Linking strategy to operations – impossible…
The most important abstract in this blog is;
Don´t buy a Business Process Management system before you have a strategy for the long run! And I am seriously… An approach without a strategy has been tested – I won´t tell by whom… (guess who…)
Almost every large corporation today has invested a lot of time and money in making the perfect strategy, but does every employee know the strategy? The answer is probably not, so how do we then secure that the strategy is performed? The answer is: by linking the strategy together with the processes.
When you have read this blog – you will understand not only how to link strategy to operations – but also what the minimum demands are in a Business Process Management (BPM) Strategy seen from my perspective.
This blog is written with inspiration from two books, and my own mistakes throughout the years working with Business Process Management:
- by David P. Norton and Randall H. Russell. Read it – it´s a classic!
- BPM: The SAP® Roadmap by Snabe, Rosenberg, Møller, Scavillo. “The bible when working with Business Process Management”.
A good company strategy identifies gaps – where do we want to be in the future. This is often seen in the vision statement. These gaps can be reached by using Business Process Management by connecting strategy with operations. These gaps have to be closed by choosing a theme, and according to Norton and Russell most companies should have the below mentioned themes:
- Operational Excellence
- Customer Relationship
- Growth through Innovation
Before you choose one or more themes, to close the gap; you have to analyze your strategy.
The breakdown is as follows; Find gap -> connect to theme -> connect to value chain -> find the relevant process(EPC) – improve/change the process.
[Image is made with inspiration from: Linking Strategy to Operations: Process Models and Innovation, by David P. Norton and Randall H. Russell]
Example: A company wishes to implement Business Process Management to perform a downsizing
in full time employees – the gap is to go from x number of employees to y number. The theme is Operational Excellence; in this case innovation could complement Operational Excellence. The process office recommends looking into the non-core processes found in Human Capital Management.
When the theme have been chosen – the real Business Process Management strategy work starts, the next sections will show the most important parts of the strategy, I´ll recommend to use the “bold” marked text as table of content in your strategy. Remember that this will probably go all the way to the board of directors for an approval, this is serious stuff. You´ll only get one chance!
Goal: what do you wish to achieve to launching the Business Process Management initiative. Could it be achieving a better usage of IT – or secure that processes always are documented and
Rationale for action: Why do you wish to implement Business Process Management? Is it to secure competiveness?
Statement of direction: How do you plan to launch the initiative? Which minimum resources are needed? Who shall own the Business Process Management initiative, a Business Process Management initiative is not a project, it is a management discipline.
Approach: How do you plan to approach the implementation of the Business Process Management?
- People: How will you motivate the organization for the transformation?
- Processes: Prioritize your processes – implement and link Process Performance Indicators (PPI) to the processes.
- Organizations: When you implement Business Process Management – you´ll need new organizational units and roles – define them – most important the process office.
- Technology: Which tool do you wish to use to model with – but remember it´s the business who manage the Business Process Management initiative.
- Process Publishing: When the process has been modeled and approved by the Quality assurance – publish it through the portal. Every employee must have access to the approved processes.
- Continuous Communication: Plan and communicate the Business Process Management, make a communication plan.
Transformation: There are three choices in-between when starting the Business Process Management transformation:
- Revolutionary approach
- Step by step approach and
- Evolutionary approach
My own favorite is the evolutionary approach; here it´s possible to choose the most critical process first! Modeling everything is in my opinion not necessary and cost effective, model your core processes, and implement best practice for non-core processes. It is of the outmost importance that the first process improvement is a success!
For more information, please read the article and the recommended book. The above is the minimum for a BPM strategy!
My next blog will contain relevant information about the SET-UP of a Business Process Initiative.