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BPM mind shift drives innovation

Great innovation often fails because of poor execution. But experts say BPM may be the key to staying the course.

SAN DIEGO -- Business process management (BPM) is more about operational efficiency and effectiveness. If used correctly, it can also drive innovation.

"We tend to think of BPM as more oriented around operational efficiency and effectiveness," said Bruce Williams, CEO of Savvi International Corp. in Scottsdale, Ariz., a BPM vendor and sponsor of the Gartner Business Process Management Summit. Williams, an expert on business methodologies such as Six Sigma, was addressing delegates at the event. "Once we've got something up and running, how do we guarantee what we've got is going to stay on track."

BPM is set of business processes intended to assist businesses to be more effective, more efficient and more capable of adapting to change.

Williams said BPM is essential for making sure companies operate effectively and are "at the top" of their game.

"But I'm here to tell you that the greatest strength, the greatest power, the greatest potential of BPM is really in the area of business innovation."

Williams said innovation is the introduction of something new and the process of using that new idea to create and enhance value.

"It could be a method, a technique or a practice," he said. "Quite often we think of it as a product, widget or gizmo. But business innovation is also about the process by which this is brought to life."

Williams said most U.S companies don't have anything formal in place to foster innovation. And innovation efforts tend to focus on products. Business process innovation, technology development and business models are often neglected.

He cited TD Banknorth Inc., a Portland, Maine-based bank that has grown through multiple acquisitions. He said bank executives had noticed a surge in change-of-address requests from customers. They did a survey and found the bank was receiving 25,000 change-of-address requests per month. But the bank's process for handling these requests was ad hoc.

Some customers were telling the teller at the window. Others were calling on the phone. Some were sending them over email. There was no standard process -- it was hodgepodge, and there were a lot of mistakes. They kind of scratched their heads and said, 'This is kind of a mess.'"

The greatest potential of BPM is really in the area of business innovation.

Bruce Williams, CEO, Savvi International

Williams said TD Banknorth had implemented a BPM system that provided an integrated layer and services capability among the various systems it inherited from all the banks it had acquired in recent years.

"Because they had implemented BPM in the process of acquisition, they took a look at this and said, 'What is this?'" he said. "They built a couple of portals, an internal one for people inside who got change-of-address calls from customer contacts, and another one out for customers to use on the Web. Because they took this innovative approach with BPM technology, do you know how long it took them to design, develop, roll out, integrate and switch over to this change-of-address system? It took them five days."

Williams said BPM helps organizations manage their processes when they are in the "manage phase." But when it's time to enter an innovation phase, BPM has the controls, monitoring and analytics that can help drive business innovation.

Barry Smith went to Gartner's BPM Summit hoping to find the information he needed to make a business case for BPM at his company. Smith is a systems advisor at Syncrude Canada Ltd., an Edmonton, Alberta-based producer of synthetic crude oil from oil sands.

Smith agreed that BPM has the potential to drive innovation.

"To foster innovation, you have to capture someone's idea and do something with it," Smith said. "If you put it in a process and get it distributed to that person's peers, they can refine it and then put it into a development process."

Smith said there is no process of innovation at Syncrude. He said the company captures and develops many innovative ideas, but so many more are dropped. Smith said that with 5,000 employees at his company, establishing innovative ideas and processes take time.

Smith said his company is under pressure to innovate right now because there are three oil companies in Canada and the market for crude oil developed from oil sand is about to explode.

"My company doesn't recognize that BPM can drive innovation," he said. "That's my job to get them to recognize that.

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