Process for the Enterprise » People

Don’t Give Your Process Improvement Over to a BPO

Scott Francis — Fri, 10 Feb 2012 14:14:51 +0000

Adam Deane has once against sparked a discussion in his comments – this time about BPM and BPO – and he ends with the question: “So why are BPO and BPM not talking to each other?”

I might not have commented on the post, but for reading Neil Ward-Dutton’s response, and then Evan McDonnell’s response. Neil points out that CapGemini’s BPO offering uses IBM BPM (Lombardi), Steria’s F&A uses Nimbus/TIBCO. And AWD from DST. So it looks like there are a few examples – perhaps not getting much press.

Evan’s comments were even more interesting to me, crediting BPO providers with some foresight. He rightly points out that BPO has largely been “lift and shift”, and that they’re running out of steam (but trust me, there are still low wage geographies and polutions for BPO providers to exploit). Evan goes on to describe the BPOs with foresight and the great benefits they will achieve by adopting BPM.

I have no argument with that – clearly any company with scale, and customers, will benefit from good leverage on a BPM suite/system/solution. BPO providers are, after all, just companies like yours and mine.

But I took some issue with the idea that we aren’t hearing about their success because they’re keeping it secret, and wrote:

I file this under “I could tell you about our successes, but then I’d have to kill you” (smiley face)

BPO organizations are/were not exactly known for being innovators. I didn’t notice any of them “anticipating” the lack of cheap labor – their whole business was typically based on the premise that the cheap labor pool was virtually limitless. It is no surprise that they are late to BPM, late to process improvement (for real). And a BPO’s process improvement is not for the customer’s benefit, it is for their own. As a customer to a BPO firm you have to own your own process improvement.

You might think I’m crazy or talking nonsense. Does Apple leave it to their suppliers to figure out how to improve their processes or their manufacturing? Or do they go in there and make it happen at a detailed level? Don’t think you can just hand off and walk away. If you do, you’ll find something that went from differentiator (when you made it a core competency) to commodity (when you stopped differentiating on it), eventually turn into a weakness and a cost center (after BPO has set in for a couple years). Only by then, you’ll have lost the critical internal organizational expertise to run that outsourced process…

There are benefits to BPO, but big risks as well. Handle with care.

Of course, many people would argue that most companies don’t do this investment in process and people – but whether companies do or do not invest, it is pretty clear that they should be investing.

As for BPOs, trust me, when a company’s whole business model assumes that individual people are not valuable nor interesting, it is hard for them to suddenly retread for the world where skilled labor is more expensive, and choosier. Instead, they migrate down the experience ladder, or the education ladder, until they find people who meet the right cost structure (often regardless of the impact on customer outcomes).

To the BPOs out there: invest in people and process, it is the best way to add value for your customers. But to the customers of BPO vendors – own your own processes. Improve them. Don’t let all the benefits of process improvement accrue to someone else.

Nobody Cares about BPM… Or do They?

Scott Francis — Tue, 07 Feb 2012 16:19:07 +0000

Ian Gotts says nobody seems to care about BPM – on the basis of attending a conference (unnamed) in the USA, that was sparsely attended. He has a great picture of the room, nearly empty, that presumably he was speaking in. Of course, that picture could be taken before everyone comes in to sit down – it might not be intended to be taken for a literal head-count. But the point is clear:

I was keynote speaker at an event billed as ‘one of the USA’s most important BPM events’ – 500 attendees. Gartner gets fewer 1,000 at their US BPM Summit.

In contrast Dreamforce (image right), which is Salesforce’s PAID annual user event gets 25,000 delegates.

As I pointed out in a comment on his blog, this is a bit of apples and oranges. I don’t believe any of Gartner’s conferences have 25,000 delegates. They’re analyst-driven conferences that tend to appeal more to executives than rank and file users. Gartner’s CRM conferences aren’t attended by 25,000 people either…

On the other hand, IBM Impact was attended by north of 8000 people last year. Appian’s user conference had record attendance, as well. IBM’s other conferences have similarly large numbers of attendees (I believe the IOD conference is even bigger than Impact, for example).

Ian asks:

So what is it? Perhaps BPM has been around too long and everyone knows about it, so they don’t need to attend conferences and measuring conference attendance is misleading. But the world has moved on with technology enabling fantastic advances in operational excellence, so surely there is a need for continued education. And similarly, CRM has been around 20 years or more yet Salesforce conference attendance is still climbing.

What is it? It is vendor-focus rather than analyst focus. As I commented in his blog, these are just different audiences. The vendor conferences are more users as well as decision-makers. Users don’t generally go to analyst conferences, however. And if you’re going to your vendor’s conference- do you really need to go to one or two more analyst conferences? Probably not.

It isn’t that BPM is too broad, any more than CRM is too broad – it is just that vendor conferences are a bit more interesting than vendor-agnostic analyst conferences. And hey, the vendors usually bring in better bands and entertainment!

My experience is that BPM enthusiasm at conferences is running high – at software vendor conferences, that is – and so I find myself in disagreement with Ian on this one.

Chris Dixon asks: Who Should Learn How to Code?

Scott Francis — Thu, 02 Feb 2012 05:32:27 +0000

What a great blog post from Chris Dixon, “Who should learn how to program?” :

Businesses all over the world need more programmers. Every company I know is hiring engineers (e.g. see this list of NY tech startups). Top programmers can make $100K+ right out of college. Yet there were only about 14,000 computer science (CS) majors last year. Meanwhile about 40,000 people got law degrees even though demand for lawyers has been shrinking. America is suffering from what economists call structural unemployment: jobs are available but our labor force isn’t trained for those jobs.

Plentiful job opportunity is just one great reason for people to learn how to code (program). Unfortunately, after the dot-com bust, the news media and many cynical people convinced many college students that software jobs were going overseas and never coming back. It was a classic market-driven overreaction to a correction. In places where students have good data about market dynamics (e.g. Stanford) the number of computer science majors are up double-digit percentages each of the last 3-4 years. Additionally, there’s been a big increase in software-related fields, not typically classified as Computer Science (like Symbolic Systems, electrical engineering, and certain types of engineering and product design).

Chris also points out that programming is a great foundation for starting a tech company. Hard to argue with that. If your goal is to start a company, knowing how to code will give you a much better chance of achieving that dream than just about any other skill. Taking BP3 as an example- a services company that you might not think requires programming skills to start: I have a computer science background, and Lance knows how to write code, though it isn’t part of his job description(!). Knowing how to code and being able to do it were what allowed us to start BP3. And those skills translate well to nearby fields like statistics, that require structured or algorithmic thinking.

Programming is good for your brain – to misquote (slightly) Steve Jobs, it is like a bicycle for the mind. You’ll be amazed at how well you can remember not only where specific lines of code are in your work, but by how long you can retain this knowledge, often even years later being able to trivially skim through your code to the right spot to fix a defect.

An even better point Chris brings up is this one:

Programming is an important part of being “culturally literate.”

It is hard to underestimate this today. I’m raising two children. We’re exposing them to an immersion school that teaches them to speak fluent Spanish (as well as their native English). But the school (and through some help from outside of school) we’re also teaching them Mandarin (and a little Cantonese). If our children graduate from college fluent in English, Spanish, and Chinese – they’ll be able to do business almost anywhere in the world and converse with people from all over the world. They’ll be much better off than their monolingual father, to face the challenges of the future. But there are two more “languages” I will try my best to pass on to them:

programming. If our children learn how to write software, it will open up vast opportunities to them. It isn’t about how many software languages they learn – even one will be a big head start heading into college.
product design. I don’t think it matters if it is physical design or software design, but I want to impart to the kids something of the language of design – the terminology, the flavor, the subtlety of how you talk about it. I once compared “design language literacy” to the way chefs talk about food and cooking. If you want to communicate with a chef (or a foodie) about food, you need to learn their language and vocabulary. Similarly, for design, we need to learn the vocabulary and thought processes to communicate effectively – even if we don’t intend to become a designer.

These programming and product design skills are “meta” languages in a sense. They transcend national borders and historical language affiliation.

The comment section of Chris Dixon’s blog puts the exclamation point on the value of this post to the general school of thought about coding.

So who should learn how to write code? You should. Your children should.

Passion + Process

Scott Francis — Wed, 01 Feb 2012 17:00:52 +0000

Great interview of Ron Johnson, the new JC Penney CEO, by Seattle Times… In it, Ron pointed out the stores he admires – Whole Foods and Starbucks, and why:

Q. Other than Apple, which stores do you admire?
A. I admire lots of stores. Whole Foods is a great store. I just like their passion for food. It shows up in everything they do. It shows up in their packaging, their presentation and their employees. Starbucks. It truly has created a community. As I travel around the world, I just know that if I go to Starbucks I will have a great experience.

He’s right -Whole Foods is almost the sale of groceries art form. Starbucks has an incredibly consistent experience. These are two companies with a very strong process culture. Ron focuses on the end result (the store experience), but it is deeper than that - these companies also go deep into their supply chain and understand the origins of everything they’re selling (and then use their buying power to influence the supply chain). When you motivate that process-focus with a passion for the product (organic food, or coffee), the results seem to be much better than passion without process, or process without passion. It is almost impossible to tell whether process-focus led to a designed-in passion for food and coffee (to achieve the desired result) or whether passion for the food/coffee drove the focus on process in order to achieve the goal. But the two together are a powerful tool for a big company to drive excellence.

Another part got my attention:

Q. What ideals have you embraced from Steve Jobs?

A. The importance of doing everything you do to your very best. And that the journey is the reward. If you do things well one at a time, you end up in a really good place. Don’t get ahead of yourself. Control the things you can.

The Apple approach to building a relationship with the customer starts with doing each of the little things really well. Being a retailer, perhaps “each of the little things” doesn’t start with designing product, but for sure JC Penney has to be looking at design of stores, pricing, brand presentation, and customer service. I have such a negative opinion of the JC Penney brand, that it is hard for me to imagine shopping there for any reason, for any product. Literally, it is hard to conceive.

Yet reading this interview, I’m rooting for Ron. He gets it. If anyone can turn this around, he can. But I’d be more inclined to shop there if the name were changed to “Ron Johnson’s” instead of JC Penney.

Getting introspective for a moment – is your organization getting better, one thing at a time? Are you prioritizing to address the most important things first – but without forgetting about the little things? Are you distracted by trying to do or change too many things at once? Are you marrying passion and process and following where that leads you in your business?

Who Shall Champion Process Management?

SXSW: Startup Village + Lean Startup SXSW = Value

Scott Francis — Thu, 26 Jan 2012 06:57:01 +0000

The highlight (for me) of last year’s SXSW-interactive conference was the Lean Startup SXSW – a whole day of planned content, mainly in one room (in the AT&T executive center) focused on the idea of “the lean startup”. Eric Ries and team did a phenomenal job bringing together a set of topics and speakers that you just normally wouldn’t get exposure to in a single day.

Leveraging the success of that forum, SXSW has created the Startup Village this year. The 4th floor of the Hilton will be converted to startup mecca. I thought the “Lean Startup SXSW” track might have gone away in favor of this modified (and bigger billing) approach. Apparently not so. Today SXSW.com announces that they’re bringing Lean Startup SXSW back – and some of the chief instigators are involved again – Eric Ries, Dave McClure, Steve Blank, 500 Startups, et al:

The Lean Startup SXSW will take place on Saturday, March 10th from 9:30am – 6:00pm at the Downtown Hilton (across from the Convention Center), and the most up-to-date agenda can be found here.

So, more central location, same Saturday location in the schedule (good call). The agenda already has enough speakers identified for me to plan my Saturday schedule.

Once again, good evidence of how SXSW adapts and co-opts good ideas from the outside. Congrats to the organizers, I’m looking forward to it.

Management Debt

Scott Francis — Tue, 24 Jan 2012 07:17:18 +0000

I guess if we can have Technical Debt, and Process Debt, why not Management Debt?

Ben Horowitz’ post on Management Debt is a good read, but one thing that separates it from technical debt or process debt is that it seems to my own naivete that it almost never pays to pick up the management debt if you can avoid it, as described by Ben:

Like technical debt, management debt is incurred when you make an expedient, short-term management decision with an expensive, long-term consequence. Also like technical debt, the trade-off sometimes makes sense, but often does not. More importantly, if you incur the management debt without accounting for it, then you will eventually go management bankrupt.

He gives three tough examples – two in a box, overcompensation, and no feedback loop.

In the end, it comes down to leadership even more than management. In each of his scenarios, good leadership cuts through the problems or is willing to pay the debt now rather than later.

No related posts.

Lean Startup vs. the Great Man

Scott Francis — Mon, 23 Jan 2012 03:47:58 +0000

In Brakoniecki’s post on Lean Start-ups and the idea of Entrepreneur, he delves into the apparent conflict between the Taylor “Great Man” theory, and the Lean Startup’s emphasis on leadership, and learning (all while in essence refuting the idea of the Great Man). I commented on his blog directly but thought I’d share my thoughts here as well:

The relationship between the Great Man theory and Entrepreneur is a bit of a quandary in the lean startup community. On the one hand, many people in the startup business contend, paraphrased, that “entrepreneurs are born rather than made.” But the lean startup seems to say that entrepreneurship can be taught, learned, rather than born inside you.

The “born with it” argument, to me, seems to be in alignment with the idea of building companies around Great Men (very Ayn Rand, in my humble opinion). But that doesn’t make it correct. In my experience, these things aren’t mutually exclusive.

I’d put it this way. For some people, being a good entrepreneur *appears* to be innate. We don’t know the person well enough to know how this talent developed, and what their experiences were – they’re a black box. To us, as if by magic, they are really good at entrepreneurship (and leading). For others, it is more obviously a learned, thoughtfully acquired skill.

But I would argue that for literally everyone – born with it or not – if you decide to begin the journey of entrepreneurship, you can improve your chances if you learn. And learning what Lean Startup has to offer is clearly a benefit- even if you choose not to apply lean startup methods to your efforts, at least you’re making an informed decision. If you do apply lean startup, then of course the goal is that you also learn about your potential market and customers faster as well.

One thing clear to me is that lean startup (any startup) still requires leadership. It’s hard to imagine any other possibility. Critical decisions, pivots, and hires have to be made. I just don’t see how you do that without good leadership.

And of course the other wrinkle is that not all leadership looks the same. Contrast Tony Hsieh‘s style with Steve Jobs for example…

Mark Cuban Making Sense

Scott Francis — Tue, 17 Jan 2012 17:59:43 +0000

I never considered myself a Mark Cuban fan. But when I read his blogs and excerpts from his book I find him very convincing. It just doesn’t translate into most of the TV appearances I’ve seen.

One Entrepreneur.com, they’ve run an expert from his book “Mark Cuban’s 12 Rules for Startups” that really hits the spot for us at BP3. A couple of highlights for us:

“Don’t start a company unless it’s an obsession and something you love” – well, I’d have softened this a bit- either starting a company, or what the company is focused on, needs to be an obsession and something you love. You need one or the other. Preferably both, but one or the other are mandatory. When Lance and I started BP3, we were passionate about BPM and convinced we needed to start a company to achieve our vision around BPM services delivery. But it started with passion on the subject matter for us. That said, it wasn’t the first time for either of us to venture off on our own and attempt to start something, and we’d both worked for other people’s startups.
“If you have an exit strategy, it’s not an obsession.” Very true. Another bad sign: you have hobbies. When you’re starting up, if you’re passionate about the startup and the subject matter, where is the time for hobbies? Many founders are like Lance and I – married with kids. There’s no time for hobbies for the time being.
“Hire people who you think will love working there.” Right. If they think BPM is boring, we don’t hire them!
“Sales Cure All.” Absolutely. Almost any problem your company has can be fixed if you sell more (or more profitably) so that you have the funds to invest in fixing the problem.
“Know your core competencies and focus on being great at them.” - If you’re doing a services startup, this is a must. Time is really precious, focus is really precious.
“An espresso machine?” I think coffee is critical – for me even if it isn’t for everyone else! But we also dig the free sodas. And there’s a deli on the first floor. And a small gym. It matters.

There’s more in the article, worth reading.

Steve Blank and the NSF’s Innovation Corps

Scott Francis — Sun, 15 Jan 2012 22:50:44 +0000

Steve Blank consistently writes one of the best blogs. His installment (at least 2 parts) on the National Science Foundation Innovation Corps is no exception.

Of course the knee-jerk reaction from most people is that government cannot help in such situations without screwing things up… but then you see things like this:

63 scientists and engineers in 21 teams made 2,000 customer calls in 8 weeks, turning laboratory ideas into formidable startups. 19 of the 21 teams are moving forward in commercializing their technology.

That’s a great result from what they set out to tackle. And of course there are no guarantees that these ideas will work – odds are most of the 19 proceeding will fail. But if the NSF can get scientists thinking about commercializing the tech they produce, the economy (and the US) will benefit as a result.

And keep in mind Steve Blank’s “Secret history of Silicon Valley”:

The Scientists, the NSF and the teaching team were all going to go where no one had before.

Given that Silicon Valley had started with scientists and engineers not MBA’s, I thought this was a bet worth making.

Pretty cool. But the crazy thing is that they’re going to keep going – doing cohorts of 25 going forward. Have to applaud this program for trying to get the most out of government R&D dollars – and hopefully spawning some startups in the process. Just another interesting test case for the “process” of teaching entrepreneurship (and as he put it, applying the scientific method to developing a business).

Happy New Year! (2012 Edition)

Scott Francis — Sun, 08 Jan 2012 19:34:53 +0000

Happy New Year to our readers!

2011 was a very good year for BP3 – again, thanks to our customers, and our team. Our customers continued to invest in BP3 and in BPM, and we’re grateful for the opportunity to help customers achieve success with BPM. We had some great moments this year – we spoke at IBM Impact with one of our customers, rolled out more production deployments than ever, and had our first all-hands meeting.

Our team is the other major factor in our success. It is a really good feeling to see teammates pulling together to help each other. The maturity and experience of our team is the best, bar none. And yet, our team is humble enough to keep trying to get better, to be well-aware of our weaknesses and strengths. Every day we go to work thinking about how to improve.

We also made the 2011 “Fast 50” list in Austin for the first time in 2011 (covering years 2008, 2009, and 2010). We followed up with another banner year – we doubled revenue in 2011, above our expectations. Without releasing the exact number, you can do the math based on previous publications. One can argue that a rising tide lifts all boats, but it isn’t so much the big, general, service providers that I see getting traction in the market, it still appears to be the focused “pure play BPM” consultancies that are getting the most traction (and creating the most successes). This isn’t just true in one vendor ecosystem – it appears to be true across several different OEM software vendor ecosystems.

2011 exposed several memes that were circulating among pundits and bloggers. My summary of our learnings follows each:

BPM is Dead. In fact, 2011 has seen BPM achieve more mainstream success (and press coverage) than ever before. Far from dying, it is still fostering innovation, consolidation, and customer adoption.
BPM won’t do well as the economy improves. I think we could all agree that the economy in 2011 was better, but not good enough to really test this theory. I still contend that you can’t predict the next economic cycle based on the results of the last cycle – each one is just enough different to surprise you. This one might be the one where companies continue to invest in process improvement even as growth resumes.
BPM innovation is over. I still see interesting innovations happening across a number of vendors- IBM BPM’s chief innovation has been leveraging IBM’s software in an environment that still feels like Lombardi’s user-friendly BPM environment- versioning and all. Appian continues to innovate in cloud deployments and mobile BPM. Isus continues to blaze its own path. Tibco has picked up Nimbus to add to its own ActiveMatrix BPM. Activiti and Bonitasoft continue to improve open source options – and Activiti in particular is taking a few different turns as they build out their feature set. And that really doesn’t do justice to the other folks who are testing out innovative ways to build processes – from data mining for processes to using natural language to express them.
Austin and Texas will fare better than the US in general in 2011. Based on Novembers statistics of a 6.6% unemployment rate in Austin, I’d say that’s true. It appears likely to drop again for December.
The Process Body of Knowledge effort kicked off with the aim of being the wikipedia for BPM. These kinds of efforts take a long time to get momentum and really take on an inertia and life of their own. But if they can get it going, it should be really interesting for the BPM community.
We started to hear concerns from within the ACM community itself about its risk of failure. In fact, in February, ACM was declared dead by one of its own.
Simplicity and Experience. These themes just seem to be driving value in the software and consumer markets right now. And yet many enterprise software companies still aren’t paying attention to these key value propositions.
There is a lot to learn from startups, which can be applied to our BPM efforts. As startups examine the process of starting, and the process of product development and customer discovery, they’re exposing a lot of nuggets of wisdom about BPM, though the terminology and perspective is different. Moreover, researchers and entrepreneurs are starting to coalesce around a set of processes for starting up companies and developing products. It is really fascinating to both observe and participate in.
SXSW-interactive is a monster. The conference continues to have an impact on tech and social media. And despite being “too big” every year, it just keeps getting more interesting and evolving in unexpected ways. The latest transformation seems to be more startup orientation.
BPM conferences’ attendance was up. Both Impact and Gartner had much higher attendance in conferences closely aligned with BPM in 2011.
We had our first all-hands meeting. We should have done it sooner. Leadership and people are the heart of any business, and the heart of any BPM initiative.
There were several more acquisitions. Consolidation continues, even as new seeds are planted in new startups.

The future for BPM never looked brighter. And by implication, the future for BP3 has never looked brighter. We see some really important opportunities in front of us, and we are, right now, making the investments that we think will position us to better help our customers going forward.

We’ll have some interesting announcements to make in 2012 as we get deeper into the year. We have a few opportunities to really improve our value proposition to the BPM market and intend to follow through on a couple of those this year, and we’re looking forward to sharing our thoughts about the future soon.