Project Academy Series–Business Process Re-engineering Seminar–Part 1

Project Academy Series–Business Process Re-engineering Seminar–Part 1

[THEME MUSIC] PAUL SMITH: What is BPR? Business process re
engineering is a business management strategy
originally pioneered in the 1990s focusing on the analysis and design of workflows and processes
within an organization. That is the industry
definition, or that is the definition that’s used by most people in defining what business process
re engineering is. What is isn’t. It’s not
automating the process you have today. Business process re
engineering is that part of it that says no, no, no.
What we’re going to do is we’re going to take this opportunity and we’re going to leverage the
system, the reality of it. We’re going to leverage
the system. We’re going to leverage whatever transition we’re going to make. So look at our
business, figure out what it is today, how it works
today, figure out the weak parts, figure out the opportunities, and then redesign it so that we’re
better and more efficient in the future. So
business process re engineering is actually a lot of times the business reason or the “why” of why
we’re moving forward to any type of new system or any type of new process. The as is. The as is
is the foundation of every project BPR. It literally is
the start. The very first thing you need to do is engage the business. First thing you need to do
is you know they talk about change management.
You know that 50 percent of all projects fail? Change management, not the solution.
Something that literally, if you do it, you have a 50
percent chance of succeeding. Not a very good investment ratio. So what I’m telling you now is
when you start looking at a project or looking at a
proposal, business process re engineering, engaging the business, change management
starts that minute. That’s when you’re going to
engage the business and say listen, what is it that you want? How can we get it for you? What
are the advantages you’re going to have? What
are the things, the challenges, you’re going to deal with? Engaging executive sponsors. Until
somebody with enough power and authority and
resources and everything gets behind that, it’s going nowhere. If a guy came up with a really
cool idea, and a company came in and said
and we’ll throw in the resources and we’ll throw in the marketing and we’ll make sure it’s in every
store by Christmas, that was an executive
sponsor. Without it, your project doesn’t stand a chance. You go to that executive sponsor. You say
I have this really cool idea. What will the executive
sponsor say to you? How much is this going to cost? When is it going to start? When is it going
to end? How many resources are we going to
do? What’s it going to do? What’s it going to benefit me? Where’s the pitfalls? Where are my
risks? Where are all those things? You have to
build a business case going in. Why is it important to have the best players? Why do you
need that team that you’re asking for? Why is it so
important? What will derail the effort? You need to let the executive sponsor know right out of the
gate: If we don’t have this, this, this, and this, and
change this policy, change this procedure, do whatever, that project is going to die right out of
the gate. So then the executive sponsor now can
plug in and realize the things that will cause problems in the project or in the business
process re engineering effort. So let them know
beforehand so that they can look for it and help you. SUMI SMITH: You to have do this whether it’s
your idea or whether it’s their idea. So if they
come to you with an idea, you still need to understand the business case. PAUL SMITH: And
the reason why that’s so important, there may be
an executive sponsor in your organization that really wants to do a thing, and
there’s four other executive sponsors who don’t
think it’s that important. There are four of the executive players who don’t think it’s that
important. You need to build a business case so
that you can best represent that executive sponsor and that executive sponsor’s initiative to
those people to get them to play as well. Before
you even begin the exercise, have a strong business case why you’re doing it. What you plan
to achieve. What’s the scope? Where is it going
to start? Where is it going to end? What is it going to impact? What is it not going to impact?
What is it going to achieve? What is it not going to
achieve? And the beginning of the process is engaging the business. And from a vendor
standpoint SUMI SMITH: Okay. So you also have
to engage the business from the vendor. The vendor also wants you to do this. They want you
to do this because they need that executive
sponsorship too. They really care to have somebody at the executive level that they can
push their issues to. You need to make sure that
you have that commitment at that level or they can’t finish their contract. And remember, the
whole point of the vendor being onsite is to finish
a contract and get paid. That really is what they’re there for. No matter what they actually say. So they
want you to have that sponsorship so that they
can make sure anything they need to get to their end goal they can get as quickly as they possibly
can. They also want you to ask for subject matter
experts. And this is a key part of BPR because the quality of their deliverable is based on the quality
of the information that you put in. And don’t forget
that when you provide good information, you’re going to get a good process. So you should be
able to use that in talking to your sponsor and get
the commitment for the strong, knowledgeable subject matter experts. The vendor also wants
you to have a good business case. They need
you to know why you are doing this. What is the intent? What’s the goal? Where are we going with
it? And what’s going to be done with it
afterwards? And once again, they’re looking out for their own best interests here. If you know
where you’re going, you can get there the fastest
way possible. You want to get to the end game, and the vendor wants that check. So the faster
you can get them that check, the happier they’re
going to be. So they will support you on this. And you’ll need their support. Create a cross
functional team. This goes along with the subject
matter expertise. We’re looking for people, not just the people in the main business process,
but we’re looking for people who know all
of the processes that that process touches because those are the people who are going to
give you the little gotchas. You know. This other
process works this way. This is how I use the information. Well, now that changes depending
on the way that you’re automating it. So you need
to get all those cross functional teams involved, and if you’ve got a good vendor on board, they’ll
help you do that. PAUL SMITH: Build a strong,
stable foundation. If you build a foundation, whether it’s a raised foundation or a cement slab
foundation, if it’s not laid out correctly, from that
point forward you’re going to make correction after correction. A strong foundation is the most
important thing. And the as is is your strong
foundation. If you don’t know where you are, if you don’t know how the business process is done
today, you will have no idea where you’re going to
go. You will have to constantly look for that hole in the operation you missed and then redesign it
down the road. SUMI SMITH: And every time you
redesign it, it costs more, and it’s more expensive later on. So take the time to do it up
front. PAUL SMITH: Initially when we did the
business projects, we had all these people come in. They told us how to do purchase
requisitions and purchase orders. We built a
solution that allowed you to do a purchase requisition and create a PO. We forgot to invite
the institutions. It was all headquarters folks.
Headquarters folks have a certain way of doing it. Institution folks have a completely different way of
doing it. So we built this foundation of an as
is, and we immediately train wrecked ourselves because we built a solution that could only serve
one third of our population. We didn’t realize that
until we went live. It really was a train wreck right out of the gate. We immediately had a
change management issue because people
thought it didn’t work. It’s not that it didn’t work. It’s that it didn’t work for every process. The reason
why it didn’t work for every process is because
the (IA) build was based upon a faulty as is. It wasn’t that people didn’t do a good job. It was
that we didn’t do a complete job. We didn’t have
enough people. We didn’t have enough eyes on the target. (IA) we know that, so that’s your as is.
What your to be is is okay, we want to do it better.
So based upon what it was before, and we went to make it better for everybody, we’re going to
make these changes. Again, it’s like building a
house. First thing you’ve got to do is have a good strong as is. Tools are important. The very first
thing you want to do is if you’re going to do an as
is, pick a tool, pick a methodology, and have everybody do it in that way. So if you do standard
tools, which is a standard methodology,
everybody’s working from the same page. Everybody literally, every meeting’s about
production. (IA) the meeting’s about
getting it done. It’s not teaching everybody, oh, this is how I did it. You know. Everybody use the
same methodology. Train staff before you bid. If
you’re going to do this, you need to train everybody on how to do business process re
engineering, how to do an as is before they get
into their first meeting. Their first meeting should be about training them how to do it. Facilitation’s
important because it creates a standard
methodology, everybody walking into the room knowing what to expect, knowing how it’s going to
be done. So you can literally deal with a lot of your
issues up front. Engaging the vendor. If you create something really cool, and the vendor
community that you’re going to be going to to try
to get the solution from has no idea what you’ve created, so no idea how to rate it, that’s a
problem. Did we mention standardization? Make
sure that everybody has clear understanding and everybody does it the same way. SUMI SMITH:
Okay. So from the vendor perspective, BPR is a
buzzword. Don’t get pulled into that scenario. Really ask the questions. Really find out. Does
this vendor really do process re engineering?
When have they done it before? Ask them for their methodology. BPR is not easy. So you don’t want
a vendor on board who’s going to work with your
business, take up their time and effort, your money, and not give you something that you can
use at the end or not give you something that you
can build from. Right? You need this to be done right. We talk so much about the fact that this
needs to be a solid foundation, so let’s make
sure that when we hire this vendor it is a solid vendor and they have experience doing this. So
some things to ask for. Ask them for their
templates. What are they going to present you with? Can you use it? What is their process?
How do they do their flow maps? Ask for
experience. And then ask them what their activities are going to be. How are they going to
get this information? Are they going to
conduct jazz sessions and then just give you I actually had a vendor who conducted jam
sessions, wrote up on the white board, and then
the delivery to me was a snapshot of the white board. I’m not kidding. How am I going to use
that? So find out what it is. Is it reviews? Is it
online surveys? Are they going to take flow maps? Are they going to do (IA)? What are you
going to get at the end? And does it work for your
organization? Every organization is different. Every organization has their own culture. Some
organizations love to sit in meetings. Some
organizations really, really don’t. I worked for a company that was an engineering company, and
everybody had a cubicle with a door that was
really this big, and the cubicle walls were about ten feet high. So once you got into your cubicle,
you were alone. There was nobody else in your
visibility, in your hearing. You know. People would come and sit in their cubes, and that’s where they
would sit all day long. There was no chitter
chatter. There was no talking around in the hallways. None of that happened. Well now, this
organization’s not going to do really well in jam
sessions because they don’t like to talk to each other. They’re going to do really well with online
surveys, written forms, things like that, because
that’s where their space is, their head is. So figure out what that is for your organization, and
make sure you select a vendor that matches. So
you don’t want a vendor who’s going to upset your business because they’re trying to change the
culture of the way your business does work. And
then find out how are they going to identify their disconnects? There’s always going to be a part
in the process where as you’re working through
the steps of the process you might miss something. So when you discover that you
missed something, how are they going to handle
that? Are they going to go back and reevaluate the entire process and validate that there’s not other
gaps? Are they going to modify their documents?
How are they going to handle it? Find that up front and make sure you agree with it. So you need to
think about what do you need, and then you need
to ask the vendor to tell you that in the proposal, and your selection criteria should be based on
what you need them to provide to you. We’ve
already talked about the fact that you can select many different types of methodologies, and you
don’t necessarily want to trap them into one type
or another. It’s perfectly okay to say this is the way my organization is. Tell me how you’re going to
handle this. PAUL SMITH: Vendors build in risk
dollars. They build in dollars thinking that you don’t know your business. They build in dollars
thinking that you didn’t document well. They build
in dollars that says we’re going to have to come in and redo the whole thing. In your RFP, if you
show them an as is that is unbelievable, your
bid’s going to be lower. This is actually the one that doesn’t cost you much money at all. It costs
you time. Now, this is where the investment is
with the business process owners. You have to explain to them, if you do this, it’s going to cost
you less. If you give us your best people, it’s
going to cost less. If we document correctly, it’s going to cost less. When you’re starting your as
is, cast a wide net, especially in the current
technology environment we live in today. You know, with BYOD, cloud services, ERP
technology. These are now enterprise wide
technologies. I guarantee you that somebody that you don’t think is going to be impacted by your
project is going to be. If you bring them in at the
earliest stage, it’s a requirement. If you bring them in at the end, or if they catch you at the end,
they can say well, it doesn’t meet my needs.
That’s called a change order. Which one costs more? Change order. By how much? On average,
ten times. So if the requirement costs $1,500 to
make, $15,000 to fix. The cool part about this process is this will tell you, if you do a good as is,
and you identify who all the customers are, who
the suppliers are, who the inputs, the outputs are, who are of your current world, it’s going to
give you a very good idea of what it’s going to
cost. You know, a lot of our projects in the State of California, we fail for one reason: Planning. And
we don’t budget correctly because we don’t plan
well. And Sumi and I cannot convey enough why the as is is so important, and it’s the cheapest
part of your project. Okay. Let’s do this game. I
have this whole IT shop, and we have these kind of capabilities. Is there something that we could
do for you? Now, the stakeholder’s going to look
at you and go, you know, I have this thing. It’s been bugging me forever. Can you fix it?
Sometimes the answer’s going to be no. Yeah,
I’m sorry, I can’t do that. But if you can say yes, you now have a committed stakeholder. Because
here’s the deal. Sometimes, you know, we’ve kind
of lost sight, especially with our IT folks, we want to offer solutions all the time. The problem is that
we don’t ask the question of what wants to be
solved. You know. We more say we’re going to solve this. We don’t ask what do you need me to
solve. SUMI SMITH: The other thing you can do is
communicate across the department and make sure everybody’s aware of what you’re doing.
Because then they probably know that they have
a connection to that business better than you do. And if you’re focused right on your main business
process, you may not catch those outliers. But
they can come to you and say you know what? I think I have a piece of that. Or I’m interested in
understanding your status because… well, that’s
you know, that’s a clue right there. If you need to know what’s going on on this project, you’re a
stakeholder. It goes back to change
management. Communicate, communicate, communicate. You’re doing change management
from day one. PAUL SMITH: Remember in the
very beginning we talked about stating what you’re trying to achieve, getting everybody on the
same page? And if you get everybody involved in
the as is and the business process re- engineering exercise, it’s not a surprise to them.
It’s not a shock. And not only that, but you get
them involved in creating whatever the solution is, whether they’re part of the as is
generation or the to be generation. They feel like
they’re part of that change. They feel like they’re being (IA) that is actually something that
they’re taking part in. How often in your lifetime do
you get an opportunity to actually effect change? Now you’re going to get them involved in saying
look, you can now change that. You can now
effect that. You can make it better. SUMI SMITH: You know, a lot of times you’re going to run into
where people, where SME’s are going to know
their little piece of the process and not anybody else’s. That’s going to be part of the challenge of
doing the BPR, is that you’re going to have to
work with all of these sideways and put them all together and make a comprehensive picture of
the entire process. PAUL SMITH: That’s the
reason why you put so many people in the room. If you just have a small group of people in the
room that are all from the same area, they’re
going to probably defer to one person. If you put a bunch of people in the room from a whole bunch
of different areas, you’re going to have all those
perspectives in the room, and you’re going to get a much better picture of how the business is
done. So five clues that the process is failing.
These are five things that you should as a project manager or stakeholder or a business process
owner, if you see these things, these are red
flags. SMEs are now unavailable. Ah, they’re on vacation. Oh, well, I put her on another
assignment that’s so much more important, and
you’ll get her in three or four weeks. It’s also a sign that your meetings are not being run
correctly. A business owner will come back to you
and say look, I keep sending them to these meetings, and half a meeting is trying to figure
out the process or the procedure, and it’s a
waste of our time. It’s a four hour meeting, and you need to do this in an hour. That’s why we talk
about standardization, and that’s why we talk
about using a methodology, and how do you facilitate it at every turn? But your number one
clue of that is SMEs not available. The other
reason why the SMEs are not available, they’re tired of working with you. They’re tired of they’re
asking the same questions over and over again,
and they’re done and they’re tired. Okay? That’s going to happen. Approvals are harder/easier
than they should be. Something’s taking three or
four weeks to get through the approval process. What’s usually a bad sign about that? It’s stuck
somewhere. Why is it stuck? They don’t have the
commitment. That’s why. Priorities. Bad process. Somebody hates it. Or somebody doesn’t feel
that they’re the right person to make the decision.
So this is something you need to engage your stakeholder on and go and say look, I don’t think
this person wants to make this call. Do you have
somebody who’s willing to make this call? Easier: You send it as an email, and three
minutes later, it comes back yeah, yeah, yeah.
Absolutely approved. They didn’t read it. They’re not engaged. They’re yeah, whatever, this is not
important to me. I just need to get it off my in
basket. Here, take it. Which one’s deadlier? The latter. Because they’re going to approve
something, but a vendor’s going to come to you
and say you signed it. But again, those are (IA) something’s really important. The executive
sponsors are disconnected or disinterested. You
go to them, and you say here’s this issue, and so on and so forth, and they go yeah, yeah, yeah, you
should handle that. Or I’ll meet with you. I’ve got
five minutes on Thursday. Those are really good telltales that you’re doing something wrong. It
could be that your process is not good. It could
be that they’re getting a lot of noise from their managers or subordinates. It could be any
number of things. It could be that they don’t think
the ball’s moving fast enough, or they think it’s moving too fast. SUMI SMITH: Or something else
has changed, right? That’s a good time to have
another discussion with them and say, you know, are you still on board? Is the business driver still
the same? PAUL SMITH: What we’ve been talking
to you about starts over every time you get a new sponsor. Don’t assume that they’re going to read
everything or get briefed. That’s not how it’s going
to work. SUMI SMITH: And don’t assume that they have the same level of commitment as your
previous sponsor. So make sure you have that
business case solid. Make sure you understand the business case and the impacts to the
business, either having or not having this done.
And then make sure you can repeat it so when that new sponsor shows up you’ve got your little
elevator speech ready. This is the reason. This is
why we’re doing it. So all of a sudden, you’ve been having these jam sessions or these
discussions around process, things have been,
you know, things have been going forward, and eventually the team has come to resolution. Now,
all of a sudden, we’re not coming to resolution.
People are speaking up. You’re getting these loud arguments or discussions. You’re not
agreeing on what that final process is going to be
like. That’s a good sign something’s wrong. Either they’re not committed, they either don’t
believe in where you’re going, or you’re going in
the wrong direction. Or they don’t like your vendor. Or you’ve got somebody in the room who’s calling
the shots, and everybody’s waiting for that person
to make the decision. That will be a failure for you because that eliminates all of the other
perspectives in the room, and then you’re just
getting that one person’s voice. PAUL SMITH: The people in the room, when they turn to this
process, they may realize, oh, my god, I’m going
to collapse an organization that my manager is in charge of. So if I say this, I’m going to get in
trouble. Those things are real. Those are (IA)
conversations where you pull somebody out and say what’s going on? Why is this are you
concerned about something? And that’s where
executive sponsorship comes in, where the executive sponsors can say you know what?
We’re doing this as an organization. This is
something that we’re doing, and they show that strong support, and that person will start talking
again if they feel that they’re going to be
supported. SUMI SMITH: And a lot of times we walk into these as project managers, we walk
into these BPRs and jam sessions as task
oriented because we tend to be task oriented, and we’re meeting schedules. Be aware that
when we’re doing this we need to also engage
the human side. We’re working with people who we’re changing their world. We’re changing
the way that they’ve been working for, you know,
25 years. This is not comfortable for them, and they’re nervous, and they don’t necessarily like it.
So be really aware of the dynamics in the room.
Put their fears to rest. PAUL SMITH: Engage in personal activity. Can you get me a cup of coffee
please? In front of you, you have what’s called a
(IA). A very simple tool. It’s one of the very first tools you use in an as is process. If you look at
the (IA) that’s in front of you, you have suppliers in
the upper hand left. The inputs, the major steps is in the middle, the customers of the coffee, and
the outputs. This is one of the things I actually
hand out to pretty much everybody when I’m about to start a project. This takes about 15
minutes to fill out for every process that you do.
Do you process POs? Yeah. How do you do them? Do you process requisitions? Yeah. How
do you do them? Do you take phone calls? Yep.
How do you do it? You can map it very, very quickly using a tool like this. If there’s too much
art, it’s chaotic. If there’s too much science, it
doesn’t guarantee success. Project management is going through the same
evolution today. We’re realizing that there are
projects that have got every checkmark correct on their list of things that they have to do from a
public standpoint, and they’re still failing because
we’re not applying the art part of it. Now somebody was coming up to me and saying
well, this form is actually used for this, and it’s
used for this and it’s, you know, was telling me the science of how the form was used. True. But
the thing is that the art is how will you use it for
you? How will you use it to get what you need? Another person said we went through projects
and we used one methodology, and we
transitioned to another methodology. And you were saying just use one methodology. They’re
not mutually exclusive. What we’d like you to do is
one methodology at a time. But if you find that it’s not working, use your art part. Get everybody in
the room and play the art game. Walk in and say
it’s not working, everybody. It’s not working. So we’re going to try and change direction, and we’re
going to now do it like this. And that’s what makes
project managers, is the ability to shift plans if the plan that you’re currently using doesn’t work.
Don’t depend upon the science. You as project
managers and project directors have to realize you have to adjust it to match the culture that
you’re in, and you may have to retool completely.
When we did bids originally, we used the implementers’ methodology of business process
re-engineering. We did the whole thing. And
when had it was over, we had an awful product. We retooled. We created some of our own tools.
We agreed on all of those tools, and then we
started forward, and we redesigned our business processes. That’s the art part. The
science is not a suicide pact. Just because
you’re checking off the boxes does not guarantee your success. Your project management, your
brains, your knowledge, and your skills, the skills
of other people around you that you can ask questions, the community of project managers
that’s the real power. Find out if somebody’s
doing it better or somebody’s doing it differently. Again I really want it to be really clear: Use the
tools and use the methodology, but also use your
heads and use that art component. SUMI SMITH: Don’t forget that projects are comprised of
people. We don’t have a project with just a bunch
of tools. That means that part of what you do is dealing with the change that happens when
you’re dealing with people. So we need to be
ready to adjust to that change. If it’s not working for your organization or even just for the
personalities in the room, then don’t be afraid to
rethink it and change it. Because the goal is to get a good quality product. PAUL SMITH: Okay.
The to be. In this section, we’re going to be
talking about how to begin the process. The four levels. Embrace your inner toddler. Change, be
brave, challenge everything. Achieving buy in.
When to engage the vendor. How to begin the process. So you’ve gone to the effort and created
an as is that everybody’s bought into, everybody
has signed off on. Everybody agrees that, yes, this is how we do business today. The very next
thing you need to do is reengage your
stakeholders and all your business partners and say what is the goal of what we’re about to do, of
what we’re trying to achieve? And it has to be an
enterprise approach. It has to be everybody. Can’t be just the stakeholder. It has to be everybody.
Everybody has to understand where you’re going,
what you’re trying to achieve. All players have to know that. Because if they know that, then
they’ll work with you. And if they have a concern
about it, they’re going to raise it there. So in order to be successful with BPR, before you even
begin anything, everybody has to understand and
agree to what the enterprise goal is, what you’re about to do. So it’s on change management. You
get buy in every single step. Yes, it’s time
consuming. Yes, it can be frustrating. But in the long run, it’s way easier. Trying to get them to buy
in at the very end where they feel they didn’t agree
to this in the beginning is near impossible. Next one. Facilitate everything. The facilitator actually
has to be the fair arbitrator of all ideals that
allows them to be heard, that manages the rules of the meeting. You need a secretary. You need
all the tools of facilitation. And the reason why
that’s important because down the road, if you don’t do it correctly, everything’s going to be
disputed. The team that’s doing the BPR should
all be trained facilitators. Facilitation is one of the greatest skills you could ever learn. It allows you
to deal with and communicate with large groups
of people and get them to consensus or to a position in a very short period of time. And if
people see that you’re being efficient, they’re
more willing to give you time. Have meetings about the meetings. You need those meetings
about setting up the ground rules for future
meetings. What are we going to accept? What are we not going to accept as a group? How are
approvals going to work? How is disagreement
going to work? How does the escalation work? Who’s going to be the facilitator? Who’s
responsible for getting the notes out? Who’s
responsible for having the agenda done? A lot of times people think that meetings, especially
large meetings with lots of divergent groups,
have to be run by somebody with a high rank because it’s the only way to control (IA). I have
meetings run by AGPAs and associate
information systems analysts that are dealing with chiefs, CIOs, directors, the whole nine yards.
And the reason why is because we have a
meeting with them and say this is how the meeting is going to be run. This is the facilitator
of your meeting. Does anyone have an issue with
that? No. Yes? Then we resolve it. You set up all these rules so that when the meeting is
occurring, when somebody starts to behave
badly, or they’re not paying attention, the facilitator, all they have to do is get next to that person and
just kind of keep talking, and then the group will
control that behavior. Because that’s facilitation. That’s how you use it.

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