Category Archives: BPM

IBM’s Software Portfolio contains Business Process Management Tools. When and how you should use a BPM platform such as WebSphere Business Process Manager depends on the type of Business Process that you want to automate.

Types of Business Processes

I classify 4 types of Business Processes in a 2 dimensional table – 1 is not enough and 3 is too much for marketing :-).

The horizontal axis is the differentiation axis:

• Differentiating : You have business processes which are truly differentiating : your company is the only one to make it that way, or produces that type of products or services.
• Non-Differentiating : Those business processes are just standard business processes. You do the same as the competition in that domain.

The vertical axis is the “core business” axis:

• Core business processes : those business processes are core to your company. Example : Credit or Payment processes in a Bank.
• Non Core business processes : those business processes aren’t really linked to your company but you need to have them. Example : Payroll, Company Cars, Building Maintenance and Security…

Good Boys

For two cases, it really makes sense to master a BPM platform in house :

• “Non-Differntiating” and “Core Business” Business Processes. Those business processes just belong to your industry and so you need to have them. For instance, in the Pharma industry, you need to communicate with the FDA in order to commercialize drugs. In that case, it’s a good idea to try to automate the business processes in order to reduce cost to a maximise. I qualify this zone as “OPTIMIZE” business processes.
• Differentiating and Core Business : those business processes is your battle field. It’s the place to win new customers by being faster, smarter and offer more than the competition. Those processes are in the INNOVATE zone. It’s the place where you can innovate. Working with a strong BPM and SOA platform can help you achieve your goals faster by providing IT agility.

Bad Boys

For the two other cases, it’s less obvious why you’d need a BPM platform. However:

• Non-Differentiatng and Non-Core Business : in this case you run business processes which are not really important for you and that will not help you to win market share. This kind of processes should be outsourced to other companies : I put them in the OUTSOURCE zone. Example : outsourcing of Company Cars Pool Management to external companies like ?LeasePlan. If you absolutely want to keep those processes in-house, you’d better manage them right in order to avoid hidden costs and benchmark them. A BPM platform is a plus in that case only.
• Differentiating and Non-Core Businesses : the first question is to know WHY you are doing this. You have diversified your company with differentiating processes which are non-core. You have two options to handle this : make them core business by adapting the strategy – adding a business unit- or stop doing them by selling or outsourcing them to someone who wants to make them strategic. If they can’t be dropped or promoted to the strategy, you’ll need to manage them you can take advantage of the BPM platform you have bought for your core-processes. Just keep them independant such that you can sell them at any time.

Which Core Business Processes would benefit the most from a BPM platform ?

It depends. You can jump into the “Winning the Customer Battle” by providing better services but you can also cut down prices and/or increase margins by optimizing . IBM wants to help companies to Innovate by becoming the Innovator’s Innovator (Seehttp://www.ibm.com/innovation/guide/conclusion.shtml) and after all optimization sometimes requires innovation….

Next question : How does processes stability play a role ?