Archive for the ‘Observations’ Category
Preparing for Recovery
I recently read a Gartner Insights report provided by Forbes magazine. It provides some data on the outlook for the economy from a number of C-level executives. I read it in light of recent stock market performance. One year graphs of the Dow Jones Industrial Average and S&P 500 are shown in the MarketWatch charts below. It clearly indicates that while March of this year was not good, it may represent a bottom. More data is needed to call a bottom so we won’t know if that was a true low point for a while yet. However, the signs are encouraging.
I take this data in light of the Gartner Insights report. The report concludes with “Although cutbacks are seen as an inevitable consequence of the current economic recession, many businesses are using this time to formulate strategies that will give them an advantage when revenue growth returns.” It seems apparent from the data provided in this report that essentially all companies have had to reduce headcount. It is appropriate to remember that along with those staff reductions comes a corresponding reduction in skills inventory and experience.
Even when some portion of the staff is eventually replaced, the experience and skills inventory will take years to rebuild. That’s why it is so vital to decouple a company’s operations from as much dependence on that lost skills and experience inventory as possible in preparing for a recovery. There is no substitute for experienced and motivated workers. However, a fact of corporate life is that you probably will never have as much of either as you need. The only hedge is to simplify and automate your workflow as much as possible. Just make sure to simplify them before you automate them.
These ideas may seem obvious yet many companies lose site of these ideas in the day to day struggle for survival. Survival can generate a lot of background noise. I argue that it is now time to stand back, take a deep breath and consider how you will prepare for the upcoming recovery. These decisions will be with you for a long time.
Thanks for stopping by. The referenced Gartner/Forbes report can be found at Preparing for Recovery [Gartner].
Dow Jones Industrial Average Source: MarketWatch (www.marketwatch.com)
S&P 500 Source: MarketWatch (www.marketwatch.com)
20% Savings! Really?
Originally posted on 7/15/09.
Recently, I read an article by Gartner with a title referring to a 20% cost savings in the first year after a BPM project. Being in the BPM consulting business, I was delighted with the title alone and have included a version of the article provided by ebizQ in the Files section on my Resources page. It can also be found on the ebizQ site at http://www.ebizq.net/news/11095.html?rss . If you’re a Gartner Group client you should check out their article directly at www.garter.com . I’m sure it will be more detailed. Obviously, one of Gartner’s motivations for publishing this information so that it’s available to folks who are not Gartner customers was to drive interest in one of their BPM summits. That’s not a problem for me if the information is useful and accurate. I do think this information is useful and accurate. By no means do I think that those savings claims will be true for everyone. I do think that the pursuit of improving BPM for any company will lead to impressive results. If I didn’t I wouldn’t be investing in a business to help clients get there.
I do differ on one of their points. The article states that organizations which adopt BPM without establishing a business process competency center find their efforts don’t deliver the promised results. I ran manufacturing organizations, process technology organizations and IT organizations for many years. Based on firsthand experience and observation in the real manufacturing world I believe that BPM has to be at the core of the manufacturing or service organizations to be sustainable, not in an external group. Sustainability is the key. I believe that the client is best served if, instead, they have what I call a Business Process Architect. That should be a person on the client’s succession plan to be the COO and have significant leverage or ownership in the company’s operations (service or manufacturing) organizations. That person doesn’t need a competency center.
Other than that one point, I think this article has merit. Consistent with this article, our SLR methodology strives to institutionalize a continuous improvement mindset broken down in to two distinct parts. First, the step change component which is the combination of RUP and Lean approaches and an ongoing Six Sigma type continuous improvement component. Both become must a part of the corporate culture and be sustained. This ends the overt StrAIT Advisors pitch for this post.
I believe that most of the points made in this article are worthwhile so Gartner gets gold stars from me. I hope you found this post to be valuable. See you next time…