BPM Success: How a Travel Giant Turned Its Ship Around

Declining sales. Cost pressure. Customers who wanted change, fast. Maritz Travel's COO tells how a group travel giant facing all of these pressures revamped its business processes, and how business and IT came together to make the effort pay off.

1 2 Page 2
Page 2 of 2

The bad news for IT execs is that being a software selection pro won’t help you much with your BPM projects. A BPM effort, as Motorola CIO Patty Morrison says, is not about tools, it’s about process. You can pick the most technically sound BPM tool in the world but what really makes BPM go, according to Morrison, is a combined effort by IT and business to examine process, then reshape process and culture.

Phillips agrees, saying, “It’s important to pick a provider that really understands process and transformation and has an aligned road map.

“I know the [software] giants will eventually figure this out, but this requires a different way of thinking,” he adds. “The Phase 1 implementation is really irrelevant. It’s what you learn from Phase 1 to make Phase 2 and Phase 3 better.”

In addition to Lombardi, vendors like Savvion and Pegasystems are helping companies wrap key business processes in software outside of the core ERP suite, says Forrester Research’s Sharyn Leaver.

Some IT execs may wonder why they should trust a smaller vendor when addressing their company’s most critical processes but the reality, Leaver says, is that SAP and Oracle may be a couple of years away from being able to help you with BPM.

SAP’s new hosted ERP suite for mid-market customers, Business ByDesign, has a business process engine, she notes, but that’s a brand-new product. Consequently, you’re not going to get feedback from peers on how it’s working so far. (In the end, Oracle and/or SAP may choose to acquire one of the BPM expert companies in order to boost its prowess in that arena, she says.)

There’s a comforting reality right now for IT departments charged with wrapping key business process using a BPM platform, Leaver notes: Virtualization can help.

Virtualization, already high on the list of most companies’ technology priorities, lets IT simplify and speed up development and testing of the BPM releases, safely.

The BPM ROI

How is the process revamp paying off? According to Phillips, since the BPM effort began, Maritz has improved its customer quality indicators while reducing overhead. “Some of our cost ratios have improved between 8 and 24 percent,” he says. “That’s important since our industry is becoming increasingly cost-competitive.”

Overall, he notes, Maritz’s process is now “keyed more to where parts are in the pipeline than to people.” This helps him spot trouble more quickly. “I can see cycle time issues and reduce time to clients,” says Phillips.

Measurement Is Everything

The BPM work at Maritz won’t be finished anytime soon; this is a project without an end date.

“We continue to add subprocesses and refine subprocesses. I’m a believer in iterative improvement. We get a payoff from every phase.”

As for measuring and evaluating those improvements, that’s an area where Phillips advises CIOs and COOs to be careful. Phillips now says he wishes he had established key metrics and ways to capture the information earlier in the project.

“We plowed ahead lightning fast on the process side,” he says. “I should have created ways to grab crisper benchmarks.

“Now we’re already on the slope of improving. We didn’t have clear metrics that captured baseline performance. I’m thinking through linking process results to business results. If you can do that, then you get the visibility to prioritize your next investment.” Also on Phillips’s current to-do list, Maritz has implemented measures to improve cash flow and will look to BPM to strengthen that effort. “What we’re planning to do in BPM is to make people more aware of the major cash events within a cycle. That just saves the running around that can occur,” Phillips says. “We deal with some pretty big checks.” Ultimately, he says, Maritz wants to complete what he calls the holy grail of BPM: “We’d like to link our processes to supplier and customer processes.”

According to Forrester’s Leaver, that’s exactly what many customers are demanding—another reason BPM is rising higher on CIOs’ agendas.

Did Maritz’s customers demand process links? Not in so many words. Customers may be unhappy without realizing that their unhappiness stems from the fact that their processes don’t match up with a business partner’s processes. “What we saw was pain,” Phillips says. “As we tested the story with our clients, they were resoundingly supportive. This is a wave BPM can and must address,” he says.

Copyright © 2007 IDG Communications, Inc.

1 2 Page 2
Page 2 of 2
7 secrets of successful remote IT teams