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Sizing The BPM Opportunity ForManufacturin
Clay Richardson
Senior Analyst
Forrester Research
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Clay RichardsonSenior Analyst
Forrester Research
Serving Business ProcessProfessionals
3 Entire contents 2009 Forrester Research, Inc. All rights reserved.
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I heard this BPMthing might help us
reduce costs.
BPMBPM O enO en 40%40%SourceSource SaaSSaaS
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Diverse factors trigger firms to investigates po en a
Which of the following have been major drivers foryour BPM initiative?
5 Entire contents 2009 Forrester Research, Inc. All rights reserved.Enterprise And SMB Software Survey, North America And Europe, Q4 2009
Survey of 227 Enterprise and SMB IT Decision Makers
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Manufacturers demand BPM for standardizing
42%
36%
34%
6 Entire contents 2009 Forrester Research, Inc. All rights reserved.
Surveyof2227SMBandEnterpriseITDecisionMakersinQ4of2008
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What we hear common drivers for BPM
SEC audits have raised concerns over inconsistent and
undocumented business practices
enterprise level due to rapidly changing regulatory
environment (Model audit, 38a-1)
Process standardization will be difficult with our currentset of development tools for custom software
development
7 Entire contents 2009 Forrester Research, Inc. All rights reserved.
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So, what exactly is
management?
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Defining business process management
Business process management focuses on continuousim rovement of cross-functional end-to-end business
processes Process improvement methodology and disciplineessential ingredients for success
Requires a specific set of process skills and talents in
BPM suites and other technology can greatly accelerate
9 Entire contents 2009 Forrester Research, Inc. All rights reserved.
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Dont let the BPM term confuse you
10 Entire contents 2009 Forrester Research, Inc. All rights reserved.
October 2008 Drive BPM Initiatives To Higher Business Value
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BPM is now the language of IT-to-BT
Vertical/ Functional/ rocess Process/functional Service/ rocess
functional overlays overlays organization
From traditional To Horizontal
LOB and functionalmanagement
Centers ofExcellence
11 Entire contents 2009 Forrester Research, Inc. All rights reserved.Source: BPM Focus (www.bpmfocus.com)
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BPM center of excellence drives process
*Base: 46 IT architects and 65 IT architects
12 Entire contents 2009 Forrester Research, Inc. All rights reserved.
Source: October 2007 US And UK Enterprise Architecture And Business Process Management
Online Survey
(percentages may not total 100 because of rounding)
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Process improvement tasks and functional
13 Entire contents 2009 Forrester Research, Inc. All rights reserved.Source: June 20, 2008, The BPM the BPM center Is Here: Now What?
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Wheres the money for
to come from?
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ROI metrics for BPM success
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Efficiency Benefits
Benefit Example
Eliminate Manual DataEntry
Reduction in time to add a new employeerecord into the HR system from 9 hours to 10minutes
Reduce Process Cycle
Time
Reduction in compensation processing timing
for 12,000 sales reps from 33 days down to 7.
Reduce Manual Analysis/Routing
Elimination of 80% of the manual workpreviously required to route invoice
teams.
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Effectiveness Benefits
Benefit Example
Handle Exceptions Fasterand Better
Evolve process from saving 5% of distressedshipments to saving 70% - yielding $2M perquarter in saved revenues.
Make Better Decisions Better review process results in $3M saved inbilling dispute write-offs that would formerly
just been processed because the process was.
Consistent Execution Customer satisfaction improvement to 92%based on proactive tasks that help ensure thehome loan rocess executes better and faster
17 Entire contents 2009 Forrester Research, Inc. All rights reserved.
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Agility Benefits
Benefit Example
Faster RegulatoryCompliance
Change customs related processes afterSeptember 11, 2001 within 90 days to complywith new federal re ulations for bettershipping visibility.
Su ort New Business Abilit to chan e shi in artners within 10Models minutes in core process allows manufacturer
to change primary shipper every quarter based on best bid provided.
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Example: ROI of Correspondence
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Example: ROI of Correspondence
anagemen con .
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How to demonstrate the value that governance
and cost overruns prior to the implementation of the BPMfunction.
requirements defects discovered during testing and afterthe solution is in production prior to the implementation ofBPM.
Project portfolio value Prepare reports that provide theinvestment costs and expected value of the portfolio of
Report actual valuenew solutions add to the organizationas compared to the expected value predicted in the
22 Entire contents 2009 Forrester Research, Inc. All rights reserved.
.
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How does BPM fit in
technology portfolio?
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1st: Identify the characteristics of your key
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3rd: Explore where BPM fits within your current
m x o app ca ons
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Process standards facilitate intra-department
commun ca on an co a ora on
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Source: http://www.bpmn.org/Samples/Elements/Core%20BPMN%20Elements.htm
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Recommendations
Understand that BPM focuses on methodology and
Connect your ROI and business case to corporatestrate to minimize waste and maximize im act
Evaluate your process requirements to identify which
BPM attern and tools are best fit
28 Entire contents 2009 Forrester Research, Inc. All rights reserved.
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Recommended research
April 2010, Pegasystems Acquires Building Blocks-
January 2010, Lean Business Technology MaturityMatrix For BPM Governance
December 2009, Dynamic Case Management - An
Old Idea Catches New Fire
October 2008, Drive BPM Initiatives To HigherBusiness Value
29 Entire contents 2009 Forrester Research, Inc. All rights reserved.
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Thank you
Clay Richardson
+ . .
[email protected]: passion4process
www.forrester.com
30 Entire contents 2009 Forrester Research, Inc. All rights reserved.
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