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Business is something of an art – and that’s especially true in the current services economy. Multiple variables, market ambiguity and rapidly shifting backgrounds open the door to diverse interpretations and (often conflicting) conclusions. It would all be much simpler if companies could reduce uncertainties and better predict results with more scientific methods, such as observing repeatable patterns and developing replicable processes.
IBM is doing just that – taking people-based processes and turning them into a science, into applications, into replicable technology and consulting assets – through its Model Driven Business Transformation (MDBT) micropractice. Granted, there will always be an array of exceptions and variables, but the MDBT approach offers a way to view business challenges from new perspectives and deliver practical, IT-based solutions.
One national retail chain, for example, sought help in developing more effective, efficient and collaborative distribution methods. The company’s monthly inventory flow forecasts were sluggish and error-prone, causing bottlenecks in its distribution centers and retail stores. The process was further bogged down in manual tasks and cascades of spreadsheets, with little use of references to historical data or company-wide forecasts, and difficulty in managing and sharing forecasts across divisions. The company’s collaborative process began at the lowest field level, was propagated up to headquarters, and the results were then funneled back to the field.
With a studied eye toward linking the company’s business requirements to a practical IT solution, IBM researchers evaluated spreadsheet input and rebuilt backend processes to help deliver greater consistency and reliability. The IBM solution helped improve accuracy, build more common processes and improve integration across silos. The client also has reported improved market agility through better work flow and data access.
Significant to this IBM MDBT approach was the use of operation modeling to define the business need. Classic business process modeling describes actions in terms of verbs (“My business does X”) – a strategy that is essential for implementing data processing, but less effective in fleshing out business needs. Operation modeling, on the other hand, describes what is acted upon: “I am in business to process Y,” with Y being business artifacts such as invoices, customer service reports, sales slips and receipts.
These artifacts resonate with business people, because there’s little ambiguity associated with them. Modeling the operational layer of a business – how an enterprise achieves its goals – captures what’s important to the business. It also offers insight and clarity about how to link business needs to IT solutions. The IBM model-driven approach adds a more formal (scientific) description of the operational layer, identifies strategic goals that can be stated in business terms and maps them to IT capabilities.
In this engagement, IBM focused on well-defined needs and was able to deploy the solution and deliver results remarkably quickly. “Typically we need a year to see the kind of results this project has delivered in two months,” said one company executive.
The initial application is now in productive use by the company’s own IBM-trained MDBT team, delivering improved weekly, rather than monthly (or nonexistent), inventory flow forecasts.
The IBM MDBT toolkit can be employed to address a variety of business issues across a broad range of industries. It’s already been credited with helping provide IBM’s own Distributed Enterprise Services with greater efficiency through a clear operation model and straightforward implementation. It’s helped a major health insurance company better track its processes with advanced performance metrics, linking objectives to those measurements. The toolkit is also at work helping automobile manufacturers in their relationships with dealers and clients.
IBM Research and IBM Global Business Services work with clients and industry experts to deliver this and other groundbreaking approaches and technologies. To find out more about the research and explore innovative ways to apply MDBT micropractice solutions to your business, contact On Demand Innovation Services today.
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