Business process automation continues to top the list of CIO priorities this year as cost cutting and productivity gains remain a focus for IT and business operations alike.
Of course, improving business processes through automation has been the province of IT organizations since IT entered the workplace. CIOs estimate that about 80% of their business processes are automated or supported by IT, according to Gartner Inc. analyst Mark McDonald. In surveys conducted by the Stamford, Conn.-based consultancy, improving business processes has taken on more urgency: Fifty-eight percent of CIOs said it was among their top five priorities in 2009, up from 44% in 2005.
"What's different is that with the downturn in the economy, the mentality of the [business] folks using these systems has changed. Now they need our help," said Joseph Marcella, CIO for the city of Las Vegas. "There are less of them, so they see automation as an assist."
Marcella's centralized IT operations have focused relentlessly on finding better ways for this hard-hit city to conduct its business since the first hints of a recession three years ago. A recent example is the city's municipal courts system, where the director was forced to cut 10 people from the counter that serves citizens. "He could never have reduced staff by 10 without alternative mechanisms," Marcella said, including a new automated voice service for the courts and putting in place an online traffic court service for the city. "[The director] is looking to IT to keep him whole and not pay the salaries," he said.
Marcella, who oversees an IT staff of 84 and a total IT budget of about $22 million, has been a proponent of BPA since he arrived 10 years ago, when the city had a rudimentary IT infrastructure and services. A former director of information services at Norwest Bank (now Wells Fargo & Co.), Marcella grafted his philosophy of centralized IT systems to city government, eliminating the phantom IT departments, redundancies and lack of standardization that bog down business processes.
Marcella also claims to have been the first municipal CIO to use Oracle Corp.'s ERP platform. Having functions -- financials, human resources, payroll and purchasing, for example -- in a single database streamlined operations and yielded the business intelligence and metrics that can propel change in organizations reluctant to change. The robust ERP system was critical when Las Vegas was adding as many as 8,000 residents per month, and even more important during the past two years, when he saw staff cuts of 25% because of plummeting tax revenue.
Not that business process reengineering has been easy.
BPA can be particularly challenging in government. Employees by and large are not motivated to change how they do their jobs, Marcella said, and the work itself by definition isn't geared to making a profit. "The services that government pursues or delivers are the ones that the private sector either can't make money at or are not really interested in," he said. "You don't have a whole lot of private fire departments."
Because of governments' monopoly on services, customer service typically gets short shrift. In addition to such cultural issues, the barriers to entry for implementing a new process encompass logistical blockades related to union rules and classified skill levels, as well as compliance.
"When I got to the city, business process reengineering [BPR] was near impossible. All we could do was tweak," Marcella said.
That has changed. One of Marcella's largest efforts focused on automating the city's land development agency, a critical operation that was shared by three highly vertical departments, and was crippled by redundancies and manual, paper-based processes. By figuring out a way for all three departments to talk to each other, the automated Oracle workflow in place today takes a land development project -- whether to build a hotel or enlarge a residential garage -- from start to finish. The plan moves from the initial request, including various approvals, inspections, and zoning processes, right up through storing the project documents. Project documents are also integrated with the city council's Web-based meeting agenda, so an interested party can click on the agenda item, find all the relevant documents and even access a video of the agenda item meeting. "You can see the relationships from cradle to grave," he said.
SearchCIO.com asked Marcella to share some tidbits about approaches that have helped him automate, tweak and improve the city's business processes.
- BPA starts with BPR. "[BPR] is sitting down with the business to figure out what they actually do for a living, where the dependencies are and where the interrelations are," Marcella said. "Once that happens, the [BPA] is the result of that."
- Be prepared to tweak. One of the problems for the city's land development agency was simply knowing where the planning documents were at a given time .Getting these documents online was a big improvement and made workflow more efficient, until somebody was out of pocket or out sick. "We revisited and reengineered the systems so the plans could be gotten to somebody else who was approved to do the job," he said.
- Setting up a project management office is a must. The city's major BPA and business process improvement projects were funneled through a project management office headed by Marcella's deputy director of IT, who reported not to IT but to the city manager, to reinforce the joint nature of these projects. The deputy director in turn had three enterprise project coordinators, each responsible for some broad aspect of city government (finance, public safety, and so forth). Five project coordinators in the IT department who handled the technical components of the projects also reported to the director, who was the point person for all the stakeholders, subject matter experts and vendors as well. "You can't do these projects without oversight and authority. You need a champion, of course, and an authority who agrees with the champion," Marcella said.
- Build a system "as a throwaway" to learn what you really want from a vendor. It's not common to build a system with the intent to throw it away, but Marcella began most of his process improvement projects by building a system manually in order to have a deep understanding of the requirements. For the city council website, for example, his team spent 18 months cobbling together a system. "We knew what not to do and what we wanted a vendor to provide for us, when we got to the stage of passing this off to an outside provider," Marcella said
- Don't automate an iteration of one. This is self-explanatory. "Folks will tell you there is a lot of work that can be automated, and when you do the investigation you see it is something that really should be done manually because there isn't enough to automate," Marcella said.
- Ready, fire, aim; but "get the chicken test done early." As the "Miracle on the Hudson" made clear, birds don't respect airplane shapes, and the Federal Aviation Administration requires that jet engines be designed to ingest birds. After many tens of millions of dollars went into designing a jet engine, Rolls-Royce shot a chicken into its very expensive engine -- at which point the engine failed. The jet blades critical to ingesting birds could have been tested early in the process on a cheap engine.
Marcella tries a lot of things and has his share of "well-intentioned failures," but he always makes sure the chicken test gets done early, he said.
Let us know what you think about the story; email Linda Tucci, Senior News Writer.