Why Business Process Management is so important

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The entire country watched in disbelief last week as a United Airlines passenger was forcefully pulled off an overbooked flight to give room for crew members. The passenger had a valid ticket and boarding pass and was already in his assigned seat when he was dragged off the plane. How could this happen and why?

After the incident, United Airlines said in a statement to Business Insider:

“Flight 3411 from Chicago to Louisville was overbooked. After our team looked for volunteers, one customer refused to leave the aircraft voluntarily and law enforcement was asked to come to the gate. We apologize for the overbook situation. Further details on the removed customer should be directed to authorities.”

Furthermore, United Airlines CEO, Oscar Munoz, wrote an open letter to the airline’s 82,000 employees where he tried to explain reaffirmed his support for the employees’ actions and saying that “Our employees followed established procedures for dealing with situations like this.”

This is where the real problem becomes painfully evident. The employees followed established procedures yet the outcome was disastrous. So who’s to blame?

Well, management is at fault, and the underlying issue relates to a disconnect between the execution of the business strategy and the day-to-day processes that produce value for the customer. The strategy of the organization provides the organization with the “what” we should be doing while the processes of the organization provide the organization with “how” or the tactical day-to-day operation of the organization. However, many management teams think of their organizations in terms of the functional organization chart, and they actually have little or no understanding of how the work is actually accomplished.

It is also easy to become complacent. Instead of looking at the business processes as a whole, you only look at the software development process or business transaction process or some other specific function of the business. But it is important to monitor and continuously improve the entire gamut of business processes to achieve the desired competitive edge. All business processes have to be aligned with the specific business goals. From there, the organization will be able to more readily identify performance gaps which, as we all know, can have a huge impact on the customer experience.

Incidentally, also in the past week, Amazon’s CEO Jeff Bezos wrote in his annual letter to shareholder’s about how companies can avoid situations like the one involving United Airlines by making a concerted effort to never become a slave to established processes, no matter how entrenched they are in company culture.

“This can happen very easily in large organizations,” Bezos said. “The process becomes the proxy for the result you want. You stop looking at outcomes and just make sure you’re doing the process right. Gulp. It’s not that rare to hear a junior leader defend a bad outcome with something like, ‘Well, we followed the process.’ A more experienced leader will use it as an opportunity to investigate and improve the process. The process is not the thing. It’s always worth asking, do we own the process or does the process own us?”

Processes of any organization should be under constant review. Are they providing for the execution of the business strategy? This question needs to be answered in two dimensions:

The inside out view – the organizations perspective.

The outside in view – the customers’ perspective.

Amazon has done an exceptional job in both dimensions, while United failed to consider how their processes operate from the customer perspective.

By Lotta Collard and Marvin Wurtzel

Sources and to learn more:
http://www.businessinsider.com/amazon-jeff-bezos-united-incident-pr-fiasco-2017-4

http://www.businessinsider.com/united-passenger-dragged-off-police-2017-4

Wurtzel, Marvin, “What is BPM?” New York City: The McGraw-Hill Companies, 2012

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On April 17th, 2017, posted in: Business Analysis, Six Sigma by

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