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Will BPM Projects Start to Fade As Businesses Shift Into Growth Mode?

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Now that the economy is showing clear signs of recovery, do you believe that, as Ian Gotts asks, BPM projects will start to fade as businesses shift back into growth mode?

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  • The answer really depends on what you mean by BPM Projects and their purpose on the programme portfolio.

    I think there’s a perception that BPM (the discipline) is all about following a continuous improvement cycle rather than the creation and support of a growth cycle. This is partly due to the message that BPM has been founded upon and its roots coming from process reengineering. Deming started the ball with Plan-Do-Check-Act, Six Sigma followed suit with DMAIC which if anything reinforced control of the capabilities and performance of an operation but nothing in creating capacity or the ability to innovate for the future.

    I posted something similar on ReduxOnline earlier this month (Downturn = BPM, Upturn = No BPM) and there were some interesting responses. Whether discipline or implementation of a solution, if it’s sold on the basis of an improvement cycle it’ll have a definite lifespan attached to it by the Exec, if it’s sold on the premise that it will create a foundation and support mechanism for growth then it has a greater chance of making it past a business case.

    BPM can provide greater flexibility for an organisation if it chooses to take advantage of it this way. If not, well, that’s a wasted opportunity.

  • As I responded on Theo's blog (Redux) - although BPM and process improvement have tended to follow economic trends counter-cyclically, you can't really predict the next round based on the last round's outcomes. Because the same economic conditions can produce different groupthink in corporations - or one additional variable can change things dramatically.

    Imagine, for example, if offshoring had not been an option (for whatever reason) for Information Technology in 2000-2004... The recession in IT might have looked quite different - we don't know whether it would have been better or worse, but it would have been different - and that is just one variable.

    Also, how you cut cost can vary a lot. In one cycle, you might focus on reducing errors through better software for example - providing the same complexity at lower cost. In the next cycle you might commoditize your product manufacturing and eliminate the need for software to help- getting all of your savings from making all your production streamlined (PCs went through this transition, then intel-based servers, as an example... network gear has gone through similar transitions from time to time).

    So we can't be sure what the current up-turn will hold - but we can hope that businesses will not too-quickly forget the value of running a lean operation as they grow.

  • Think my response will be short to this question...

    Basically, in answer to the question NO.

    I think when businesses are in growth mode they are more likely to look at ways in which to run more efficiently - which can help them grow further and in a more controlled / efficient fashion. It also enables them to realise more profits from their growth due to increased and continued process efficiency...Finally, this kind of investment at a growth time helps protect against times when the company will not be growing, or needs to quickly respond to market demands...

  • I'll expand on Andrew's theme that companies in growth mode will want to improve productivity.

    At the beginning of a recovery, business picks up but people aren't immediately hired to handle the load. Instead, overtime hours go up. Eventually something has to give.

    The business then has a choice: automate and optimize business processes or hire more people. This is the ideal scenario for motivating the development of new process applications. In a stable or shrinking economy, a new process application that improves the business process by automating many tasks will be fought by the people who foresee losing jobs because of it.

    If the improved efficiency instead staves off the need to hire, there is less push-back. In fact, the people whose productivity will be enhanced will like the idea and will provide the help needed to make it successful, since they will see that it will make them more valuable to the company and thus more likely to get a raise.

    It is never a bad idea to look at the motivation of people trying to protect their jobs or, for management, the jobs of the employees that report to them (and thus, the size of their fiefdom).

  • The answer is most definitely "No." Although it is true that BPM is counter-cyclical, this does not mean that BPM businesses will suffer in a returning economy. Our BPM business has absolutely boomed in the last 2 years because ProcessMaker is part of two counter-cyclical markets - BPM and Open Source. But when the economy returns, any reasonably well positioned brand should benefit from the rising tide phenomenon. There is a clear example from the open source technology market with regards to the way RedHat Linux performed in the last two recessions. In each case, market share grew faster in relative terms during the recessions, thus helping to consolidate market share. But in absolute terms, Redhat (and everyone else) performed better during the good times. So, in summary, this recession should have provided a great relative boost and helped in the positioning of many BPM companies. But those same companies should see even better days ahead.

    Brian Reale
    http://blog.processmaker.com

  • No, in fact, I think the opposite will happen. The question insinuates that all BPM projects are undertaken with the notion of consolidation and resource conservation to function with lean assets. This isn't true. Companies that operate at full productivity while decreasing the time and effort needed to manage business processes are much more likely to out-perform and actually grow their profits. If a company is already in growth mode and on an upward trajectory then "leaning" its BPM practices will enable more targeted, organized collaboration amongst employees. Additionally, and this is elementary, growth begets growth. As a company expands so does its product lines, customer base, and subsequently, business processes used to manage the first two. In that sense BPM will get bigger and more entrenched in proportion to corporate growth.

    http://www.ebizq.net/blogs/pp/

  • Thanks to the crisis, BPM is more accepted by enterprises. What I heard:
    - “stop promoting BPM, just let us know how to do it?,
    - BPM helps enterprises to enable innovations,
    - a couple local banks want to re-learn the rational way of working by applying BPM on organizational, operational and technical levels together.

    So, the question is how to capitalize this momentum and show to enterprises that (thanks Theo for nice wording) BPM can provide greater flexibility for an enterprise. I think, we have to industrialize BPM. More precisely, the practice of BPM -- construction and evolution of enterprise BPM systems (which I define as a portfolio of the business processes of an enterprise, and the practices and tools for governing the design, execution and evolution of this portfolio, see also http://improving-bpm-systems.blogspot.com/2009/04/should-we-consider-third-forgotten-bpm.html ). Industrialization of this BPM should make it less depended on tools, level of local teams, etc. and more useful for enterprises.

    The new future of BPM depends on our ability to carry out its industrialization.

    Thanks,
    AS

  • Let's face it - BPM is mostly used for cost cutting. Give me an example where BPM increases innovation. But I completely agree that businesses do not want to do BPM: They want to do business. Which means as long as BPM requries complex and difficult upfront analysis work that won't happen. With BPM a business can be in growth mode for a little while as long as it can exploit existing processes and knowledge. Such exploitatition is easy to copy and replicate and thus it will fail as a competitive growth means very quickly.

    To really and continuosly grow, businesses need to innovate in how they support and service customers. The idea that one can industrialize innovation processes is simply ridiculous and can only come from a person not involved in creative processes and with creative people. I have never seen anyone creative involved in process flowchart design because it is the antithesis to their view of life and work.

    BPM is exploitation, and thus at best usable for 20 to 30% of the processes a service business needs. What about the rest. Around 50% of processes are knowledge oriented and they are not supported by BPM. That is the reason that a more adaptive style 'Design by Doing' (J. SInur - Gartner) of process creation and innovation is needed.

    More on: http://wp.me/pd9ls-dJ

  • Indirectly, looks like we're saying that there was whole lot of BPM growth due to the downturn? I don't think companies really went out of the way and "invested" in BPM when downturn struck, or if they would do when any downturn strikes.

    There are three levels of BPM drivers on Operational dimension (overly simplified to make the point) - Immediate operational savings; Mid-term Operational Flexibility; Long Term Business Agility. Companies invested in BPM from long term standpoint understand this and would not link the BPM investments with downturn. (And in growth environment most probably don't care about real ROI from most investments, not only BPM!)

    If it does look reverse-cyclical for some, they may actually not be practicing BPM but building some "applications" rapidly using BPMS based accelerators, and following agile (and that covers only IT throughput). But I really wonder, even in that case if the benefits so envisaged(!) from BPM within downturn really would have been achieved within the downturn cycle unless they "were" really practicing BPM by the time downturn crept in.

  • There are some great answers posted. I posed the question based on a discussion with elise Olding from Gartner. She had looked back over time and seen a correlation between BPM spend and a downturn in the economy.

    I think there are some different market conditions on this occastion. Firstly there is significantly more regulatory compliance driving a need. Secondly the recent downturn was deep and prolonged and therefore BPM was being considered a strategic option.

  • There is another dimension at play in recessions, many organisations have shed staff and with it mountains of experience. Not a problem if processes are well documented, understood and accessible. If they aren't then businesses face a problem as growth starts of developing people without experienced people to rely on to help. Couplle this with the desire to cut costs in things like training budgets and suddenly you have real problems. BPM can be in some situations the only sensible way forward.

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