Information vs. Intelligence: Is Intelligence Jewel on the Information Crown

Information answers the questions. Intelligence questions the answers.

Information is air at digital era, however, information is only the means, the prerequisite for intelligence, only through action-based intelligence, one can solve problems, to turn the world a better place.

1.What are I&I: Information vs. Intelligence

According to Dictionary .com:

(1) Information: Information is defined as: knowledge communicated or received concerning a particular fact or circumstance; news or knowledge gained through study, communication, research, instruction, etc.; factual data. The act or fact of informing.

2) Intelligence: Intelligence is defined as capacity for learning, reasoning, understanding, and similar forms of mental activity; aptitude in grasping truths, relationships, facts, meanings, etc.or manifestation of a high mental capacity. The faculty of understanding.

2. Information vs. Intelligence

Information answers the questions. Intelligence questions the answers.

Information is processed data. Intelligence is processed information.

Information is a pre-requisite for intelligence, but in order for you to recognize the information, you need intelligence.

Information is what we know and intelligence is what we do with what we know. Intelligence is actionable information.

Information is a passive perceptual entity and intelligence is an active cognitive entity.

Information is just information without intelligence -or the right intelligence. Success depends upon both.

Intelligence is real-time wisdom or Wisdom is ultimate intelligence.

3. Intelligence is Jewel on Information Crown of Businesses

In the context of a business or organization, information is representation of organizational objects (including human beings) and processes. Intelligence is the understanding of the relationships between these objects, processes & patterns and derivation of associated value for the good of the organization.

Information is the grist for strategy: But it is intelligence that defines the strategy. With the introduction of information and application of intelligence, strategy MAY be developed - no action or reaction being the alternative.

Intelligence is contextual understanding: Intelligence is to understand semantics associated with universal/worldly objects & recognition of patterns in the universe and deriving value out of universal objects. Human cognition understands processes but even processes need to be represented as objects for perception. So intelligence is your perceptual and cognitive ability to understand the objects and relationships (processes) of entities of the world and recognize the patterns in them. 

Intelligence is to utilize cognitive ability: Utilizing cognitive abilities to derive value for the betterment of human kind is intelligence, genius and wisdom. In practical application, information is all that is used to create the intelligence that shapes strategy; as well as to test the results of strategy execution. Further, it is the aggregation of information and the assessment of that information that creates the intelligence required to define the rules that drive the business; sometimes not so easy to do. 

Information" is usually understood to be essentially "model-free"--just data: "Intelligence" implies the ability to make inferences (predictions) from the information based on a model. Btw, "learning" would go a step further, and implies actually adapting the model itself over time.
Information is actionable but in order to take it to the next level; Intelligence is nothing but the ability of a person to solve problems. The issue of "actionable" is more a matter of whether intelligence generates value, rather than being a fundamental characteristic of intelligence. People (or systems) can be highly intelligent, but only when the intelligence translates into action is any value creation possible. 

 
The quality of intelligence depends greatly on the quantity of information: if focused, the more we know, the more we can do. If not focused, we may know "everything" and still achieve nothing. Conversely, if we know "nothing" we will achieve nothing. Most of humanity's achievements, or solutions to its problems, have a mostly neutral impact. They tend to have positive and negative impacts based on value proposition.

So intelligence is your ability to solve problems. The larger/bigger the problem you solve in terms of its positive impact to the society, the more intelligent you are. And you can see how the breadth and depth of impact of such intelligence can have.

Read More

CIO’s Five-factor Consideration in Creating Five-year Strategic Planning

The goal for creating five-year strategic planning is in place to focus long term effort and vision though The rate of change in any market is increasing, so it's unwise to assume the 5-year plan will not change once it's been created. A good long term strategic planning should embrace three “C”s: Context, Cascade, and Creativity.

 IT strategy is an integral part of business strategy, CIO must consider business relevant factors in order to create effective strategic planning to well align business vision and strategy, more specifically, what are key factors in such five-year IT strategic planning?  

1. The Most Important Factor Is the 5-Year Business Strategic Plan 

First and foremost, to have an effective "IT Strategic Plan", you must first have a clear and usable "Business Strategic Plan". 

• The most important factor is the 5 yr. strategic plan for the business. Without that, you can't do proper business-technology alignment. The five-year goals for the business will be high-level, descriptive only in terms of revenue, market position, gross margin, etc. Ideally, the executive team will work backward and plan year 1 (with better certainty), year 2 (with somewhat less certainty) and year 3 (with the best of intentions). Year 5 is only out there as a target everyone is trying to hit. 

•  Clarify business visions: The IT manager and business stakeholders should work together so IT has a clear picture the desired state. What does revenue look like? How has the business model evolved? What is the desired position in which markets? If these things aren't clear, then there should be no planning for a 5 year IT strategic plan. The goal is to review the plan EVERY year for relevancy and increased clarity

• Predictive Questioning: What's going on in the market? Where are my suppliers headed? Where are my competitors headed? And most importantly, where are my customers headed? You must ask 'why' enough times to uncover the negative factors that create a divide between the vision/strategy of the desired future and the current reality. This builds the foundation for an IT strategy

 IT organization as a whole can be considered "critical" to the business, but with defined and proven Business Continuity/Disaster Recovery plans, criticality of IT is relevant as it relates to the varied business needs (emergency or not). If there is a solid strategic plan for the business, then the following factors need be considered:

2. Current IT Maturity and Capability

• Functional Maturity and Capability. Do the functional areas in each part of the business have what they need to achieve the 5-year business plan? In IT: What things are in place that will enable the business strategy? What can be done to strengthen them? What things are in place that will inhibit or endanger the business strategy? What can be done to minimize them? Are the right skills in place? Are costs in line with the 5-year plan? 

• Five "WHYs" Reality Tree: The first question to answer is "why are we here?". Current reality trees ascertain the forces creating the current state and thus constraining programmatic efforts to attain the desired state. A detailed description of the current situation including current policies/procedures/ practices, values, and resources associated with the current reality. Participants in the planning must ask probing questions to get deep down to the underlying or “root causes” that brought IT to its current state. Some “roots” are problems - others are strengths. Both should be explored. The success to executing a current reality tree is to ask the key question” “Why …?” You build your Reality Tree with asking enough 'why's to get to the root.

3.   What is the IT Organization's Capacity for Change?

If radical changes are needed, does the change management structure exist internally to deliver on that? If not, I should be looking for a partner or possible acquisition target. 

• Assess IT Capacity to Change: What will change about the business over the next 5 years in order to achieve the strategic plan? And what are the impacts of those changes on IT? Higher transactional volumes? Heavier investments in product development? Does the business need to make decisions faster? 

• Gather as Much Input from all the business groups and departments including adherence to industry standards, approach to human resources showing support of overall organizational growth or shrinkage (follow industry ratios), and sourcing alternatives, with an in-depth understanding about organization's capacity for change. 

• Figure out The Gap between "Now" & "Future": IT managers need coaching in strategy and aligning their tactical roadmap to the business strategy. That said, two techniques to consider for align or acknowledging and fixing misalignment are the "current reality tree" and "negative branching". In essence, it is a matter of figuring out "where are we now" and "where we want to be".

4.    What Could Cause Business to Fail?

Brainstorming scenarios for failure in the future helps everyone be clear about what we don't want to happen and what we can do to avoid it. 

• First: You have to take into account the evolution of tech, and what/if/how it would affect your company. Some companies are more tech-forward than others, and if you're setting policy, you're going to have to set a level of comfort that you'll be okay with. Setting test parameters, roll out procedures, etc.

• Next, you must acknowledge undesirable affects of what IT is doing wrong, what IT is not doing or how the current reality is not aligned with the business strategy. Uncovering the under desired effects allows for negative branching - the cause and effect and the underlying intervening or missing actions to be addressed.

• Every manager must be capable of using the problem-technique of 'the 5 whys' to have great root-cause troubleshooting techniques for both managerial and technical matters. Five WHYs Reality Tree Scenario:

        1) Service Quality from IT is poor. We need IT to meet service levels.

        2)  Why is it poor? Well, the staff performance is sub par and response is disorganized.
        3) Why do we have sub-par performance from our staff? Training is inadequate.
        4) a. Why is training inadequate? Priorities are always changing.
        4).b Why is service response disorganized? Supervision is infrequent and not measured.
        5) a. Why do we not measure performance? We don't have processes in place. 

5.  Looking at the Risks, what Should the Business Do?

• IT must have authority for solutions and action. Without this, inaction and floundering in the current state will prevail. Once the data points are collected, we must determine the time/quality/cost values that will guide us to prioritize the work effort for IT. Getting peer reviews and feedback from stakeholders will start to formulate the IT strategy.

• Linkage of Business & IT Strategy: Once the action plan is assembled, cascading or waterfall MBOs of the business strategy should directly map to IT efforts. Any action by IT without linkage to a business target needs to be re-examined. After assessing the risk, and ensuring budget, resources, etc., are in place, can also tactically plan how they will maintain pace with the corporation's progress (or even one step ahead). 

There're an art and a science in crafting a strategy, "strategy" is not scary, it's not academic, and it's not overly weighty. “Less is More”, CIO’s strategy plan should be no more than 10 pages, and when the non-tech CxO reads it, he or she should say "Ah ha! So that's what IT is going to do over the short term and long term perspective!"

Read More

Does Governance Stifle Innovation

The leverage point is to let innovation shine via the effective governance discipline, but not adding too much complexity. 

Innovation and governance seem to be the opposite practice: Do individuals believe governance is essential to effective business innovation and that the two are interdependent?  Or do individuals believe governance is incompatible with innovation and leads ultimately to company failure? 

1. Governance vs. Innovation

• Governance is by definition a framework of principles, practices and indeed ethics; separate, different and outside the setting and subsequent control of business strategies, budgets, outcomes and metrics (in short, Management). Governance by definition does not set a corporate strategy that is management’s responsibility. Governance does not define company culture, which is one of the key contributors/enablers for innovation. Remember governance isn’t about putting restrictions only on what you can do, it is about monitoring and knowing when things are not going to plan so that you can take appropriate action at the right time.     
      
• Innovation is somewhere between invention and implementation -finding new and different ways of doing things. Innovation is doing something better than it currently is. Hence it requires a sound and competent understanding of what is currently being done. Not what others are good at. It's a mindset. And that's where governance comes in. Governance needs to set the framework for innovation management 

2. Why Governance Stifles Innovation Sometimes

If governance is deemed to stifle innovation, then it is wrongly implemented, or indeed wrongly understood. The governance aspect and innovation don't immediately come together depending on the context in which innovation is used

• Traditional Governance Discourages Innovation: To create innovation that has the ability to truly change the course, an organization needs creative people who think out of the box and don't always constrain their thinking with the organizations’ current capability. That said, a lot of innovation can come from the shop floor when it is encouraged. However, sometimes traditional governance restricts and even actively discourages innovation that is not based on the Organization’s current capability.  

• Over-Governance or Under-Governance Hurts: Applying a single layer/definition of Governance, as a lot of businesses do, will either enforce ‘over Governance’ or ‘under Governance’ in or more of these areas. Both over Governance and under Governance can and will stifle innovation. 

• Divergent View of Governance: The problem with governance is that the people enforce governance normally have a frame of reference based on their own experiences and a view of the organization's existing capabilities. Also sometimes governance "standards" can be taken too far and become their own bureaucracy. In that case, innovation would be stifled. This generally occurs in very large, mature organizations though. Those are the ones who are more interested in protecting their positions and markets rather than innovating and generating new ones. 

3. Effective Governance Enforces Innovation

When governance is done properly,  it actually is a great tool to facilitate innovation. A good governance standard provides a common corporate "language" as well as working instructions. In other words, proper standards, appropriate business, and use cases, etc., may not let every idea through, but it will certainly bring the ones forward that makes sense.

• The leverage point is to frame innovation, but not adding too much complexity. Metaphorically, if innovation management is like the pedal to accelerate the speed of the car, then governance is like a brake to ensure safety via properly controlling. Both are needed, in integral way, the brake is not just for stopping the car, but for allowing the car to run safely. The leverage point is to let innovation shine via the effective governance discipline, but not adding too much complexity. 

• Innovation does not happen in “vacuum”: So if by innovation you mean in a "vacuum," separate and apart from the business goal, then governance would get in the way of that type of sandcastle construction. Innovation can NOT be separated from a specific business purpose and in a broad context governance is critical for meaningful innovation 

• Look at them as a continuum: What context "innovation" is used in? When you say innovation, you could really mean maximizing value to the business, when you say governance you could mean minimizing risk. Is the purpose of the governance to support budget, security, regulatory issues, safety, etc. If you don't just look at them as a continuum (increasing value increasing risk),  it could be argued that maximizing business value from prioritizing business objectives actually lessens a number of risks so the two are lock-stepped together. 

Governance is to frame innovation management, it should orchestrate the change, not police the creativity, do it with trust and flexibility.

Read More

CIO’s Talent Strategy: Are People the Weakest Link in IT

Don’t be afraid to look above, below, and outside of the Talent Pools that you are seeing.

The speed of business is accelerated; the talent demand for IT department is also never ending. However, the crux of the problems is that IT tends to employ the wrong people, and HR often plays 'buzzword bingo' because they don’t really understand what they have been tasked to the source. So, are people the weakest link in IT, and to what extent is your IT function let down by your talent supply chain?  If so, why / where?

1.  Main Issues in IT Staffing

Start solving problems by owning it. You have taken the view that you are possibly the weak link in your talent value chain, and dig through the root causes:

• Lack of Clear Process Guideline for Staffing: Without better education of the complete range of skills required in an IT department, the IT department will continue to under perform and languish. Without the independent advice and strategic guidance on how to build an IT department, internal HR departments and external recruitment companies will continue to hire ‘buzzword jockeys’. 

• Hire for Yesterday: Somehow most companies experience a sudden (instead of planned) shortage of people with specific knowledge or skill that can be workable in a very quick period of time and want them for "yesterday." On this scenario usually, they hire the first person they are able to find that can join right away. Time, not quality is the main driver. Also, project or short term needs are over considered than profile fit for the organization long term needs.  

• Hire Certification, not Ability: Certifications is mainly as an indicator of good discipline to learn and ability to pass exams not always ability to put this knowledge to solve problems in context with teamwork efforts, certifications are overrated by a whole industry of selling training and certifications. IT only looks for the technician, as a shortcut tell HR to put requirement filled with keywords. This results in those job descriptions we've all seen, and candidates that either "fib" to meet unrealistic expectations, or are so deeply entrenched in a technology they're unable to change with the times. What IT really needs are people who can learn new technologies and businesses, problem-solving, and communicate effectively with peers and users    
      
• Lack of People Development: This is also a long-term view and one of the main causes of the broken IT staffing supply chain. Companies also seem to be averse to continuous training of their employees. As a result, they either do not change or add technologies or they pigeon hole the employees with knowledge in older technologies forcing them to leave and hire new employees with the new technology experience. What they forget is that a significant amount of knowledge of the business is walking out the door. Further,  a key expertise that is overlooked in IT is business knowledge and that is incredibly important. It is important to create a culture of continuous learning for IT employees, so their knowledge and experience continue to grow

2. What are the RIGHT Qualities for IT Talent

The weak link is people who are too tunnel vision, looking for / focusing on the narrow but deep experience of the individual. IT leader needs to take responsibility for ensuring the talent is made of the right stuff and ensuring that we don’t let this talent drift out the door. As candidate tend to be hired based on certifications and prior experience rather than whether they are able to think. The team needs members experienced and educated in the technologies that are being used at the company but more importantly, IT personnel needs to be able to think, learn new technologies and relate what they have known in the past to the new technologies. Whilst from a solutions delivery perspective, the focus should be on extracting information related to situations in which candidates found themselves that demonstrate the ability to learn and solve problems. The good quality for IT staff:

• Growth Mindset
• Problems Solving Capability
• Empathy - Communicate with the ability to think on one's feet 
• Culture fit 
• Competency (via multidimensional lenses)
• Capability/Skills/Experience 
• Think innovatively
• Establish insight into approach and style in different situations 
ability to learn to reflect
• Discernment 

3. Next Practices for IT Staff

Not only does IT explore the best practice, but also it should continue to develop the next talent practices in order to strengthen the weakest link –People:

• Don’t just delegate the process to HR or a recruiter: As for IT: Talent, simply stating “this is what I want” is going to get you a pool that survived the automated candidate parsing system and is either very narrow in the skill-sets or very good at playing the “qualifying word bingo” Game. But if HR is supposed to be providing a service, shouldn’t they be more proactive in ensuring that you really need what you are asking for and ensuring that your talent requirements are articulated in an unambiguous and recruitment agency-friendly manner?  

• Don’t be afraid to look above, below, and outside of the talent pools that you are seeing. Be open-minded to hire candidates that would be considered somewhat unconventional to others but showed a real desire to do the work that was required of them and had skillets that proved to be eminently transferable to their roles. Many great candidates can be recognized by wise eyes, otherwise, they would have likely been given a pass by an Automated HR System.  

• Don’t get caught between the “Hire the Experience” vs. “Grow your Own” Traps. Everyone in I.T. is “Grow your Own” and regardless of past experience or success, providing the time and $$$ to educate, train, and re-train IT Talent is a constant process that will never end. Look for people who are able to grow and give them the opportunity to do so, look at how to motivate and obtain the most out of the talent and look for breadth of experiences, internal rotational opportunities, individuals who are motivated to succeed along with leadership who encourages appropriate risk-taking. 

• Challenge to improve "Attract-Hire-Retain-Train-Organize" Cycle: Introduce HR-IT- Business Programs to reduce turnover, eliminate technology tunnel vision, introduce rotation programs, increase employee productivity and efficacy. IT leaders, need to be visionaries who can articulate the strategic direction and personalize it to the staff. Then, use this to motivate the staff to learn those technologies needed to realize the strategy. Additionally, IT  need to personalize the strategy to each member of the team, so they are motivated to learn and grow. This is how to cultivate culture and organization, to overcome the weak link in staffing. 

• Enforcing the connection between the requirers and the required: Clearly one of the ways I.T. leadership can help alleviate this issue is to deepen their involvement and relationships with HR and (if they use them) recruiters. It may be time-consuming and even somewhat difficult, but the effort can be worth it. Build a strong case for IT to maintain exclusive ownership of the recruitment process, involving HR only towards the end of the process, potentially with the final few candidates.  

• Be ready for the departure of top talent by trying to build a deep bench: Getting people to learn the first 50% is the hard part. The last 50% tends to come easy, especially once it has been made part of someone’s daily work life. So build as many 50%’ers as possible as people begin to reach their highest levels of skill. - Increasing employee loyalty and training, taking care of employees, will eventually increase IT productivity and quality, sometimes the short-term increased stress and oversight lead to long term reward with a deep and talented IT Bench. And for an IT leader (or really any Leader) that should be one of the primary goals.     

By analyzing the key problems, and manage next practices, IT can strengthen its weakest link and make its talent supply chain more mature, adding real value to both business’s bottom line and top line growth. 

Read More

Three Questions to Define KPIs for IT Organization

Broadly speaking, the KPIs of the organization need to be the KPIs of the IT function.

Today’s IT organization intends to become a business’s growth engine, rather than just a maintenance back-office, a value center, not just a cost center; be proactive than just reactive., etc. How to measure IT performance can be the right step to improve IT maturity, so what are the important Key Performance Questions and related KPIs for IT today?

Q1. Are You Delivering the Value Demanded by Customers? 

Broadly speaking, the KPIs of the organization need to be the KPIs of the IT function. If this is not already the case then the IT function is doing its own thing. That said, IT customers include both end customers and internal users. The related KPIs may include:

• Net Promoter Score (a measure of customer loyalty derived from responses to the question, on a scale of 0-10) 

• Recommendation Rate: How do you rate the probability you will recommend firm/product/service to a family member, friend or colleague? 

• A number of Satisfied Users? A lot of users have a low opinion of their IT function. Thus, how to change their perceptions as a strategic priority if the IT functions are going to break free from its operations-focused branding. 

Q2. How effective in achieving the Strategic goals Set by the firm's executives?  

The firm's CEO and C-Level reports establish the firm's vision, true north direction, strategic goals, and the key strategies are needed to deliver the desired outcome. Each of the key strategies becomes the responsibility of a specific C-Level executive. As the strategies are invariably cross-functional, the executives must work with cross-functional teams to ensure *their* strategy is implemented. Related KPIs:

• Schedule: Are tasks being completed on time?
• Cost and budget: Are the project expenses occurring as expected?
• Issue management: Are issues being resolved appropriately?
• Portfolio management - Are the right projects being done for the right cost.
• Risk management: Are risks being managed, mitigated and addressed
• Quality: Are defects being found as expected? 

In addition to the "IT" measures, there should be KPI's linked to some of the key business outcomes to key business projects

·  Execution versus plan (budget, time, resources).

·  User community satisfaction (SLAs). 

·  Contribution to the firm’s business bottom line (ROIs). 

·  IT community development (personnel, tools, research)

Q3. Is Business Sustainable? 

The KPIs include the firm's balance sheets and profit & loss Accounts with respect to all of the 'Five Capitals'… that is financial capital; physical capital (physical assets & IT systems), human capital (intellectual property & know-how); social capital (morale, esprit de corps, community collaboration, etc); and natural capital (renewable & non-renewable resources). 

Therefore, IT leaders must keep in mind which KPIs best measure IT ability to deliver business value. You want to have KPIs, at a high level, related to effectiveness, resource utilization, productivity and error rates. Track the right metrics and know what to do with them to see improvement. And you need to do it wisely.

Read More

Top Ten Biggest Challenges to BPM Initiatives

the adequate governance and right set of metrics will help to measure not only the process effectiveness but also efficiency, to ensure process both doing the right things and doing things right.

 BPM has already gained a lot of attention within organizations in the past years. However, there is still a long way to cover to anchor BPM in the organization as an essential part of 'the road to operational excellence' or even “the trail to value differentiator”,  what are those biggest challenges to any BPM initiative in an organization?

1. Not getting Executive endorsement 

Many key business processes underpin business capabilities, just as a well set of capabilities underpin business’s unique competency, thus, it’s strategic effort need get executive endorsement, start top down as you have to understand business objectives and understand key capabilities to achieve the business strategy. With this you build the processes that can plug and play into delivery + support of the business to consumers or businesses.

However, senior executives have many things on their “To Do” list, how to manage a solid business case can be another challenging thing to do.

2. Lack of Business Case

A business Case provides the description and reason for starting an BPM initiative to articulate and align with VSSP (Vision-Strategy-Structure-People-Processes).

What is the current process state? What are the concerns with the current state (costs, inefficiencies, top line impacts etc). What is the proposed process state? What is the cost, time, others resources needed to get to the proposed state. It’s about he financial impact of the proposed state (in terms of ROI or the expense ratio). A solid business case can also become a base to develop a BPM roadmap as the next challenging step.  

3. Not Develop a Road Map 

Develop a comprehensive roadmap provides an effective roadmap for the (BPM) trip an organization will make. Imagine without one, how might the trip turn to be?

 If there is no guide people will walk but to where? If there is a shouting guide that cannot explain where we go, people refuse to walk. Especially for the complex BPM effort, a understandable roadmap results in more systematic planning and milestone setting. A clear customer centric roadmap can also avoid the thorny IT-led route as the next challenge.

4.  Implementing IT-led BPM 

At industry era, both EA and BPM are easily get caught by over-complexity, inflexibility and redundancy. Every business process that is not impacting the customer in a positive trend should be brought out or clearly re -engineered.

Customer satisfaction index is important, as it is an overall KPI that is mandatory to be maximized. Different channels for achieving it should be used. Innovation & technology breakthrough are the clear differentiators in the BPM world. Traditional BPM might also be too inward-looking, outside-in customer-centric BPM can fit better in business purposes in competitive business environment

5.  Too Slow to React to the Business Change

Change is accelerated in today’s business dynamic, how should BPM adapt to such transformation? At the organization level and its value channels, all processes should be observed, controlled and optimized as a whole, not separated . Bottlenecks should be brought out and every task with a negative client service impact should be eliminated and its parental process should be re- modeled.

Real time performance dashboard KPIs data could be analyzed for the future re-model of the entire business processes chain ....reprogram the DNA if necessary ! Adaptive Control/Actions of processes should be on board. Without this, BPM is just words......

6. Gap between the modeling and the implementation phases

Once the business processes have been mapped and reviewed the organization goes “back to normal' : the process maps become part of the 'historical' archive and the alignment with the evolving requirements from the operations gets lost, that being said, there’s gap between modeling and implementation phases.

For initiatives that go forward from publication of paper process maps to setup of a run-time environment, the methodology indeed becomes the instrument to orchestrate work and collect data for analyzing processes. A BPM initiative is frequently launched as an inevitable step in the migration of a new application which requires an important review of the business processes. . 

7. Seen as a One Time Project

Managing a process requires constant attention to throughput (leveling and balancing workload across instances and task performers). The owner has to be sensitive to the need for improvement, BPM shouldn’t be seen as one time project.

It’s a "continuous" journey. So should BPM become the instrument to let business learn how to look for operational improvement by analyzing processes; not only in case of issues but also by structurally evaluating the BPM library towards the actual situation. This activity will induce a critical/questioning attitude towards the processes and can be the foundation for continuous improvement.

8. Not Investing in Staff

For any project or business as a whole, people are still the weakest link, how to invest in staff is always a long term goal; and from BPM perspective, the following roles are critical: 

• BPM Project manager - day to day responsibility for running the BPM Project -> reporting to the steering group
• Senior USER ( Process Owner) – focused on the business objectives of the project
• SMEs( Subject Matter Experts) from the line-of –business area – having in depth knowledge of the operational mechanics and deep appreciation of the macro –level business objectives ( roles per major business area)
• Process Architect ( Lead Business Analyst ) - will provide the analytical rigor and techniques of the project .He/she will guide SMEs for process improvement
• Additional BAs/Process Consultants may be necessary
• IT Experts - at least one or two are needed to advise on opportunities to leverage and re-use existing IT assets. They need detailed understanding of the capabilities of the Selected BPM technology and experience of integrating multiple systems
• SQ (Service Quality) Expert

9. Lack of CoE BPM

BPM Center of Excellence (CoE) is the key of a successful BPM project approach, it takes the top executive sponsorship for the creation of BPM Center of Excellence and a BPM project team to be highly committed to the organization re- engineering and change.Following are the key aspects in CoE:

• Comprises a group of committed individuals who focus on how the process of the firm drive bottom –line Profitability & Performance.
• Responsible for developing common principles, language, frameworks and methodologies for process development and process architecture management
• Delivers overall process architecture ( key processes interaction across different business units , different product life cycle phases and company value chains)
• Well versed in BPR ( business processes re-engineering)
• Business Systems Manager ( acts as the primary interface between business unit & IT department)  

10.  Poorly Defined Measures of Success 

ROIs for BPM typically quit shortly after the 'go-live" date. Whereas the first BPM initiative requires a lot of infrastructure, extending BPM from the first process to other processes/functional units requires a lot less effort providing the benefits of BPM are seen.

And the other biggest challenge for BPM is to become an un-ignorable 'instrument of control' in the strife for operational excellence. As financial results (P&L, variance analyses,...) and KPIs have already become logic components for business control.

Therefore the adequate governance and right set of metrics will help to measure not only the process effectiveness but also efficiency, to ensure process both doing the right things and doing things right.

From rocky road to bumpy ride, BPM  touches the mighty waters, hit by social wind, it has also to avoid pitfalls and overcome such big challenges in order to reach process wonderland.

Read more blogs about BPM:

BPM's Rocky Road

BPM's Value Trail

BPM's Mighty Waters

BPM's Social Wind

BPM's Hill View

Top Ten BPM Roadblocks

BPM's Wonderland

Read More

“Why” & “What” Should Be Included In A Business Case?

Executives are going to make a decision about a business case based on the "why" not the "what."

A business Case provides the description and reason for starting an initiative: Many times we’ve seen business cases that are verbose and rarely read. Others are nothing more than Excel worksheets that contain a preponderance of clever macros and pivot tables. Or some still are written on the backs of envelopes and articulate very little. As a decision maker, what do you think the minimum contents a business case should include?

1.   Assess the “WHY”

Well articulate the reason for starting an Initiative, at minimum content, a Business Case provides the description and reason for starting an initiative to articulate and align with VSSP (Vision-Strategy-Structure-People& Processes). These are the principal justifications behind undertaking the initiative

• Key Business Drivers – what are the key drivers behind this project? What problem or event is driving the need for the project? What immediacy does this problem or event have and why does it need to be addressed now? What is wrong with maintaining the status quo? What impact are these problems currently having (either to the organization or the community)? Can the impact of these problems be measured and quantified and if so what is the quantum of the problems., etc. 

• State Check: What is the current state? What are the concerns with the current state (costs, inefficiencies, top line impacts etc)? What is the proposed state? What is the cost, time; other resources needed to get to the proposed state? The financial impact of the proposed state (in terms of ROI or the IT expense ratio) 

• Strategic Alignment – How is this project aligned with the strategic business objectives of the organization? What sort of contribution is the project expected to make to the strategic business outcomes being sought by the organization? What stakeholder support does the project have? Who is the senior executive who wants to take ownership of the outcomes from this project?  

• Benefits and Outcomes – Which benefits will be achieved through addressing the key business drivers? Can these business benefits be measured and quantified? What outcomes can the project sponsor expect to achieve through investment in the proposed initiative? (a) the KPIs of the business case / project be clearly articulated and that (b) a framework for subsequent benefits management be included ( for a 3 or 6-month post completion assessment).  

Executives are going to make a decision about a business case based on the "why" not the "what." Though business cases tend to focus too much on the "what" (the solution, in particular, the technology solution) and don't place enough focus on the "why" (understanding, qualifying and quantifying the problem and outcomes., etc.). 

2. Describe the “WHAT”

In this step, focus on what the proposed initiative will be doing, In essence, it must deal with cost / revenue / regulatory /or risk. A good business case will demonstrate some measure of ROI, ROA, or ROE. if addressing in a business case for business improvement and technology-related projects. “What” can include both from a business perspective and from a technology perspective.

• Business Changes – what business changes need to be made in order to address the key business drivers identified in the justification? What benefits will these business changes deliver? What changes are needed to organizational structure, roles, and responsibilities, policies, process and work instructions? What changes will be needed from external stakeholders? How will the changes be communicated and implemented?  

• Technology Solutions – what IT tools or systems will be needed to support the business changes? What changes to existing systems will be required? What new tools and systems will be needed? Is there an opportunity to leverage new technologies to enhance business changes? How will these solutions contribute the achievement of the business objectives and business benefits of the project? What solution options are available that will meet the business need and which option is the best option? Is it one solution or multiple solutions that will be required? Which solutions represent best value-for-money in terms of achievement of the business outcomes? 

• What are Content and Context in Business Cases: 

1. Problem context - What's the current state 
2. Market state, Opportunity, Market Segmentation 
3. Business Options 
4. Financial Comparison 
5. Pros and Cons 
6. Direct Risks and Mitigation
7. Alignment to the Org directions/ Vision
8. Change management impacts to the organization 
9. Implementation Schedule 
10. Costs/ Financial summary 
11. ROI timeline 

• Further Context Subject to Flexibility of who the Audience are:
  a) Background information
  b) Context - Problem definition
  c) Solution options and which solution option is most aligned with the strategic goals of the business
  d) Viability projections of the solution over a period of 5-8 years covering the ROI and NPV
  e) Risks and issues associated with the solution
  f) A list of stakeholder departments that may be impacted by the Change.
  g) Stakeholders who may be requested to approve the Business Case for next steps and next steps itself. 

In looking for a "standard" format, there may not be one. It’s hard to be prescriptive with the size of the document, however, 'less is more' should be the default mantra which requires clear thinking and demonstration of the ability to synthesize and communicate effectively

Read More

Five Key Ingredients in an Innovation Play Book

The strategy is the landscape of the innovation garden. 

Innovation is the light every organization is pursuing now, however, most of the businesses may still think it’s serendipitous, and now innovation practices go beyond innovative products/services, also include business model innovation, process/culture innovation, etc. So imagine you are planting the innovation garden, how shall you put effort on and what are the key ingredients, theme, the rich of color or the variety of beauty in your secret garden?

1.    Innovative Leadership

Leadership is like sunshine, nurtures your innovation garden on a daily base. It takes innovative leadership to manage cross-organizational innovation initiative holistically, the sub-ingredients in innovative leadership include:

• Vision: A vision that reaches out to some point in the future, Innovation is an adventure, it takes vision to blueprint either future of the business or a better version of services, it takes leadership teams’ imagination and creativity.  

• Listening:  Understand what people want and making it possible. Innovation is also positive transformation, improving and giving another purpose or reason for customers to require the product in question.

• Openness: How to respond when presented with an innovative idea that may invalidate something central to current identity or worldview. That's where the openness and humility come in.

• Courage: Courage to fail is critical and probably even more so is management acceptance to allow those failures and not penalize those that had a great plan develop and execute but still failed.

2.    Innovation Strategy

The strategy is the landscape of the innovation garden. Innovation is a business strategy, and it takes strategy to navigate innovation management. Without a strategy, innovation isn't supported with a clear path on how to reach that point. Unless you're a business entity with limitless resources and lack of accountability for a positive return, innovation will have natural constraints. Thus, draw the map...

• Diagnose innovation bottleneck or potential pitfalls: Is it because of miscommunication, culture inertia or lack of effective KPIs, etc. Absolute clarity of purpose - which was radical, innovative and would challenge many and if done right would be great. Well define problem can be the first step in forming a strategy. 

• Set up Guideline: Calibration with the company’s appetite for risk, the governance and risk management principles. 

• Following A Set of Choice to Execute:                       

(1) Technology Driver: It is feasible, it can be done in terms of the latest technology
(2)Market Reader: It is viable; it fits the business model and can make money or create value for customers or the business processes etc.

(3) Need Seeker: It is desirable, someone must want it, either it is already a want and need that can't be fulfilled by existing products, or the innovation creates a need and want  

3.    Culture of Innovation

Culture is soil of innovation garden, and positivity is like fertilizer to enrich your plants. Since innovation is synonymous with positive change, the organization's culture is critically important. Organizations that thrive on consistency and predictability are of course excellent at maintaining market share. But this leaves them vulnerable when the market shifts. Joseph Schumpeter's theory of "Creative Destruction" rightly pointed out how companies grow from being innovative challengers to being status quo market share managers. It's their nature. Once that transformation takes place, innovation, in its many forms, becomes more difficult to foster or adopt. What are culture of innovation:

•  An Agile Culture is a prerequisite. That culture requires a transformational leader, high organizational justice (trust), participatory management (employee engagement), and more. Individuals need to be open to new ideas, work in a risk-tolerant environment and have a perception of their own efficacy to contribute and survive changes. 

• A Creative Culture: The key is realizing that innovation is everyone's job (not some special group) and that it is a function of both individual and organizational factors. One without the other won't work. One of the key ingredients in innovating is creating the right environment that encourages creativity. 

• An Encouraging Culture: Encouragement is very important as many people have so much talent that just needs to be developed, and it is about planting that positive seed. such as creativity, diversity, curiosity, value, passion, focus, desire, open minds, out of box thinking, rewards for Ideas, to grow innovation.

4.    Innovative Team

The team is just like plant and flower seeds, it's the only hope for innovation blossom. Beside innovative culture for changes, an effective team with gifted people, with a range of expertise and disciplines AND, most critically, who are still curious, to ensure diversity in the team - Diversity and curiosity are crucial for innovation, the team should embrace visionaries, futurist-minded, problem solvers, idea creators, well mix people from different positions, backgrounds and languages (caused some difficulties at first). Overall the teams need present following characteristics:

• Passion: they were all committed individuals and they energized each other - even doing 12- 14 hour days, to evoke startup spirit in a large enterprise.  

• An inquiring mind and the confidence not to accept things at face value and find a better/ alternative solution are amongst the key ingredients 

• Courage: Creativity requires a certain tolerance for and acceptance of failure (which is more than just risk tolerance). Fear of consequences stifles creativity 

• Learning Agile: Learn from Failures, to innovate means to experiment, to test new hypotheses, and learn from mistakes. Gain inspiration from evolutionary biology.     
      
• Removing "intellectual noise": Thinking about politics, sport, music... is important, even necessary but distract too much. Keeping mind free for creative thinking is something that you can learn. 

• Persistence:  In the face of ignorance, apathy, and fear, it takes persistence to harvest innovation fruit for the long term. 

5.    Processes & Resources to Mange Innovation

Work on an innovation garden not only takes  passion but also need the process and hard work. The process is the key ingredient in managing innovation, since exploring and exploiting are interdependent in terms of innovation. Thus, you can use a lot of time creating new ideas for new products etc. But they will never see the light or, at least, newer be a success if there is not also a focus on exploiting these ideas.

Deploy Systematic Process to avoid Blind Spots: At this point, many of those in positions of leadership are smart, accomplished people who have done well with what they have before them. The issue, however, is that so many fields are morphing so quickly-- we could not have imagined a short time ago--that it is easy for any of us to get caught and comfortable in our own blind spots--and we all got 'em. The key is to acknowledge that last fact: we all have blind spots and it can be uncomfortable and humbling to have them revealed to us--but THAT systematic innovation process is critical if real progress is to occur. So deploy a process that allows the idea to adapt through the iterative process versus to be fixed. Strong innovations are almost always evolutionary. More specifically:

• Defined the problem: When you put right question, you already did half job
• Banned "yes but" - to ensure ideas were heard - not slapped down 
• A wave Pattern of expanding and consolidating ideas - sub-groups all attended feedback sessions 
• Tight time pressure: Stretch up, but not stress out, create a sense of urgency. 
• Iterative Processes: Try making improvements in their workflow, within a system can achieve innovation based on continuous improvement. Innovation like most aspects of learning is best started with small frequent improvements within any organization.
• KPIs to measure result: Well define the right set of KPIs to measure innovation

Therefore, exploring innovation starts with leadership, strategies, and culture, can then naturally flow through to the customers needs. Design then follows. And the focus & rewards of innovation playbook is on core disciplines and ways of logical thinking and systematic processes that are different to creative thinking which is free to form exploration outside the box where the dots are yet to be imagined. It’s the science of innovation management

Read More

TCO: Is It Relevant?

TCO is a cost trade-off and only one of a variety of factors that goes into any decision.

Total Cost of Ownership is often held up as the critical metric for IT performance, the usual argument is being what you want to provide a service at the lowest possible cost, both in terms of acquisition cost and ongoing "care and feeding." Perhaps this makes sense when applied to a commodity; however, overemphasizing TCO puts one into a commodity mindset in IT which spurns talk of misalignment with the business, outsourcing IT, etc. So, is TCO really relevant?

1. TCO is a Useful Metric

In a word, the answer is YES. TCO is indeed a useful metric but is only an indicator of initial capital costs and closely related recurring costs when utilized in most IT-based financial models.  Many components within IT are indeed commodities, but IT itself is a mature and complete business function that must be measured utilizing the same financial disciplines as all other business functions. TCO should be a reflection of the complete IT business function. 

• TCO without activity-based costing is useless. Treat IT just like a business: Strategic Plan for the future; Tactical execution in a cost-effective way without stifling innovation; and proper budgeting and governance including the use of TCO tools as describes for the commodity element of IT. As such, proper TCO measurement is dependent on knowing ALL of the associated costs of any asset or service. In IT, this includes servers, storage, networks, facilities, software licenses, personnel, real estate, etc. Each one of these elements carries its own costs, which in turn must be partially or fully allocated to the asset or service in question. In order for TCO to have real meaning, the costs must be related to accounting methodologies, financial policy, and asset utilization. 

• TCO is a component of a management framework that gets to ROI. TCO is a concept that cuts across typical budget lines. TCO is a combination of tech expenses, marketing expenses, operations expenses, etc. related to delivering a service or producing a product. Yes, TCO is often applied to tech expense today, but often because tech is a significant expense for a large percentage of companies. So, imagine you are running a multi-channel company. You have been asked to cut budgets by x%. Using TCO-related to tech, aligned with the business, provides a view into where tech dollars are being spent. So you, as the CIO or another tech leader of the company can go the business unit owners and say “X dollars of tech expense is used to support your business line, X for yours, and X for yours, etc.” Now, instead of a total tech expense discussion, the discussion shifts to what line of business provides the greatest return, which should be invested in for the future, etc. Alignment of tech expense or TCO by business process, channel, product, etc. provides a more accurate view of the value of tech. To simply try to push off TCO as an invaluable exercise and instead of attempting to fight tech expense. Understanding the expense side of ROI positions the management team to make better decisions not only related to tech, but to all expenses. 

2. Define Value First, Calculate Cost later

Producers do not define the value of the product or service. The “buyer” does. IT does not define the value of the services it offers, the “buyer” of the service defines that value. Where IT must “align with the business” is by clearly defining the features of the services it offers and the costs associated with the various features.

• Build Trust with “Buyers” of IT service: TCO, when done with granular cost pools that reflect the cost of assets and then roll up those costs into service features, is, perhaps, the most valuable tool for developing the kind of evidence that builds trust with the “buyer” of IT services. IT can prove that the combination of quality and price for any given service feature is comparable to the marketplace, or can buy those discrete services themselves for the company in its role as steward of IT and agent for the company. Once the “buyer” of the services can trust the “prices,” then the “buyers” can be given the “checkbook” and buy the services from IT, they wish on an annual basis. That’s true alignment. 

• Don't let TCO kill Innovation: TCO is important but not enough. TCO is a way of understanding your IT costs, but should not be an only critical measure. Cost-benefit Analysis of a solution is flawed if only economic costs and benefits are considered. Besides, the culture of only looking at it from the economic perspective kills innovation through self-censorship. IT should be measured in the way other business units are. You need some innovation to survive and build for the future. 

• TCO is a cost tradeoff and only one of a variety of factors that goes into any decision. Applied by itself, it overrides logic and potentially degrades overall corporate value. The quest may result in applying a metric that may not be the appropriate one for the decision at hand ... not all decisions within an organization are made for the same rationale. If you attempt to uniformly apply all corporate core decision values/principles to each decision, you create resolvable conflict. So it is a collective and prioritized set of factors that goes into a decision, and blindly applying anyone without a rational structure, is a path fraught with peril. Lowering TCO at the cost of losing core knowledge or the company's unique value, is a poor decision at best. 

• TCO is an implication of one principle; prudent financial management, a business voice. The corporate strategic planning will have identified relevant business initiatives and associated metrics (balanced scorecard or other). Financial is only one of the legs of "balanced" decision making. TCO is relevant but it all cases we should avoid both taking the output of TCO or any other metric as the set in stone. There are many qualitative factors to take into use. The principles - core decision values - used in each decision is different. However, these can be defined and allocated consistently, so that everyone makes decisions in accordance with these values. 

• TCO is important to measure but should be only one dimension of the overall decision in a technology purchase A solid risk-benefit analysis needs to be put together before any type of decision is made. Often times CFOs and CIOs are oriented on hard costs vs, soft costs on technology..... and soft dollar costs cannot be ignored to get a true TCO for any technology or service. TCO is just a due diligence thing we check along with many other factors, such as TCO, ROI, Macro and Macroeconomic indicators, etc. There does not exist one tool that can be used to dictate the direction of the organization, you must use an integrated approach. TCO, just like every other tool or model has its role but does not overly simplify the situation, a tool or model is not going capture all the quantitative and qualitative information required to make an informed decision, looking at the full lifecycle, and making sure all factors are included in any decision making regarding cost comparisons and IT management.

Thus, IT first needs a way to define the value to the organization, and to do that – it needs to properly understand all elements of value that are translated to the organization, and how all the pieces and parts of the organization are ultimately impacted, for good or bad, by each new initiative. Total impact and total value should be what need be defined, not just cost. Cost is a component of value – but ultimately what matters most to an organization is value. Therefore, shouldn't organizations be defining value and then measuring that?

Read More