Best Practices of Business Process Management: The Top Ten Principles


The Top Ten Principles

Years of successful and not-so-successful process management experience have led to a set of best practices a number of fundamental principles that must be honoured in order to optimize returns to the company, the delivery of business results to customers and to satisfy the needs of the organization’s other stakeholders. The following principles underlie the methods of business process operation and change. Understanding and living according to these principles will get managers and practitioners alike through some tough debates about managing processes. Without support for these the principles, teams can easily get lost and distracted from the intent of the mission.

The 10 principles are:

  1. Business change must be performance driven.

  2. Business change must be stakeholder based.
  3. Business change decisions must be traceable to the stakeholder criteria.
  4. The business must be segmented along business process lines to synchronize change.
  5. Business processes must be managed holistically.
  6. Process renewal initiatives must inspire shared insight.
  7. Process renewal initiatives must be conducted from the outside in.
  8. Process renewal initiatives must be conducted in an iterative, time-boxed approach.
  9. Business change is all about people.
  10. Business change is a journey, not a destination.

Principle 1: Business Change Must Be Performance Driven

All change must be based on business performance measurement. All the things we do, we should do for a reason, and measurement allows us to know if we are acting consistently with the reason. “You get what you measure,” seems true for all organizations. All must know their aim in life and set a scorecard to evaluate how they’re doing and what’s working. We need predictive measures, not just after-the-fact reports, to see the total picture. Constructing a connected measurement system is critical for us to break down overall targets into what people do every day.

After performance measurement factors are determined, the organization sets some performance targets. There may be inherent conflict among the targets so a balance will be key. Management must send clear messages on strategy and priority through performance metrics and not rely just on wishes alone.

The bottom line for any business improvement is that well-thought-out, targeted measurements will inspire progress and ensure that we allocate our scarce human and financial resources to things that matter most.

Principle 2: Business Change Must Be Stakeholder Based

This principle asks, “Who cares about what we are doing and how well we are doing it?” It recognizes that the organization doesn’t exist only for its own purposes – it must serve a larger community than itself. Stakeholders provide context for the business – its own mecosystem.

A stakeholder is anyone or any group that’s affected by, has a vested interest in, or can influence the organization’s performance in some way. Types should be segmented according to their different requirements and the difference in the way that they are to be treated.

To understand each stakeholder segment, we should know the current state of our relationship with that segment and what would we want it to be in the future. The gap between these two states will drive our needs for change. The future state view will provide a set of evaluation criteria for change from the current reality. The stakeholder criteria will depend on the stakeholders’ actual needs, but this will be balanced with the organization’s desires and intent.

Principle 3: Business Change Decisions Must Be Traceable to the Stakeholder Criteria

This principle ensures we obtain accepted criteria before we enter into choosing among business options, and use those criteria instead of internal personal drivers. When criteria drivers are also misaligned to the organization’s mission, vision, and values and to its stakeholders’ expectations, we cannot expect to optimize results. Insist on agreement to the future state stakeholder criteria that will determine your course of action; then and only then, select that course.

To actually put this principle into practice, management must consciously and visibly agree on the criteria first and then publish them. Management must also empower those working on change to work creatively within those parameters, or with the best interests of external stakeholders.

Principle 4: The Business Must Be Segmented Along Business Process Lines to Synchronize Change

It’s natural to view process as the prime segmentation strategy internal to organizations and—more and more frequently–among organizations since management structures with overly rigid planning mechanisms are too slow to respond. Seamless cross-functional integration is mandatory. Restructuring functional units alone won’t do it. Only process can stake the claim of achieving enterprise-wide integration because, by definition a process starts with the first triggering event that initiates action and doesn’t end until the results of value are delivered to the appropriate stakeholders. This event/outcome pairing defines the processes that we have. All other structures should be put in place solely to serve the full process and therefore to deliver added value to stakeholders.

This strategy implies that in deciding how to invest in change, prioritizing along process lines is requisite. In identifying processes that need to be renewed start with the customers and consumers affected. These processes are referred to as core processes.Look at the customer/consumer life cycle and follow it through, from the core processes, we can derive the processes that deliver guidance to them (guiding processes) and those that deliver reusable enablers to them  (enabling processes). Guiding and enabling processes exist only to support the business objectives that are the target of the core processes and should be assessed in that way.

By segmenting the business along process-value added lines, we have a clear framework for organizing and prioritizing change and for measuring the impact of our efforts in terms that business executives can understand.

Principle 5: Business Processes Must Be Managed Holistically

It’s becoming more and more prevalent to appoint a full process steward, for each process of the organization.

The steward acts as advocate on behalf of the process, taking responsibility for the process’s performance for stakeholders. The steward works not only to deliver improvements in process projects but also to remain in the role subsequent to completion of these projects.

This means staying on top of process and stakeholder performance metrics and reviewing current performance against the best in the business. Primarily, the steward makes certain that the process continues to perform to requirements for its stakeholders, and corrective or anticipatory action as needed to either continuously improve or to introduce radical change is taken. Process stewards must be effective in using influence even though they might have no direct control over the resources involved in the execution and management of the daily work being performed. Clearly, this offers a significant organizational challenge especially with a mixed function-and-process approach wherein day-to-day control rests with functional line management, but monitoring and improvement responsibility goes to process stewards. The critical mechanism that must be in place for ongoing process management to be effective is a forum within which processes are discussed their performance vetted, and the incentive for process outcomes shared among all involved managers. Staff involved in the day-to-day process also must see feedback on the ultimate results of the process. They must have incentives to support overall stakeholder value creation and not to do just what’s convenient for themselves.

Principle 6: Process Renewal Initiatives Must Inspire Shared Insight

Process renewal relies heavily on gathering information, gaining understanding, and arriving at innovative approaches and designs for change. Should this be done explicitly through documents and models or tacitly through human to human communication?

Experience has shown that using either approach exclusively is risky. Working closely with “knowers” rapidly accelerates the learning curve. Especially in focused areas of an organization, this type of learning is manageable because everyone can identify the credible sources of process information. As focus broadens, a business requires more formal approaches to be able to share what’s known. Hence, accessible knowledge artifacts, often in the form of explicit documents, hold great importance to help bridge the knowledge chasm.

A number of activities in process analysis and design will uncover what we know, so that it can be shared across a group in workshops. These workshops will create artifacts or records of the agreements and ideas, but more importantly they will embody a deeper tacit understanding of what’s important to allow better decision making and common commitment. In many cases, a discussion will be more valuable than the charts created.

Often, there are no right answers, only a better sense of how to judge. Not everything can be objective. Don’t leave out activities that embody trust, commitment, and understanding in the participants.

Principle 7: Process Renewal Initiatives Must Be Conducted from the Outside In

In any change initiative, it’s easy to become overwhelmed with the daunting task to be accomplished. If we try to deal with too much at once, we will never finish; instead, we will fall prey to “analysis paralysis.” Managing multiple levels of detail or going to an overly complex level is the biggest risk. Everything we do should be understood and validated at its own level, starting at the top and then working down. At each level, the objects we are analyzing must be looked at only with regard to their own context before any decomposition occurs.

Processes and organizations should employ the black-box approach. For example, we will examine each chosen process in turn to see how it works with regard to its external stakeholders and other related, internal processes. We will break down each process into its next level of activities, and each of those will be examined. In this way, we’ll keep analysis and design at an appropriate level of detail. We won’t spend unnecessary time analyzing work that won’t even exist later. We will focus on the key aspects, not all aspects. We will understand the drivers and have the insight needed before moving on. The context will provide meaning at each and every level of detail or decomposition. The details will come if and when they are needed.

Principle 8: Process Renewal Initiatives Must Be Conducted in an Iterative, Time-Boxed Approach

Principle 8 extends into an approach that encourages you to learn, create something, review it, and plan the next cycle of the same. It assumes that people don’t know everything in advance and that they must create an environment wherein they can figure things out and articulate them incrementally. This iterative approach assumes that you will need to attempt changes first at a fairly high level of abstraction before getting too detailed.

This concept isn’t new, but, more recently, those applying the concept have proven the benefit of doing only a time-fixed amount of work before reviews occur. This is often referred to as time boxing. Time boxing dictates that the activity schedule is preset and the amount of work performed varies according to what can be done within the timeframe. It also solves one of the biggest problems in process-oriented change situations–that is, scheduling the participants, especially management, for key reviews.

Experience confirms commitment to the findings is also built incrementally. However, it’s important that the right knowledge be pursued–that is, relevant knowledge to the task at hand as defined by the stakeholder criteria. Certain overly detail-oriented staff should be kept away from this type of work. We are analyzing and developing processes, not procedures. This type of rapid-fire work can put tremendous pressure on team members, who are now living a series of short-term deadlines.

Perfectionists will have a difficult time with this. What’s needed are good listeners, who can develop trust and respect, and good presenters who will explain but never defend their findings. They must not take changes personally; they must be comfortable in revealing their incomplete, incorrect work products and see the changes to them.

Principle 9: Business Change Is All About People

Human change isn’t something you do; it’s everything you do. Many steps in managing process change are there for no good reason other than decision support. Intellectually, you could argue that many steps are unnecessary or a waste of time and effort. Sadly, you are right, if you don’t consider the human element. Change initiatives are often used simply as ways of creating a document. Instead, you must see them as a vehicle of more encompassing transformation. You aren’t just converting technology, data, procedures, or organizations; you are converting people into enthusiastic supporters and participants. This is one reason that you should encourage active participation in the analysis of existing processes. This analysis fosters understanding and communication.

To do this, a number of factors become paramount. In addition to your communications strategy, you must support changes with appropriate roles and responsibilities, organizational structures, empowerment within accountability, aligned performance incentives, and recognition as well as personal growth opportunities. During transition, the staff must feel that an appropriate level of trustworthy communication is happening. They should feel a sense of contribution as a result of their participation.

Principle 10: Business Change Is a Journey, Not a Destination

A major distinguishing feature between process management and business process re-engineering (BPR) efforts that swept past us in the early and mid-1990s is their approaches to continuity of effort. BP management strives to uphold the notion of supporting the ongoing management of the implemented change or the ongoing implementation of change.

Two major business factors must be taken into account today: The first is that we don’t have time to get everything right, so whatever we do will have to adjust as we learn in the marketplace. Secondly, whatever we do, no matter how right, will be short-lived and have to change anyway. Consequently, we must build versatile solutions and keep our eye on what is changing to be able to adapt in the future. This essentially means that we will never arrive at the nirvana of stability but will always be getting there.

We must recognize that, at any point in time, our stakeholders will have a set of requirements that are in flux. The balance among these requirements will change as each of the stakeholders’ contributions to us change.

The ebb and flow of stakeholder and market evolution means that processes must be managed, even when they aren’t undergoing radical change. Without process stewardship, ongoing measurement, benchmarking, and constant attention to stakeholders of all types, we will fall behind through attrition. Change is required even if we simply want to maintain our current position.

Summary

If process change is a journey, it’s important to pay attention to all the preceding principles all the time. Notice especially that seeking perfection before action is suicide. Doing something small now and learning are more valuable than getting a bigger process right later.

Whatever we do, we must be prepared to do it again better on the next go around. Building learning feedback and knowledge distribution into processes is mandatory. Constantly gaining tacit insight before designing is key. Designing for change is essential. Acting fast isn’t a risk if we are prepared to pay attention to outcomes and adjust accordingly.


This article is published in association with the IRM UK Enterprise Architecture Conference and Business Process Management Conference Europe 2012 – to be held in London, UK June 18-20, 2012.  Visit irmuk.co.uk for more information.

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