The third edition of Vlerick’s Business Process Innovation conference on 11 October turned out to be a huge success. With over 230 executives attending this conference, a large and diverse community of managers and decision makers was gathered in Affligem.

In total more than 20 presentations, spread over four parallel tracks, provided the participants the possibility to customize their conference experience and to get new insights, enlightening ideas and useful frameworks.

Each day we find ourselves confronted with a myriad of opportunities and threats for our organisation. Each of them seems to be demanding our immediate and undivided attention. This requires an integrated approach to business process innovation.

The three main tracks represented the research and knowledge centers of Vlerick’s Management & ICT competence unit. These three complementary management disciplines provided an integrated approach to the creation of real customer value.

• Execution and improvement of your business processes through Business Process Management (BPM)
• Selection and implementation of the necessary improvement initiatives, through Project, Programme & Portfolio Management. (3PM)
• Knowledge discovery & management on both current performance as future improvement areas, through Business Intelligence (BI)

In addition, a solutions showcase track presented on the edge technologies in the above mentioned expertise domains.

Let’s browse through the most compelling conclusions of the day:

“IT architecture is a business issue”

The way organisations do business today is increasingly defined by IT. The potential of strategic decisions is limited by the ability change business processes. Where IT isn’t a driver for change, it often is a major roadblock. “IT integration seems to preceed your capabilities for business process innovation”, concludes DRK’s Dr McCormack.

European organisations tend to be either in a very advanced maturity stage regarding Business Process Innovation, or really far behind. That’s one of the conclusions by Prof. Dr. David Robertson, following a survey of 150 companies in 7 the US and Europe. Asking them about the impact of IS/IT architecture on their business strategy execution, IMD’s Prof. Robertson concludes IS/IT are too often a roadblock. “When the IS/IT architecture prevents you from doing what you want to do, that’s a business issue”, he states.

Both organically grown or acquired through M&A the IT architecture often lacks standardisation and integration. Comparing with construction works it would be considered highly unwise to start without a precise building plan, or to make lots of improvised changes along the way. “Yet that’s how we build our data stores”, Prof. Robertson comments. “Building new capabilities the right way, or the wrong way, will come at the same price”, he warns. Only through structured cooperation we can prevent IT from having to eternally chase the corporate strategy. When you do it the right way, IT often comes with ‘happy surprises’.

From vertical to horizontal organisations

David Robertson proposes measuring IT agility through a 4-stage maturity model – from IT silos, standardised technology and an optimised IT core, to a truly modular business architecture. “European companies tend to be either to the left or the right side of the spectrum”, finds Dr. Robertson.

He warns that in this evolutionary model you cannot just skip a stage, due to IT issues and management learnings. After surveying 150 companies Robertson found only one CEO taking his company through more than one transformation stage. Organisations have to gradually grow through the stages, to an increasingly ‘happy’ collaboration between IT and the business process owners.

Worldwide research from Dr. Kevin McCormack highlighted some turning points in growing to BPM maturity. Organisations have to climb from the ‘base camp’ of defined processes and practices, to integrated Business Process Management. It takes vision and strong leadership to make this uphill transition, going against the ‘natural forces’ of business reality.

The benefits of such emphasis on processes, ‘horizontal’ integration as opposed to ‘vertical’ hierarchical structures, are clear: reduced interfunctional conflicts, better overall business performance and increased ‘esprit de corps’. However, flipping from vertical structures (departments, lines of business...) to process-centric management is a painful process, affecting people, culture, methods, strategic alignment, governance and IT. “It’s hard to kill your own position”, Dr. McCormack stresses.

The Portuguese professor Jorge Coelho added to this statement by giving some tips and tricks that aim for the strategic alignment of people and process objectives. The lack of it is often found as a major hurdle in becoming more process-oriented. The assessment criteria for people are not associated to the ones to assess the organisation. Shared objectives are confused with shared responsibility creating problems to ask for individual responsibility. Processes need to be on the people minds and not only on the computers.

Kevin McCormack also offered some maturity models for measuring Business Process Orientation within an organisation. “Start from anecdotal evidence. People tell stories, hear them and try to see patterns”, he advises. Organisations have to aim higher than just defining business processes – SAP practitioners would declare this a success, while there is no real business performance gain – into linked or truly integrated business processes, or even extending them beyond the company boundaries to suppliers, partners or customers. “IT integration seems to preceed your BPM building capabilities”, Dr. McCormack concludes.

The customer oriented business

Is margin the number one metric for business performance? While striving for increased revenue, enhanced service and decreased cost organisations tend to be missing one thing: customer expectations. In their book ‘Customer Expectation Management’ Steve Towers and Bennu Group’s Terry Schurter speak out about customer interaction being the key to success. At the Vlerick BPI Conference, Terry Schurter put up a trivial yet disturbing challenge to business leaders – taking an outsiders’ perspective on their own customer service performance.

What’s the key to delivering superior customer service? “It’s the network”, a large American cellco thought, until proven wrong by an MVNO (Mobile Virtual Network Operator) signing up a million subscribers per year without owning a single transmission tower. It’s about consistently living up to expectations, including the customers' ‘moments of truth’ or break points. Hence, we would need to align our organisations against the customer, especially innovating customer-facing business processes. “It’s not easy. Most of us still are used to thinking inside-out. We need to create successful customer outcomes outside-in”, Schurter concludes. Innovative business processes could empower customer facing employees, moving decision making closer to the customer.

Régis Lemmens of the Robert Gordon University at Aberdeen (UK) inquired how business rules and procedures can increase sales force performance in relational sales. Sales performance is too often reviewed on highly subjective criteria, while investments in Sales Force Automation and Business Intelligence face slow user adoption. Why don’t they use those BI or SFA-tools? “Because they often don’t contain actionnable information”, Régis Lemmens states. After an in-depth study of a large European services organisation Régis Lemmens tried to correlate metrics like the number of opportunities, the conversion rate or the sales lead time with the actual sales performance. He couldn’t help finding the correlation rate was really low due to the lack of accurate data. When a CRM or SFA platform offers no actionable information, sales people will ignore it or enter opportunities late or at arbitrary times. Régis Lemmens concludes that reaching the strategic goal , they absolutely need to realise tactical reporting and increase operational visibility first.

Practitioners speak out

The third Vlerick BPI Conference was a clear sign that business process innovation is a reality within Belgian public and private organisations. The number of ‘mixed profile’ delegates and the vested interest in practitioner oriented subjects was instrumental to the growth of business process innovation. The shortage of skilled project managers, programme managers and business process architects is real, yet the Vlerick BPI Conference helps closing the gap. Attendees could draw lessons from other practitioners, sharing best practices and demonstrating the tangible business benefits of their projects.

Mr Vincent Dewaele of Mobistar explained from first hand experience how programme management is done within a major Belgian telco business. “First we had some major projects like Y2K, the Euro conversion and number portability. Those had clear deliverables with no conflicts of interest’, he stated. Real ‘programmes’ typically last longer. They may have clear long term goals, but the way to get there is often unclear at the outset. Programmes thus often  imply serious conflicts of interest among stakeholders and traditional project management methods will not prove successful for this kind of challenge.

Mobistar had such programmes running to introduce their new ADSL and fixed line offerings, on CRM and network operations outsourcing. For mr Dewaele programme management is a truly cross-functional challenge, involving change management, sponsorship and leadership at all levels within the organisation. Separate programme meetings bear a serious risk of duplicating the decision making process. Hence Mr. Dewaele has translated Mobistar’s strategy into clear objectives, while creating buy-in from key players directly and integrating decision making into existing governance structures.

Mr. Paul Allaerts of Dexia demonstrated how the banking group goes through a rigorous and standardised selection process, before even considering to start a project. Given structural constraints of time, budgets, people and IT resources, it is key to do the right projects and kill low-priority projects from the start. Dexia’s Project & Portfolio Management also looks for synergies and aligns local and cross-border projects throughout the group. Per project a High Level Project Charter states objectives, milestones, levers and links with other projects. Through a formalised process Dexia will then decide which projects will ultimately receive approval and funding. Mr. Allaerts adds Dexia is using a portfolio management tool (CA Clarity), yet it’s crucial to put up a good evaluation process first before even considering a tool.

Mr. Stefaan Loos of DAB Vloot explained how this maritime government service increased financial visibility and control by implementing a single platform for accounting and ERP (Oracle eBusiness Suite). More rigorous control over spending, auditability and workflow automation were some of the key benefits aimed for and reached by the programme. “We can’t spend over budget anymore”, states Mr. Loon. Very detailed ad hoc reporting was another key benefit, thanks to more detailed input fields. DAB Vloot is currently implementing user self service (Profitability Manager), allowing decentralised cost accounting.

The presentation of Eandis could well serve as the executive summary for this event. Peter De Pauw, head of the Process and Project Management Office explained that Business Process Management cannot be seen as a standalone management discipline. Only when BPM can interconnect with other domains such as Quality, Productivity, Project methodology, Portfolio Management, Knowledge Management and Change Management, it can reach its full potential. Quality needs to set strategic aligned process goals. Process improvements are implemented on a project basis and overseen in a portfolio structure. The change department will ensure business acceptance of the improvement initiatives, and good knowledge management will enable people to find (process) documentation in a logical way.

The conference delivered an unequalled faculty of academics, industry pioneers, thought leaders, visionaries and down-to-earth practitioners from leading organisations in the fields of BPM, 3PM and BI. Only an integrated approach to Business Process Innovation will results deliver real customer value and realise successful customer outcomes.