A Smarter Approach to Processes and Decisions Proven patterns for successful process improvement

A Smarter Approach to


Processes and Decisions

Proven patterns for successful process improvement

Mike Huseman

WW BPM and Decision Management

IBM Software Group

Bill Hahn

BPM Solution Architect

IBM Software Group, North America

Agenda


The Agility Challenge


Patterns for Success

1.
Business Process Management

2.
Decision Management

3.
BPM & DM Together


Projects to Programs to
Transformation



3

Business Growth & Complexity

CEOs Recognize the Challenges and Opportunities as the
Business Network Becomes More Dynamic

IBM Global CEO Survey, Institute for Business Value, 2010

“
In these uncertain times,
effective and swift
decision making

is more important than ever.
”

Shuzo Sumi,
President and CEO

Tokio Marine Holdings, Inc.

“
Our products
need to
anticipate need
, rather than
respond to a request.
”


Michael D
’
Ascenzo,
Commissioner of
Taxation, Australian Taxation Office

“
The
complexity over the next five years

is off the
charts
–

a 100 on your scale from 1 to 5
”


Edward Lonergan,
President and CEO

Diversey, Inc.

4

Developers

Rest of IT

Leveraging your

knowledge workers

can be a huge opportunity

240x

Business Participants

Doing More with Less…

Engagement & Self
-
Service

Agenda

The Agility Challenge

Patterns for Success

1.
Business Process Management

2.
Decision Management

3.
BPM & DM Together

Projects to Programs to Transformation


Account
Opening

Campaign
Management

Regulatory
Compliance

Vendor On
-
boarding

Order
Fulfillment

Customer
Problem Handling

Process is everywhere


8

Solution Pattern 1:
Business Process Management

Executive

Management

Customer

Service

Invoice

Reconciliation

Teams

Finance
and Ops

Account

Administration

1.
Unstructured Tasks and
Communication (ex
Paper or email)

2.
Inefficient Working
Environment Spans
Systems

3.
Inconsistent
Prioritization

4.
Incomplete or
Inaccurate Data Flow
Between Systems

5.
Lack of Control Over
System and Business
Events (Exceptions)

6.
Poor Visibility Into
Process Performance


1

2

3

5

4

6

Typical process problems

9

1

2

3

4

5

6

Executive

Management

Customer

Service

Risk Management

Teams

Finance

and Ops

Account

Administration

1.
Automate workflow &
decision making

2.
Reduce errors and
improve consistency

3.
Standardize
resolution across
geographies

4.
Leverage existing
systems and data

5.
Monitor for business
events and initiate
actions

6.
Real
-
time visibility
and process control


Business Benefits:

•
Huge Reduction in
Manual Work, Errors

•
Faster, More
Consistent Issue
Resolution

•
Easier to Manage the
Business

•
Consistent Case
Handling

BPM brings order to the chaos

1

2

3

4

5

6

10

BPM Leverages a Service Oriented Architecture (SOA)

–
BPM can abstract the
“business process”

from underlying
systems and services.


–
Over time,
IT can
consolidate those
services into a
common set

of
services within one
SOA layer.


–
Users of the process
are not affected

as
services and systems
are merged, replaced,
or updated
.


Systems

SOA

BPM

Executive

Management

Customer

Service

Invoice

Reconciliation

Teams

Finance

& Ops

Account

Administration

1
2

Customer Video

12

Process Improvement Requires A “Third Way”

Flexibility

Low cost/time

Build

Buy

Customized

Unique

High TCO

IT bandwidth



Reduced time

Initial Cost

Standard Feature set

Reliance on vendor

Response to Change



“Third Way”

+

+

-

-



+

+

-

-

-



Process
-
improvement requirements are likely to be unique, which favors build rather
than buy. And the timeframes and costs of both are often not compatible with process
improvement, so a ‘third way’ is required.

BPM

•
Figure it out yourself

•
Lock the team in a conference
room for day(s)

•
Sticky notes

•
Whiteboard drawings

•
Back and forth till you finally
understand your process

•
Scribe it all down

•
Convert it to a diagram/drawing

Let’s Start With Process Discovery
and how is it done today?

14

The best way to engage line of business
users in process discovery, documentation,
and simple process automation

Gain control and insight

•
Instant dashboards for visibility

•
Reporting for improved governance

Anyone can improve a process

•
Automate work run through email

•
Easily document processes

Collaborate for better results

•
Team up in secure private workspace

•
Leverage public expert community

15

Accelerate Change by Improving the Way You Work

Streamline, document, and run processes

‣
Increasing Transparency through
Documentation

•
Document and provide standard process across 8
regional offices

•
Simple processes from travel requests to complex
processes like new traffic control tower setup

‣
Centralizing and Standardizing Processes

•
Document and standardize processes across 14
domestic and 5 international call centers

•
Able to centralize core workforce management
functions due to large part of standardized process

‣
Incorporating Broad Participation

•
External business areas view and maintain their own
processes within a centralized repository

•
Reduced resources to manage and administer process
repository from 14 to 2

•
Reduced change requests from 8 weeks to 2 minutes

Government Agency

Worldwide Outsourcer

Global Insurer

Lowering Barriers to Collaboration creates Value

16

Enable faster business
-
led
change

Power

to scale with
transactional integrity

Governance

to manage
change confidently

Change is inevitable. Adapt accordingly.

Embrace complexity, adapt quickly and exceed expectations

Simplicity

for deep business
user engagement

Visibility

to empower
business users to optimize
processes

17

18

Shared Assets

Versioned Assets

Server Registry

Process Center

Repository

BPMN

Process
Rules

Monitoring

BPEL

ESB

Process Server

Process

Designer

Integration
Designer

Process Center
Console

Out
-
of
-
box

Process Portal

Optional

Microsoft Add
-
ons

Configurable

Business Space Widgets

IBM Business Process Manager

Define

Deploy

Update

Measure

Governance

Visibility

Management

End User Interfaces

Design

IBM Business Process Manager

Now available
in the Cloud

IBM Business Process Manager Leverages SOA Infrastructure

Systems

SOA

BPM

Executive

Management

Customer

Service

Invoice

Reconciliation

Teams

Finance

& Ops

Account

Administration


•




IBM Business
Process Manager
Advanced Edition

Individual Processes

Process Complexity

22.5%

75.0%

2.5%

The Full Spectrum of BPM can be addressed

Highly complex processes typically found in global enterprises

Somewhat complex processes common to global & mid
-
market companies

Simple processes common to
all

sizes of businesses

IBM

Business
Process
Manager

IBM Blueworks Live

20

Paper overload

•
100,000+ client requests per
month each generating a paper
-
based process instance

•
Client complaints due to lost
documents

Poor IT
-
business relationship

•
Paper problem was understood
but limited IT/Business
collaboration prevented
improvement

21

Business Challenges at Lincoln Trust Company

Leading independent provider of trust and custodial services

Joint LOB
-
IT executive steering committee and a small BPM team
developed a 2
-
part strategy for process improvement:

•
Common “shared process” for

document imaging and automation

using content management tools


•
Removed physical paper from

145 company processes

•
Business teams created “as
-
is” and

“to
-
be” process models using

IBM BPM Blueworks


•
IT teams implemented automated
workflows for 15 processes including
service requests, plan establishment,

and distributions

Quickly address

key pain point


Business
-
led automation
for full business processes

1

2

22

Partnering for Process Improvement

Lincoln Trust developed an aligned process focus across the company

Results

•
$2.2 million

in savings to date

•
120%

ROI in one year

•
25%

increase in employee

productivity

•
50%

-

75%

reduction in cycle
times

•
90%

reduction in customer
complaints

Best Practices

•
Build a partnership between
business and IT

•
Focus on business value
–


be willing to trade
-
off for an
initial project

•
Include process analysis skills
on BPM teams, but don’t

over
-
analyze

23

Process Improvement Benefits at Lincoln Trust

24

IBM Business Process Manager V7.5 Demo

Operational Decision Management

Analytical Decision Management

Business Processes, Applications & Solutions

Decision

Services

Business

Rules & Events

Predictive Analytics

& Optimization

Internal & External Data


Policy


Regulation


Best Practices


Know
-
how


Risk


Clustering


Segmentation


Propensity

Scenario Analysis

& Simulation

Decision Management
is a business discipline that enables
organizations to automate, optimize and govern repeatable
business decisions.

Solution Pattern 2:
Decision Management


25

How Decision Management Works: Customer Acquisition

Call Center

Internet

Agency

Make a
personalized offer

Trigger agent

call back to assist

Seek clarification

Multi
-
channel
quote requests

Respond

Decide

Detect

Business Rules:
Is customer
gaming the system?


Event Pattern:
Same vehicle ID
with different addresses on phone
& Web request:

Event

Correlations

Business Rules:
Customer good
prospect, find best promotion

Event Pattern:
Customer requests
a series of quotes with increasing
deductibles

Event Pattern:
2 web quote
requests and 1 direct contact in 3
days

Business Rules:
Determine best
product

Decisions

Rules

Events

26

Decision Management
Solution


Deployed a BRMS to automate
its order system, eliminates
invalid orders, shortens the
fulfillment cycle, while saving
the company manpower costs
and reduces operational costs to
comply with regulatory changes

Verizon Wireless used the WebSphere ILOG JRules business rule management
system (BRMS) to automate its order validation process. The JRules BRMS
automates the verification of incoming orders and diagnoses errors. Verizon
has been able to reduce invalid orders out of its systems, reduce operational
costs and shorten fulfillment cycle time


Challenge:


The nation's most reliable and largest wireless voice
and 3G data network, serving more than 93 million
customers


Needed to increase self service, improve customer
experience and be quickly adapt to meet pressures of
the market


Benefits:


Keep invalid orders off the system


Shorten fulfillment cycle


Human resource savings


Reduced operational costs to comply with
regulatory changes

Verizon Wireless increased customer service

And achieved business agility

WebSphere Operational

Decision Management

Situational

Awareness

Contextual

Decisions

Business
Rules

Real
-
time BEP
(CEP)

WebSphere Operational Decision Management 7.5 highlights


The
most complete platform for building decision management solutions

that can
use both event
-
based and knowledge
-
based decision logic


The
most extensive capabilities for LOB subject matter experts

to directly participate
in the definition and maintenance of decision logic


The
most powerful governance and management functionality

(e.g. versioning and
history, role
-
based security, team collaboration, multiple concurrent release management)

WebSphere Operational Decision Management v7.5

Combined business rules and business events management platform


28

Rule Designer
Event Designer
Decision Center
Console
Rule Solutions
for Office
Decision Center
for Business Space
Design
Design
Design
Management
Management
Management
WebSphere Operational Decision Management
WebSphere Decision Center
Decision Artifacts
Versioning
Access and Control
Repository
Rule
Execution
Rule
Execution
Event
Execution
Event
Execution
Decision
Monitoring
Decision
Monitoring
Connectors
Connectors
WebSphere Decision Server
Define
Deploy
Update
Measure
Visibility &
Visibility &
Governance
Governance
Rule Designer
Event Designer
Decision Center
Console
Rule Solutions
for Office
Decision Center
for Business Space
Design
Design
Design
Management
Management
Management
WebSphere Operational Decision Management
WebSphere Decision Center
Decision Artifacts
Versioning
Access and Control
Repository
Rule
Execution
Rule
Execution
Event
Execution
Event
Execution
Decision
Monitoring
Decision
Monitoring
Connectors
Connectors
WebSphere Decision Server
Define
Deploy
Update
Measure
Visibility &
Visibility &
Governance
Governance
Decision Center


Contains all the
business user
capabilities
:
repository, web
environment, test
and validation,
Business Space
components, Rule
Solutions for Office

Decision Server


Contains all the
technical
capabilities:

runtimes for
business rules and
events, execution
mgmt, integration
connectors,
developer tooling

WebSphere Operational Decision Management

Products/Components

29

Managing Decisions in Microsoft Word and Excel!

Leverages Tools Familiar to the Business to

Promote Collaboration

31

31

Customer Video


Improved efficiencies, higher levels of customer service and
worker safety


Significant improvement in fraud detection


Estimated payback of 6 months


Save more than $100 million dollars

Client Pains


Australian state social service agency dedicated to employee
worker safety and compensation


Ensure timely workplace claims processing for citizens


Identified a specific project that would benefit from automated
workflows and decision points

Business
Outcomes

WorkSafe Victoria Improves Operational Efficiency


Delivering outstanding workplace safety together with quality
insurance protection to workers and employers


Process automation and business rules software to increase
efficiencies and cut costs while helping Victorian workers
return home safe every day

32

33

Rules & Events Demo

Agenda

The Agility Challenge

Patterns for Success

1.
Business Process Management

2.
Decision Management

3.
BPM & DM Together

Projects to Programs to Transformation


35

Distinct technologies but Complementary Solutions

Process Management

Operational Decision Management

•
Defines and orchestrates the end
-
to
-
end
process

•
Combines automatable and human elements

•
Is fundamentally concerned with
operational
efficiency

of the organization

•
Defines and executes specific decision points in
processes and applications

•
Is focused on automating and improving
decisions

•
Is fundamentally concerned with the
operational
intelligence

of the organization

35

Starts

Notifies

Invokes

Responds

How they collaborate….

Solution Pattern 3:
Combining BPM and Decision Management

36

May

June

July

August

September

October

April

Process and Decision Life
-
Cycles can be
Managed Independently

Strongest Ecosystem and Partner Network


800+
Business Partners authorized and certified to support customers


Strongest global ecosystem including major global and regional
system integrators skilled to provide
comprehensive solutions

Unparalleled Expertise and Investment


Expert consulting and implementation services for
fast realization
of
business value


Industry expertise to
customize solutions
for your specific industry

Why IBM for BPM and Decision Management?

Largest Customer Base


#1

in Business Rule Management Systems (BRMS) market share
according to all leading analysts


#1
in Business Process Management (BPM) market share according
to all leading analysts

37

38