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Embrace complexity, Simplify your organization

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Simplify your organization 1 . independent software vendor. In addition to traditional business process management techniques and technologies. To deal with business megatrends such as mass customization and customer self-service. the old “best practices” no longer suffice. we outline the principles which constitute the foundation of the Be Informed business process platform.Executive summary When reality changes. the extent to which this needs to be improved. Thanks to Be Informed’s unique approach to dynamic case management. Be Informed is an internationally operating. new practices and technologies are needed to enable what analyst firm Forrester calls dynamic case management. We also explain how business processes can be tested to establish their level of knowledge-intensiveness and. administrative processes have become more knowledge-intensive. if relevant. and a reduction in time-to-change from months to days. The reality of business processes has significantly shifted. Embrace complexity. In this paper. Finally. the next wave after business process management. we explain how the transition can be made from process-based operations to a more case-based focus. Further benefits include a much higher straight-through processing rate leading to vastly improved productivity. which are becoming increasingly knowledge-intensive. The Be Informed business process platform supports administrative processes. organizations using Be Informed often report cost savings of tens of percents.

sociodemographics. and most organizations feel that increased control is of key importance in order for their business to survive and thrive. it wants to schedule all appointments and procedures for a patient on a single day where possible. Over the years. damaging to future business performance potential. Would it be acceptable for the agency to reject changes because its processes. complexity of systems and the complexity of the organization itself. the many pre and Embrace complexity. based on age. companies have built complicated systems and processes. It encompasses all the systems. But there is a difference between what makes the world complex and what makes it complicated. Complexity is the enemy of control. Again. Complexity of processes. “Old-style” optimization would consist of large batches of similar appointments and procedures. They have to deal with tens of thousands of rules. or that country’s nationality. However. and customer preference. asset value to be insured. but this has rarely given them greater control. Consider the following examples: • An insurance company that has a strong customer intimacy strategy wants to offer personalized cover. resulting in multiple visits for patients. while others require them to have a full stomach. Complicatedness is a human concept.Introduction “Reduce complexity” is one of the most important mantras in the board room. some examinations require the patient to abstain from eating. and that the company should settle for standard products and services? • Within a country’s immigration service. it is simply the way the world is. rules change multiple times each year. the right to work or live in that country. Simplify your organization 2 . Furthermore. Wrong and. Complexity is a natural phenomenon. On the contrary: complicatedness leads to less control. systems and organizational activities cannot handle the complexity? • A hospital wants to redesign its processes. Now. As logical as it may sound and even feel. processes and exceptions organizations have created. this intuitive reflex may very well turn out to be wrong. in the worst-case scenario. Should the IT department inform the CEO that the systems are unable to handle the complexity. with all its diversity and change. ranging from country-specific regulations to supranational legislation such as European Union policies and the specifics of the many treaties with other countries. This could easily result in billions of combined forms of cover. inefficient operations and a growing distance from the customer. civil servants assess whether applicants should be granted a visa.

A McKinsey report outlined the business case: “If complexity. How can full observance of the conditions be ensured? Complexity cannot be reduced. not as a problem to be eliminated. in all its aspects. McKinseyQuarterly. people and organizations create bottlenecks which obstruct the process of dealing with the natural complexity in the world. Companies reporting low complexity [which we refer to as “complicatedness”] had the highest returns on capital employed and returns on invested capital. systems. businesses can generate additional sources of profit and competitive advantage. Instead.” 1 1 Source: Cracking the Complexity Code. May 2007 Embrace complexity. In attempting to achieve this. a competitive advantage in the private sector or sustainable government in the public sector can be achieved through a different competence: embracing complexity. processes. Simplify your organization 3 . is seen as a challenge to be managed and potentially exploited.postconditions for procedures could easily lead to billions of combinations.

Embrace complexity. The list of possible disruptions is endless: the introduction of Sarbanes-Oxley regulations turned business operations around. until. Figure 1: S-curves 2 This moment is often referred to as a “black swan”. something unexpected happens again (see figure 1). to “go with the flow”. after a new S-curve has been adopted. It may have been risky in traditional business management. but the opposite is true. providing them with the means to do their job. In fact. A black swan represents something thought impossible (within the existing view of the world). something unexpected happens2. at a given moment. A new way of working is needed. Then. Usually. and their return is also lower. Simplify your organization 4 . business performance can drop even further before it goes up. S-curves Reality shifts like S-curves. but if reality shifts. the credit crunch turned public opinion on business conduct around. A new trend starts slowly. This may sound risky. instead of telling them what to do. as the old ways no longer suffice. This means enabling your customers. at a given moment. new ways of working are not as proven.Embrace complexity… In order to embrace complexity. so must best practices. call center agents. In other words. we need to shift from a control-driven approach towards an approach of empowerment. globalization turned corporate thinking around. takes off and becomes the new paradigm and “best practice”. Then the new S-curve becomes the next best-practice. citizens and so forth.

manufacturing processes were optimized through mass production. mass customization is the norm – a new S-curve. In the 1980s. this could not be further from the truth. Insurers can offer personalized cover. There is almost no vertical where mass customization has not become a key value proposition.. can often be ordered in millions of different configurations. by means of the same process. Mass customization and customer self-service Administrative processes are now mass-customized as well. When customers take over the front-office work. In companies that have mass process customization. Much faster than in manufacturing. the company’s costs are reduced and high-quality data is ensured (it is in the customer’s best interest to enter their data correctly). Cars. they have already in the past. Mass customization is often combined with another principle: self-service. it strengthens the company’s value proposition..If trends develop like S-curves in general. online check-in for flights. In of Embrace complexity. From the beginning of the industrial revolution to the days of Frederick Taylor’s scientific management. in its original meaning. Bureaucracy. was invented to treat everyone equally. Nowadays fairness is defined differently. Doing business is a process of continuous interaction and collaboration. car and hotel reservations via airline companies. both online and through other channels. Moreover. then trends in the world of business processes most likely follow the same pattern. Marketing departments use microsegmentation to offer discounts and special offers. Today. Administrative processes have roughly followed the same path. and almost seamlessly. the next S-curve followed. making back offices lean and efficient.. Internet banking at financial institutions. Indeed. Particularly in administrative organizations. Most people would be familiar with the quote that the T-Model Ford could be delivered in any color “so long as it is black”. and other manufactured products. the best practices government agencies give every citizen the the old world are useless same special attention. It means that a new S-curve. as customers are requesting self-service capabilities. These are all examples of customer self-service. They choose which customer contact channel is used in each process step and perform those tasks at a time which is convenient for them. The advantages are clear. The principle of mass customization is also very prominent in the public sector. customers are effectively directing the organization’s processes. and every product can be a unique combination of characteristics. this is the new norm. self-direction of the building-permit process. Today. As a result of mass customization and self-service. Simplify your organization 5 . business process re-engineering brought the first levels of operational excellence for administrative processes. there is no longer a difference between the front and back office. based on their specific circumstances.

Trying to run a process like this with a traditional business application – the result of years of business process re-engineering – is challenging. and execute with maximum precision. Gartner Symposium. It is one level up: from optimizing operations to optimizing the change of operations. “stick to reality” Knowledge-intensive … Embrace complexity Table 1: mass production and mass customization 3 Michele Cantara. and the process consists of those rules and activities which specifically contribute to the goal. the goal is to successfully complete the process. Gartner said.” 3 The best practice in the old S-curve was to optimize operations through deliberate and careful analysis. Being able to change the system only twice a year when there is a new software release is simply unacceptable.Traditional business applications pose challenges Control-driven processes no longer work. In short. In fact. business-driven Keep options open. Mass production • • • • • • Every transaction is the same Control-driven Two changes per year (system release) Advance choices. When there are billions of combinations. Simplify your organization 6 . “stick to the plan” Process-intensive … Reduce complexity Mass customization • • • • • • Every transaction is a unique instance Goal-driven Continuous change. 2010 Embrace complexity. to say the least. Table 1 contains a list of characteristics of mass production and mass customization. In a mass-customized world. “stick to the plan”. The only way forward is to define goal-oriented processes. “30% of organizations like to make changes to processes on a daily basis. it is simply not possible to define and document every possibility and exception. every transaction is now a unique instance. Gartner Research VP. Recently. Cannes. the only thing you can do is “stick to reality” and optimize operations by keeping all your options open.

Embrace complexity. or with an object such as a building.…Simplify your organization Great. business in control Declarative … innovative business process platform. case-based processes Knowledge-based environments (why it needs to be done. services and business processes? The great leap forward comes from abandoning the central concept of the old Scurve: the process-centric approach. the process needs more hardcoded exceptions. using ontological metamodels Table 2: process-based versus case-based Embrace complexity. there are no unnecessary steps. A case can be defined as all the work that needs to be done to achieve a certain result for a customer. Table 2 compares the process-based approach with the case-based approach. this is called a prescriptive approach. for example. business rules engine Case-based approach • • • • • • • • Non-linear. The context of the case solely indicates which activities are required in order for the case to be completed. inductive User follows the process Syntax-based. There is no predetermined sequence or set of activities that needs to be completed. IT instrument Prescriptive … traditional business process management suite. Simplify your organization 7 . But how? What if you are stuck with the systems you have? And what if your employees are already handling the maximum of complexity they can cope with? What other choice is there than to try to reduce complexity and start standardizing products. Great. Process-based approach • • • • • • • • Linear. not the process. deductive The process follows the user Semantic. In more formal terms. This approach dictates that transactions need to follow the process. fuzzy. and that the moment transactions do not fit with the process. discrete processes Procedure-based environments (what needs to be done next) Build the process Bottom-up. The case-based approach If you turn it around. We get it. what it contributes to the goal) Build the guardrails Top-down. the complexity problem disappears: put the case at the heart. clear. This is more formally referred to as a declarative approach. instead of trying to reduce it.

the disadvantage is that it has led to the process spaghetti that many organizations suffer from today. The actual process – which will be different as each transaction is passing through the process in a (slightly) different way – becomes nothing more than a metamodel that states only what has to be done instead of how and in which order. This means that after many specific processes have been defined. It simplifies the organization and allows organizations to embrace the inevitable complexity presented by their environment. These new insights can be applied when these predefined processes are revisited. Simplify your organization 8 . billions of different combinations can be made. while the metamodel ensures every single instance is valid. instead of defining a road. the old logic of having to fully define a process upfront disappears. Once the metamodel is approved. putting the process metamodel together first. Today. more generic business rules appear. This new way of thinking. Individual transactions then all use components of this metamodel to effectively create the singleinstance process. Putting the case in the middle greatly reduces the complicatedness of business process landscapes. the metamodel only defines the guard rails. The advantage of this method is that it is easy to understand and to follow. The advantage of the deductive approach is its agility. referred to as dynamic case management by analyst firm Forrester. Embrace complexity. This is a sequence of steps derived from the metamodel to process a single transaction. like a traditional process does. A metamodel approach benefits more from a deductive approach. To use a metaphor. business processes are often defined inductively.Once you focus on the case. the disadvantage is that its comprehension requires more conceptual thinking. also requires a different analytical approach.

Simplify your organization 9 .Take the test Administrative processes are becoming increasingly knowledge-intensive. high ambiguity Non-trivial impact of regulatory requirements Operational decisions require explanation to customers Contextual information is unstructured or not always available Easy terms and goodwill-sensitive Transactions and business rules are non-discrete and interconnected Transactions are processed in consultation with the customer Table 3: Knowledge-intensive processes The more statements you have chosen in the right column of the table. clear rules to follow Based on your own stable standards Operational decisions do not need to be communicated Little contextual information is needed – the transaction speaks for itself No room to deviate from the rules in the process Transactions are discrete and not connected Transactions have a strict order of steps Knowledge-intensive • • • • • • • • Mass customization in administration. And the more knowledge-intensive your business processes. both in the public sector and in commercial enterprise: “When executives focus on knowledge workers. […] All employees are ultimately knowledge workers. especially if the goal is to drive performance to new levels. According to Harvard Business Review. this means we have to redefine what constitutes a knowledge worker. the more you need to embrace complexity. every transaction looks different Requires human judgment. the more knowledge-intensive your business processes are or should be. 4 http://blogs. clear overview of possible combinations Low ambiguity. Not knowledge-intensive • • • • • • • • Mass production in administration. choose either the statement in the left or right column of the following table. they lose sight of the fact that even highly routinized jobs require improvisation and the use of judgment in ambiguous situations. Many of these improvisations require interactions with one's fellow humans.org/bigshift/2010/04/are-all-employees-knowledge-wo.hbr.” 4 To test how knowledge-intensive your current or required business processes are.html Embrace complexity.

dramatically reduce operating costs and optimize customer interaction. in the form of pre and postconditions. assessments or data elements for potential next activities. At the core of Be Informed’s unique approach is ontology. define the boundaries of a process. based on the principles of dynamic case management. then another activity that produces that result needs to be completed first. irrespective of which activity produces that specific result.How Be Informed helps you to embrace complexity The Be Informed business process platform. They say what needs to be done in order for the transaction to be completed successfully. For example:  If Activity A has a precondition for a certain result as input. but without specifying the exact method. Simplify your organization 10 . This can be in the form of a calculation or classification. this is called a postcondition. Figure 2: A Be Informed ontology depicting a subsidy case An ontology is a formal representation of knowledge as a set of concepts within a domain and the relationships between those concepts. Typical postconditions include creation of documents. helps organizations to achieve high levels of straight-through processing. as shown in figure 2. for instance.  If Activity A needs to produce a result. These decisions typically require multiple preconditions. The relationships. Embrace complexity.  Some activities are geared towards decision-making. and are communicated through a single postcondition.

Lastly. Simplify your organization 11 . much of the ontology comes as part of the off-theshelf product. Figure 3 depicts a “drinking-and-driving” process for a typical police force. the ontology even drives the interface generated immediately for the user. On the left.Off the shelf Putting together the metamodel – the ontology – is the most important part of a Be Informed business process platform implementation. providing the big picture of the relationships between the various activities. the changes take effect immediately (or within a specified time frame). Once you change an activity or its pre or postconditions. the dynamic activity plan shows the status of the case after the breath test has been completed. the application comes to life instantaneously. Figure 3: drinking and driving Embrace complexity. while on the right. The most visible element of the ontology for an end-user is Be Informed’s goaloriented dynamic activity plan. the dynamic activity plan shows the status before a breath test is conducted. The ontology also represents the documentation of the application. If one of Be Informed’s standard solutions is used. When the ontology is started.

When the new information is processed. but in a repository.  Separate the “know” from the “flow”. the new route to the goal is generated immediately. What makes Be Informed unique? The dynamic activity plan makes the Be Informed business process platform goaloriented. This is the idea on which the Be Informed business process platform is based – an idea that has been adopted by many organizations already. This means that the systems suggests only the activities which are necessary for the completion of the transaction. retriggering other processed activities.  Do not model the process. Simplify your organization 12 . complex transactions to be handled by a single generic process. However. The business rules (the “know”) are not stored in the business systems and the processes (the “flow”). Whether activities should be processed manually. without the necessity of restarting the process. the process does not need to be restarted. users can choose which activity they prefer to perform first. based on their own insights. All unnecessary activities are omitted. Furthermore. there are no exceptions to the rules – all conditions are rules. based on human interpretation of facts. current activities and future activities. or can be processed straight through. and further information needs to be generated by other activities first. if a business rule changes. the following principles are unique to the Be Informed business process platform:  Everything is a business rule. should the user find new information. these activities can be repeated easily. both in the public and private sector. The system provides guidelines on how to successfully complete transactions. The preconditions of these activities state that the information available for them is insufficient.  The processed activities are those which have been completed already. the system adapts accordingly. At the same time. In other words. It depicts the ontology in three intuitive ways:  The current activities that you can perform if you wish to. This approach allows many knowledgeintensive.  Future activities that cannot yet be processed.The dynamic activity plan is the guard rail of the Be Informed solution that is always active. should new information arise. Embrace complexity. their discussions with the customer or their own preference. There is no prescribed order for the current activities. depends on design choices or the level of ambiguity of the available information. so they can be reused. Repeating activities immediately updates the status in the dynamic activity plan. In short. Be Informed models the activities and their pre and postconditions so that each transaction can have its own unique flow.

organizations using Be Informed often report cost savings of tens of percents. The Be Informed business process platform supports administrative processes. the next wave after business process management. Simplify your organization 13 . and a reduction in time-to-change from months to days. which are becoming increasingly knowledge-intensive. Further benefits include a much higher straight-through processing rate leading to vastly improved productivity. Thanks to Be Informed’s unique approach to dynamic case management. Linda Muselaars and Geert Rensen Embrace complexity. Author: Frank Buytendijk Contributing authors: Jan Willem Ebbinge. independent software vendor.About Be Informed Be Informed is an internationally operating.

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