BPM In The Current Economic Climate

19 Nov

In today’s economic climate, organisations continue to face strong global competition, demanding customers and the commoditization of products and services. All of these issues are driving down prices and increasing pressure to cut costs. Company departments are being asked to do more with less. One could argue that an organisations success in this economy is dependent on its ability to be more efficient than its competition. Business Process Management (BPM) will go a long way to making an organisation more efficient and perform better in this economy (Cleveland, 2012).

As we have established from the previous blog posts on this topic, BPM is a way of looking at and then controlling the processes that are present in an organisation. In times of economic crisis it is seen as an effective methodology to use. BPM can make certain that the processes are efficient and effective which will result in a better and more cost efficient organisation. After my research of the literature in the past month or so on the topic of BPM, it seems the most important aspect is that it should not be a onetime exercise and it should be a cross-organisational effort. It should involve a continuous evaluation of the processes and include taking actions to improve the total flow of processes (Cleveland, 2012).

A recent Capgemini report found that 96% of companies who had tried to measure a return on investment from BPM spending reported a positive return. 55% of these companies reported a return of at least twice their initial investment. With these figures in mind, it’s no surprise that 68% of companies surveyed by Capgemini said that tougher than expected business conditions would result in them placing greater emphasis on BPM. An interesting point to note is that, in many respects, BPM can be viewed as a catch-22. When businesses are doing well, many don’t see the need to improve processes but when businesses are struggling, they feel they cannot afford the investment in BPM (Cleveland, 2012).

Sources:

http://www.bpmleader.com/2012/09/11/bpm-in-this-economy/

http://www.capgemini.com/insights-and-resources/by-publication/global-business-process-management-report/

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5 Responses to “BPM In The Current Economic Climate”

  1. cmcoughlan November 20, 2012 at 8:17 pm #

    Hi aplusk22, interesting blog especially your last point. When businesses are doing well, they don’t see the need to improve processes and instead wait until their business is in trouble to introduce BPM – at a time when they cannot afford it and have other matters to focus on also. Businesses should make BPM a continuous effort year round and not see BPM as one time solution to a problem.

    • aplusk22 November 24, 2012 at 3:37 pm #

      Thanks cmcoughlan, appreciate the feedback.

      BPM should certainly be a continuous effort on the part of the organisation. They should realise that while they may be doing well now, there will be a time in the future when things won’t be so great due to a number of issues. Embracing BPM as a continuous process will go some way to improving an organisation’s chances of getting ahead of the competition and thrive.

  2. timh88 November 26, 2012 at 2:44 pm #

    It seems that when times are tough certain budgets within an organisation are slashed. This is most evident in the advertising and marketing budget of firms during times of economic uncertainty. However it is interesting to see the reverse of this in relation to your last point that focus is shifted to BPM when a firm is not performing as well as it should be, and as a result are unable to invest in BPM.

  3. aplusk22 November 28, 2012 at 12:44 am #

    In most cases, when times are tough financially, the marketing budget is deemed the first to be cut. I suppose companies can find themselves in financial difficulty for reasons beyond their control (eg. stock market crashes, natural disasters, etc.) but by focusing on improving processes and BPM initiatives they give themselves the best opportunity to balance the books.

  4. Nancy Beckman December 30, 2012 at 6:10 pm #

    “an organisations success in this economy is dependent on its ability to be more efficient than its competition. ”

    I think that’s a very fair argument to make. Every inch counts in today’s economy. How can you save a little bit here without sacrificing your customers in the long run? It’s both a short-term and long-term game. Efficiency is important but what are you willing to give up to be more efficient?

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