Focus on Business Value is What Sets BPM Apart
It’s kind of funny that people still think of Business Process Management as a new or innovative approach. When you actually look into the discipline, its just a collection of the good ideas developed over the years about managing business initiatives, IT projects, and software development in one end-to-end methodology.
What is eye-opening to me about the BPM approach, however, is the focus on business value throughout the entire cycle. Any true BPM project starts off with clear, measurable business goals, a clear plan of how these will be measured and rapidly delivered, and then evaluated in a program of continuous improvement.
To date, most of the partner BPM deals I’ve seen are very IT-centric. Only a few have followed a more classic value-centric approach for BPM. This isn’t that surprising since many of SAP’s partners are more comfortable talking with a customer’s IT department about custom application development. It’s hard to have a discussion about strategic decision-making with the people who are responsible for tactical implementation.
I would like to share with you one BPM partner sales story that I found from 2009 where the customer and partner took a value-oriented approach to a BPM project proposal, and the results were significant. I won’t name the customer or partner here, but rest assured, the cat will be out of the bag soon as there is a Business Transformation Study in progress as a result of the business value the customer is now enjoying from their BPM solution.
First off, you should know that the customer had no budget allocated for this project. Most sales reps would instantly disqualify this customer and head off in search of lower hanging fruit. It was arranged for the customer to attend a local SAP Value Academy. There the customer learned about how to manage projects according to value, and were introduced to the value-oriented approach of BPM. As a result of this experience, the customer engaged with SAP Value Engineering and leveraged the Value Lifecycle Management tool to build out a business case for process improvement using BPM.
They chose to improve their process related to invoice management and paying suppliers. Their value discovery showed them that by automating the process they could expect benefits such as:
· Reduced administration costs by 20% – 25%
· Reduced training costs by 10% – 30%
· Reduced IT operating costs by 15% – 30%
· Increased productivity by 30%
· 95% or greater payment of invoices within planned time frames
Qualitative benefits would include better user experience, traceability of payments, and built-in measurement of process performance to help aid further optimization.
As a result of this excellent business case including rapid attainment and measurement of value, additional investment outside the IT operating budget was allocated for this project. Now, as a result of the success of this project, the customer is working on further business process improvements, and the partner involved is benefitting from an ongoing stream of projects.
Does this sound like a sales fairy tale to you? The SAP value resources mentioned here: SAP Value Academy, SAP Value Engineering, and the Value Lifecycle Management tool are available to customers and partners. If you don’t already know about these and how to use them, you should learn. And, they fit perfectly with a value-centric iterative BPM approach by helping build a business case, measuring the value received, and evaluating results.
I would like to invite you to attend the breakout session I’m holding at PKOM 2010 titled “Value Discovery and SAP Value Engineering for BPM Projects” to learn more about the value-centric approach of BPM methodology and the resources SAP makes available to customers and partners.