I think most business people who have a first-hand opportunity to see what Business Process Management (BPM) is all about, realize quickly that there is a whole new world out there that they had not imagine existed.  Certainly in the early 2000’s when Intellera entered this market it was borderline revolutionary and it was one of the reasons we felt strongly it was the way to go in the future, especially (as you will see) in light of our prior 15 years of experience at that time in the Enterprise Resource Planning (ERP) world.  (If you are not 100% clear about what BPM and ERP are all about, check out my BPM primer and my ERP primer – I promise it’s really easy to catch on!)

Those who discover BPM may feel rightly excited that it can solve a whole host of problems that exist in our modern high-speed streamlined and “right-sized” organizations, starting with the fact that most of us (I think) are human, and well, “to err is human” as the old idiom goes.  (It reminds me of an IT supervisor I worked with back in the days of  “minicomputers” who had a coffee mug he cherished that read “to err is human, to really screw things up you need a computer…”)

So humans make plenty of mistakes and often like to cover them up.  Therefore creating a way to automate and centralize procedural business workflows, essentially “who-does-what-when-and-who-gets-notified (repeat as required)” helps.  In any department you can ensure that someone provides the appropriate data inputs, that forms and data get routed to the next appropriate persons in line, and that service levels are tracked and the appropriate persons are notified of tasks to do or completed (examples are capital expenditure approvals, new employee intakes, IT change management control).  It  reduces mistakes, increases quality, improves service levels, and provides the transparency and approvals required by the governance folks.  Side benefits include a reduction in e-mail, unnecessary conversations and status reports, and yes, less humans in the long term to accomplish mundane tasks.  All departments in all business entities can benefit from streamlining business processes so it has huge success potential and a great ROI.  Wow, can it do my laundry, too?

Meanwhile ERP provides a way to automate and centralize “resources”, meaning usually people and sometimes machines, to ensure that required business functions and procedures are followed.  Traditionally these ERP systems were called the “accounting” systems because they started as bean-counting helpers to keep the books, then they moved in to help track inventory, then sales, then purchasing, then manufacturing, then human resources, etc.  The functions they provide are often complex and usually “hardcoded” (or very heavily “configured”) so they are expensive to implement and to alter later, which is why their ROI has not been what was originally thought it could be in general in the industry.  Examples include a purchase order that must be entered a certain way to capture the correct data, and is programmed to function (usually) in one single way.  The next person who needs to perform an action might be assigned a task but this is not the key benefit of ERP. It is to enter and track the mission-critical business entities like PO’s, Sales Orders, Inventory, and People.  Business processes, how and when things get done, generally take a back seat to more core critical functions. Nevertheless ERP systems are now a staple of all organizations because they control the mission critical production data.

So the big question to me goes as follows: what exactly is the difference between ERP and BPM anyway?  If you are clear on my summaries above or have read my primers on BPM and ERP you will note they are strikingly similar in their descriptions.  To someone not steeped in the realm of IT, they kind of sound exactly like the same thing, and even to those of us who live and breathe it, there are obvious overlaps.  Are they the same thing? Well… Yes and no (don’t you love gray areas?).

… check out my next post for the answers!

Advertisements