Sourcing Shangri-La

Optimize 15,000 Business Controls? No Problem.

This is kind of obvious - I'm sure you knew it already - but it had escaped me until I sat in on two client case studies at IP11 this week: Managing variants in global business controls is essentially the same problem as managing variants to global processes.  Except that it's arguably more complex and business critical.

McKinsey has noted that most organizations don't manage global processes well. Many are in denial that there is a problem. They define process variants as an IT issue and talk of 'vanilla' system implementations as solutions. And if variants are addressed, it's in a one-off Inquisition, as though things would stand still thereafter.

The truth is that every global process requires local variants of some sort. But global processes continually evolve, and local circumstances continually change. So what's really needed is the capability to continually re-optimize the mix of global process and local variants. And, of course, to continually re-deploy these changes to the workforce in a way that ensures adoption. 

McKinsey noted that many multinationals don't have the collaborative (and governance) framework in place to pull this off. They suffer a 'globalization penalty'.

It's the same problem for global business controls, except more complex.

Rene Nibbelke from BAE Systems highlighted in his IP11 keynote the value of visualization in enabling a Finance team to transform and deliver 280 processes with 230 business controls. But an investment bank, in a workshop case study, showed 15,000 business controls embedded in its processes in Nimbus Control.  Many were local variants. The bank's problem was to continually re-optimize the mix of global controls and local variants.

As an integrated management platform, Nimbus Control delivers the capability to continually re-optimize the global/local mix for processes and business controls.

It's not just analytical either - it supports real world operations, where some business controls require daily reporting and attestation.  And it can do this at pace. 

In one case study - another investment bank - the client created a single source of truth: an integrated process map, covering its activities in 28 functional areas and across 3 regions of the world, complete with 10,000 business controls embedded in the operational processes - in just six months.

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After Nimbus IP11, The Sky's The Limit

 
It seemed entirely appropriate that an extraordinary first day’s program at Nimbus IP11 closed out this evening with a stunning set from the amazing a cappella vocal group Naturally 7.

It was a day of superlatives. I lost count of the number of people, whom I’d never met before, saying, in the breaks: ’This is amazing!’. 

As one delegate put it, the Nimbus plane took off some time ago, lifted high by client enthusiasm.  And the video message from TIBCO founder and CEO, Vivek Ranadivé, who was keynoting at TUCON in Las Vegas today, confirmed that Nimbus now has an extra large powered-by-TIBCO jet engine strapped under each wing.

As ever, it was Nimbus customers who fizzed with energy. And, as usual, their candor was remarkable: this was real knowledge-sharing among pioneers in an approach to enterprise business process management that will one day be business-as-usual.

My own highlights from the stage, picked out from a packed program, would be...

Tim Leach from Northrop Grumman, on the challenge of bringing together the insights of 23k people (many of them actually rocket scientists, he laughingly pointed out) and aligning them in the cause of continuous improvement. If Northrop Grumman can assemble all the parts for the most advanced aerospace equipment, and keep them aligned so the plane can fly, then why is it such a challenge to get people aligned and flying in formation?  How could it be that having 7k people trained in Six Sigma and Lean was yielding so little in terms of sustainable cost reductions and service improvement? The answer: bring their work together into a single process repository, within a single process architecture, and connect that with how people get real work done. “Our failure”, he said,”was that we tried to build it ourselves. After 18 months we found Nimbus, and that was an immediate 85% of the solution.”

Richard Miller from Marathon Oil, manager of a platform in the Norwegian sector of the North Sea that cost $3bn to build, costs $160m to operate every year – and that pumps $1.6m of oil and gas per day, when everything is working properly. After a Nimbus Control implementation that has successfully enabled a major in-sourcing exercise, and a re-implementation of SAP: "The thing I notice", he said,"is that things are becoming much more predictable. Not just in planning work and the delivery of materials, but right across the business."   

Darren Anderson, Principal Solution Architect for Sony, based in Tokyo, steering Sony's global SAP program (which is his 32nd major SAP implementation), and striving to ensure that process is at its heart. "We had this realization - I knew this but could never vocalize it - that end-to-end process is what we have to focus on." That realization had enabled Sony's European business to reduce the timeline for delivery of an SAP program from two years to just one. "The critical success factor was Nimbus: working around one process. I want the business to be thinking about how to improve the process, not have to think about changes to SAP. Nimbus Control has the potential to accelerate our global program, and to help us win in the marketplace by being One Sony."  

Gregory Reynolds, Head of the BPM Center of Excellence at Nestlé, described as a 'no-brainer' the final decision, after an exhaustive evaluation, to adopt Nimbus Control as Nestlé's global BPM platform. "There's almost unlimited potential", he said,"because continuous improvement is baked into our culture." 

Anne Salétes from Novartis on how Nimbus Control is enabling process improvement in the most challenging regulatory environment by providing end-to-end visibility. "We are all talking about - and challenging - the same perspective on our clinical operations processes. Our people working in clinical trials are, naturally, very precise.  What we are doing is helping them to see the big picture as well. So we can see how we can improve - and show our regulators that we are efficient and managing the risks." 

The funniest moment, for me at least: Richard Parker, co-Founder of Nimbus, talking about the company's evolution within the SAP landscape, and noting that: "We're not just going around helping the victims of SAP implementations any more."  (Images of ambulance-chasing to get to the scene of an implementation and help to restore the vitals of the enterprise fast...)

But I can't neglect to mention the Guide Dogs video, which was hugely inspiring. I happened to meet a delegate from the conference on the train on the way home (as I wrote this - she recognised my conference badge!) - and it was the Guide Dogs, and Naturally 7, that she wanted to talk about.    

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Google's Ngram Viewer - on BPM and Sourcing

Google does it again. This week's TED video on What We Learned From 5 Million Books introduces the Google Labs NGram Viewer, which searches for any phrase of up to four words across the five million books already digitized.  It's Big Data meets the cultural genome: the new 'science' of culturomics. Fascinating and open to all. I could easily have wasted the whole afternoon...

Looking at the number of mentions since 1980 for some common terms in this neck of the business world, it's astonishing how closely the data fits the reality as I've seen it.  Lean has grown consistently every year since 1992, though you have to wonder if it won't soon go the way of Quality Management, which peaked in 1996, and Six Sigma which has been in decline since 2004. BPM and Business Process Management show modest but steady growth since 1999. 

 
It seems odd that Outsourcing has been mentioned so much more frequently than Shared Services. Satisfying naturally to see how Business Process has tracked so closely the growth of Sourcing ;-).

 

Great fun and, one day, an incredible cultural resource - it's at http://ngrams.googlelabs.com

 

BPM - The Foundation For Operational Excellence

Looking in on rehearsal presentations for Inspiring Performance 2011 next week, it's interesting to see how operational excellence is coming to the fore - and how BPM is central to it. 

Agreed, operational excellence sounds worthy but boring (though execs at UBS might be wishing that they'd paid it more attention).

Agreed too that, while it's a widely used term, there's only a loose consensus on what operational excellence actually means (even the Wikipedia entry includes an appeal for help).

But, however it's defined, or branded within the organization, it's an unqualified good.  Every COO wants it. What's less obvious to many organizations though is how operational excellence is directly linked with Business Process Management.

BPM in its IT incarnation - let's call it 'micro-BPM' - is focussed on automation.  But BPM in its wider sense - 'macro-BPM' - is about operational excellence.  And, in global organizations across every sector, a macro-BPM platform is emerging the essential foundation for operational excellence. 

Talking with clients and colleagues since our first attempt, back in January, to define how you do operational excellence in practice, we've converged on four closely-related capabilities: 

To achieve operational excellence, the enterprise needs the capability...

to understand the whole.  To maintain a complete, holistic and integrated model of the business - including what's automated and what's not, what's outsourced and what's in-house.

to flawlessly execute strategy as end-to-end operational processes. To maintain two-way line of sight between strategy and operating reality.

to continually re-optimize performance by integrating metrics and analytics with end-to-end operational processes and providing the framework for the entire enterprise to collaborate on continuous improvement.

to manage risks, controls, quality and compliance together, within one enterprise-wide and real-time governance framework.

Cue the enterprise-wide BPM platform: the essential enabler for all of these capabilities, and therefore for operational excellence. More on this, after the conference...

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What's A Good Process Tool?

'Can anyone recommend a good tool for process mapping and modelling?'

The latest LinkedIn discussion on process tools set me thinking. 

The answer of course is that it all depends.  What's a good car? It might be a seven-seater SUV or a Ferrari or a Smart Car - it all depends on what you need.

Here's my way of looking at it. It's not scientific and can't pretend to be unbiased. It's jottings over a cup of tea, and yes it probably is inspired by a Domino's menu. 

Ten things that you might want in a process tool, and what they would lead you to choose.

 
  
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Our Real-Time Interconnected Future

In The Interconnectedness Of Things, my colleague Rob Speck uses an M&A example to illustrate the value of end-to-end business process as the best framework for clarity in an increasingly complex world.

When we revisited our core value proposition recently, our clients' appetite for simplicity really became apparent.  It's what has led us to describe Nimbus Control as an 'integrated management platform' for the enterprise.  Even more boldly, as the enterprise platform for operational excellence.

Enterprise 2.0 needs its people to collaborate on improvement and innovation like never before, and at pace.

It needs collaboration across the silos within the enterprise, and often outside the enterprise, across a complex and dynamic web of activities delivered by outsourcing providers. Above all, it needs effective collaboration across the functional boundaries between operations, IT and compliance.

So simplicity has become crucial. But it's at many levels.

Visibility of end-to-end business processes, not just what's automated, graphically and in the language of the business - is just the start.  Many organizations have plausible end-to-end views.  Usually in Visio and on the wall of a proud process owner.  It's when they are integrated within an enterprise process framework that the benefits really start. Interconnectedness is the key.

But it has to be a multi-layered process framework, managing meta data at every level. It has to blend processes with metrics, systems, compliance, risks and controls. Again, interconnectedness is the key. (London Underground maps offer a parallel). 

And it has to be a real-time enterprise process platform. All this would be just an interesting snapshot without robust governance because everything is constantly changing.

But the hardest part of all is to win hearts and minds.  It has to be intuitive and appealing.  Like the Unix computer so beautifully sold and loved as the iPhone, this integrated management platform for the enterprise has to be seen as easy, authoritative and indispensable. As an intelligent operations manual built around me.

No-one is there yet - this is a journey (come meet some fellow travellers at Inspiring Performance 2011 later this month). But I'm optimistic.  It's beginning to become clear how Enterprise 2.0 fits together and how BPM will be its essential underpinning.

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 more on Cracking Complexity.

The Social Enterprise: Don't All Speak At Once

Larry Dignan at ZDNet nails it in describing the looming 'social sprawl' in A Few Caveats Ahead of Utopia, his take on Dreamforce 2011:

"Every software vendor has some social hook. Let’s say every IT buyer goes whole hog with the social stuff. Well guess what? Now you have HR social features. CRM social. Business execution social. It’s a social fest. Meanwhile, employees are still using Twitter and Facebook. If social sprawl isn’t an issue today, it will be tomorrow. This emerging issue can go two ways for Salesforce. IT buyers can see Salesforce as the great social enterprise consolidator. Or they can close their ears. At this point, it may just be a jump ball."

He's right about the emerging issue of social sprawl. But I think it has a different resolution. It's not a jump ball between Salesforce Chatter and an alternative of a cacophany of voices. There's a rapidly emerging alternative - a process-based paradigm. And the best example may be the convergence of Tibbr with Nimbus Control, which analysts seem to have underplayed in commentary on Tibco's acquisition of Nimbus Partners.

Diversity in our interactions online is natural, just like in the everyday physical world: as Tom Cortese has argued, focussed and niche social networks will always have a place. But the collaboration and dialog that is at at the core of the social enterprise needs structure if it is going to be purposeful.  Especially because, while we may kid ourselves otherwise, the evidence is that actually we're not very good at multi-tasking. 

So what's the context and framework most likely to encourage effective collaboration in the social enterprise? It has to be the processes of the business.  What else is the social enterprise seeking to continually improve and optimize?  Ergo a business process management platform sits at the heart of social enterprise.

After seeing his social baptism ceremony last week, I'm coming over all funny. So, to channel the extraordinary Marc Benioff for a moment: Beware The False BPM Platform!

Is there a single integrated process architecture for the enterprise, with clear line of sight between strategy and operations?  Is there visibility of end-to-end processes, not just what's automated, and across outsourced activities too - and all in the language of the business, not IT-speak? 

No? Then it's a false BPM platform!

Are real-time performance metrics, business controls, compliance and quality, integrated with the end-to-end processes to create the operating system for the enterprise? Does it ensure that Lean and Six Sigma projects are delivering sustainable benefits?  

No? Then it's a false BPM platform!

Does it help people get real work done? Is it deployed to every desktop and mobile device as a personalised intelligent operations manual? Is it easy for every person and process stakeholder - including especially the IT community - to collaborate every day on operational excellence?  

No - then it's a false BPM platform!

Here endeth the diatribe. ;-) 

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Solving The Riddle Of Sustainable Improvement

In a podcast following his HBR Blog How To Sustain Front Line Process Improvement Activities, Brad Power describes the riddle he's trying to solve.

For improvement to be sustainable, it has to be within the DNA of the organization.  It has to create a culture capable of surviving a change of CEO. 

After researching 50 case histories, and Toyota aside, Brad concludes that there are very few organizations with this kind of cultural depth:

 "How do we embed continuous improvement as an ongoing activity across the enterprise? That's the riddle we're trying to solve here."

Looking at leaders in continuous improvement, he identifies characteristics that they tend to have in common, components of an 'architecture for sustainable improvement in an organization':

Process visibility: the ability to 'see' end-to-end processes - singly and in the wider context, and in an intuitive way that everyone understands (esp outside of manufacturing, since most processes are not tangible)

Process ownership: accountability for improvement of end-to-end processes (across the extended enterprise, including activities outsourced or in shared services)

Strategic alignment: line of sight between strategy and front line operational improvement activities

Performance metrics:  KPIs embedded within processes to provide immediate feedback on performance, and the impact of improvement activities. 

When Brad and I have swapped perspectives on this before, I woffled a bit. I couldn't put my finger on what now seems totally clear, and reinforced by real world evidence: that the future lies in a culture of operational excellence that is enabled and sustained by an integrated process management platform at the heart of the business.

This integrated management platform has to use the universal language of end-to-end business process. It has to integrate process with real-time metrics, risks and controls, compliance and quality management - all within one governance framework. It has to be 'live' - deploying process to desktops and mobile devices as an intuitive and personalized operations manual.  And it has to provide the social collaboration framework that gets people working together effectively.  

No platform can solve the riddle completely. Talent management, executive leadership, behavioral incentives to break down political barriers to change - these will always be essential ingredients for sustainable excellence.  But an integrated process management platform is emerging as the essential enterprise infrastructure to underpin a culture of sustainable improvement.

Join us at Inspiring Performance 2011 in London later this month to hear case studies on these themes from Nimbus clients such as Novartis, Northern Trust, Marathon Oil, Northrop Grumman and Royal Bank of Canada.  It's one of the world's largest business performance improvement and process management events - and it's free.

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The Power Of New

Back from a week's vacation in the remote Scottish Highlands and Islands - where mobile networks can be wonderfully sparse - to a new world. 

Quite a radical change of pace in fact, Tibco being founded on 'The Power of Now', as you'll see from this ad I saw on a store in Invermoriston, which explains why it's important to buy a copy of the Inverness Press and Journal daily: ' because every day is different'.   

Scotland is the most gloriously beautiful place and has everything except reliable weather.  Luckily we had full waterproofs. But we did spend a good deal of time in pubs and restaurants, talking, reading and doing puzzles. Including word puzzles, of course, which is why it's obvious that 'Tibco and Nimbus' is an anagram of 'IBM Scan In Doubt'.  Haha - don't tell Phil Gilbert but it's also an anagram of 'Ban IBM Discount' ;-)