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Business Performance Management and IT Readiness

Originally published February 7, 2005

As organizations prepare to embark upon a business performance management (BPM) initiative, one area that is often overlooked is information technology (IT) readiness. At the start of typical BPM projects, well-prepared companies confirm that they have executive sponsorship, an appropriate level of funding and a good understanding of their business requirements. The examination of the IT area at this stage is usually limited to understanding technology compatibility requirements and/or constraints. Significant issues can arise down the road, however, if a proper assessment of IT people, processes, infrastructure and systems is not done up front.

People and Processes

Most BPM systems today are designed to be maintained and expanded by the business end-user. This is great for the end users, and also ultimately for the IT group that no longer has to program a custom report every time a new need is identified. Marketing hype aside, the end user will need some level of expert support from IT, particularly if the new report requires changes to the underlying metadata (chart of accounts, organization chart, data categories, etc.). Here is where potential problems can arise. Many IT groups are staffed with developers/programmers who excel at building solutions from existing business intelligence (BI) tools or custom programming an application from scratch. Implementing one of today’s BPM packaged applications requires a different set of skills. The end user support team in IT needs to be trained on the syntax of the product being implemented. From a process perspective there needs to be some sort of central help desk/support line that can support a large number of business users on the application. Many IT groups have helpdesks already in place today for other software. The difference with BPM, besides the volume of users, is that many support requests will require an understanding of the business use of the product, as well as the underlying technology. This is an area where the typical IT group tends to be weaker. Whereas typical support calls usually go something like: “Windows crashed, my machine is frozen …” a BPM call is more along the lines of “My budget is due today, I just entered some new numbers, and now the balance sheet won’t balance – something must be wrong with the chart of accounts.” IT may need to partner with Finance on problems of this type, but the point is these issues will arise, they will be time critical and IT needs to be prepared for it.

Infrastructure

A well-designed business performance management system will be embraced by the organization and will be used in some form by almost everyone. With a high volume of users, response time can become an issue. Also, the nature of the data in the system can create a sense of urgency for the user. If someone is trying to see if they made their revenue goals for the month and therefore get to keep their job, a few seconds of delay in a report coming up can be an eternity. The added complexity with BPM systems relates to usage patterns. Due to the particular business processes being automated, there will be very large usage spikes. Let’s take budgeting for example, a key component of BPM. When the budget is due, almost everyone will be on the system submitting the budget they just finished working on. That means potentially hundreds, if not thousands of users are updating the database almost simultaneously. This can be a challenge for the selected software, but this also places a burden on the corporate network.  All of these users will be accessing the system and database concurrently. Similarly, BPM systems facilitate the month-end close through their consolidation module. Once that is done, everyone is anxious to review their performance for the past month. Another peak usage spike occurs, this time relating to data access. This spike occurs monthly. Lastly, some forward-thinking organizations actually have their board members sign in to the system to view the key metrics live during a board meeting. While this is not a volume issue, it is a high-visibility situation where you do not want the network to be sluggish or crash. The challenge is to make sure the network, server and communications infrastructure is robust enough to support the type of usage that is common with BPM. We also have seen organizations that analyze and adjust the infrastructure at headquarters, but completely neglect testing performance at field locations or even other buildings in a campus environment. Be thorough. Poor performance can reduce active usage of a BPM system and therefore ultimately reduce the benefits to the organization.

Systems

Business performance management systems often sit on top of a variety of legacy systems – some a few years old, some ancient. Their dashboards, or even just their reports, become the most common way that people across the company access corporate data. The IT challenge here is clear: either the BPM system needs to interact directly with most of the existing systems, or a data warehouse needs to be put in place for the BPM system to access data. If the company already has a data warehouse you are ahead of the curve. If not, there are many steps IT needs to take in preparation for BPM. Although most BPM systems have the tools to help create the data mart they require, the issue is in the source systems and data itself. First and foremost, do the existing systems already provide the data the BPM system will require? In other words, if you look at the key performance indicators (KPIs) planned to be displayed on the BPM dashboard, is it clear where the detailed data sits to derive those KPIs? For example, if one of the KPIs is sales win rate, does the company already have a system in place that tracks that sort of data (Sales Force Automation or CRM system)? If not, where will this data come from? Assuming the systems do exist to provide the required data, the next area of assessment relates to those systems themselves. How are they accessed or how does the data get moved from them into the data mart? How reliable and clean is the data? Is it in a format consistent with other data (i.e., currency, scale)? Do these systems use the same metadata? In other words, does “Consolidated Region 1” mean the same thing across all source systems? Unfortunately, the answer to most of these questions is often that the underlying systems are not consistent and synchronized and this is an issue that needs to be addressed before your organization can obtain the full benefits of BPM.

While these challenges are significant, the many benefits of BPM justify addressing them. Our recently completed BPM Pulse 2004 Survey indicates that nearly 75 percent of organizations have recently completed a BPM project, are in progress or have plans to move forward in the near term. If you are ready to move forward with BPM, you should be aware that there are proven methodologies to help assess and address your IT organization’s readiness for BPM. To discuss this topic further, you can contact Lew Walker directly at lwalker@bpmpartners.com.

  • Craig SchiffCraig Schiff

    Craig, President and CEO of BPM Partners, is a pioneer in business performance management (BPM). Craig helped create and define the field as it evolved from business intelligence and analytic applications into BPM. He has worked with BPM and related technologies for more than 20 years, first as a founding member at IMRS/Hyperion Software (now Hyperion Solutions) and later cofounded OutlookSoft where he was President and CEO.

    Craig is a frequent author on BPM topics and monthly columnist for the BeyeNETWORK. He has led several jointly produced webcasts with Business Finance Magazine including "Beyond the Hype: The Truth about BPM Vendors," the three-part vendor review entitled "BPM Xpo" and "BPM 101: Navigating the Treacherous Waters of Business Performance Management." He is a recipient of the prestigious Ernst & Young Entrepreneur of the Year award. BPM Partners is a vendor-independent professional services firm focused exclusively on BPM, providing expertise that helps companies successfully evaluate and deploy BPM systems. Craig can be reached at cschiff@bpmpartners.com.

    Editor's Note: More articles and resources are available in Craig's BeyeNETWORK Expert Channel. Be sure to visit today!

  • Lew Walker

    Lew leads BPM Partners IT Assessment practice. During 12 years at Hyperion Solutions, most recently as CIO, Lew created a global IT organization that captured and supported an aggressive growth strategy establishing IT groups, data centers, and call centers on three continents and leading the integration behind five mergers. Prior to his current role at BPM Partners Lew held executive positions at Warp Technologies and Desknet where he led the efforts to develop and market leading-edge enterprise solutions. His wide-ranging experience has given him the perspective necessary to bridge the gap between IT and the business units and successfully bring the objectives of both worlds into a singular focus with measurable results. Lew earned an MBA from the College of William and Mary and a BA from the University of Virginia.

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