BPM's Business Value Grows
By Samuel Greengard
Over the last decade, business process management has emerged as an increasingly common way to manage enterprise processes. It is an effective and proven tool for driving gains in areas such as productivity, customer focus and compliance. But the state of BPM is evolving, according to a Global Business Process Management report from Capgemini.
The consulting firm surveyed more than 1,000 senior business and IT leaders and found that more than half of respondents believe that BPM will play a more prominent role in their organization over the next year. More than two-thirds of respondents indicated that their business processes are either "managed" or "optimized" through the use of BPM.
"Many companies are seeing double-digit improvements as a result of implementing BPM," states Nicholas Kitson, head of business process management for Capgemini. He adds that, even among companies unable or unwilling to measure ROI, executives reported significant benefits. "Organizations increasingly recognize that integrating systems leads to more productive workers and fewer glitches and problems," he says.
An overwhelming 82 percent of respondents indicated that BPM should be treated as a C-level concern, and 68 percent said that it is an important agenda item at the managerial level. More than half of the executives believe their organization will place greater emphasis on BPM in the next year, while 68 percent noted that if the economic climate continues to challenge their organization, they will ramp up investments.
Hot areas of BPM include banking, insurance and private equity, where recent increases in regulation— such as MiFID (Markets in Financial Instruments Directive) and Basel III (published by the Basel Committee on Banking Supervision)—mean that compliance is paramount. In fact, 78 percent of the survey respondents from the financial services sector identified compliance as a key driver for their business, and 48 percent said they will be investing more in the coming year to respond to the growing impact of regulations.
The consulting firm found that social media is also driving adoption of BPM. Over half (56 percent) said that harnessing opportunities and managing the threats of social media are important business drivers, and these challenges can be addressed via BPM solutions.
Meanwhile, for consumer-facing businesses, CRM is increasingly delivered on the back of process management solutions. An overwhelming 78 percent of respondents who implemented BPM to improve CRM and customer interaction reported a positive impact. Overall, 96 percent that tried to measure ROI from a BPM investment reported a positive return.
Despite all the gains, organizations are feeling some pain. For one thing, Capgemini found that there's a lack of clarity about who should hold the reins for the BPM budget. Financial management of BPM is split between senior business management (18 percent), IT (16 percent), operations (13 percent), business units (13 percent) and dedicated process management units (12 percent). This fractured approach could ultimately undermine the effectiveness of BPM, Capgemini notes.
Some organizations are more successful than others in reaping the benefits of BPM. Only 18 percent of companies reported that they have achieved process optimization, and 32 percent admitted they are failing to formally measure the ROI of their process management effectively. The majority (55 percent) stated that the key barrier to success is people working in silos across organizations, thus preventing collaboration.
Kitson says that BPM will gain further traction in the months ahead, especially as cloud computing takes hold. "BPM is becoming a part of the infrastructure layer of organizations," He concluded.