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Business Process Management is Under Construction

BPM systems have mastered process integration and automation, so advanced products promise embedded process monitors and feedback mechanisms. With so many vendors checking every feature and function box, we teamed up with sister publication Network Computing for a hands-on comparison of nine BPM suites. We looked at modeling, reporting, business activity monitoring and simulation features and discovered that, for the most part, the road to the future of BPM has yet to be completed.

Completing a business process can be compared with traveling from point A to point B in your car. Both journeys require infrastructure, a good map and respect for the rules of the road so you don't wind up in a ditch or — in this post-Enron world — get pulled over by a trooper.

Executive Summary

Business process management (BPM) systems have mastered the art of integration and automation. The next stage of the technology, say the experts, will be about higher process intelligence, with embedded business activity monitoring (BAM) capabilities including metrics, key performance indicators (KPIs) and dashboards as well as advanced simulation to support decision-making. To get a closer look at the current state of BPM systems, we partnered with sister publication Network Computing to compare suites from nine vendors. Our tests confirmed that integration and automation are largely commoditized, but we discovered that advanced process intelligence features remain under construction.

Most of the products we tested made it a simple matter for business types to model processes, but contrary to the marketing hype, IT assistance was required to put new processes into practice. As for BAM functionality, dashboards and KPIs were in evidence, but out-of-the-box functionality was limited to simple process operational metrics such as execution times, completions and exception statistics. To understand the deeper impact of processes, business analysts will have to spot the crucial variables and IT will have to build BAM features that will correlate the data. A few products are headed in the right direction, but none has all the features you'd want in a single product.

When it comes to process infrastructure, workflow software helped us lay local roads starting in the late 1980s. Enterprise resource planning (ERP) and customer relationship management (CRM) added interstates in the mid- to late '90s, and enterprise application integration (EAI) soon built interchanges between the major arteries. Business process management (BPM) vendors came along at the dawn of the century, offering modeling, traffic management and integration and automation rolled into one. Modeling maps out the most efficient route for processes. Management eliminates traffic jams by load balancing, and the integration and automation minimizing human "traffic-cop" interactions.

BPM software saves time and money, and sales are now growing 20 percent per year, according to IDC. Little wonder content management, EAI, infrastructure and application giants such as IBM, Microsoft, SAP and Oracle have joined the market. The challenge for would-be practitioners is selecting from among the more than 100 BPM products. With so many vendors checking so many feature and function boxes, we teamed up with sister CMP publication Network Computing to put a sampling of BPM suites to the test.

As we wrote in April "Blow the Lid Off Automation," integration and automation are old hat for BPM, so we were most interested in looking at modeling, analysis and reporting, business activity monitoring (BAM) and simulation features. Network Computing test maven Lori MacVittie discovered big differences among the nine products (see "IT Detours on the Road to BPM,"), with only a few providing advanced monitoring and simulation features and all requiring IT assistance. Clearly, state-of-the-art BPM is still under construction, but fear not, as our research revealed that few organizations are well along.

Learn to Walk

BPM software is headed for mainstream adoption, but it's still a relatively small, immature market. Software sales reached $1 billion last year, and double-digit gains through 2009 will bring it to $3 billion, says IDC. By comparison, the document and content management market should surpass the $3 billion mark this year. Plenty of organizations have yet to discover BPM, a point evident in our "Listening Post" e-mail poll, in which 36 percent said they were considering BPM and 29 percent said they had no plans to implement it, while only 24 percent said they were either piloting, rolling out, in production with or upgrading BPM.

Automation and integration may be old news for some, but they're the first big challenges for BPM beginners. Initial projects are often aimed at tying together disparate systems and information silos, eliminating paperwork and creating a consistent, accessible process to track and document.

Gas distributor Blue Rhino, known to many barbecue enthusiasts, had these goals in mind when it launched its first software-managed business process in March 2004. Built on Metastorm's eWork BPM system, an inventory transfer process Blue Rhino streamlined tracks shipments of full gas tanks, inventories and empty tank returns among the company's 200 distributor locations. The old process — a hodgepodge of Excel spreadsheets and faxes — forced the inventory manager to make countless phone calls to reconcile information.

The new process is accessible to everyone through an intranet, and the company's SQL-based inventory tracking system is continuously updated as inbound and outbound shipments are logged in at distributor locations. Field personnel benefit because a simple interface takes the place of paperwork, and the system also prints out bills of lading required for each shipment that previously had to be prepared by hand.

"[It used to take] two weeks to close inventories each month because there were always discrepancies," says Blue Rhino systems integration manager Keith Reichard. "Now we give the distributors a two-day deadline for reporting, and it takes half a day to reconcile the final numbers."

Blue Rhino has also relied on BPM to comply with the Sarbanes-Oxley Act. In 2004 it launched a process that tracks why, how and when changes are made to the company's information systems. The process timestamps all user requests, actions and approvals. "No task is completed unless it follows the proper approval workflow," Reichard says.

Beyond Integration

Most organizations gain efficiency just by turning ordinary processes into streamlined, connected, documented and tracked processes managed by BPM systems. But what Blue Rhino and thousands of other users have yet to do is exploit the technology's closed-loop process control and continuous process improvement capabilities. Closed-loop process control means using operational statistics and higher-level BAM to better manage work in process. Continuous process improvement is about spotting patterns of problems and exceptions and revising the process accordingly.

"Most companies are barely pursuing either of these goals," says Gartner analyst Janelle Hill. "Closing the loop is about performing process analysis in real time and using the results to change the behavior of in-flight business transactions. You can also build up an audit database over time, perform analysis and put the results back into the [process] model so you can reduce the possibility of future exceptions."

At the most basic level, organizations are reporting on and reviewing historical process statistics — how many instances were completed, how many are in process and how many required exception handling. More sophisticated processes might incorporate operational dashboards or alerts so managers can respond in near real time when certain thresholds are reached. At the next level of sophistication — one many products have yet to support, as confirmed in our tests — processes might include business metrics, key performance indicators (KPIs) and correlation of operational data into meaningful business insight.

"Most BPM systems don't have prebuilt analytic functions that can run through calculations on events," Hill says. "They lack a correlation engine that can find the pattern in three or four events happening simultaneously that tells you, 'Demand for our new product in going up exponentially.'"

Process by the Dashboard Light

Citigroup offers an example of a BPM deployment that graduated to more sophisticated business activity monitoring. The company's asset management unit has been using CommerceQuest software for system-to-system integration since 2003, but in January it added the vendor's Traxion BPM suite to support human workflow and add process-monitoring capabilities for decision support. Among the company's first projects was a pricing process for the company's Asset Management unit.

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