February 3, 2015

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Setting up a BPM Center of Excellence (CoE)

I recently wrote a blog on how BPM can help in front office innovation by enabling back office automation. (You can read it here). The blog focused on how BPM can help in implementing new age applications without going through complex legacy modernization.  However, before realizing the full potential of an elegant BPM implementation, one of the most critical factors for success is to setup a BPM center of excellence.

Why have a BPM CoE?

A BPM program is a collection of business processes that are defined in a simplified manner which helps in reducing the cost and improving the quality of services. Often, a BPM program is initiated to solve an immediate business problem. The desire to solve a particular problem through BPM results in the creation of silo solutions that cannot be scaled or repeated to solve other organizational needs. BPM implementation costs a lot of money to the organization, and a poorly designed BPM solution struggles to provide the stated return on investment as per the business plan.

A BPM CoE can help mitigate the risks in creating business problem specific solutions for an enterprise wide program. However, the key issues involved in setting up a CoE are twofold:

  • What would the CoE do?
  • Who would pay for the CoE?

This blog attempts to answer both questions and provide some clarity in justifying a BPM CoE for an enterprise.

BPM CoE Construct

Before setting up a BPM CoE, it is important to define its scope, role and function. A BPM CoE should have the following three components:

  1. Operationalize: A focus on mobilizing the CoE and making it real and functional. Functions like architectural best practices, common services, and demand management functions are key to operationalize the CoE.
  2. System Management: Establish the right technology platform for performance and business activity monitoring. System management aims to provide proactive and adaptive analytics to make the BPM platform robust, scalable and business aligned.
  3. Behavioral Changes: Aspects of organizational change management (OCM) for the adoption of BPM practices and ways of working.

The picture below, details the CoE construct.


 

  1. Operationalize:

    To successfully set up a BPM CoE, an organization needs to establish clear and defined goals and objectives for the CoE, with a clear vision and roadmap. These are the critical elements for operationalizing a BPM CoE:

    • Define the CoE charter: It is of paramount importance to correctly state the business objectives of the BPM program. Clearly define the problem(s) you are trying to solve and then articulate the mission of the CoE. Clarity in thought is the first step in establishing a successful CoE.
    • Establish roles and responsibilities: Often, BPM services users are confused about the role of a CoE - how would it benefit them? How do they interface with the CoE? Etc. Clearly define the roles and responsibilities of the CoE, provide access points to the larger organization, and mention what function(s) the CoE will perform and how this will benefit the program.
    • Articulate the vision: Defining the CoE’s goals and complementing it with a roadmap of functionalities gives confidence to the organization. Highlight the business benefits and align the CoE to broader organizational initiatives.
    • Define a roadmap: The CoE should run like a product company – provide a clear definition of what functionalities will be offered, and by when. This provides clarity in the thought process and gains acceptability in the organization.
    • Define the process for demand capture: Once the organization experiences a successful program, this will lure the other business units who would want to implement BPM.  Not having a proper process for demand capture will not only create chaos but also cause the program to fail due to poor planning and other system related limitations.  Set up the governance and cadence with the business and organization, work out a template-driven ROM (Rough order of Magnitude) model for work estimation, and provide strategic consulting help to the business wherever applicable.
    • Align the demand to the program’s objectives: Always ask how the current demand aligns to the organization’s priority. It is critical to align the program and capabilities. Taking on a program that does not align to the BPM CoE’s priority may result in program failure. Stakeholder management is another key aspect in this scenario.
    • Define in what stages of the program the CoE will be involved: The CoE cannot and should not be involved in all the stages of a program’s implementation. Define clearly where the CoE can help. For instance, the CoE can help in the architectural design or can act as a development extension team in concept evaluation. Making such things clear increases the adoption of the CoE.
    • Create a CoE Digital presence: Get the digital experience of the CoE in to the hands of the business users; create a web portal and/or a mobile app which provides one point access to all information about the CoE, or develop a podcast for best practices or conduct online design JAD sessions. Make people feel its presence.
    • Publish success stories: Replicate the best practices, capture the lessons learned, and publish the success stories. Remember that success reaps further success. This is absolutely crucial from the standpoint of adoption.
    • Think about the future; Stay ahead of the game. Conduct experiments, be business focused and solve problems in small incubation factories. Make Innovation as one of the prime agendas of the CoE.
  2. System Management:

    System management offers a common technology stack that helps develop the BPM program function according to business needs. The key elements of system management include:

    • Dashboards and reporting: For a successful BPM program, the system needs to function well. Use the information generated by the system to learn instantly and act. Provide instant access to BPM related metrics based on user persona and access.
    • Business activity monitoring: Implement BAM (Business Activity Monitoring) to provide real time access to data for business critical application monitoring and reporting. Provide the ability to deliver business intervention based on events.
    • Focus on non-functional requirements: Focus on elements such as performance, connection throttling, dynamic load balancing, user state maintenance, and the ability to scale as resource demand fluctuates. These are key aspects for BPM to be scalable as the program expands its user base and more business processes get on board. 
  3. Behavioral changes

    A BPM program can only be successful when an organization adopts it. BPM changes business processes and often results in the elimination of roles, or in doing things differently. This often creates organizational barriers which are prime reasons for implementation failure. These are the key elements to consider in the organization-wide adoption of BPM:

    • Understanding the organization: Each organization is different. Before defining an OCM strategy, it is critical to understand who the key stakeholders are, assess the organization’s readiness to change and determine the key influencers.
    • Leadership buy-In: For a BPM program to be successful, leader buy-in is absolutely critical. The leadership team needs to invest its time in the change management process and help mitigate people-centric risks.
    • Communication strategy: Depending on the culture of the organization a communication strategy needs to be drafted. Beyond delivering the communication it is also necessary to monitor and track it for effectiveness and take the necessary corrective action.
    • Competency building: Establishing the training approach, accessing behavioral and managerial training needs, and accessing the impact of change are critical towards building the competency for successful program rollout.
    • Sustenance: Celebrating successful milestones, recognizing team efforts, capturing feedback, and realigning performance management are key to the adoption of the program.

Through this blog I’ve attempted to show the critical thinking that is required for a successful BPM implementation, which starts even before the program begins. Often, creating a CoE is seen as an overhead or as an overstated need. However, when a CoE is correctly established, the success of a program can be guaranteed and the businesses can realize the return on investment. If done correctly, the BPM CoE pays for itself as most of the architectural services it provides could be leveraged by the programs. Besides, it can eliminate program waste by around 30%.