Process Is The Main Thing

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Banking and Telecom: BPMS without BPM

Banking and telecom were the first BPM adopters. How valuable is these pioneers’ experience for other industries?

Let’s consider a manufacturing company. Roughly speaking, it consists of a shopfloor and an office. The demand for BPM comes from the office: the customer-centric business processes, the issues of cross-functional cooperation, the interaction between people and automated systems are all here.

The shopfloor has processes, too. But these processes have specific issues, specific methods and technologies: production lines, automatic machines, process control software. There is no cross-functional issues - it’s a single function after all. There is no need for BPM here, rather industrial automation and robotics.

Now look at the bank. It has the office, too. The processes here are basically the same as at the manufacturing company’s office: interactions with clients, personnel on/off-boarding, advertising campaigns planning and execution, computers maintenance, bookkeeping etc. Therefore we may expect that BPM is applicable in pretty same way.

The bank’s ”shopfloor” is a place where accounts and transactions are stored and processed. The principal difference from the real shopfloor is that it doesn’t need people: only servers, databases, automated systems and networks. Computers instead of humans and machines, ATMs and SWIFT instead of delivery service. Unlike the real shopfloor, it’s possible to fully automate the bank’s shopfloor.

Since a single automated system can’t satisfy all needs and besides we interact with other banks’ systems, there is a need of processes at the bank shopfloor to coordinate actions performed by different computer systems. A human is either not involved at all (STP - straight-through processing) or only handles relatively rare exceptions.

No humans - no pain: the most part of the process complexity goes away with humans. Therefore the complexity of bank’s shopfloor processes is much less than the complexity of the office processes. On the other hand the shopfloor processes’ performance, reliability and scalability requirements are much higher. The process consisting of calls to three or four systems and databases, several business rules and couple of logical gateways is relatively easy to model, it doesn’t change frequently due it its simplicity but it must be processed in milliseconds and the system must handle a huge flow of such processes. This is a perfect fit for BPEL while process methodology and agile implementation are of no use. It is a pure IT project.

A telecom company has a human-less “shopfloor”, too: a client makes a phone call - the process runs from the beginning to the end - the data are stored into one or more systems of one or more (e.g. in the case of a roaming call) companies.

Historically, both the systems used to manage specific processes at banks and telecoms “shopfloors” and the systems designed for office processes are called BPMS. It pleases those vendors who have chosen a strategy to satisfy the banks’ needs first and then try to adapt the product for the rest.

So when a vendor reports on successful BPM implementation at the bank or telecom, it is often about the “shopfloor” processes really. But due to the human-less nature of these processes such experience is hardly applicable to other industries. We may call such projects “BPMS without BPM”: BPMS is involved but the other two components of BPM - a process methodology and agile implementation - are absent.

I don’t mean that all BPM implementation in banks and telecom are of this kind. For example the initial phases of “Issue a Loan to an Individual” (application processing, customer verification, decision making) is a typical office process with human activities and complicated logic, long-term yet relatively low-intensive. When the credit is approved and the contract is signed, the end-to-end process continues at the “shopfloor”: the information is stored in information systems, the SMS notification is sent to the client etc.

So better get deeper into vendors’ cases, try to figure out whether it’s BPM or just BPMS.

04/24/10 | Articles | ,    

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