Many clients ask, in these times of budget cuts and project reductions, how they can lower the cost (and associated risk) of adoption of business process management and business rule management technology. As an early Christmas present we discuss the techniques we’ve used to do this over the last few years.
If your company are new to business process management and/or business rules and are looking to evaluate and adopt the technology (BPMS or BRMS), you will rightly be concerned about minimising the cost of initial projects, both to save money and in order to minimise the risk that they will be culled at the next budget review. Similarly, if you have evaluation projects in flight, you will be looking to avoid being an easy target for savings initiatives which see evaluation projects as easy prey.
Although short sighted, it is customary for projects that are exploring improvements or new approaches to be cancelled during economic downturns on the grounds that they are speculative and not contributing directly to the bottom line, even if they could seriously reduce existing costs. You must fight this mindset.
Below we share some techniques our teams have used to reduce, defer, offset and avoid significant costs inherent in these projects (and the risks associated with them).
In conducting a BRMS/BPMS evaluation project, many might be tempted to address a small problem in order to minimise project size and risk. It is accepted wisdom that to prove a technique or technology with which you are unfamiliar one should solve a small problem to demonstrate its efficacy. This is wrong. Pick a big project with considerable visibility and aim to solve a key (but scope limited) issue with that, preferably one with an easily measured key performance indicator(s) that is well aligned with the over-arching business strategy. By applying your solution to a high profile problem, you will attract more senior stakeholders (with larger budgets) and your success will be more relevant and harder to deny. This is particularly relevant now that BPMS and BRMS are no longer in the early adopter phase and are established technologies.
This is not to say you should select a business critical project, that would be unwise. Look for a visible, high-profile, non-critical application with lots of current pain points. Then stick to it and avoid scope-creep as hard as you can.
Know the True Cost
Be results oriented: know exactly how your proposed use of processes and rules will save the business money in the longer term, how much money could be saved and within what timeframe(s) the saving will manifest. In other words, be aware of the true cost of the project by factoring in (and determining the value of) the business benefits it could yield. Integrate the cost and the benefit so tightly that it is hard to perceive one without the other. Be prepared to quantify this countless times to win business stakeholders to your premise – define (with them) exactly what constitutes success and provide measurable goals your business can check against to assure them of even progress. Ensure the goals are aligned with current business strategy so that no one can accuse you of addressing an irrelevant issue.
The need to demonstrate large value should be key to your identification of viable projects for validation of BPMS and BRMS. Pick processes (or decisions) that have excess manual work, too much person to person hand-off, the most inter-department inconsistency, too little business visibility, expensive exception handling or which deliver business benefit but lack monitoring. All of these are good reasons for adopting a application for your first project as they are likely to deliver large, tangible gains quickly.
Get the Business to Pay (By Results)
A BPMS or BRMS evaluation project is not an exclusively IT project and should never be viewed, planned or financed as such. Right from the outset ensure that all stakeholders understand that you are delivering real improvements to the business and you expect them to co-fund this initiative and be fully involved. Attach the project entirely (or at least partially) to a business budget. However, be results oriented and integrate costs with benefits, as we suggested above.
By obliging the business to pay (in total or in part) for your project on a ‘by results’ basis increases their commitment to and involvement with it. Being a business project with quantified savings, against which to offset costs, will significantly lower the risk of project cancellation, increase your chances of success and enhance the quality of your business processes and rules.
Squeeze Your Vendor
If you plan to adopt commercial BPMS or BRMS software, ensure your vendor knows that, at these times of financial pressure (as a rough guide you may assume all times are times of financial pressure), your project will fail quickly if his costs cannot be pared to the bone. Only skimp on costs where there is no risk: license fees, software fees, etc. Do not cut expert consultancy time which might jeopardise the success of your project. It is worth demanding free consultancy from the vendor and (in this age of low interest rates) taking advantage of any payment deferment options they offer. With some skill at the negotiating stage you should be able to defer all cost until after the initial projects start to pay for themselves. Even more pressure can be applied if you introduce cost competition.
You can sweeten by the deal by: promising to pay vendors by results (based on key performance indicators, see above) rather than a fixed license fee – be sure to define these carefully and ensure that if your application is hugely successful you can still afford to pay; offering to make your application a reference site for the vendor – frequently good reference sites are hard for them to obtain and publicise; offering to attend conferences with them and sing their praises – although, obviously, confine yourself strictly to presentation of the facts.
Your adoption of BPMS and BRMS should not be piecemeal. Instead adopt the tool set across a range of business application projects and share the high licensing costs between all of them. When we help financial clients with BRMS for, say, accounting, we also typically show them how BRMS could be used for data validation, reconciliation, pricing and allocation. When used across multiple disciplines in the finance space, the client will still only pay one license fee, but can effectively amortise it across several businesses. Furthermore, invite technical and business subject matter experts to your team in order that they can share the benefit of what you learn, but then charge their cost centre for the privilege.
Use Open Source Software
Using tools such as Drools, JBPM, OpenRules et al., offers the prospect of avoiding licence fees completely and this should be considered. Be careful to evaluate the strengths and weaknesses of open source tools for your application: they are not all as fully featured or mature as their commercial counterparts. In addition, ensure you capture all the implicit costs of open source tools before you commit to them: the choice between commercial and open-source suites is often not as simple as paying, or not paying, a licence fee.
Demonstrate Success As Early As Possible
Avoid a ‘big-bang’ benefit delivery that demonstrates a win only at the conclusion of the project. Instead define several key performance indicator goals at initiation which set the target for each iteration of the project. Then continually monitor your progress towards achieving them. Ensure every delivery is adequately publicised and that any failure to deliver is investigated. Design the first deliveries to be as early as possible without limiting their tangibility.
We wish you every success with your adoption projects. Using these techniques you can prevent the appearance of an expensive, high-risk IT project that serves only to enrich the CVs of those that participate. By demonstrating true business value you can lower your project’s cancellation risk.
Don’t forget to capture your lessons learned, both successes and failures, in order to assist future projects.
As a parting shot, it should be noted that cost conscious customers should compare the cost of managing business processes and rules with the cost of not managing them, which is always more extensive (If less tangible and immediate).