Brett Champlin is the President of the Association for Business Process Management Professionals (ABPMP.org) and a Senior Process Consultant with a large insurance company. He has led business process transformation projects for the last 15 years. Champlin is also on the adjunct faculty at Roosevelt University and the University of Chicago.
Champlin is a pioneer and advocate of the new field of “services engineering”. In the last two hundred years, we shifted from a primarily agricultural-based economy to a manufacturing-based economy because of the industrial revolution. Now the trend is moving away from manufacturing toward the services industry. In the year 2000, 75% were employed in services and this sector makes up almost 80% of the U.S GDP. Service processes are different than manufacturing processes and we need to develop different tools and measurements in order to make improvements in service process productivity and quality.
The push for more productivity and cost reduction in manufacturing is still driving most change in business. Managing change is the focus now. Trying to solve new problems with old tools designed for the manufacturing era creates problems. Champlin says that the opportunity for growth in manufacturing is shrinking but the opportunity now is in reducing waste and increasing efficiency in services. Some think the cost of services is inflated by 30%-80% waste. In other words, much work is being done that adds no value. Champlin thinks that there is a 40%-80% productivity opportunity to improve services.
Service processes are:• Activities that usually have intangible outputs• A service process is a series of states involving the decision-making process and experiences of the customers • Provider/client interactions that creates and capture value• All economic activity whose output is not physical product or construction• Time-perishable, intangible experiences performed for customers acting in the role of co-producer
There are three service types: • Professional services such as consulting firms• Service shops such as retail and restaurants• Mass services such as airlines and hotels
Analyzing service processes is much more difficult than for manufacturing because it can be invisible or undefined, and can vary for each customer. A single service might require multiple processes. Other factors make these service processes difficult to measure. These include:• Intangibility – the process and the results may vary from intangible to tangible• Heterogeneity – the knowledge workers- outcomes vary from one to another• Simultaneity – the production and consumption may coincide like booking a hotel room• Perishability – once the event or time has passed, opportunity is gone
Dimensions of performance also make services difficult to measure. These factors include:• Completeness• Financial• Quality of service• Flexibility• Resource utilization• Innovation
We need a new model for measuring performance of services because they are less visible making it more difficult to track the flow of work. There is a lack of meaningful data because people can’t be controlled like machines. However, it can be done by finding more creative ways of measuring workflow.
Frequent problems include:• Unnecessary hand-offs• Constant switching• Too much work in process• Too much waiting time• Excessive defects• Over-production• Difference in how people “think” the process works
Champlin says that IBM is doing research in this area called SSME, (Services, Science, Management, and Engineering). IBM focuses on strategy models, standards, continual business optimization, information integration, service-oriented architecture, and security/privacy.
One new way to look at business is as a set of contracts between shareholders including customers, employees, managers, suppliers, government, and the community. Another focuses on the attributes of complex adaptive systems. These include:• Non-linear• Dynamic• Multi-objective• Synergistic• Feedback systems• Emergent behavior
Champlin summarized the service-process field by saying that we tend to view processes from the perspective of the provider, but that with services, it is necessary to include the customer as a co-provider of value to the process. He quoted Warren Buffet, “The best kind of investment to make is one in which a huge return results from a very small increment of invested capital.” This is the promise with service process engineering.
