How to Select BPM Services Firms #BPM11
- May 11, 2011
- 2 Comments
Michele Cantara gave a rapid fire session on the last day of Gartner BPM 2011, covering how to leverage Services firms to gain expertise for your BPM efforts. As with most presentations there was plenty to agree with, but I’m going to take time out to really contrast the areas in which we disagree.
First, Michele asks the audience to understand Gartner’s six-step plan:
- Select your BPM Usage Scenario (from specific process-based solution to business transformation)
- Select your “BPM Corner” (using Gartner’s Four Corners framework)
- Do a gap analysis of BPM skills and roles
- Align the motivations of sourcing roles to the process owner desired business results (this is a bit tricky, get in the weeds a bit)
- Understand the capabilities in the BPM consulting and systems integration market (C&SI).
- Evaluate C&SI Capabilities against criteria identified in steps 1-4.
The steps make sense, at a high level, but of course the devil is in the details, and I disagree with the assumptions underlying steps 5 and 6.
To understand where we differ, it is important to understand Step 2. Borrowing from Gartner’s presentation:
The basic point is that from left to right, processes evolve from changing infrequently to changing frequently or continuously. Bottom to the top: a spectrum where IT makes all the changes at the bottom, and business makes all the changes at the top. There are descriptions of typical examples in each quadrant.
So far so good. But then Michele makes the recommendations for where the sweet spots are for different types of vendors:
If you just glance at it, it may not jump out at you. But look closer. Offshore service vendors are recommended in all four quadrants – meanwhile Boutique firms are recommended for only one. If we’re to believe our eyes, offshore vendors are as good at assisting with continuous change processes in which the business makes all the changes, as they are at assisting with processes that change infrequently and are changed only by IT.
Does that pass the test of common sense or of what we see in the real world? It does not.
The presentation notes imply that once upon a time, BPM consulting was the bastion of boutique consultancies (true). However, Michele jumps to the conclusion that because customers would like to have larger consultancies assist with global delivery models- that these larger (global) consultancies actually have such skills and abilities. The “establishment” of a BPM practice by a major firm is as easy as issuing a press release and fictionalizing a number of consultants who participate in the practice. There’s no audit of said numbers. And if one initiates a practice with 500 people – where exactly are those people billing out? Which customers are the victims of this 500 person experiment? When that big firm closes a deal, they’ll come calling on the boutique BPM firms to fulfill the on-site work (or in the case of Accenture, buy the boutique firm). I always wonder where these 500 experts materialize from – if we added them up across all the large vendors you’d think we’d have a surplus of BPM talent in our business… Something doesn’t add up.
The fundamental fallacy is the idea of scale (i.e. that large firms will have large numbers of experienced and qualified practitioners), because large does not mean effective – that large firm is only as effective for you as the team it assigns to your project(s). Of course these big firms have a few great people of some talent. But the question is whether that talent will be deployed to your project or not. If you have spent a couple of decades in professional services working either within or alongside these entities you know this to be true. Now compound that with offshore companies who by and large don’t implement BPM in their local markets, and rely solely on the export of their services for their experience. They’re missing a huge piece of the BPM experience by not being in front of customers. Ultimately, it comes down to those individual contributors who have the localized experience – with business, operational, and technical acumen.
It turns out that BPM is still led by boutique consulting firms. It is the boutiques that still provide the thought leadership as well as the bleeding edge of technology leadership. If I were drawing this same chart, Boutiques would have showed up in every quadrant, with qualifications – you need different boutique firms for different types of BPM initiatives. If your organizational goal is to learn how to fish in the BPM pond, rather than to have a services provider serve you dinner, then the boutique firm will line up better with your needs. Those big firms have big billable and staffing targets to hit and they’re going to unload the bus. Yet, a highly skilled team of 4-6 people can make a huge impact on your global BPM efforts.
Offshore vendors are most well suited for the lower-left quadrant – infrequently changing processes, driven by IT. If I were drawing the same chart, it would look something like this:
I’m not sure why Gartner would be pushing BPM hopefuls into the arms of offshore services vendors. Going offshore with BPM doesn’t address the most critical failure mode of BPM projects: getting the requirements right. In fact it impedes getting to the right answers by stretching time and distance. If you’re sending the work to a big team of offshore resources- well no one is going to learn anything in that situation. It doesn’t help your organization become self-sufficient in BPM – and so you’re not really getting leverage from your BPM services investment.
Michele Cantara showed another chart that shows Capabilities of the various types of vendors, in general:
I have a tougher grading scale, in general, so I’m sharing my own opinion on these ratings here:
I’m sorry to find myself so far out of alignment with what was presented at Gartner’s conference, but the distance on the assumptions behind these last two steps in their process was so great I just felt compelled to write about it. Others may disagree, but this is just how it looks from our perspective – both as a boutique services firm that has done a lot of mop up operations.