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Process Power

Process Power

Many companies use their process models as a kind of wallpaper, leaving the CIO to wonder whether there are any real benefits to be gained from the exercise.

Changing Emphasis

Rosemann began thinking about business process re-engineering (BPR) while involved in preparations for an SAP implementation in Germany in 1993. Heavily influenced by Michael Hammer's work on BPR, the team began by doing quite a lot of business process modelling, but became distracted once it got its hands on SAP. The trouble was, Rosemann says, like most organisations this one found the early awareness of BPR could not be followed up until it had "cleared up its IT landscape".

"From 1993 to 1996 we saw a lot of SAP implementations in Europe where initially we looked into processes and realised later it was all too complex to do BPM and ERP implementations at the same time," he says.

At the time most implementing companies were still based on functional silos and were hesitant to institute collaboration between those functional areas. Not until they had achieved effective integration of their major applications were they in a position to start thinking about business process, redesigning their company around business processes, and designing and selecting IT solutions based on business process-related criteria.

Australia has lagged behind Europe in this area, but Rosemann says the situation is changing fast. Perhaps 20 to 25 major Australasian companies, including Australia Post, BP, the Commonwealth Bank, Woodside, Health Insurance Commission, Centrelink, Ford Credit and Television New Zealand have implemented ARIS over the past two years. Others are striving towards BPM using other tools and frameworks.

Business process modelling is a core activity within business process life cycle management. Rosemann, whose postgraduate students also have been helping many Australian companies to examine their business processes and come up with ideas for improvement, says business process models provide a bridge between IT and business as organisations seek ways of aligning future IT opportunities to business expectations.

"We literally take postgraduate students to many companies here in Brisbane and have a look at various business processes. After a few weeks we always come up with significant improvement ideas," he says. "But companies traditionally still very much believe in their functional silos, and hesitate to collaborate between these functional areas. The idea of business process modelling is to increase the awareness, the appreciation for the idea of business process management."

Rosemann says although Australian organisations have done some process modelling, their efforts have typically been fragmented and patchy. "Wherever we go we find process models or related tools but there is often no overall enterprisewide approach," he says. "As part of a continuously increasing BPM maturity it will be the next challenge to roll out the BPM idea in an integrated and standardised way within and beyond the enterprise."

He says in Europe this new emphasis on process has seen many CIOs take on the new title of chief process officer (CPO), in recognition of the need for the technology head to support the business processes. It is something Australian organisations might do well to emulate and would be a recognition that CIOs must understand that it is possible to improve processes, but that IT is not always the only vehicle to achieve this.

Those wanting proof should look to what is happening in Asia and Europe where there is a far higher level of business process management maturity. Rosemann says in those regions many organisations have replaced the concept of doing requirements specification as a prelude to developing software (a software-centred modelling approach) with a business modelling approach where business and IT aspects are both modelled. Although there is no guarantee such an approach will always reap a benefit, if an organisation has never looked across its functions, that exercise is almost certain to pay off.

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