AIIM have released their annual report on the state of the BPM industry which is based on the experiences of over 450 BPM users within the AIIM community, this report details how long the payback period might be and the likely return on investment (ROI) across a number of potential process types.
The study also covers the biggest project issues and critical factors for success. Users told us where they prefer to buy their BPM tools and what features and functions they have found to be most useful.
It also goes on to reiterrate the point that most practitioners of BPM and Enterprise Architecture have known for many years and I have seen with most customers I have worked with over the years.
Business Process Management (BPM) is not widely recognized as a single software product or even as a suite of related software tools. It is, more accurately, a business management practice which might utilize a number of dedicated software mechanisms.
…BPM takes on both broader and deeper aspects. Broader in the sense of integrating with other enterprise applications, taking in electronic forms and edocuments, populating transactional databases and providing a single point of interface for users. Deeper features include process modelling and simulation, reusable process modules, and process monitoring and optimization.
By its nature, BPM is an intrusive technology. It has an excellent track record of investment return largely achieved by changing and re-shaping business processes for higher performance. As an agent of such change, the implementation of BPM presents many challenges, particularly when a process crosses departmental boundaries, or when the proponents of the BPM project are not from within the Line of Business affected.
Key findings from this BPM report include:
- 63% of responding organizations consider the importance of BPM to be significant or imperative.
- Hard-dollar savings from “Improving process throughput” and “Reducing process steps” are the two biggest drivers for BPM, followed by “Improving accuracy and repeatability”.
- 49% of organizations achieved payback of their investment in BPM tools within 18 months and a further 23% within two years. Additional projects are taking around 8 months on average to complete.
- 62% of those polled consider they have only addressed 1/5th of the potentially profitable BPM projects.
- Accounts payable and accounts receivable processes showed the strongest success factors, followed by customer support cases, proposals and contracts, and claims processing.
- In a third of organizations, BPM projects are likely to be initiated by Line of Business managers, whilst in another third, IT take the lead.
- Integration with other systems is the biggest technical challenge faced by our respondents.
- The strongest indicator for successful BPM processes is the presence of an existing process owner.
- 35% report that they have applied BPM to scanning all incoming mail.
- 6% are currently extending managed processes across the supply chain, but 19% have plans to do so.
- Just 4% of organizations are currently outsourcing BPM-enabled processes but this is set to rise to 18% in the future.
- In this sample, organizations are most likely to use BPM functions within DM/ECM systems (26%), followed by those using specific BPM functions in enterprise suites. Third is custom development and middleware, ahead of dedicated BPM suites (13%).
- 11% of organizations currently use BPM functions in SharePoint, and this is set to treble to 34% in the future, largely from new BPM users, and particularly in mid-sized organizations.
- Spending on BPM licenses looks set for a net increase over the next 12 months, with spending on BPM services and consultancy set to increase significantly.
- 36% look to buy their BPM tools from their existing ECM supplier, with 25% buying best-of-breed tools, and 23% preferring dedicated BPM suites.
With the current economic pressures, investment projects that show near-term payback are likely to be favoured. BPM scores very well, with 49% showing return in 18 months or less, and 72% within 2 years. These returns are most likely to be from a first project, with additional projects likely to show an even faster return. As is common when we ask specific ROI questions, many organizations do not measure improvements (31%), limiting their ability to justify future projects.