BPM Rising

[From iSource Business, October/November 2002] Tom Saxe says that if all he wanted to do was map out business processes on a flowchart he wouldn't need software any more complex than Visio or another of the standard drawing applications. No big deal, right?

But when Saxe, vice president of systems engineering and program management at Otis Elevator, set out with his team to document the processes linking the company's 20 manufacturing facilities to its decentralized sales and field service forces around the world, he figured he needed a tool with a bit more firepower. "We were taking it a step beyond process mapping," says Saxe.

So Saxe and his team turned to an application from solution provider ProActivity that allowed Otis not only to map out and document the company's processes but also to design new processes and create an enterprisewide process repository.

As it turns out, ProActivity is just one of a host of software companies offering tools that address some aspect of business process management (BPM), and the solutions available today go beyond even documenting processes to actually executing and analyzing them.

Roots in Workflow Automation

BPM, traces its lineage back nearly two decades to the dawn of workflow automation, the technology created in the early 1980s to route documents and information around an organization. From the beginning, the object of business process management has been to discover and eliminate operational inefficiencies, whether that is an ungainly approval process for purchase orders or an unwieldy procedure for picking and shipping products.

Today corporations' continued emphasis on reducing costs and their increasing interest in integrating business functions are driving both the development of new tools for process management and the growing use of those new tools within enterprises. True, current adoption rates for the latest tools remain low, at about 10 or 12 percent, according to studies from technology consultancies Aberdeen Group and Delphi Group, respectively. The problem, in part, is that many companies have a hard time understanding what it is they do in terms of processes, as well as who is responsible for making a particular process happen, since processes typically involve multiple people, departments and applications, or even extend to business partners. In fact, Delphi, in its 2002 survey of the BPM market, reported that only 2 percent of companies had digitized all their processes, while about half had digitized less than a quarter of their processes.

But Delphi also reported that 54 percent of companies were evaluating BPM solutions, and Aberdeen has predicted that 40 percent of corporations would be using BPM tools by the end of 2003. Clearly this is "a market well on its way," as Delphi put it, and a host of solution providers currently offer an almost bewildering array of BPM applications. (See the sidebar "Finding the BPM Tool That's Right for You".)

Documenting Processes at Otis

Sifting through the myriad of BPM solutions, Tyler McDaniel, a technology analyst formerly with now-defunct consultancy Hurwitz Group, sees solution providers attacking this market with three different types of solutions. The first class of solutions, like those from ProActivity, focus on understanding business processes. These providers' tools are geared to understanding current running processes, analyzing their effectiveness and modeling those processes to be more efficient. This is just the type of tool that Tom Saxe was seeking when Otis Elevator set about documenting the processes that connect its sales force to its factories and field force.

Otis, a $6 billion, wholly-owned subsidiary of United Technology Corp., has sales and field forces serving clients in more than 200 countries, as well as 20 manufacturing facilities in the Americas, Europe and Asia. That decentralization presented the company with a technical challenge: "We didn't have a good infrastructure in place to facilitate communications between all these various entities," Saxe explains. "So we decided to put in a system that could help bridge the gaps."