BPM-EAI

You go and ask any retailer these two questions:
What is the percentage of promotions that you execute are completed as intended?
And secondly, what is the value of sales lost every year, just because the products are not available when it mattered most or in typical business jargon a stock-out.

There are many such pain points plaguing the retail industry in an era, when the consumer is getting more and more Value conscious (I won't use the term Price conscious). Truly the mantra is, every penny saved is a penny earned.

Retailers operate in a world that is constantly changing. You need to be agile to be in sync with current market dynamics.

Promotion is one of the corner-stones on which Four Ps of marketing has been built. It is a way through which every marketer tries to capture maximum share of mind / heart / wallet etc. And retailers are no different. Coupons / Pamphlets still hold good in country like India where digital marketing has still got some ground to cover.

One of my friends rightly pointed out. "You need to have an eye for detail in retail".

So what this would translate into, when we talk about promotion. Should we go for promotions across the board or specific to a consumer (a part of wider philosophy called Precision marketing).

So what is the business challenge?
To improve revenue and customer satisfaction by streamlining the promotions' planning and execution process

Can BPM help in achieving the same?
Yes it can. Let's get into the specifics of how BPM can effectively help any organization boost its Top / Bottom - Line by streamlining the promotions process.

To start with general promotions, a system has to be built to track the inventory turnover. Unsold inventory has its own cost (in operations we call it Inventory Carrying Cost). So depending upon the ageing, rules could be built to create promotions periodically. So what could be typical rules, for example?
   1. Age of inventory
   2. Timing (So during start of school season, you would typically want to run promotions on stationery)
   3. Performance of similar promotions and all

In my opinion, do not treat general promotions to build customer loyalty. Rather treat it as an exercise to avoid Inventory Carrying costs and generate quick inventory turnover.

What will indeed generate customer loyalty is specific promotion.
So it is paramount that you get this thing right. So a consumer who is bald, and you send him voucher to give a good hair massage, is sure to appall and might entice him to defect.

So capturing customer profile is mandatory. What you capture would actually depend on in what context you are operating your store.

Next thing to capture would be his / her purchasing pattern. So, if I go to a wine retailer and purchased Heineken 6 out of 10 last purchases and along with that , every time I purchased, for example, a pack of Pringles. So now suppose, Heineken International wants to do a test marketing for its new premium product. The retailer would do good, if it  identifies me as a prospect and offers me a complementary Heineken Premium Beer. This will have a twin-pronged effect. One, it will definitely engage me as a customer and two, it will move me up the value chain, if I like this product.

Another parameter to design promotion would be success of similar promotions earlier.
So all these things could be designed using a robust BPM platform having a similarly robust BAM (Business Activity Monitoring) platform. So can't it be done using the traditional CRM tools? Of course it can be done. Just that you need to do a cost- benefit analysis of using a traditional CRM vis-à-vis a BPM tool. On eobvious benefit of using a BPM tool is to keep business out of IT. Give them what they are best at. Designing promotions, leveraging data from the strong analytics.

With whatever experience I had so far with BPM tools, that they are the most agile thing. So if you want a quick ROI, then probably BPM would be the answer.
I would be taking other opportunities in retail sector for BPM in another blog.

Please share your experiences, if you have been engaged in alleviating retail pain points using BPM.

Posted by Arup Guha at 9:11 AM | Permalink | Comments (0) | TrackBacks (0)

Some simple requirements - can a business implement a new business process or even a part of business process that find problematic today but be corrected in a day’s time. That is define a new process in your Business Modeling tool of BPM, deploy it as you are done, there will be regression test harness that will test out the older test conditions + the new test conditions and give the results and if fine, it will go ahead and make it live in production. Everything seamless, automated to a large extend and peace of mind to everyone. Better productivity and better rewards are obvious results if things happened this way.

In today’s morning print edition of WSJ, this news (for ref) would have caught any technocrat’s attention.
Everybody in general knows and many B-schools professors have articulated the paradigm shift in technology and business where Apple has moved from Mac to i-P* and Google from search engine to Android and now the buyer of Motorola Mobility. But Microsoft didn’t make such waves. Is Microsoft unable to appeal young users other than X-box?
The technological one-upmanship is so critical that even a moment delay in delivering the latest technology oriented product puts the company in back seat. Look at Toshiba, Dell, Lenovo… they are still selling but none of them are leaders and they still have products that are latest but still not the latest.
The thought process however carried this over to systems Integration - whether there is such a similar trend in BPMS, BRMS, SOA and CEP. Or are they still lagging behind in terms of time to market, cost of implementation, cost of maintenance, cost of change or upgrade and overall agility that is expected of technology nowadays?
Another example; In an SOA implementation, one of the service components need to be updated and thus a new version of the service definition should be available. Can it be done in a day’s time? Today, it goes through the usual change management process and day’s time is never feasible to ensure stability and quality. This is not an excuse to compromise quality or stability but an opportunity to do a faster development, testing and implementation. Off-the-shelf governance tool will help in managing multiple versions of the service component with ease and off-the-shelf service mediation will help in compatibility across consumers and producers catering to use different versions.
This is where the system Integration vendors, both on the software products as well as services would need to work on. There are products on BRMS and CEP that makes this quite close to the desired goal where hot deployment, no shutdowns are necessary to get new rules added to the rules engine. Still there is a governance process to make changes to rules that would take more than a day’s time to test and close it.

Ultimately, imagine a business user who conceives a new idea to improve her job and as she thinks, she just draws that concept out on her iPad or Playbook with an app for BPM tool where there is no restriction to use specific notations but whatever comes to the mind and whatever the hand can draw. The partial intelligence is however in the app that translates that into a standardize BPMN based model and creates the byte code equivalent deployed for runtime, goes through the software life cycle automatically and finally available in production just in a matter of milliseconds and then we realize the objective of “BPM at speed of thought”. Obviously this is quite simplified but should not surprise if it happens anytime in near future.

Posted by Narayanan Chathanur at 5:32 PM | Permalink | Comments (2) | TrackBacks (0)