In my career I have had large multi-year BPM project leadership experience. That includes an implementation spanning years managing the wholesale ordering applications and processing for one of the top-5 mobility providers in the US. Once given the freedom to implement my own solutions approach, I chose a very different tactic. It is one I believe to be especially suited to the outsourcing environment – if not the wider shared services community.
In my experience the biggest drawbacks to what I would call “Big BPM” in the outsourcing realm are as follows:
- Price. At the core of the majority of outsourcing programs is an expectation of cost savings. Those big-name BPMS solution hardware, software and implementations come with a high price price-tag. Licensing and hardware alone are substantial enough yet typically represent less than 30% of the total cost of implementation. Even amortized over a 36 month contract life, that approach represents a considerable cost burden – regardless of business case.
- ROI. Complexity of healthcare, insurance and telecom workflows together with the nature of the big BPMS paradigm equate to large projects and ‘long wins’ realizing distant ROI. That is especially true when BPMS project scope extends to a re-engineering of the user interface to combine complex sub-processes and disparate legacy function. I speak from direct experience on that.
- Distraction. Entire teams of the most experienced delivery resources will be distracted from customer service by conformity with Software Development Life Cycle (SDLC) methodologies and timelines to include testing and retraining. That rarely occurs without an impact to customer satisfaction.
- Stickiness. Hardware, licensing and code ownership considerations will serve to reduce your flexibility in future vendor selection processes. Once dependency to a major external BPMS system and code base development and maintenance is established – regardless of right of ownership – the playing field changes. Transition of a code base is difficult and compounds the complexity and risk of any future vendor transition.
- Structure. Typical FTE pricing actually serves to dis-incent outsourcing partners from engineering and implementing efficiency improvements that would reduce headcount.
Despite claims of quick implementation my own experience in the telecom space has proven that major legacy application aggregation projects can easily grow to approach the complexity of the base coding of a replacement application from scratch. The most compelling reasons for that are tied to the nature and complexity of the telecom environment itself: Multiple products, acquisitions, multiple geographies, numerous pricing plans, regional product availability, regulatory compliance, disparate systems, complicated pricing, fare structuring and the sheer number of systems required to perform customer support – all contribute to breaking the measures established in other industries.
For all those reasons I prefer a much simpler approach to complex business process optimization. That proceeds as follows:
- Measure. I begin by installing an application of my own invention called StopWatch. It gathers desktop analytics to provide detailed insight into associate behaviors, direct effort to the best areas of focus and provide the statistical measurement required to quantify any remedial business case. (See “Tools” section of my blog site www.SourcingSage.com for free download)
- Analyze. Given that statistical input, I engineer a much more surgical approach to the quickest and largest “wins” as quantified up by the hard facts. I analyze the data and design a solution targeted to individual opportunities with an eye toward future aggregation into a composite entity.
- Socialize. Next I communicate and collaborate with the client and floor managers around solution proposals to ensure that all changes are on target, understood, and gain “buy-in” from the beginning. Impacts such as training, change management, security, staging and risks are recognized, assessed and mitigated early on.
- Act. I believe in rapid development paradigms that can bring both real solutions and unreal savings to bear – as measured in days and weeks rather than months and years. I leverage technologies and approaches that minimize intrusiveness and allow gradual yet measureable wins.
- Assess. We are uniquely capable of determining a. whether the “fix” is being adopted by agents (through StopWatch monitoring) and b. whether the business case was actually realized. If not, we adjust accordingly, if so, we move on to the next challenge.
- Repeat. Remember, the word is CONTINUOUS Improvement. This is an ongoing process wherein together we strive to make improvement truly continuous.
In one specific example for a Fortune 500 player we provided a solution that realized a series of quick wins over a 90 day period. Together with a longer reorganization and cross-training reengineering the project plan resulted in an overall 33% savings -- approximately $3.6 MM USD annually. Key differences in our approach are as follows:
- Rapid Implementation. In some cases we brought production-ready solutions to the desktop in one week’s time with significant and measurable impact. Some approaches begin with mini-windows which migrate to persistent banners/sidebars and then to larger screens. In any case, we are realizing real cost savings before the typical BPM project can begin to define requirements.
- Transactional Pricing Structure. I have helped structure transactional pricing plans that lock the client at current cost thresholds in the beginning. We can then fund process optimization initiatives against the differential gained by driving out inefficiencies across client programs. Our engagements typically remain “open book” – preferring to move forward as partners. After initial optimization investments are regained we share the revenue gains with you, driving your overall costs downward and the process ever onward.
- Open Source. We have a unique architecture that decentralizes the code base and relies only on a central data store for reporting. We design all applications to be configurable without coding whenever possible and keep low-level floor resources trained to support. I prefer to emulate the antithesis of “sticky” and win loyalty based upon merit.
- Low Expenditure. Because this approach adapts open source solutions, the overall investment is lower and thereby the ROI is quicker to realize.
- Minimal Disruption. My passive StopWatch measurement system and direct observation methodology minimizes the time investment of both our shared resource pool. In most cases formal retraining is not required and often implementations require less than 30 minutes overview. Business continues with minimal interruption.
In summary I have both approached BPMS from the top down in large SDLC implementations, as well as from the ground up realizing rapid incremental wins to build a similar structure. I believe the latter is most appropriate to the outsourcing relationship and environment. I welcome your comments and feedback.