Business Process Management And Change Management

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Business Process Managementand Change ManagementAnalysing the human factor: people, change and governanceAuthor:Micheal AxelsenDirectorApplied Insight Pty LtdContact:m:t:e:w:b: 61 0412 526 375 61 73139 edinsight.com.auwww.michealaxelsen.com

Business Process Management andChange ManagementTable of ContentsIntroduction . 1Business Process Management . 2Overview . 2What Business Process Management is not . 3Five activities of business process management . 4Change Management . 6Overview . 6The rationale for change management. 6Change management in practice . 7Change management and business process management . 8Developing a change management approach . 9Principles of change management . 9Towards a BPM Change Management Approach . 9Factors influencing the change management approach . 10Preparing for change. 12Introducing change . 15Making the change stick . 18Conclusion . 21Commercial in ConfidenceCopyright Applied Insight Pty Ltdi

Business Process Management andChange ManagementIntroductionThis paper examines the importance of change management in the context of business processmanagement. The paper briefly defines “business process management”, outlines thefundamental nature of change management, and then considers the reasons why changemanagement is a major factor in the success of business process management projects.The paper then provides a framework for the development of a change management strategy,with a particular emphasis on dealing with employees that have ownership over processes.Commercial in ConfidenceCopyright Applied Insight Pty Ltd1

Business Process Management andChange ManagementBusiness Process ManagementOverviewBusiness Process Management (BPM) is an emerging field. BPM is where management andinformation technology meet, and it sets out methods, techniques and tools to allow thebusiness to design, enact, control, and analyse its operational business processes.These operational business processes are made up of people, organisations, applications,documents and other sources of information.Figure 1: The Business Process Management ModelIn overall terms, BPM includes within its scope the activities performed by organisations tomanage and, if necessary, to improve their business processes. BPM is a management modelthat allows the business to manage their processes in the same way any other asset might bemanaged.The model allows the business to improve and manage these processes over the period oftime, which is perhaps a different way of thinking of business assets, but does recognise theinherent value inside business processes.Commercial in ConfidenceCopyright Applied Insight Pty Ltd2

Business Process Management andChange ManagementWhat Business Process Management is notFigure 2: What Business Process Management is notIt is useful to consider, briefly, what business process management is not. The processes thatoccur within the scope of business process management are the repetitive, day to day,business processes that organisations perform.The processes are not strategic decision-making processes, which top-level managementcarries out.There are also key differences between „Business Process Reengineering‟ and „BusinessProcess Management‟. Unlike Business Process Reengineering, BPM does not aim for asingle revolutionary change to business processes. BPM seeks a continuous evolution of thebusiness processes and an ongoing development of the asset.BPM usually combines management methods with information technology, whereas BusinessProcess Reengineering tends to focus upon the achievement of measurable one-off „savings‟through the application of information technology.Commercial in ConfidenceCopyright Applied Insight Pty Ltd3

Business Process Management andChange ManagementFive activities of business process managementFigure 3: The five phases of BPM ActivitiesInformation technology is a strategic enabler of Business Process Management. The activitiesconstituting BPM can be grouped into five life-cycle phases: e five categories can be reviewed prior to considering the impact of change management.ActivityDescriptionProcess DesignThis activity captures existing processes and documents their design in terms ofprocess maps, actors, alerts & notifications, escalations, standard operatingprocedures, service level agreements and task hand-over mechanisms. The newprocess is then designed to address the captured process and ensure that a correctand efficient design is prepared for modelling and continuing improvement andoptimisation.Process ModellingProcess Modelling takes the process design and introduces different cost,resource, and other constraint scenarios to determine how the process willoperate under different circumstances. Process modelling models differentscenarios that are relevant to the business.Commercial in ConfidenceCopyright Applied Insight Pty Ltd4

Business Process Management andChange ManagementActivityDescriptionProcess ExecutionThe full business process (as set out during the process design activity) isdefined in a computer language that can be directly executed by the computer,either automatically or using business rules that require human input.Process MonitoringProcess monitoring tracks individual processes so that information on their statecan be easily seen and statistics on the performance of one or more processes canbe recorded. Specialised Business Activity Monitoring software can be used tocomplement existing Business Process Management Software in this context.ProcessOptimisationThis activity provides ongoing and cyclical optimisation of the process. Itincludes retrieving process performance information from and identifyingpotential cost savings or other improvements and then applying thoseenhancements in the design of the process.Using this BPM approach, the business can deliver value from these process-based assets.Change management is of course a core part of realising this value from these assets.Commercial in ConfidenceCopyright Applied Insight Pty Ltd5

Business Process Management andChange ManagementChange ManagementOverviewIn a general context, change management requires an intimate understanding of the effect ofthe human factor in business projects. Change management requires a focus on the alignmentof the company‟s culture, values, people, and behaviours to encourage the desired results.Irrespective of the benefits theoretically obtainable, a change to a business process will notdeliver value without change occurring at the level of the individual employee.The rationale for change managementThere is a phenomenon often referred to as the „valley of despair‟ with change management –with change management, the change is hellish but manageable. Without a strong changemanagement approach – outcomes can be poor to say the least.Figure 4: The 'Valley of Despair' in Change ManagementThe major impediment to the successful implementation of a business process change isfrequently the poor change management approach adopted. Although the role of technology,process design, process modelling, and all other factors in the business process managementfield should not be de-emphasised, this is an intuitively true statement.Commercial in ConfidenceCopyright Applied Insight Pty Ltd6

Business Process Management andChange ManagementChange management in practiceFigure 5: Kurt Lewin's simple model of the change processIn some ways, issues such as these arise because businesses tend to adopt the „just do it‟philosophy. The fundamental model of change has of course been Kurt Lewin‟s model ofbusiness change whereby a business process is thawed, changed, and then re-frozen. Thismodel has been presented to undergraduate business students since time immemorial, and tobe fair there is little that is explicitly wrong with it.However, in the way that it has been applied and in terms of our basic understanding, we tendto prefer to consider that the natural state of affairs is „fixed‟ and immutable, and thus changeefforts were directed at „unfreezing‟ that which was frozen, moulding it to a rationally„perfect‟ world, and then „re-freezing‟ the organisation into that new state.Thus, change became „something different from the norm‟. Change was to be avoided.Change was an unnatural state for a business to be in. Change would „all be over‟ very soon,and if everyone followed the new rules and directions, the period of change would soon becomplete and the world would return to „normal‟.This is an autocratic view of the role of change. The top layer of management dictates theneed for change to the (very many) layers of management below, and the change is thenimplemented.Today, this view seems rather quaint, but, somewhat distressingly, this autocratic, „changeby-fiat‟, approach is still used in some organisations. The point should be made that this canCommercial in ConfidenceCopyright Applied Insight Pty Ltd7

Business Process Management andChange Managementbe an appropriate approach for some organisations, but it clearly is not the case for allorganisations.Change is now the natural state of affairs and it would be unlikely that a business today can beregularly frozen, thawed and frozen again without losing flexibility and the ability to respondto the changing circumstances of the enterprise.Change management and business process managementThis is particularly the case in the context of business process management with its ongoingevolutionary changes. Life and business is today simply far too fast-paced for an autocraticand directive model to work. An organic and systemic response to the need for change isnecessary to ensure effectiveness in most organisations of today, which is why BPM is moreappropriate to today‟s business needs.Individuals have complex reactions to change. Change also affects internal power structures.Change affects feelings of competency and capability. Substantive change requires personalre-invention. At its core, good change management calls for: An understanding of the organisationA comprehensive consideration of the implications of the changeA particular concern for the implications of change for the individuals and groups in theorganisationThe need for a planSystematic implementation of the changeWhole-organisation changeA problem-solving approachIt is recommended that an overall change management approach (including tactics) is built,and then link the BPM program of work to the change management tools that the approachhas made available.Core to the BPM strategy is the Program of Works. The program of works should set outshort, sharp, and defined „mini-projects‟, with project deliverables roughly defined intoquarters. If a project deliverable cannot be met within a three-month timeframe, it should bebroken into separate deliverables. There is a significant risk that an item of work on the BPMwork program that takes longer than three months will never be completed.With these principles in mind, it is useful to consider how to develop a change managementapproach in the context of Business Process Management.Commercial in ConfidenceCopyright Applied Insight Pty Ltd8

Business Process Management andChange ManagementDeveloping a change management approachPrinciples of change managementThe emphasis is on a rational and directive approach to change, which is in line with theBusiness Process Management approach. As a rule of thumb, clear and accuratecommunication is important for successful change management.Trust and integrity will affect the success of the project – the relationships amongststakeholders are important for the change to be taken up. There is also of course anunderlying assumption that, in at least some way, the proposed change is positive. BPM, byfocussing on a rational model for developing the case for change, assists with this.Five key principles to recall with change management are that: Different people react differently to changeEveryone has fundamental needs that have to be metChange often involves a loss, and people go through the "loss curve"1Expectations need to be managed realisticallyFears have to be dealt withCore tactics for strong change management include: Preparing for change as a continuous activity for managers and managedGenuine involvement in the processCommunication and participation across internal boundariesThe removal of undue restrictions on input to strategies and tacticsThe sharing of informationPrioritising personal development and new skills acquisitionBy its nature, BPM modifies many processes throughout the business in an evolutionaryfashion. There are many different stakeholders and process owners affected. It is infeasible toattempt to identify a unique change management approach for all elements of the program ofwork.Towards a BPM Change Management ApproachGood change management starts at the outset with the underlying business strategy. Thechange management strategy should be embedded into the business strategy, which simply1The “loss curve” refers to the personal feelings and the period of time it takes for an individual toadjust to a change. The classic acronym is „SARAH‟ – Shock, Anger, Rejection, Acceptance, andHealing.Commercial in ConfidenceCopyright Applied Insight Pty Ltd9

Business Process Management andChange Managementmeans that the business strategy must articulate the overall need for change and recognise inthe broadest terms the organisational approach to change management.The diagram below illustrates the approach used in this paper for formulating the changemanagement approach.Figure 6: The BPM Change Management ApproachAs part of the change management strategy, a formal recognition by the business of theexpected approach to change management is required as a statement of business strategy. Thisarticulation of the need for change is then used as the basis for developing an approach tochange management.Factors influencing the change management approachThere are several factors that influence the approach to change management selected by thebusiness:FactorDescriptionStaff attributesAbilities, talents, developmental requirements and capacity of staffOrganisationalcharacteristicsOrganisational structure, management style, approach to leadership,decision-making, and attitude to learning and developmentUser attributesIndependence and preferences of the users in dealing with businesschange and the workplace in generalEnvironmentalcharacteristicsEconomy, industry, legal environment, and the wider culture of thecountry.Commercial in ConfidenceCopyright Applied Insight Pty Ltd10

Business Process Management andChange ManagementThese factors are inter-dependent with the change strategy and type of change to be adopted,as set out in the diagram below. These factors will affect the type of change managementapproach selected.Figure 7: The factors that influence the change management strategyThe change management approach set out earlier shows three basic processes for changemanagement: Preparing for changeIntroducing changeMaking the change stickIf the change is going to „stick‟, then the hard effort that has to go into creating anenvironment in which the participants accept that change as a natural phenomenon isunavoidable.Commercial in ConfidenceCopyright Applied Insight Pty Ltd11

Business Process Management andChange ManagementPreparing for changeFigure 8: Getting the organisation ready for changeThere are core activities identified for this process: Recognising the need for changePersuasionCatering for Multiple ExpectationsCreating ConfidencePositive Senior Management Input from the StartIdentifying AlliesSome specific tactics to adopt here include:TacticBurning platformDetailed Description Show how staying where you are is not an option and that doingnothing will result in disaster. Look for a crisis that you can highlight. They are often lurking nearby,forlorn and unnoticed. You can also engineer your own crisis that forces change.Expose or create a crisisCommercial in ConfidenceCopyright Applied Insight Pty Ltd12

Business Process Management andChange ManagementTacticDetailed Description Stimulate people into change by challenging them to achievesomething remarkable. Show confidence in their ability to get out oftheir comfort zone and do what has not been done before. This works particularly well with small groups, as well as individuals.Once the group has bought the challenge, then they will bounce offeach other to make it happen. This is most effective when the people create their own stretch goals,so rather than telling them to do something, challenge them to achievegreatly, then, when they are fired up, ask them how far they can go. Enforce change by telling people what to do and what is going tohappen. Do not accept any input or objection from them. If they do object,punish them.Evidence Find evidence that supports the need for change.Cold, hard data isdifficult to ignore Use data and statistics to create impressive graphs and charts.Destabilising Stimulate the need for change by creating instability that leads peopleto seek somewhere other than where they are at present. Teach people about the need for change and how embracing change isa far more effective life strategy than staying where they are orresisting. Teach people the methods of change, about how to be logical andcreative in improving processes and organisations.Management byObjectives (MBO) Set formal objectives for people that they will have to achieve, but donot tell them how they have to achieve this.Tell people what to do,but not how In particular, if you can, give people objectives that they can onlyachieve by working in the intended change. Give them relatively free rein in how they go about achieving theobjectives. Particularly if you want to encourage a change inbehaviour or attitude, then you might encourage them to 'look outsidethe box' for creative new ways of achieving the objective.ChallengeInspire them to achieveremarkable thingsCommandJust tell them to move!Shaking people of theircomfortEducationLearn them to changeCommercial in ConfidenceCopyright Applied Insight Pty Ltd13

Business Process Management andChange Managemen

Figure 2: What Business Process Management is not It is useful to consider, briefly, what business process management is not. The processes that occur within the scope of business process management are the repetitive, day to day, business processes that organisations perform.