Interview with Saleel Nair
The most recent Application Landscape Report from Capgemini – a survey among 1,100 CIOs – once again makes clear where the IT department’s priorities lie these days.
Reducing costs is still at the top of the list, followed by simplifying the application landscape and creating business impact. This article zooms in on this last priority.
IT is becoming increasingly important to be able to respond immediately to occurrences and deviations detected in the business processes. And with the Business Process Focus method (BPFm) in Application Lifecycle Services, we provide a unique form of operational intelligence which makes that possible. This method allows IT to make a valuable contribution to improving the business processes. Saleel Nair, global lead for Application Management at Cagemini’s Application Services, explains.
Saleel: “The way in which organizations are being managed is changing. New insights indicate that an ‘agile’ approach is not only something for IT, but also an ideal method for connecting the business and IT. We therefore see more and more large organizations using this approach as a guide for their business management. This presents a nice opportunity for IT. With our Business Process Focus method, they can make the difference.
With BPFm we support our Application Lifecycle Services clients with a journey from technical KPIs, to Smart KPIs and on to KPIs that are linked to business output. BPFm is based on a new trend: operational intelligence. It provides real-time insight into the progress of the business activities and detects situations in which inefficiency arises, performance is lagging behind the norm, or there are opportunities for improving processes. BPFm additionally supports the ‘root cause analyses’. This means that decisions can be made in the here and now about direct actions that result in improvements in the business output.
Proven in practice
BPFm is now more than just a theoretical model and has already proven its usefulness in practice. Saleel provides an example: “We applied BPFm to the online shop for a global retailer. In first instance we linked the IT applications to the business processes by depicting the customer journey. As part of this, the processes were elaborated in detail and we made frequent use of our reference process models.We also looked at how the data went through the process and to the interfaces. Previously we could only make technical KPIs visible, so whether an application worked or not. But now we were able to formulate Smart KPIs by linking the technical KPIs to the business processes. So we could show, for instance, how many customers were able to successfully complete their online order, or whether a discount was applied correctly and whether product masters for composite products worked well or not. The trick therefore is to find the KPIs that have an impact on the business.”
Paid out repeatedly
After formulating the Smart KPIs, it is possible to start working on Business KPIs. Using these KPIs, the management acquires the operational intelligence to adjust processes so that the end result is improved. While normal business intelligence provides a periodic overview of aggregate information, there is now daily insight into the details so that interventions aimed at tweaking and tuning can be made. Saleel: “At the moment, discovering how we can further increase the value for the business using BPFm still involves pioneering work, but we gain new insights every day.The efforts we have invested have already paid for themselves many times over. For the retailer mentioned earlier, we significantly increased the desired currency of his online prices. That is very important, because online prices are always immediately compared with each other. And the sale of products no longer in stock was reduced to zero. For a worldwide producer of consumer products this same method produced an improvement in order fulfillment of 17%, which increased accuracy of product delivery to 99%. For a large English metal company the number of blocked orders was reduced by 25%, so that more straight-through processing could occur and the Order2Invoice process was sped up by 30%. And at a European credit card company the process of issuing new credit cards was assessed using this method, resulting in a reduction in the lead time by 25% and prevention of the double issue of credit cards.
The journey to process improvement
Usually, KPIs like ‘10% fewer incidents’ are used. Within the service provision of Application Lifecycle Services, this can already be reported as standard in real-time dashboards.It is much more valuable to be able to aim for ‘10% fewer blocked selling instructions’ for instance. By making information from the IT systems available in real-time dashboards, for instance using the SAP connector, this becomes possible. With technical KPIs you steer for quality and costs of IT, which is also the first step to take. With business KPIs a journey can be started towards process improvement and management of business performance. Using business KPIs therefore provides a view of the possibilities for adding value. IT can provide valuable support in this process and that will certainly benefit the relationship with the business,” Saleel concludes.
This article was written by Co Van Leeuwen from CapGemini: Capping IT Off and was legally licensed through the NewsCred publisher network.