Harmon on BPM: Why Isn’t Process a First Class Concern to Business?

I've read three articles in the past month on changes in business school curricula. The idea is that business schools need to better serve their students, to better prepare them for today's business environment, and that they can do this by making changes in what they teach business people during their MBA programs.

Each article talked about specific changes in the program, but none really talked about fundamental changes in the overall topics taught in MBA programs. These fundamental elements are sometimes called First-Class Concerns – they are the subjects or practices that it is felt that every MBA must master. They are often the topics of basic courses offered by the school. They include: Accounting, Marketing, Strategy, IT, Organization and Operations. If one of these has changed, it's the growing emphasis on IT and how it affects all of the others. If one concern is core, it's probably accounting. Ultimately, accounting is the common language of business – it's the way we express the way the organization is organized (as a table of accounts) and how it changes over time (financial statements).

What concerns me is the fact that business process (or more broadly, the systems approach) has never become a first-class concern of business. Several business gurus have proposed this, but it's failed to catch on.

Many management gurus have written to complain about how businesses are organized into silos that remain more or less independent of each other. Marketing occupies one silo, for example, and operations occupies another. No one coordinates activities that cross between silos. If you wonder why a business person might conceive of his or her organization as made up of silos, look at the courses taught in business schools. The silos of actual businesses are the first-class concerns of the MBA curriculum.

I recently talked to a local university about teaching a class in Business Process Management. The head of the business school listened, but allowed as how it wasn't one of their major concerns. He wondered if I shouldn't be talking to IT – which, in fact, proved more interested. As it turns out, however, the IT people wanted me to teach a course that was focused on creating flow diagrams that could then be converted to software code. While this is an important element in modern process work, it's rather far from my personal concerns. I am much more interested in the analysis and redesign of business organizations – of defining business problems and fixing them – than in focusing, narrowly on just the automation of well-defined processes. In my experience, problems are as likely to arise from management practices, or employee training (or lack thereof) as they are from opportunities for automation.

I view diagrams of major processes, showing where demand originates (marketing and sales), how it is communicated to various production operations (IT, memos), how products and services are produced (operations), how it's delivered (customer interface) and supported, and how payments are accepted and logged (bookkeeping) as all parts of understanding the flow of work within an organization. And I regard that understanding as a second language of business, as important in its own way as the language of accounting.

In my conversations with business school people, I've found that they usually want to pigeonhole me as someone concerned with operations. But operations, as its taught in business schools, is narrowly involved with producing products or services. Operations people often produce flow diagrams, but they are typically diagrams that show how operational work is performed. If you are trying to solve organization-wide problems, you usually need a broader perspective. You need to know that certain operational activities don't take place until documents arrive from accounting – and you need to know how those documents are generated so you can understand why they take so long and may not get generated when needed. You need to know how customers communicate their needs and why some customer concerns may not get passed on the manufacturing. You need to know how employees are rewarded (or punished) for doing specific tasks in order to know why employees may or may not perform certain tasks in ways desired. And you need to know what managers know, at each stage of the process, so you know if they are prepared to stop the process when something goes wrong, or when production begins to exceed demand.

Business processes aren't linear flows: they are networks of actions that are coordinated by the need to generate certain outcomes. To understand what could go wrong, or how to speed up the flow, you need to understand how all the various activities interact with each other to either support or hinder each other.

In modern firms, much of the work involved in understanding the parts and how they fit together has fallen to IT. Most of the communication between activities is conducted via electronic channels. IT people are often an organization's process people by default, and are often responsible for diagnosing problems and fixing them. Unfortunately, however, the job is beyond IT. As I already suggested, many of the real world problems I've examined were caused by human problems, by training or the lack of it, or by human motivation. And even more problems were caused by managers, who didn't set goals in appropriate ways, don't offer support and rewards when they would have helped, don't take appropriate measurements, or don't made timely changes when they are required. IT is rarely in a position to make needed changes in HR or in corporate management practices. That job is a management job.

Historically, organizations are only really top-performing organizations when senior management understands and is directly engaged in managing the day-to-day execution of business processes.

A process (or systems) perspective permeates everything. Strategies need to be based on well-defined business processes. Marketing needs to play a role in supporting operations and vice versa. And the roles need to be defined in process terms. Process concepts need to be a first class concern of business managers.

At the moment great firms are the way they are because a specific or a few key managers “get it” and implement process concepts at their firms. The firm does exciting things as long as the process-focused manager remains, and then drifts off target when the manager leaves.

This won't change until business schools realize that business process concepts are truly important, on a day-by-day basis, and begin to teach those concepts in business schools. The emphasis on systems or process concepts must become a first class concern – with its own courses and professors. Until it does, managers are going to be good at Accounting, or Operations, or Marketing, but somehow never be able to fit it all together and see the value chain as a single process that needs to be constantly measured and improved.

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Paul Harmon

Paul Harmon

Executive Editor and Founder, Business Process Trends In addition to his role as Executive Editor and Founder of Business Process Trends, Paul Harmon is Chief Consultant and Founder of BPTrends Associates, a professional services company providing educational and consulting services to managers interested in understanding and implementing business process change. Paul is a noted consultant, author and analyst concerned with applying new technologies to real-world business problems. He is the author of Business Process Change: A Manager's Guide to Improving, Redesigning, and Automating Processes (2003). He has previously co-authored Developing E-business Systems and Architectures (2001), Understanding UML (1998), and Intelligent Software Systems Development (1993). Mr. Harmon has served as a senior consultant and head of Cutter Consortium's Distributed Architecture practice. Between 1985 and 2000 Mr. Harmon wrote Cutter newsletters, including Expert Systems Strategies, CASE Strategies, and Component Development Strategies. Paul has worked on major process redesign projects with Bank of America, Wells Fargo, Security Pacific, Prudential, and Citibank, among others. He is a member of ISPI and a Certified Performance Technologist. Paul is a widely respected keynote speaker and has developed and delivered workshops and seminars on a wide variety of topics to conferences and major corporations through out the world. Paul lives in Las Vegas. Paul can be reached at pharmon@bptrends.com
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