As every executive knows, the corporate arena is rife with buzzwords and terms du jour, and "business-process management" is no exception. BPM, many analysts note, can help a company become more efficient, streamline operations, and boost its bottom line.
But BPM is also something of a soft term, encompassing both services and software, depending on which vendor is touting the strategy.
Companies looking to tap in to BPM's power through software would benefit from identifying what exactly the applications do, and how they can change processes and meet goals without busting the budget.
In general, BPM identifies, documents, monitors, and automates activities within a company, usually connected to the development of a product or service.
Business processes that can be managed in this way are numerous, and can include product creation, procurement, order delivery, or distribution. For example, a company can use BPM to help plan how tweaks will be made to existing products. Or it might streamline the way distribution is handled, clearing miscommunication that might occur between the shipping department and order processing.
There are other types of management software that seem to do similar work, but often what they are managing is technology such as databases or servers. BPM digs deeper to examine and automate the underlying processes. For instance, rather than streamlining the database used by the accounting department, BPM optimizes that department's processes.
"The technology is important, and that's why software is involved, but at a higher level, BPM is about bringing an organization together around documenting a certain process, or set of them," said Jeff Kristick, director of BPM products at Tibco.
By documenting the process and bringing an entire company together to do it, BPM addresses the kind of communication and information hurdles that often hinder projects. Individuals and departments often have information gaps between them and around them, Kristick noted, and these tend to show up as bottlenecks down the line.
Many times, businesses turn to BPM software when they have a very specific project that has multiple processes and they need a closer look at how those processes work, according to Kevin Spurway, vice president of marketing at BPM vendor Appian.
These projects can include application development or any other multilevel, complex endeavor that involves many, if not all, departments at a company. For instance, when an application is created at a software company, it involves the work of programmers, managers, network and systems engineers, graphic designers, and even finance personnel.
The software assigns specific tasks to each department and to each individual, and then is able to track how well they perform those tasks and how completion of their responsibilities might affect others.
To help participants understand the task at hand, BPM software provides a graphical view of the process, as well as items like timelines that can help project managers see where a department might be lagging while another speeds along.
Once a process is clearly defined and monitored, a BPM tool can create alerts when a problem is discovered, and develop automated functions to clear roadblocks. The alerts are vital in keeping a process streamlined because they can save time if an issue crops up. With automation, the software can determine which tasks are able to be handled by technology rather than individuals and can make changes.
Because of BPM's growing usefulness, the marketplace has several software options available, either in standalone versions or as part of larger suites of tools that incorporate customer-relationship management (CRM) with BPM.
"In the past, companies might have turned to workflow tools," said Spurway. "BPM actually has grown out of the workflow space in the last couple years, and incorporated new functionality as it evolved."
The way BPM software differs from workflow applications is in its ability to go beyond handling simple bottlenecks and to monitor what is happening in different departments. This creates an environment where people can work together to manage documents or content, for example, Spurway said.
In the future, it is likely that more CRM vendors and others will incorporate BPM capability into their offerings, said Yankee Group analyst Sheryl Kingstone. "There are a number of companies looking at how to fold BPM into their software, because demand is so high," she said.
Oracle, in particular, has been keen to build business process flows into its application, noted Kingstone, although companies that need only BPM are often better off going with a BPM-only vendor, she believes.
"At this point, if a company looks at BPM and determines that's what they want, without any other kind of capability, they're going to find more sophistication from a vendor that does BPM and only BPM," she said.
Although BPM software can address process issues, it is not as if a CIO can install the application, walk away, and have the company run better. At the heart of every process is a human, said Tibco's Kristick, and that person has to understand why the software was implemented in the first place.
"A very common misconception is that a company can just install BPM and have better processes," Kristick said. "Then, they find that their processes are still broken and they figure the software doesn't work the way it should. They underestimate the softer side, which is communication between people."
In some ways, adopting BPM is similar to installing spiffy new conferencing software and expecting employees to communicate more effectively. The software will provide a tool, but ultimately the individuals have to know how to use it, and more important, why they should be relying on it to collaborate.
"There needs to be an owner, a single person that is the champion for BPM," said Kristick. "It's not like a word processing application that you can just install and then have everyone start using. The company needs to understand its goals, and the reason to commit resources to BPM."