BPM-EAI

There seems to be many similarities in the life-cycle of a home-maker with that of IT folks in Enterprise. Neither can ever achieve the nirvana, of less work and more output.

Of the many promises that SOA assures Enterprises of, the prominent one is the reduction of burden on developers, maintenance personnel, engineers et al, who are commonly clubbed under a banner category called IT folks in an Enterprise.

Let us look at this one particular promise from a different perspective, by comparing this SOA fever in today’s IT World with that of electrification of households in early 1900s.

Taking a straight lift from Nicholas Carr’s recent book, “The Big Switch” which provides a deep insight into the electrification fevers of early 1900 and then later we will take a look at the SOA fever of 2000s.

{Page 89 - reproducing the same for giving the readers the actual words used by Mr. Carr}

The Utopian Rhetoric was not just a literary conceit; it proved to be a powerful marketing pitch for the manufacturers of electric appliances. General Electric was particularly adept at playing to people’s native optimism about technology. During the 1920s the decade in which the pace of wiring the American homes peaked, the company increased its yearly promotional expenditures from $2million to $12 million dollars. It devoted much of the money in installing in the public mind what is called “a positive electric consciousness” through a concerted program of magazine advertisements, pamphlets and presentations at schools and women’s clubs. Typical of the campaign was a booklet called ‘the home of a hundred comforts’ which described in flowery prose and futuristic illustrations how electric appliances would eliminate most household work, bestowing a life of peace and leisure on formerly harried home-makers. Having electricity in house the companies marketers proclaimed would be like having 10 home servants.

Whether conjured up for literary or commercial purposes the Utopian future never arrived. Cheap electricity brought great benefits to many people, but its effects purely played out as expected and not all of them were salubrious. Tracing the course of some of the most important of those affects through the first half of the last century reveals the complex interplay between technological and economic systems and their equally complex ways it exerts its influence over society.

Later in his book, he provides some insights which can be anti-thesis to the so called benefits.

{Page 99}

As it turned out, though, the electric iron was not quite the unalloyed blessing it first appeared to be. By making ironing “easier” the new appliance ended up producing a change in the prevailing social expectations about clothing. To appear respectable, men’s and women’s blouses and trousers had to be more frequently and meticulously pressed than was considered necessary before. Wrinkles became sign of sloth. Even children’s school clothes were expected to be neatly ironed. While women didn’t have to work hard to do their ironing they had to do more of it, more often, with more precision.

{Page 100}

A series of studies of the time women devoted to housework back up Cowan’s observation. Research undertaken between 1912 and 1914, before the widespread adoption of electric appliances, found that the average woman spent 56 hours a week on housework. Similar studies undertaken in 1925 and 1931, after electric appliances had become common, found that they were still spending between 50 and 60 hours a week on domestic chores. A 1965 study again found little change - women were spending on average 54.5 hours per week on housework. A more recent study, published in 2006 by National Bureau of Economic Research, also found that the hours housewives devoted to domestic work remained steady, at between 51 and 56 a week, in every decade from 1910s through the 1960s.

There might be many reasons for the no-change state of amount of work, while the primary reason was the push in the levels of cleanliness. An office employee might have been forgiven for crumpled dress before the arrival of electric pressing machine (Electric Iron). It is supposed to be easy to press cloths with the electric appliance hence it is mandatory for one to have pressed his/her cloths. Earlier carpets were cleaned once in a while (hence the term “Spring Cleaning”) as opposed to current once a week routine, if not once a day.

Due to this perceived notion of “ease of work” the workload remained repetitive due to the changes in the social norms; while expectations changed due to these widely canvassed “easy” perceptions.

Here, we can draw a comparison between the frenzy electrification and the todays frenzy SOA-fication of Enterprise IT.

Will SOA not change the “perception” of Enterprise business folks towards IT folks?

Will not these so called “ease” of development, lesser “time to market” and flexible maintenance, create a new set of business norms? Will this ease not overburden the IT folks, else at least make them do repetitive tasks like cogs in machine working for the Enterprise will?

Before the advent of “packaged” applications, businesses depended on the multicolumn spreadsheets and also were tolerant of certain omissions, due to system limitations; compare the same with a packaged application, where everything is supposed to be out-of-the-box, yet the IT folks are found spending their energies in “customizing” the out-of-box features.

I would like to draw attention of the readers to one particular sentence in the above write-up from Mr. Nick Carr.

It devoted much of the money in installing in the public mind what is called “a positive electric consciousness” through a concerted program of magazine advertisements, pamphlets and presentations at schools and women’s clubs.

Doesn’t it sound threateningly similar to what our today’s magic quadrants and analyst reports talk of? The innumerable conferences, summits, road shows, webinars etc trying to instill in Enterprise minds the benefits of SOA and countless dollars spent by businesses in POCs to peek into the SOA world.

Can we draw safe conclusions that like the ease of electricity increased or rather did not affect the workload of homemakers; SOA too will not or cannot affect the burden of the IT, instead may increase the burden?

Purists may argue that “efforts” measured purely in terms of time is just one part of the whole equation, while the output or the value created is another significant part. There again, how does one define “value”?

What appears to be a “value-add” today becomes “norm” or “hygiene factor” near soon, this has been already shown as in the case of electrical appliances by Nicolas Carr. What is today “disruption” will be tomorrow’s “legacy”. This is exactly the part of “Innovation Life Cycle”.

I rest my case here, for the readers to ponder over…

Posted by Anil Prasad Kurnool at 4:01 PM | Permalink | Comments (2) | TrackBacks (0)

There is always something to learn when nature creates ruckus such as the recent Japan earthquake plus tsunami cascading its effect on radiation leak but through man-made nuclear reactors. Most of the organizations create Disaster recovery (DR) processes and DR data centers to ensure that the businesses work as usual or with minimum downtime. Most of the IT platform kicks up activity in DR center if the main Infrastructure data center gets affected by similar disasters though even on very lesser scale such as a simple case of power failure.

A simple question is what is the effective way to plan and create strategy for DRs and high availability? There are some traditional but effective thoughts to it.

1) DR centers need to be geographically separated in risk assessment of disaster that a center could be prone to. For e.g., having one Data center in Houston, Texas and other in Morgan City, Louisiana is not of much help as both are similarly prone to Hurricanes. Similarly even having one in Indonesia and other in Hawaii though geographically separated have similar risk profiles. The risk profiles of DR centers should be different and complement each other and not be similar.

2) DR centers are not a Fault Tolerant replacement. This is one mistake which most of the organizations do by using the DR data center as a fault tolerant pair for their applications. For e.g. for any failure of application in the main data center, the corresponding application is failed over or started in the other data center (DR) to maintain high availability. Though this is a easy choice but it is not the objective of DR center. DR center ideally should have a carbon copy of high critical applications (one doesn’t need all applications in case of a disaster) with same configuration up to the hostname and network id such that when it starts, it actually acts as the main infrastructure provider for the duration that is required to bring the main center up without affecting any changes to any applications. The principle is to keep the logical layer IT layer same for the business process whether the physical machines are run in main data center or DR doesn’t matter. The tendency is to make some use of DR since there is a cost to set it up. DR is an insurance against disaster and thus the investment should not be looked on for generating returns.

3) High Availability on the other hand does not directly or indirectly translate to having a back up in a remote center such as DR. HA is to provide mechanism to zero downtime to business during normal business operations. For e.g. an instance of an app A goes down due to any glitches triggered by software or hardware problems, another instance of App A is configured in a different machine in the same DR probably in the same network domain that will pick up the pending work and service the business operations.

4) Having a load balanced configuration (also called active-active) is to serve a different need than fault tolerant configuration (also called active-passive or swappable). Most of the time both are used in hybrid. This only increases the infrastructure footprint unnecessarily adding to the cost.

5) Last but not the least the statement “Cloud computing platforms will take most of the burdens from the organization on this front” is a viable alternative.

Posted by Narayanan Chathanur at 8:07 PM | Permalink | Comments (0) | TrackBacks (0)

There is a lot of information on Internet about getting Social Networks into Enterprises. Tonnes of Thesis to say about all the good things that Social Networks can give to Enterprises, many case studies of such endeavors quoting the “savings” etc.

How about the reverse, taking Enterprises to Social Media?

Imagine a scenario from the game of “Farmville” a person goes from one village to another to buy some goods, then the seller transfers the goods to the buyer and buyer pays the seller money. All this happens virtually, where no “real” money is exchanged and no “real” goods are transferred.

If we extend the same to real world, where the real money is used and the seller is a real seller of goods. How does the scenario unfold?

Now think of a networking portal like Facebook, called “CitizenBook”, where real people register with their real ids and bio-metrics. Their addresses are virtual reflection of their real places of living, while the currency used in transaction would be the same as the currency of the country they reside. The sellers are real sellers of goods (say for groceries Kroger opens an app/shop in CitizenBook and for automobiles Toyota opens an app/shop in CitizenBook.)

As in the game, a person logs into the CitizenBook and goes to the seller and buys what he/she wants. The real money is transferred to the account of seller from the buyer (as is the case in Facebook’s virtual money) and the real goods are delivered at the real doorstep of the buyer.

Good! Where does the Enterprise fit into this all? These transaction on CitizenBook would be a click or two on the site (as is the case in the game) but in the backend the real enterprises doing the business on the portal would need to start their “real” processes, with help of their EAI engines to start off a series of well orchestrated business processes to enable the complete round trip of the transaction, shopping cart, billing, delivery of goods, transfer of money from one account to another.

For marriage registration or for getting married, one needs to change their “status” on profile and point the same to the spouse’s profile, with the “approving authority” to approve of the change. The printouts can be used in lieu of marriage certificate. While profile page’s “nationality” would be equivalent to the “passports” and currently “living in” would be showcasing the domicile of the person.

The Enterprise class applications need to run behind the scenes with EAI/BPM tools to ensure smooth orchestration of processes and workflows. If the Enterprise is taken to Social Media, governance would be more of a game than bundles of bureaucracy. Shopping online would not be so complicated and life would easy. The very reason why Social Networks caught on the Netizen’s like wild fire is due to simplicity in their use and hassle free way of doing things.

Is it possible? Yes, it is! Think about it! There are few “shops” already, not a part of any game though! One can buy Reebok or Nike Shoes at Facebook, order flowers etc.

Of course, purists would argue that there are many holes in this thought and may call all this as scientific fiction. May be in near future, we can look out for these kind of things, as traveling to moon was fiction till late 1960s. Only future will tell…

Posted by Anil Prasad Kurnool at 10:49 AM | Permalink | Comments (5) | TrackBacks (0)

Contact center or call center in day to day parlance, plays an important role for any organization in quite a number of ways. It helps in retaining customers by logging and resolving their issues at the earliest. 

Imagine, you are a credit card customer and you lost your card at around 10 at night. What if, there was no contact center. Hmmm, pretty scary scenario. I would have lost sleep and counted hours as to when would bank open and I get a chance to lodge a complaint. But, hurray, no need to lose sleep. Contact the contact center and block your card and place a request for duplicate card. Your new card would be delivered at your door step, albeit for a charge though. 

Contact Center also helps in customer acquisition. Most of the unsolicited calls from the contact center typically fall under this category. Like last week itself, I got a call from a private club for membership. Besides, contact center can also play a role in increasing customer life time value by engaging in cross-sell and up-sell. 

So you can appreciate how big a role, a contact center plays for the goods / service provider as well as customer.

Can BPM help in automating some of the processes that are in place in a contact center setting? Can BPM help in making the system intelligent enough to suggest for what reason a customer might be calling? Certainly it can.

Before I elaborate further, one question might cross your mind. Who's the customer I am talking about? Is it the user of the system or may be person like me, who calls up the contact center. I would like to clarify that, in this blog I am trying to capture how this particular application tries to enhance the customer (You and me) experience.

The core process for any contact center is typically like the following with few steps here and there.

In places like Banks, Search Customer and Verify Customer has been automated with the advent of T-PIN, so that you need not verify yourself again during the call. However, in other scenarios like, what I encountered in two-wheeler insurance, when you call, you would be asked certain set of questions to verify your identity. So in latter case we have two scenarios. Either after the agent has selected the customer, he / she is presented with a screen of customer details based upon which the agent will ask relevant questions. Or, you present a screen capturing only the security question details. In my opinion, the latter opinion is better as the chances of human discretion are alleviated and standardization of service is enforced. 

So what after that? Customer would ask for certain services like Address Change or Contact Details change etc. Most of these processes would be work-flow based. So why not have a BPM application, where in you can launch these processes at the click of a link. So what would be the POD (Point of Differentiation) of a BPM application over let's say Non BPM application?

The area where BPM application would score over a Non BPM application is the Case Management feature that most of the BPM tools provide. Remember that a call center is the face of the organization. Even if you have problems with Marketing, Finance, Product department, it's the call center agent who will listen to your grievance.

So in what other ways we can enhance the customer experience. One way is to empower the agent himself. An agent is expected to have an answer to all the queries. One way is to put the agent through exhaustive training. Jeez. Lots of overhead. What's the alternative? Have a robust Knowledge Management. Attach links, files to the flows to 'empower' the agent. For example: One frequently used service process in banking industry is to enquire about different charges. Attach a link or file explaining all the charges. Bravo. I definitely won't mind a knowledgeable agent on my part.

Why else you would even call a contact center? Reward Points. Ring a bell. Campaigns and Offers would be the next logical topic to discuss. Can we utilize business rules to determine what offers and campaigns to present to the customer during the call? Consider this. Why can't system group similar consumers based on age, income etc and depending upon past usage of offers of similar customers, the system would prompt the agent to dole out a similar offer to the current customer. Just an example.

Although my blog has a customer centric flavor. But the benefit is not just restricted to the customer. In fact, if I am allowed, I would call it a Benefit chain. Let's have a look at the benefits from various viewpoints.

Customer's Viewpoint:

A tailor made interaction, with additional offers and campaigns based on past relationship and interactions. Not much of a difference from a traditional application. In fact, whatever offers I might be getting prior to this new application, post installation of this new BPM Application, I won't be getting any new offers. On second thoughts, there might be certain value adds that a customer might be getting. Probably I am missing something. Would certainly like to have a discussion on this aspect.

Agent's Viewpoint:

Knowledge Management capability would help the agent in reducing Average Handle Time as well as First call resolution rate, both of which are important KPIs in this industry.
Less Human Intervention since the interaction would be more or less system driven.

Business' Viewpoint:

Since most of the processes are driven by rules, business rules could be delegated to the business users as in a traditional BPM application. Like for example, how much discount an agent can give to a platinum member. Today it is 5 %. Tomorrow, the business might want it to be raised to 10 %. So business can directly take charge and do the change instead of relying on IT department.

Whatever I just talked about is not rocket science. We do have vendor tools that try to do exactly the same, whatever I have mentioned. The objective of this post was just to sensitize how BPM methodology could be leveraged to automate customer centric processes in this industry, where any miss can prove costly resulting in a lost customer. As they say, it's 6 times as costly as to get a new customer rather than maintaining an existing one.

Posted by Arup Guha at 6:05 PM | Permalink | Comments (2) | TrackBacks (0)

This is an interview with the Pega and Infosys thought leaders about their views on Warranty Management.

Sudripto De, Principal, Infosys Technologies has published several articles on Warranty Management in industry journals and Research Technical Journals including WarrantyWeek and International Journal of Product Development (IJPD)

1. What are the main cost drivers in Warranty management from your experience and how can they be controlled?

   Setrag: There are a number of challenges in Warranty Claims management. The two, often conflicting, objectives are controlling the cost of managing warranties and improving the customer experience in Warranty claims management. A related challenge is controlling the entire supply chain for managing cost, quality and responsiveness. There is also a regulatory and compliance cost for accurately predicting future warranty outlays to set aside the correct capital. The main approach in controlling and improving warranty claims management is automating the entire spectrum of policies and procedures within these challenges, through a Warranty Claims BPM suite solution.

   Sudripto: This is a great break-up of the warranty cost contributors by Dr. Setrag. To add some more indirect costs - we need to account for the transactional costs of warranty operations, the logistics costs of warranty returns and the cost of capital when warranty managers block huge warranty reserves which leads organizations to obtain external debt for meeting their additional working capital requirements.

   For global organizations having sales of their warranty secured products across multiple continents and countries, the transactional costs and reverse logistics costs are huge. Some of the Hi-tech consumer goods and telecom device manufacturers have to hold close control of their operational costs. Managing a balance between reserves and actual warranty spend is a forecasting aspect, fraught with inherent issues of errors of estimation. The best way to manage these costs is to develop an agile warranty management system, which captures trends early and provide feedback for timely adjustment of warranty policies and procedures. I would add to Dr. Setrag’s remarks, and say, that an integration of the BPM suite based claims management with the warranty claims analytics system would be the recommended solution.

2. What are the typical expectations of a Warranty Management Solution from a customer perspective?

   Sudripto: First of all it is necessary to define the customer. It could be the service provider or dealer or service station, the extended warranty insurer and/or the end user of warranty secured products.

   Take the case of the customers of warranty who are the end users of the products. As against automobile consumers who have initial period of free-of-cost warranty replacement assurance, consumer experience of high-tech and other construction equipment is based on the warranty that is “bought” during buying the product. A higher cost of warranty package would lead to a threat perception of the product’s reliability and may adversely impact the product’s sale.

   Ideally, to convince customers to buy products backed by reliable performance and assured claims management service, organizations should have efficient claims management system which improves visibility across the claims management process with a blend of manual and automated claims management.

   Setrag: As noted above, the customer experience in managing warranty claims is critical. Looking at the customer complaints generated by the service providers and dealers, usually the warranty agreement is based upon cryptic agreements and rules on executing the claim. Potential of errors in processing claims or misinterpretations are considerable.

   The other end of the customer experience is processing the Warranty which often includes third party suppliers and the overall service for the claim. Since these players are third party players in the warranty arena, the wide range of coverage and the ease of settlement of claims drives favorable customer perception.

   As Sudripto suggests above,all these three areas are best addressed through automated and controlled policies, procedures and end-to-end processes involving different parties - through a BPM Suite. The BPM suite can directly capture the procedures and policies (business rules) of warranty claims management and also automate both the claims as well as the ability to apply the most appropriate policy for a given context

3. What are the various ways in which people and process integration have improved warranty performance?

   Setrag: One of the challenges to Warranty management is the fact that traditional warranty approaches have been inflexible, with either mostly manual processing or having warranty rules ossified and buried in code. The modernization of the warranty claims management through a robust BPM suite solution is key to improving the visibility, automation, and overall continuous improvement of warranty claims processing. The involvement of the business to discover and define warranty rules directly has been critical in manufacturing organizations that have deployed BPM based warranty improvement solutions. The business policies and procedures get typically harvested from multiple “legacy” systems. With BPM the organization gets complete visibility as well as a platform that can easily introduce or change new rules and/or processes for end-to-end management of warranty claims.

4. Why is there an increasing need for agility in Warranty Claims Management? Does this relate to continuous improvement?

   Setrag: There are several aspects of “agility.” While executing the warranty claims, several unexpected events could arise. So it needs to be processed in a controlled fashion - while having the flexibility in handling the events in the context of the warranty case for the customers. Thus this aspect is the dynamic case management capability that is essential to handle unexpected events or situations. The other, perhaps even more important aspect of agility, is the ability to quickly introduce new decisioning policies, or specific specializations for new products, new suppliers, new markets, new customers, jurisdictions etc. - and be able to execute the most appropriate policy or procedure for a given context.

   Sudripto: As explained by Dr. Setrag, agility manifests as flexibility and scalability. In addition, there should be efficiency of operations and granular standardization of processes which enables high degree of re-use. It is not just a matter of continuous improvement but continuous adaptability to changing market needs.

Hear more from Dr. Setrag and Sudripto De on “How Agile is your Warranty Claims Management Process?” at the Warranty Chain Management Conference on March 17 at 13:15 PST.

Posted by Dr. Setrag Khoshafian at 1:48 PM | Permalink | Comments (0) | TrackBacks (0)

Alright! So after a long hiatus, I am back to blogosphere, penning down my thoughts.

Not so many days ago, my marketing professors used to chant one word pretty frequently - Customers. In fact, there is even a framework called Stakeholder Framework sometimes used by Strategy makers with Customers being one of them. So we have several Jargons that you would typically hear when you happen to be in some board room meetings of marketing honchos - Customer Acquisition, Customer Retention, Customer Attrition, Customer Churn and last but not the least, Customer Relationship Management. The last one has also brought fair bit of moolahs to several organizations within this industry.

Well, even a layman can possibly answer what value does customers bring to any organization or for that matter to anyone who has got goods or services to offer. So what makes me bring this topic to this forum?

Well if we have a look at the broader picture, whenever an entity deals with a customer, certain process is always involved. Be it Customer Acquisition or even managing Customer churn would involve certain set of processes. And in this era, when business users are paying a whole lot of attention to optimize / automate processes to yield better ROI, how can we neglect BPM whose USP is to give you better ROIs in terms of process results.

So where can BPM fit in the customer processes, if I am allowed to call it that way. Let's start with Customer Acquisition and try to fit some elements of BPM into it. Okay, so I go to Shopper's Stop (a department store chain operating Pan-India). I do some shopping worth INR 2000. I go the billing counter and there he asks for my mobile number. On inputting the same he finds that I am not a First Citizen card holder (Loyalty Card system). So here the counter person's discretion comes into picture. Should he or should he not offer me the loyalty card? So what can BPM do here? Bring some automation. Change the process. Get some business rules. Okay, so this person has spent more than 2000 Rs every time he's visited Shopper's Stop in last 3 months. Throw an alert on the screen and offer the customer a platinum loyalty card (of course if such a thing exists).

Taking it further, how to handle Customer Defection or Churn. There is a minor difference between the two theoretically with churn rate being ratio of customers lost and new customers gained while defection rate being percentage of customers leaving a business in a year. However, the bottom-line is, every business wants to minimize churn. Let's understand this from a call center scenario about how BPM could possibly help in minimizing churn. Since MNP (Mobile Number Portability) has kicked in pretty recently in our country, which has done nothing but empower the customers to choose what is best for him or her, I would try to correlate with telecom sector. So one fine day, I call up my existing operator contact center regarding some discrepancy in my mobile bill. I am absolutely furious about the additional charges they have levied. So the agent takes down my request. However, I have every right not to feel happy about the entire episode. Thankfully, the issue is taken care of and all the additional charges are waived off, quite correctly so. So the question is would that make me feel happy. I would say probably not. Mind you, I am satisfied but I am not delighted. In this fiercely competitive world, customer satisfaction is now a point of parity. Organizations should aim to delight the customer. So how the process should be tweaked so as to bring maximum value to the customer as well as organization?

One possible way is to automate the offers process where in what offers a customer is eligible for is calculated based on his past disposition, customer lifetime value as well as customer's propensity to use any particular offer. However, this is just a vague solution, just to give you a whiff of what could be possible if we tweak our processes a little bit here and there.

With this, I would bring this piece to an end. Since this article doesn't focus heavily on technical aspects, I solicit responses from BPM evangelists to share their experiences in this forum that would benefit newbie like us immensely.

Posted by Arup Guha at 7:11 PM | Permalink | Comments (2) | TrackBacks (0)