Business Value of Process Standards

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Jeanne Baker is Vice President of Technology for Sterling Commerce, a subsidiary of SBC Communications and a global provider of business integration solutions. She is chairman of the international nonprofit Business Process Management Initiative (BPMI.org), which promotes and develops the use of automated business process management by establishing universal standards for process design, deployment, execution, maintenance and optimization.

Baker says that business processes link computers and people in the areas of workflow, human intervention and process automation. BPMI, the non-profit BPM standards organization that is developing and promoting royalty-free, XML-based business process standards, has specified four required BPM components. These are:

  • Design

  • Deployment (depository)

  • Execution (server)

  • Operation  (portal)

According to Baker, BPM drives growth through the automation of business processes, particularly the processes that integrate organizations.  These provide the best opportunities for growth. Studies have shown that companies that have good collaborative process have:

  • 15% less inventory
  • 17% stronger order fulfillment
  • 35% shorter cash-to-cash cycle
  • 10% of stockouts
  • 7%-8% increase in revenue from savings
  • Sales increases

BPM also has a big impact in financial services. Regulations such as SOX and changing customer purchasing patterns reduce the float and transaction fees while requiring additional infrastructure investment. Banks that have implemented systems integration have found that BPM can increase cost savings by 25%.  Other benefits include greater operating efficiency, a single view of the customer, and improved transaction visibility.

Across all industries, BPM reduces operating expenses by increasing efficiency and accelerating ROI on technology investments. Sales are increased by the creation of new sales channels and reduced time-to-market.  The greater clarity and control that BPM creates enables a demand-driven enterprise with improved decision making and increased customer loyalty.

BPM spans all disciplines, including enterprise operations and product and service life cycles while bridging the business and technology domains.

The good news is:

  • Process models are core company assets with business-critical value
  • Process execution has a proven return on investment
  • BPM and Web Services have been shown to lower IT costs
  • Process engineering is a respected discipline

The bad news is, despite more than 170 vendors selling BPM solutions and more than a dozen standards organizations working on process standards, there is a lack of standards clarity which is slowing adoption. The process standards landscape is crowded and complex.

According to Baker, BPMI, is working toward convergence in this area, hosting a standards summit with participation from many of the standards organizations along with business executives, BPM practitioners, analysts, and vendors.

Baker says that education is needed. This includes a glossary of terms, the standards landscape today, and BPM best practices.

In the execution layer, BPEL, the Business Process Execution Language is becoming the accepted language for business process execution.  It supports business rules, task lists, and has the continued participation and support of OASIS.  Business Process Query identifies query elements and constructs use cases. 

BPMN, Business Process Modeling Notation, is also progressing toward greater acceptance by supporting process maps and business rules.

Baker said the BPMI mission is to:

  • Clarify the standards landscape

  • Influence emerging standards and technology

  • Network industry experts on BPM

  • Collaborate on best practices and resources

  • Reach out to partners, customers and the industry on the importance of processes

  • Provide a front-row seat to the future of BPM

Baker says that the cost of waiting is higher now than the cost of just plunging right into BPM. Today's BPM is ready and does allow for incremental growth with clear ROI opportunities. It is visible and can be easily communicated to others. It is also easy to build out for early success. Moreover, the costs are going down.

Jeanne Baker recently spoke on this topic at a recent BrainStorm’s Business Process Management Conference.  For more information on this conference, visit www.BPMConference.com

To hear the archived audio file of this presentation, visit:

http://www.bpminstitute.org/presentations.html

Jon Huntress

Special Events Correspondent

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