IT Enabled Business Processes Drive Competitive Advantage

A new article from Harvard Business Review, Investing in IT That Makes a Competitive Difference, by Andrew McAfee and Erik Brynjolfsson, provides some good qualitative and quantitative evidence that market leaders better leverage IT investments to achieve and maintain their status.

What I also found interesting was one of the sidebars, The Elements of a Successful IT-Enabled Process. I have seen companies be successful by leveraging a BPMS approach where previously they had failed using other approaches and I found the observations in the article to be well aligned with my own experiences. The six elements cited in the article for successful IT-Enabled business processes along with my comments are listed below.

• They cover a wide span. In my experience the processes enabled need to be important enough to matter to the business, but not too big if this is the first IT-enabled process. BPM is best done in an agile way, so if a customer service process can be improved in three months do that first.
  
• They produce results immediately. I totally agree with this element especially when it is combined with an agile process life-cycle approach across business and IT.
• They are precise. A real benefit since it then allows for inline collection of metrics to drive future improvement.
• They are consistent. This really helps where different levels of skill exist across like job functions and helps improve the corporate knowledge retention.
• They make monitoring easy. I am a big fan of the real-time analytics and event driven aspects of IT-enabled business processes.
• They build in enforceability. A major difference with using a BPMS approach is that they can capture the horizontal business processes that cross multiple systems, groups and people. These are often the very valuable processes that are not well represented in a traditional ERP or CRM. As the article points out doing the process right across 4000 stores creates far greater payback then a few.

To these I would add a few more elements

• They are business focused. One of the greatest benefits of a IT-Enabled process is getting business and IT on the same page. Business focused means having a model-driven approach that makes the decisions centered on business terms and not technology implementation.
• They support continuous improvement. Visibility into real-time information with the ability to do full life-cycle simulation allows for better understanding of relevant business events and triggers that can impact the bottom line of the business.
• They support loose coupling of related business processes and activities. IT-enabled processes should not become just the next silo of complexity in enterprise IT. Instead, processes should themselves be designed in a modular way so that often used items can be reused across multiple business areas

I was pleased to see this article mention IT-enabled business processes, and in my opinion the best way to achieve these results is through a BPMS (business process management suite) approach where all of these elements are available.