1. BPM and Sustainability Identifying the pathway to the future state, governance methods, and tracking methods

2. What is Sustainability? “The ability to maintain into perpetuity” (en.wikipedia.org/wiki/Sustainable)en.wikipedia.org/wiki/Sustainable In the business world, it is most often discussed as sustainability of a society or an organization The sustained success of an organization is demonstrated by its ability to satisfy needs and expectations of its customers and other interested parties over the long term and in a balanced way. From ISO 9004:2009 Try to identify fundamental principles of the so called “Visionary Companies” who survived for at least 50 years through various product life cycles, technological evolutions and revolutions, various management theories and generations of active leaders. “Built to Last”, Jim Collins and Jerry I. Porras We will discuss three types/levels of sustainability in this session: A.Organizational sustainability B.BPM COE sustainability C.Process sustainability BA 553: Business Process Management2

3. A. Organizational Sustainability Some organizations have managed to vastly extend the company lifecycle: BA 553: Business Process Management3 1812 Citicorp 1837 Procter & Gamble 1847 Philip Morris 1850 American Express 1886 Johnson & Johnson 1891 Merck 1892 General Electric 1901 Nordstrom 1902 3M 1903 Ford 1911 IBM 1915 Boeing 1923 Walt Disney 1927 Marriott 1928 Motorola 1938 Hewlett-Packard 1945 Sony 1945 Wal-Mart

4. BA 553: Business Process Management4 B. BPM COE Sustainability Developing a sustainable approach to BPM is crucial to the sustainability of the organization as a whole Activities to achieve BPM COE sustainability: 1.Identify the future state for BPM and the major steps in the pathway to get there 2.Establish governance groups and mechanisms responsible for approving BPM activities (session 9) 3.Create tracking tools and metrics for tracking BPM COE activities and BPM progress 4.Develop a culture of continuous learning within the BPM COE to ensure skills and knowledge are constantly updated (session 5)

5. BA 553: Business Process Management5 1. Identify BPM COE Future State and Steps In order to be self-sustaining, the BPM COE must identify its desired future state and the pathway to get there The future state has many aspects, including: Process assessments Process capabilities Governance Tools and templates Current state mapping Integration/information sharing Roles and responsibilities Metrics Management of change Continual improvement B. BPM COE Sustainability

6. BA 553: Business Process Management6 Example BPM COE Journey Current state First round of “as is” maps done Complete missing “as is” maps Document “as is” into network Complete process specification Process templates created Develop improve- ment tools Develop facilitator’s instructions Integrate tools across enterprise Opportunities reviewed on their merit Examine prioritizastion methods Develop prioritization methodology Establish governance body Future state Few skilled process personnel Review BAs for potential apprenticing Hire internal process personnel Train all in tools and methods Current state mapping Tools and templates Governance Capabilities Assessments No assess- ment tools in place Develop process assessments Conduct process assessments Identify areas for improvement Year 0Year 1Year 2 B. BPM COE Sustainability

7. BA 553: Business Process Management7 Example BPM COE Journey (Cont‘d.) Reactive to requests for process work Identify/act on improvement opportunities Establish roles for process masters Continually audit processes and improve Process “big picture” not understood Develop process network Establish process-based mgt. of change Change impact known and understood Few process baseline metrics exist Establish preliminary health metrics Establish detail metrics, non-scorecard Include pro- cess metrics in scorecard Future state R&R not defined for process work Identify Lynx-defined R&R, review Determine approach to process R&R Establish R&R, train and deploy Lack of integration on tools/methods Form BPM Community of Practice Integrate with other enterprise groups Integration continued by governance body Year 0Year 1Year 2 Current state Roles and responsibilities Metrics Integration/ Sharing info. Continual improvement Management of change B. BPM COE Sustainability

8. BA 553: Business Process Management8 3. Establish Tracking Tools and Methods The pathway to the future state has been determined The governance bodies and mechanisms have been established Sustainability is now a matter of tracking progress and making necessary modifications based upon tracking results Tracking involves developing templates, tools, and methods for process work and measuring their effectiveness, along with the effectiveness of the process efforts overall The next slide provides a listing of some of the models, templates, tools, and methods discussed previously in this course B. BPM COE Sustainability

9. BA 553: Business Process Management9 Example BPM COE Models and Templates Process Specification Model (BA 563) Enterprise Process Framework: Value Chain and Process Network (session 5) Enterprise Process Inventory Template (session 5) Process Maturity Model (this session) Enterprise Maturity Model (today’s class) Five-Phase Approach (session 12) Process Change Deployment Model Project Status Communication Template B. BPM COE Sustainability

10. BA 553: Business Process Management10 Example BPM COE Tools and Methods Tools Process Modeling Tools (covered in BA 563) Process Improvement Tools (covered in BA 563) Process Measurement Tools (including SPC) Process Management Software (session 10) Process Information Library Training Materials for Process Roles Methods/Processes (most covered in BA 563) Process Project Prioritization Method Process Improvement Approach Process Design/Reengineering Approach Lean Sigma Process Improvement Suggestion Process Improvement Team Selection Method Process Owner Designation Method Change Management Processes B. BPM COE Sustainability

11. Example: BPM Sustainability Elements BA 553: Business Process Management11 Value Realisation Competency Development Business Process & IT Systems Support Sustainability Elements Knowledge Management Performance Management Process Governance This and next 2 slides: Chevron (2007), Process Sustainability, internal project presentation. B. BPM COE Sustainability

12. Example: BPM Sustainability (Cont’d.) Value Realization Track business process KPIs (and resulting dollars) monthly Convert KPIs to financial impact Communicate results Mandate Stewardship Process Governance Align process model with business planning Establish Process Sponsor and Process Owner for the processes Integrate process governance with IT governance Conduct business processes audits Business Process and IT Systems Support Define the holistic end-to-end support model Include SAP support, master data maintenance, etc. Integrate process support and governance to establish network of SMEs BA 553: Business Process Management12 B. BPM COE Sustainability

13. Example: BPM Sustainability (Cont’d.) Competency Development Build competency models for key process roles Conduct competency assessments and plan for their development Ongoing training (process training and IT applications training) Connect process competencies to career development system Knowledge Management Identify process architecture, and implement a single process library and Knowledge Management system Identify needs of end users of the process management systems Link process knowledge management system to company training program Implement a Knowledge Transfer process Performance Management Include accountability for various roles in performance plans Identify accountability for KPIs by function and region Monthly performance dialogues Conduct process observations and evaluations BA 553: Business Process Management13 B. BPM COE Sustainability

14. C. Process Sustainability The BPM COE undertakes BPM projects to design new processes or improve existing processes It is critical that the project team develop a process that can be sustained at a given level of performance long after the project is completed One way of measuring process sustainability is through a value realization: measuring whether the intended value of the effort is achieved (through its impact on KPIs) Value realization is usually measured as ROI (return on investment): the payback, over time, of the investment in designing, implementing, and managing a new process or an improved process Sustainable processes are a foundation for building a high performance organization BA 553: Business Process Management14

15. Characteristics of a Sustainable Process As mentioned previously in class, every process has its own lifecycle Processes that have a longer lifecycle and are sustainable: Reinforce or help achieve the organization’s strategy Are focused on meeting the needs of its internal and external customers Are documented as part of the organization’s process architecture Have process performance metrics, and are regularly measured Are streamlined (steps that add no value are eliminated where possible) Are designed so process problems are quickly identified and addressed Are conducted by fully-trained and qualified personnel Are flexible and agile: Enable employees to use some judgment to meet customer needs Are redesigned as needed to align with company strategy Are modified (or eliminated) when technological advances are made BA 553: Business Process Management15 Some content from AMA (2007), How to Build a High Performance Organization, from www.amanet.org.www.amanet.org C. Process Sustainability

16. Success Criteria for Process Sustainability Identifying Process Owners (session 10) Ideally, Process Owners are identified early in a BPM project so they can be involved throughout the development of the process models Near the end of the BPM project, the process models will be handed off to the Process Advisors for ongoing maintenance and continual improvement Linking process efforts to the annual planning cycle (session 8) Governance of processes (session 10) Sourcing process modeling expertise It’s important to keep the process model current after the project is complete It is necessary for the organization to have access to someone who is skilled in the use of the process modeling tool – in some cases, this may be the Process Owner – if not, Embedding process training into the company’s training programs Reinforcing critical process behaviors (session 9) BA 553: Business Process Management16 C. Process Sustainability