Getting the most out of human process management

The business world is full of processes. Some are routine and predictable, such as order to cash, procure to pay, order management. These processes can be described in detail and executed the same way every time. They readily lend themselves to existing technical solutions for managing structured business processes – for example, enterprise resource planning (ERP) systems or business process management suites (BPMS).

Unfortunately, most business processes are not predictable routine tasks, but rather ad hoc, unstructured knowledge processes. This is certainly true with processes as they pertain to the role of the corporate secretary, who today is a senior corporate officer with wide-ranging responsibilities. He or she serves as a focal point for communication with the board of directors, senior management and the company’s shareholders. In short, corporate secretaries manage a diverse collection of knowledge work, none of which is standard or routine. For most, the only tools provided by IT for these processes are email and document systems, which are handy and useful, but provide almost no management or visibility for the jobs they are used to execute.

Lately, because of increased regulatory scrutiny in many industries, companies are looking more closely at managing risk, which means a closer look at managing process. Many companies are finding that not managing these ad hoc human processes greatly increases risk in any organization, especially when the processes are as important as those handled by the corporate secretary – for example, a process initiated as a result of a board meeting.

In the world of risk management, the danger associated with processes falls under the category of operational risk; together with fraud, it makes up the bulk of risk associated with operations. The other components of operational risk are risks associated with business disruptions and system failures, clients, products and business practices, employment practices and workplace safety.

Monitoring and modeling
Process risk is much easier to handle in structured work, especially when there is a documented procedure and a mechanism for measurement and control. The best way to handle risk for such routine efforts is to use a process management tool, such as a BPMS. Codifying the process in such a tool requires the precise documentation (or modeling) of the process, something that ensures the processes are executed in line with the documentation and provides tracking and monitoring of the process’ actual execution. This significantly lowers process risk and increases process compliance.

This approach doesn’t work for unstructured, ad hoc human processes handled by corporate secretaries, however, because the exact flow can’t be known (or dictated) ahead of time. The work flow changes based on the circumstances, people involved and exact details of the specific case being handled.

The key to these processes is managing the handoffs between participants, managing the documents involved and providing real-time and historic visibility into actual execution. The trick is to provide management with information without requiring so much structure that it strangles the process. Emails and documents provide enough flexibility, but no management or visibility.

Are unmanaged email and documents the best support IT can provide for these tasks? The answer is ‘no’; there are emerging solutions for managing and monitoring exactly these types of knowledge worker processes. The approach is called adaptive case management (ACM), and some ACM solutions even let the participants continue to work in their familiar email and MS Office environments, allowing the processes to continue much as before, but in a managed fashion.

ACM replaces the detailed process model with higher-level guidelines, checklists and a description of the required goal. In addition, it offers the ability to track and monitor the execution of the process and manage the documents associated with the process. Tracking the process provides visibility into the most sensitive part of any unstructured task, and the one most prone to failure: the handoffs between participants. Managing the documents provides a way to manage the input and output of the process. Real-time and historic reporting provide the visibility into the process and its execution.

Many forms, similar elements
In general, these knowledge worker processes take many forms, but all have the same basic attributes:

• The process consists mainly of interactions between human participants
• Collaboration
• Negotiation
• Content is an integral part of the work, both
• consumed and produced as part of the process
• The participants control the process, and change it on a case-by-case basis
• Flow changes
• Participant changes
• Activity changes
• Every process instance has an owner
• Every process instance has a goal, deadline and a defined work product.

By way of illustration, let’s take a process initiated as a result of a decision taken during a board meeting. In this example, the meeting takes place, decisions are made and processes are initiated – but the actual work is different every time depending on the context of the board meeting. For example, a bank’s board is worried about the risk profile of the bank, especially its loans, so the company initiates a process regarding the risk management of loans to European real estate and construction projects.

In this example, the bank made large loans for the construction of commercial real estate projects in a number of European countries, and those projects have reached a point where they will be asking for additional funding to enable the project’s completion. In the period since the original loans were granted, however, both the macro and micro-economic environments have changed, causing the bank to revisit the original assumptions underlying the loans.

These loans now represent large risks and have the possibility of triggering external scrutiny regarding the handling of those deals, so the board decided to take a closer look. It requested that the international banking division and the real estate division jointly look into the viability and risk of the projects, taking into account various deal parameters such as the current legal situation of the country involved, the macro-economic outlook, the likely amount of financing that will be requested, the financing sources for the projects, the capital structure of the projects and the current viability of the developers.

Of course, such a comprehensive process will generate a lot of activity involving numerous people throughout different divisions in the bank and experts from outside the bank, and the specific participants and information assembled are dependent on the specifics of the loans being examined. In this example, there is a senior executive who owns each part of the process, but it is the corporate secretary’s role to provide oversight, make sure the process is completed in a timely fashion, and brief the board on the results. Today, such a process would probably be executed via email and documents, without any management visibility or IT support for managing the process. Missed handoffs, lost follow-ups and old versions of documents can all conspire to cause the process to fail.

An ACM system can ensure the corporate secretary provides an appropriate level of oversight and insight into the process, without the need to completely dictate the execution of the task and the work being carried out. The opportunity to have the process owners (and the corporate secretary) monitor, track and report on the process without providing so much management as to strangle it lowers risk and increases corporate compliance and governance.