspective
IT Budget Management: Domain Perspective
IT Budget Management: Purpose Perspective
IT Budget Management: Asset Class Perspective
IT Investment Practices of Industry Leaders
Making an IT Investment Request
Section II Conclusion: Resources Structured for Execution.
HOW TO ALIGN STRATEGY AND RESOURCES TO IMPROVE EXECUTION, ADAPTABILITY, AND CONSISTENCY
Derivative Analysis Technique for Business Strategy and Resource Alignment
Using Derivative Analysis to Align Strategy and Resources: A Self-Assessment
A Generic Derivative Analysis
Section I: Best Practices Used in Strategic Planning
Progress Report—Section I: Best Practices Used in Strategic Planning
Section II: Execution—Best Practice Use of Strategic Resources
Progress Report: Execution—Best Practice Use of Strategic Resources
Final Report: Derivative Analysis
Section III Conclusion: Strategy and Resources Aligned
Epilogue:
The Management Team ReconvenesThe Chairman Speaks
Some Practical Success Factors for Improving Execution, Adaptability, and Consistency
Start Where Common Sense Tells You
Avoid Complexity at First
Assign Ownership
Address Misconceptions
Communicate
Check Reversion
Proceed Diligently
SUMMARY CONCLUSION
Summary of Key Guidance
Section I: Best Practices Used in Strategic Planning
Section II: Execution—Best Practice Use of Strategic Resources
Section III: How to Align Strategy and Resources to Improve Execution, Adaptability, and Consistency
Epilogue: Management Team Reconvenes
Appendix A: Important Terminology
Appendix B: How to Evaluate Business Process Analysis Software
Works Cited
Index
Biography
Carl F. Lehmann is Founder & Principal Analyst at BPMethods, LLC, Duxbury, Massachusetts, USA.
In our latest BPTrends survey, readers indicated that one of their major concerns was with how to tie corporate strategy together with BPM. Carl's book provides a detailed look at the ways one can do just that. It also provides managers with a great overview of how to solve the problems involved in creating and fielding new processes in this time of unprecedented change. Pack this book in your backpack as you set out on your process journey.
—Paul Harmon, Executive Editor, www.bptrends.comStrategy and innovation meets real-world execution. Carl lays out a concise blueprint of techniques from the best practices in business process management and presents them in a way that is immediately relevant and useful to help solve the global challenges facing every business.
—Jim Hendrickson, General Manager, Global B2B Cloud Services Product Line (IBM)Gartner defines BPM as a management discipline that treats processes as assets that directly contribute to enterprise performance by driving operational excellence and agility. Yet most practitioners struggle to advance their BPM efforts from narrowly defined projects into an enterprise program. Although incremental process performance improvements are delivered at a functional unit level, in fact, enterprise performance is actually sub-optimized. To achieve enterprise success, BPM leaders should pursue BPM as a discipline of disciplines, as Mr. Lehmann describes in this book. An over arching framework that integrates various management disciplines (i.e. Balanced Scorecard, change management), process improvement methods, BPM-enabling technologies, and governance over the rate of change is key to advancing BPM maturity and delivering enterprise performance gains. Mr. Lehmann’s book, Strategy and Business Process Management provides pragmatic guidance for creating such a framework.
—Janelle Hill, Vice President & Distinguished Analyst, Business Process Management Research, GartnerThis book helps the reader by simplifying an otherwise complex BPM learning curve. It accomplishes this by dissecting a logical sequence of proven techniques and best practices across different disciplines and industries, and applying them to rapidly evolving business strategies and performance metrics. There are numerous examples and checklists that drive home salient messages. The book further synthesizes its findings into a decision framework and tools that can help practitioners to plan better and consistently execute business strategy. It should thus be valuable not only in proselytizing the BPM concept, but as a reference guide for those embarking on the BPM journey.
—Dale Kutnick, Senior Vice President, Gartner Executive ProgramsThe best path toward sustainable competitive advantage can be elusive. Organizations must seek a direction that structures their resources to embrace customer centricity, fuel growth amidst change and turbulent markets, and instill discipline in managing the bottom line. Carl’s book offers key insights for assembling an organization’s people, business processes and information technology into an adaptive system. His common sense line-of-reasoning offers sharp contrast to typical ivory tower process methodologies and frameworks. This book reveals the path for all management teams tasked with creating and sustaining the foundation and practices for strategic business transformation.
—Binu Thomas, Director, Strategic Process Transformation, MetLife
Carl has captured the essence of what it takes to achieve game-changing performance improvements and sustainable business acceleration in today's increasingly competitive business environment. Continuous process innovation is imperative for corporate survival and Carl's approach to Business Process Management is unparalleled. From strategic business analysis to consistent on-target execution, this book is a must read for the entire management team of any organization.
—Scott Thorogood, Chairman, Aegean GroupBusiness Process Management – its principles, disciplines and enabling technologies – will be one of the defining agility and efficiency levers of future business success. Carl has delivered a solid and pragmatic prescription for connecting strategy with the reality of BPM mechanics and execution.
—Herb VanHook, VP of Strategy, Office of the CTO, BMC SoftwareThis is a very useful resource for people interested in continuous process improvement and ensuring that your processes support your business strategy. It is probably most applicable to medium and large organizations. … a very useful book that summarizes and links together a number of different areas and approaches to strategy and process management.
—Alex McLachlan MBCS, in Book Reviews, www.bcs.org