Marius here again…..
On average, 80% of the IT budget goes toward maintenance and only 20% goes to new projects. On top of that, IT budgets keep shrinking year after year. This creates a big challenge in funding large initiatives like BPM. IT projects for cost reduction have been successful in the past, but has also resulted in budgets being cut. There are still pocket areas of opportunities for cost reduction, but much of the cost has been squeezed out already. Automation projects are experiencing diminishing returns. IT must now focus on business value generation, and that starts with the business process. BPM is not just about automation, but also about providing businesses information to make better decisions, change faster, and experiment. The future of risk analysis is to apply risk factors to a business process and run simulations to understand the impact.
Analyst predictions of the future:
The following predictions are worded in a way to spark discussion and you may not agree with each of the statements.
“BPM will fail at process improvement as a primary goal. Instead it will create an organizational capability as a part of the implementation journey – collaboration.”
The argument here is not that BPM will fail, but instead one of the side effects of implementing BPM will have a greater impact. The speaker argues that companies do not collaborate well enough today, but they will be required to collaborate better in the future. In the process of implementing BPM, organizations will develop a greater capacity to collaborate, not from the software, but from working on the implementation. BPM’s benefits go well beyond process improvement, making it worthwhile every step of the way.
“Current methodologies and tools for modeling will become obsolete in 5 years because process will become less predictable rather than more.”
“By 2015, enterprises that do not accept greater failure rates will lose the opportunity for success.”
This quote seems contradictory at first, but the supporting argument states that BPM’s ability to drive process change at higher frequencies combined with increasing computing power and collections of data results in the ability to carry out simulations and experiments. Simulations are an inexpensive way to explore options in pursuit of optimizing the business. The majority of the simulations will result in failures, but the failure is quick and the business is able to move on to the next idea. If a process change is applied and fails in the real world, BPM will again allow the enterprise to see the failure quickly and move away from it sooner. If the concept of quick failure being good is difficult to accept, consider the pharmaceutical companies who must test their drugs before going to market. Ideally, if there is going to be a drug failure (unacceptable side effects) that the failure occurs quickly and not years after being released to consumers.
BPMS are not just business applications like the majority in production today. They give IT the ability to once again become a business enabler. BPM does not mean that businesses will create new software systems without IT by drawing pictures and not writing any code. No — IT and businesses will jointly use BPMS to create integrated process-based applications in a way that’s faster and cheaper than traditional development approaches. The cost of IT change must go down (80% of the budget) and BPM allows the business to play an active role.