Shadow processes, the ghost in the BPM machine

By Shamus McGillicuddy, News Writer 03 May 2006 | SearchCIO.com

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Hunt them down, understand them and adapt.

The practice of working around a policy has been dubbed "shadow processing" by Stamford, Conn.-based consultancy Gartner Inc. A shadow process is a business process "that's not defined by corporate policy or rules and regulations. It's a process that, over time, people have realized gets things done," said David Cappuccio, group vice president at Gartner. "They've been around since we first put people into departments and told them to do something."

An organization that allows shadow processes to occur is an organization that is not effectively working in harmony ... and that is a tragedy. John Wheeler CIO, Nova Chemicals

Shadow processes develop when the official process doesn't get employees the results they need. They also develop when a company fails to articulate to employees why the standard process is important and must be used.

Sometimes, the implementation of a BPM solution might actually spawn shadow processes.

Cappuccio said a publishing company in Chicago suffered lost productivity after it implemented an automated business process for a travel policy. The company's travel-booking system automatically upgraded employees from coach to business class if their total time in transit was more than eight hours.

A small department in the company, whose employees made regular trips to London, developed a shadow process in response to this rigid automated process. The typical flight to London was long, but not quite eight hours. So employees went online to figure out how they could design their flight itineraries to push their travel time over eight hours.

"They would re-route themselves through Dallas," Cappuccio said. The workaround added hours to their travel time and cut into their productivity. Worse, employees in that department spread the word through the company. Soon employees in other departments who traveled less often also adopted this shadow process, Cappuccio said.

He added that the firm could have designed a process that allowed for exceptions to the flight policy based on an employee's amount of travel and how close a flight was to the eight-hour standard. A process designer might have realized this, had he talked to the employees about their travel practices.

"People write business policies, but they don't talk to people," Cappuccio said.

Shadow processes aren't sabotage. They help a company get the job done. But often they are inefficient and hurt the bottom line.

"When you talk to people who are using these things, they don't see it as a negative," Cappuccio said. "They believe they have found a more creative and more efficient way of getting things done."

Shadow processes may get the job done, but they represent a poorly disciplined company, said Dr. Mathias Kirchmer, CEO for the Americas and Japan at IDS Scheer, a BPM solutions firm.

"We have many clients who are really surprised that what's happening in their organization is very different and much more complex than what they decided employees should do," Kirchmer said. "Very often, people see the way a process is designed is not desirable, and they look for a workaround. In most cases, management doesn't get notification of the workaround."

The presence of shadow processes is a sign of an unhealthy organization, according to John Wheeler, senior vice president and CIO at Nova Chemicals, a Calgary, Alberta-based $5.6 billion plastics firm.

"An organization that allows shadow processes to occur is an organization that is not effectively working in harmony to get all its elements and all its resources to work together to get the best results, and that is a tragedy," Wheeler said.

Wheeler said he found some troubling shadow processes at his company when management standardized its pricing practices. "What we found was there were a lot of anomalies," he said. "People were doing things outside the norm that caused price leakage and customer disruptions. Getting that process into a well-organized state delivered millions to the bottom line."

Experts warn CIOs that implementing BPM technology is not a cure-all for these shadow processes. "If you don't identify what the shadows are, then you are not going to solve the problem," Cappuccio said. "The shadow process was put in place because the original process doesn't work."

Awareness of the possibility of shadow processes is good, but how do you find them?

For more information BPM: From design to excellent execution Global competition forces process changes

Kirchmer, of IDS Scheer, said he was contacted by a company that implemented an ERP system that automated many of the business processes in its materials management department. After the system was in place, management found that it needed more and more people to get the work done. Parts went missing from the assembly line.

IDS Scheer investigated and found that the ERP system had not been configured correctly, and employees had not been adequately trained. Employees found that the automated processes didn't give them the results they needed, so they did the work manually, which killed productivity and increased the risk of human error.

"People are not judged and compensated by the business process, but by the results," Kirchmer said. "They look for a way to achieve those results, regardless of the additional costs."

Once a CIO uncovers a shadow process, he shouldn't wipe it out. He should learn from it.

"You can't just shut them down," Cappuccio said. "They're there for a reason. As you design the new process, take those reasons into account. Learn how the shadow developed, what motivated people to create the shadow. This comes out from talking to people -- not managers talking to managers, but to the people doing the work."

Let us know what you think about the story; e-mail: Shamus McGillicuddy, News Writer

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