In-Depth

Q&A: Chief Process Officer Drives Business Process Automation

Company creates new position—Chief Process Officer—to handle the inevitable difficulties in BPM efforts, especially across business units

• By Stephen Swoyer
• 10/21/2003

Ultimus officials argue that organizations need to invest in an executive-level position—a CPO—with the authority to handle the inevitable difficulties that arise in any BPM effort. With the appointment of its own CPO, Ultimus says that it’s putting its money where its mouth is.

We spoke recently with Ultimus’ new CPO, Jeff Smith, as well as with its CEO, Rashid Khan, about the roles and responsibilities of the CPO.

Let’s talk about the role of the Chief Process Officer. What does he or she do? What are his or her responsibilities? And why is there a need for a distinct position of this kind?

Rashid: Let’s start with Ultimus as an example. We have an IT department, but while IT by itself is a necessity, it’s not a competitive advantage. The real competitive advantages are the business processes that sit on top of your infrastructure. So for us to go out and hire a CIO at this stage didn’t make sense, because we’re a small company [170 employees] and our IT infrastructure is pretty static. There’s nothing really innovative there. What’s really important is the bridge between the IT infrastructure and our business processes.

We have automated about 17 of our business processes already, but I can think of about 60 processes that we should automate but haven’t automated. What’s the reason behind this? The real problem is that we do not have senior people who understand the business requirements and [are able to] translate those into the IT infrastructure, basically be able to design and define the business processes… That’s where the CPO comes in.

So a CPO identifies business processes, determines how they’re mapped to an underlying [IT] infrastructure, and then figures out how to automate them?

Rashid: That’s part of it --

Jeff: In most companies, business processes have evolved over time in a need-driven basis. What happens is that in most companies, the processes tend to be localized in functional areas, and so, for example, the finance department does a pretty good job of automating the financial processes, but the boundaries are there [between finance and other departments] and things are still separated, when they really need to run across your function boundary. So part of the role of the CPO is to drive this effort across different business units, and to make sure that everybody’s on the same page. So a large part of that is handling the cultural differences and the ownership issues that are bound to occur between the different business units and IT.

A CPO acts as kind of a referee between these warring factions, so to speak?

Jeff: Yes, that’s certainly an important aspect of the job. In one case, I had an opportunity to give a presentation in front of some senior level IT people in Chicago, and a few of them took a little bit of offense to it, because I was saying that oftentimes we as IT people prohibit business from doing business. I mean, we dictate the operating system, what applications you can use, and how you can use them, and we shun all others. So when something big like CRM, like BPM, some of these other big projects come in, that’s a very big challenge for an IT department to take on. So what we’ve seen with a lot of companies is that they’ll get such a battle from IT that the whole thing falls apart, unless they find an executive who can drive it through and make it happen.

Rashid: In the end, the role of the CPO is not to own the process, but to enable business people who are non-technical to own the process and to facilitate them while still keeping the company’s IT policies whole.

Who’s handling that role today in enterprises that don’t have CPOs?

Rashid: In the absence of a chief process officer, by default it winds up in the CIO’s lap, and they’ve got so [many other responsibilities] that it doesn’t get the attention that it needs. In many of the companies that we have gone into, what happens is that there is a particular business owner, and they’ll have a need for this process to be automated, or they’ll have a need for this process to be designed and implemented, and they’ll go and they’ll contact a technical contact and they’ll start the process themselves, so they are the drivers for change.

But sometimes, that businessperson driving the solution, for whatever reason, leaves the company. Or maybe they don’t have enough senior-level responsibility to make the company realize how important this is, so they end up automating only their own process, when they really need [to automate] processes in other functional areas, too. So it just sort of doesn’t go anywhere.

Do you think that this [CPO position] is something that will catch on, then?

Rashid: If you notice, in the last two, three, or four years, there has been a lot less talk about other positions, like chief knowledge officer. Knowledge management was a big fad, but really nobody is talking about [chief knowledge officers] anymore. So you might argue that chief process officer might be a fad, but we don’t think so, because at the end of the day, a company is defined by its processes. The role [of the CPO] is not really to define these processes, but to enable other entities in a company to be able to implement and automate their processes.

The biggest obstacle or challenge [to that] is that there is a gap between the business people and the IT people: the former own the processes and have the need and IT owns the infrastructure. So it’s the responsibility of the chief process officer to fill this gap, and we don’t see that changing.