12.2. Following Process Engineering Steps

Process engineering is about what we do. The organization chart is important because though organizations were usually been created to represent work areas, the misalignment between processes and organizations (the white space) is the primary cause of process breakdowns. Of course it also reminds us that, at the highest levels, the process model must be developed from the business perspective. Information Technology can definitely help manage and formalize the process definition steps, but the IT team does not do the work that directly impacts customer relationships. Don't expect to ask IT folks to tell you what business processes are important to CRM or how to do them.

As we did for the data component, our goal is to identify, describe, analyze, and improve our CRM business processes based on improved information and technical tools. The three highest levels of the Zachman framework are all that we will cover. These high levels are what Rummler and Brache call the Organization, Process, and Job/Performer levels of performance.

Table 12-1. The Process Component

Business View	Process View
Owner's Wants View	Business functions
Owner's Needs View	Business processes
Designer's View	Activity

For more information on process engineering, see Cook's book on enterprise architectures (1996). For more on the Information Technology views, see Zachman's discussions of his framework (1987).

Just as was done for information, XYZ developed the high level CRM program process scope as part of the strategic plan. They used information from the strategic internal interviews: the consolidated list of business opportunities and business issues that were used to develop the program data classes. The steps that XYZ used to develop process classes were the same as for data, except that since processes are what we do, they highlighted every verb instead of every noun.

1.	Go through the list with a highlighter and mark every verb. These are your candidate process classes.
2.	Identify and eliminate duplicate process classes as well as any unrealistic or unreasonable classes.
3.	Write a definition of each of the process classes on your list.
4.	Organize into global process classes for ease of communication.

XYZ identified the business functions shown in Figure 12-3 organized into global process classes that match the customer-facing functions that make up the front-office. Notice that many of these business functions do have a strong resemblance to the organization chart at this high level. There are some advantages to using familiar organizational terms for business functions.

It's likely that your company will have some people engaged in marketing, sales, and support, even if they're not fully dedicated to that activity. Many companies, however, do not offer consulting assistance to their customers. A Customer Services Organization doesn't make sense for all products and markets. Virtually all companies operate in the other three functional spaces, and many companies are discovering that service is a highly profitable area with tremendous impact on the customer experience. Of course, like any company, XYZ has since discovered many additional small business units at lower levels in the organization that are also part of the company's CRM efforts. As these were discovered, they were integrated into the overall strategic model.

12.2.1. Owner's Wants View: Business Functions

During the project launch, XYZ identified the major business functions that will be impacted by this project. This step is critical if for no other reason than that these functions must actively participate, if not provide the sponsorship, in the project. XYZ's process scoping results from the Valencia launch covered in Chapter 9 are shown in Table 12-2.

Table 12-2. Valencia Functional Focus

Project Title: Valencia
Direction (issue/opportunity, critical success factors)	We don't know who our most valuable customers are because we identify customers differently in every system, so we can't be sure of their total purchases or how much it costs to serve them.
Focus (business functions, target customers, customer offer)	Business Functions: Product (S-800) Marketing, Direct (Business-to-Business Sales, Inbound Telesales

Notice that since the actual launch the team identified an additional key function, Inbound Telesales, which would be responsible for handling the customer responses. They also discovered that there would actually be little impact on businesses processes for the business to business direct sales team. Of course sales still needed to be included since their customers were being impacted. They updated their project charter to reflect this new information.

Of course, consistently identifying every customer that XYZ has in any system is a huge task. In order to scope the project such that it can be completed in about six months, XYZ started with just its top-tier customers. You'll also remember that XYZ further focused the project by linking with a marketing program being developed for customers who might want to upgrade their current series 800 systems. With these scoping factors in mind, one of the business functions impacted by this first Valencia project is marketing for the Series 800 products. The other, of course, is business-to-business sales. Now we need to identify the relevant processes.

12.2.2. Owner's Needs View: Business Processes

Next the XYZ project team continued working on the project-specific views that support XYZ's first customer identity project (Valencia). Just as they did for data, they always started each new view with the results from the previous level and generated more detail as they went along. These three steps identify the important process steps:

1.	Select a team of representatives from the business functions that are relevant for this project.
2.	This group will identify the major project-related divisions (processes) within these functions.
3.	Write a definition of each process.

There are whole lists of processes used by sales and marketing people to increase revenue, but for now we're focused on finding the right customers, making the offer, and selling upgrades. Initially, the S-800 product marketers wanted to take advantage of the Internet for information delivery and sales – it's the lowest cost means of reaching customers and taking orders. However after considerable discussion, they didn't believe the company was ready; XYZ didn't yet have enough pieces of web infrastructure to support this goal.

The project team members opted to use two well-established processes instead: database marketing (using the postal service to deliver the offer) and the company's mature inbound call centers for presales support and order taking. By making this decision, they avoided the risk of the kind of scope creep that sabotages many new projects. Although the Internet was tempting, they knew that they should minimize the amount of change to only what was needed to make the project successful. XYZ wanted to prove the concept that consistently identifying or recognizing customers across multiple existing systems would deliver successful sales results. They didn't need to change everything at once.

One real concern that the team had was about the quality and accuracy of the data in the source systems. From previous experience with both the order and product registration databases, the team members knew that the quality was poor in both systems, and that the systems differed so much in how they identified customers that combining them would be difficult. A key success factor was to identify all contacts with S815 or S817 products within the top 50 customer accounts. But internally, the company linkages were poorly maintained. The team identified a third key process, customer data quality management, which was critical to Valencia success but was seldom practiced within the company. We will discuss data quality management process more in Chapter 20.

The project team identified three key processes that would become part of the Valencia project, which are shown in Table 12-3.

Table 12-3. Valencia Business Processes

Business Process	Definition
Database Marketing	The process of using knowledge captured in a database to select the customers most likely to respond to an offer.
Data Quality Management	The process of monitoring, evaluating, testing, and correcting data in a database.
Inbound Telesales	The process of answering incoming telephone calls from customers to support, encourage, and accept a product sale.

Of course, if we uncover new processes, we must assign them to a business function. But within which organization will this process be managed? XYZ debated where data quality management should reside; some thought it belonged to the IT department. The final conclusion was that knowledge about customers sufficient to verify accurate data existed only in one of the customer-facing organizations, so the process was assigned to the marketing organization, which was the biggest user of the database and most impacted by poor quality.

It is very helpful to create a diagram like the one shown in Figure 12-4. These diagrams, called process maps, illustrate the relationships between all the current and planned internal processes that are important to Valencia and how they interact with the customer.

Our next task is to focus on each of the processes and determine the actual work steps that make up each of these key processes.

12.2.3. Designer's View: Activities and Tasks

Here we are at the Designer's View again, and this is where the handoff between business knowledge of what activities are performed and the skills needed to analyze and create formal documentation for each of the process steps often takes place. As we know, this step is the most critical because so much can be lost during the handoff.

In the designer's view, XYZ identified and documented each of the activities that people do during the process. As they did for the information component they also detailed some of the individual tasks that make up each activity. Only the individuals who manage and perform the business process have the knowledge about what is done. Information Technology often brings in the skill and knowledge necessary to effectively articulate and document each step so that a successful application can be designed and built.

One of the major contributions of the process analysis component is identifying the problems that occur in the “white space” when processes cross business organizations. The process analyst will capture information from all parts of the organization that play any part in the process and put the lists of activities together to identify process redundancy, contradiction, and disconnects.

To understand this step, let's look at the process for Database Marketing. The difference between Direct or Database Marketing (DM) and traditional marketing is that DM aims to generate a desired action from the set of specific customers who have been targeted. Direct Marketing involves creating a relevant offer, selecting the appropriate customers, delivering the offer to these customers, and measuring the results – in other words a match to the third and fourth (external) phases of CRM life cycle. The overall task of drilling into more specific levels of detail is called decomposition and is illustrated for this project in Figure 12-5.

Process decomposition simply means identifying the next lower levels of detail for each of the process views. As a result of the first three phases of process decomposition, XYZ developed the list of activities that are shown in Table 12-4. We use a similar naming convention for the different process levels as we used in Chapter 11 for data.

Table 12-4. Valencia Process Scope

Business Function	Business Process	Activity	Individual Tasks
PRODUCT MARKETING	Database Marketing	Create product offer
		Target customers
		Deliver offer	Define content,
			select media
			etc.
		Measure results
	Data Quality Management	Sample source data
		Assess quality level
		Design integration plan
		Implement quality improvement
BUSINESS TO BUSINESS SALES	Telesales	Answer product inquiry
		Analyze customer requirement
		Recommend solution
		Configure order requirement
		Enter order
		Manage order status

Of course, the IT team members will need more detail before they can understand what needs to be built. The IT team develops the remaining levels of detail. They will need both content and review input from the appropriate business experts to make sure they've gotten the right picture.

12.2.4. Following the Rest of the Steps

The two remaining views are primarily the responsibility of the Information Technology members of the project team, and we will not cover them in detail.

Builder's View: Application Design Specification

Application design identifies each step in an activity that is to be automated. Not all activities are appropriate for automation. It's important for the entire project team to understand the cost versus benefit of automating each activity. Often, the costs can't be identified until Information Technology has created the application design.

Detailed View: Software Module

Software modules are made up of computer code that is written to instruct the computer how to accomplish an activity. CRM software uses information about each customer stored in a database to decide what kind of experience to offer each customer. Other CRM software captures customer responses and stores them in a database. This software often allows a computer to perform a process that was formerly done by humans. The computer is much faster and it doesn't get tired, but it has no intuition, which is why the business expertise is so critical in the early stages of process engineering.

An Integrated Application System is the end result of the IT effort on process. Each module will be written, tested, and integrated into the overall working environment of the predetermined system users.

12.2.5. Making the Transition

The designer's view is where the handoff between the business team and the IT team takes place. Some organizations have formal process management organizations that are responsible for documenting, refining, and improving key business processes. If your company has this resource, by all means bring them into the project team at least for this step.

But for many companies, the benefit of such an organization has not been recognized. Most organizations simply don't have time to worry about how work gets done; they are too busy just working! This often results in poor and/or redundant processes that require significant rework. (They have time to do it over, but they don't have time to figure out how to do it right the first time.) In any case, in the absence of a process management team, it often falls to Information Technology to formalize the designer's view, so this is where major responsibility shifts from the business function to Information Technology, as shown in Figure 12-6.

Next, we will look at some of the key decisions involved in process automation.