BENEFITS OF PROCESS MANAGEMENT

BENEFITS OF PROCESS MANAGEMENT

   9:51 AM       Rizkooblogsite

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Why is information systems process management important? What are the benefits? There are many benefits of implementing process improvement, such as:

• Processes strengthen business partnership and improve customer service. Improving information systems processes can result in a significant improvement of customer (or user) satisfaction, which in turn improves the relationship between the business and Information Systems. In this environment, Information Systems will be aligned with what is important to the business, and the priorities will be reflected in the day-to-day operations. The implementation of a quality initiative, or TQM, in the Information Systems organization can increase the value-added contribution to the organization. The Information Systems leader who speaks and embraces quality concepts can build bridges to other areas of the organization that have been using these techniques for years. Top management confidence in Information Systems will improve as the organization measures and improves the value it adds to the company.
• Processes improve efficiency and communication. Documented processes will clearly define roles and responsibilities of project team members. Knowing their job responsibilities and expectations will allow them to be more effective. Communication will be improved as responsibilities and expectations are clear and understood by everyone involved.
• Processes improve productivity of the Information Systems organization. For years, many businesses claimed that their Information Systems organizations were not responsive enough to changing business needs as they watched their backlog continue to grow. There are many examples of failed projects in the industry. Many executives allege they spend too much money and time on projects that never meet business expectations. Information Systems is continually asked to do more with less. We all have limited budgets, limited headcount, and limited hours in a day. Rather than working harder, we need to find ways to work more productively. Process improvement can significantly improve and sustain new levels of performance and productivity.
• Processes improve effectiveness of project management. Improved processes will assist Information Systems in consistently meeting commitments through better planning, estimating, costing, tracking, and reporting of project progress. Statistics from the Standish Group that studied 23,000 projects in companies of all sizes showed that in 1998 only 26 percent of projects were successful. They defined successful as completed on time, on budget, with the promised functionality. 46 percent of the remaining projects were challenged and 28 percent cancelled. As an industry, Information Systems professionals must improve the success rate of project development and project management. Becoming a process-based organization is one condition for consistently delivering successful projects.
• Processes reduce defects and improve quality. Having a consistent and reliable process with metrics will provide the vehicle to improve and to increase the quality of service provided. Typically, the root cause of failure or defects is due to process and organizational failure, not failure of people.
• Processes help avoid bad publicity. Today, system failures and system quality issues are highly publicized events that can impact the financial performance of a company. A 1996 survey of 240 Fortune 1,000 companies in North America and Europe was commissioned by CenterLine Software, Inc., a company in Cambridge, Massachusetts that developed a software testing tool. The survey found that 12 percent of the companies contacted had faced liability or litigation issues with regard to direct or consequential damages from lack of software quality. With the movement toward ebusiness and putting software even closer to the customer, we can expect this number to increase in the future. Although process improvement cannot guarantee the elimination of events that could cause bad publicity, improved quality of products and services would reduce the likelihood of such issues.
• Processes improve consistency. Although the heroes of the Information Systems organization may produce high-quality results quickly, the entire organization may have difficulty producing heroic results consistently. Improving processes ensures a consistent level of quality and timeliness of service and support throughout the organization.
• Processes increase return on investment. Jim Stikeleather in Insane Expectations (Computerworld Client/Server Journal, November 1995) claims a $5 return for every dollar invested in process improvement. Companies are continually looking into all areas to increase the return on investment. Since many companies still view Information Systems as an expense rather than a competitive asset, they often look at Information Systems to cut expenses and obtain more for each dollar invested. They focus on how to reduce the unit cost of Information Systems. Companies may be willing to spend more money on Information Systems if they are getting a larger return on their investments.
• Processes provide the company with a competitive advantage. Faced with increased competition, companies are asking how they can utilize technology to provide their company with a competitive advantage in the marketplace. Particularly as companies are migrating to e-business, information systems processes must change significantly to handle the increased demands. Increased speed, flexibility, and quality in all processes are becoming an expectation as technology evolves toward e-business.
• Processes leverage best practices and solutions. By establishing and managing proven, repeatable processes, knowledge can be leveraged so that every project gains from previous project experience.
• Processes reduce the impact of turnover. Turnover is high in Information Systems organizations. Employees gain a specific set of knowledge and skills, but that knowledge is in only one person rather than a companywide asset. As employees leave the company, they take their knowledge, skills, and training with them. Best practices and process management turns that expertise into repeatable processes or knowledge that can be used continually within an organization.
• Processes improve business productivity and revenue. As businesses have tightly integrated technology into their business processes, the business can be significantly impacted by the performance of the Information Systems group. If the system is down or a user is waiting for the Help Desk to fix a problem, that user’s productivity is impacted. The end customer may also be impacted, as the employee may not be able to properly assist the customer without the system and tools. As a customer, there is nothing more frustrating than calling a company with an order and having the service agent reply that they are unable to assist at that time because the computer is down. In addition to affecting customer satisfaction, it could also impact customer loyalty and market share. Customers unable to wait for technical issues to be resolved will gravitate to another supplier to fill their needs more rapidly.
• Processes improve business quality. Since information is often tightly integrated with how the organization does business with its customers, it is difficult for a company to implement a total quality methodology without including the Information Systems organization. For example, a company may have successfully implemented quality concepts in parts of the organization, but not on a companywide basis. If a customer calls to find the status of an order, the process to provide that information to the customer may be very efficient and effective. However, the customer service representative may provide the customer with inaccurate information because of errors in the systems development process used by Information Systems. In fact, there is often a direct relationship between the quality of systems and the quality of goods and services that a company provides.
• Processes prepare for future growth and flexibility. Without processes in place, as an organization grows there will be a need to increase the number of employees to provide the same level of support. With established processes, productivity is significantly improved and the functions will be organized to handle growth with a minimal increase in employees. Although money may still need to be spent to handle growth, the spending would not be linear.
• Processes create a culture of empowered and satisfied employees. No one enjoys being part of an organization that has a bad reputation or is not meeting expectations. Clear processes and responsibilities enable employees to meet expectations, resulting in increased job satisfaction. The employees will also feel empowered to make changes and resolve issues. With metrics and measures that they can impact, employees aspire for excellence. Information Systems personnel feel valued, understand the expectations, and feel competent to perform their job.

As can be seen in Figure 1.3, the benefits of information systems process improvement outlined above can be realized for the business itself as well as the Information Systems organization. In fact, many of these benefits are cited as goals when companies begin their process improvement efforts. A research study was done by Gartner Group in 1997 of more than 200 Information Systems departments

on the benefits of process improvement projects. Figure 1.4 identifies the primary goal reported by these companies beginning process improvement projects.