Business Process, Business Rules and the Agile Enterprise

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Business Process Management and Business Rules Approaches (BPM/BR) are agility technologies. Yet, for most early adopters they are the last step in inoculating agility into an organization. First business, government and non-profit organizations must identify and recognize a challenge arising from changes in demand, missions and charters. Next the challenge must be incorporated into a project portfolio then lastly carried out.

Business Process Management and Business Rules Approaches (BPM/BR) are agility technologies. Yet, for most early adopters they are the last step in inoculating agility into an organization. First business, government and non-profit organizations must identify and recognize a challenge arising from changes in demand, missions and charters. Next the challenge must be incorporated into a project portfolio then lastly carried out. Discovering, prioritizing and addressing a challenge are clearly critical factors.

When the BPM/BR technology is new to the organization, it should improve the last mile of the project. Analysts, especially the Gartner Group, have developed cost saving for BPM/BR projects. For instance, they cite customer estimates of cost savings of the BRMS over traditional coding at between 25% and 75%.

If the biggest cost driver is project management and implementation, the first projects will experience smaller cost savings. If an organization can pick up IT costs from project management techniques such as earned value management then benefit might be measurable. The long-range benefit occurs when the organization maintains its applications with an automated model of business processes and business rules. The savings arrive when an organization is smoothly able to adapt to the challenge. Organization might even experience a large leap in agility by reducing project planning needs and reconfiguring its products and services. If change is simple, then wide swaths of technology changes are cutout, project planning is almost cut out. Yet, as I will suggest, there are important steps to total business engineering agility.

Most business theorists define agility as the ability of a business enterprise to run profitably in a rapidly changing fragmenting global market environment by producing quality, high-performance, and customer targeted goods and services. Because organizations’ survival and growth depends on the ability to meet mission needs and demands, agility is considered critical to success. Changing economics, trade, policies and regulations change the life cycle, process, quality, and price of productive output for business and government.

Agility should be a measure of an overarching ability to move from instantiation of the challenge, recognition by the organization, addition to technical and operating environments and, finally, business implementation. BPM/BR and Business Intelligence approaches have a role throughout these. Not only do they impact operational changes, they enable detailed research and discovery. They also improve simulation, scenario development and brainstorming. These are the traditionally touted benefits, yet this is an information systems view. For business, BPM/BR should also impact organization agility.

The agility of business operations can be assigned to four separate infrastructures: Market and Sales, Business Delivery of products and services, personnel, and information technology. I want to discuss how BPM and Business rules can improve business delivery. BP/BR can also benefit the other areas.

Business Delivery Agility

Existing business processes are tied to existing delivery capabilities of the organization. These agility factors control how rapidly and accurately the business can adapt to changes.

There are 9 factors that influence the agility of business delivery:

  • Setup or changeover time and cost required for various preparations such as product and service production or material positioning.
  • Versatility which is defined as the variety of operations a business unit performs.
  • Substitutability is the ability of a production system to reroute and reschedule product delivery effectively under overload or failure conditions.
  • Operation Commonality. This agility factor expresses the number of common operations that a business unit can perform to produce products and services.
  • Variety of workloads. This refers to how an order and delivery processed can adopt to different volumes and varieties of orders. It is restricted by the delivery size and requirements of the customer order load.
  • Transfer speed. This is associated with the complexity, configuration and availability of physical work products and customer transactions, as well as the frequency of transport.
  • Product component variety is associated with the number of new products the business system can produce in a time period without major investments.
  • Changeover effort in time and cost that is needed for preparations to produce a new product and service mix.
  • Product commonality refers to the number of shared products and services parts used in configuring a service or customer offering.
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    When it is used correctly, BP/BR technology can improve many of these factors. Business Processes might expose new capabilities by insourcing or outsourcing new combinations of trading partners and services. Workflow processes can intelligently direct work to the proper location.

    When you build your first iteration of a BPM you should consider these agility factors. You should develop an understanding of how BPM/BR can contribute to your business production. For instance, with the substitutability agility factor BPM can provide built-in capabilities of the system as for example, real-time scheduling or available transport links.

    A consideration of the role of process and rules in the delivery of products and services might change your deployment strategies. You should develop a simple sequence of checks that ensure the BPM/BR project will contribute to overall agility. If you view business process as a reusable product or service, then your approach to the process design might change a bit. The same is true when you consider corporate decisions and policies as corporate assets.

    The Long-Range View

    The long-range benefit of BPM/BR is shown in the following figure:

     

    Figure 1

     

    As more products and services are developed, controlled and monitored with a process and decision management focus, there is less need for a change drive to enter project portfolio cycles.

    For instance, consider transportation in a product delivery process. A business case suggests cost savings for outsourcing delivery. If the process is controlled in a BPM environment with interfaces to the corporate ERP, then connecting a B2B transportation system will be relatively simple.

     

    Well-built business process and a business rules maturity encourage entrepreneurial initiatives and self-organizing, self-directed business units. The agility of BPM/BR technology will streamline or even automate responses to external change drivers. This is the promise of BPM and the service oriented architecture.

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