rethinking business decisions and processes for digital transformation

Welcome! Preparing For Digital Transformation Boston, March 16 2017

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2:30PM—3:15PM

Red Hat Presentation: Powering Digital Transformation

3:15PM—4:00PM

Vizuri Presentation : Preparing for Digital Transformation

4:00PM—4:30PM

Signavio Presentation: Tools for Digital Transformation

4:30PM—5:30PM Happy Hour / Networking Time

AGENDA

“...Because we have to compete against new disruptive startups that are hiring kids fresh out of college drinking loads of Mountain Dew!”

(CIO @ Global Insurer)

Vizuri: Preparing for Digital Transformation

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Introductions

Joe Dickman – SVP, Vizuri Business leader working with organizations to understand how to leverage

innovation for increased business agility. Specializes in insurance, healthcare, financial service, retail, and logistics.

Ken Spokas – Technical Director, Vizuri Technology and Subject Matter Expert working with organizations to

evaluate architectural approaches, design extensible solutions, and introduce innovative technologies to improve business agility.

Ben-Johan van der Walt – Solutions Architect Vizuri Architect on many of Vizuri’s Rule engagements, leading projects on both the

technical and analytical side to successfully bridge the gap between business and IT for our clients.

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Vizuri Overview

●  Expert Java EE & Open Source Solution Provider ●  Premier Red Hat Business Partner ●  Preferred JBoss Certified Systems Integrator ●  4 Red Hat Innovation Awards ●  5 Time JBoss Middleware Partner of the Year ●  Certified Resources ●  Sponsor DC JBoss Users Group

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Vizuri Core Strength

Bridging Business and Tech

●  Identify strategic business drivers

●  Understand customer’s business

●  Evaluate architectural alternatives

●  Design solutions using proven, innovative, and adaptable technologies

●  Validate designs through iterative prototyping

Business Strategy

Solution Architecture

Development Implementation

Building Extensible Solutions

●  Reference Architecture

●  Continuous Delivery ●  Design Patterns ●  Performance ●  Scalability ●  Resiliency

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Pillars of Digital Transformation

API Management

Infrastructure Management

Knowledge Management

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Pillars of Digital Transformation

API Management

Infrastructure Management

Knowledge Management

●  CI/CD ●  Repeatable provisioning ●  Self-service ●  Governance ●  On-Premise / Hybrid / Cloud

●  Microservices ●  3rd Party / Internal ●  Security ●  Monetization ●  Death Star

Architectures

●  Rules / Decision ●  Business Processes ●  Predictive

Analytics ●  Machine Learning ●  Unprecedented

amounts of data

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Traditional Sense of SDLC

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Enterprise Software Engineering Focus Areas

API Management

Infrastructure Management

Knowledge Management

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Conway’s Law

Organizations which design systems… are constrained to produce designs which are copies of the communication

structures of these organizations

Melvin Conway - 1967

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Conway’s Law - Variation

If the parts of an organization ... do not closely reflect the essential parts of the product…, then the project will be in

trouble...

Coplien & Harrison, 2004

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Knowledge Based IT Management Challenges

●  Disparate Vocabularies ●  Translation of defined rules

and processes ●  Different Business and IT

Champions

●  Lack of 360 degree feedback loop

●  Lack of organizational visibility across the entire business

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Expectations vs. Outcomes

Business groups and IT require new positions to be defined that ”bridge” the communication gap.

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What is Knowledge-based IT?

A knowledge-based system (KBS) focuses on systems that use knowledge-based techniques to support human decision-making, learning and action1 Knowledge-based IT (KB-IT) is the application of KBS techniques with information technology •  Design process •  Models and methods •  Software tools •  Decision-support mechanisms •  Digital representation, and •  System architectures

Source: Fujita, H., & Lu, J. (2012). Knowledge-based Systems, Volume(31), pp. 1-211.

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What is Knowledge-based IT?

IT Solution where Knowledge is a first class citizen –  Business Rules and Process boundaries are clearly defined –  Goals drive the solution, not the IT restrictions

Change can be accommodated quickly without being impeded by IT limitations

–  The process knowledge definition and concept model should ”outlive” any technical implementation

–  Decouple the concept model and process definition from the underlying implementation to create business agility

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What is Knowledge-based IT?

●  BPM provides a systematic approach to making an organization's workflow more effective, efficient, and capable of adapting to ever-changing business conditions

●  A business process is an activity or set ●  of activities that will accomplish a specific

organizational goal ●  A business rule management system (BRMS) enables organizational

policies, and the operational decisions associated with those policies, to be defined, deployed, monitored and maintained separately from core application code

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Primary Goals for Considering Knowledge-based IT

•  Increase organizational agility •  Document processes to identify gaps

and critical dependencies •  Protect Intellectual Capital •  Reduce Complexity •  Provide insight into implementation •  Improve IT Outcomes •  Collect Key Performance Indicators •  Support Contingency Planning

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Compliance, Audit, and Policy •  Insurance

–  Underwriting –  Claim Adjudication

•  Healthcare –  Standards of Care –  Plans of Action

•  HIPAA •  SEC Finance Disclosure •  Mortgage Lending •  Government Agencies

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General Approach : Get Organized!

Both IT and Business Need Coordinated Discipline ●  Build a common way to describe things ●  Get Commitment! ●  Decompose the problem appropriately ●  Build with quick iterations ●  Continually monitor, adapt and improve ●  Take an inventory of the AS-IS problems and solutions

Discipline at each step pays off in both the short and long term!

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Challenge : Disparate Vocabularies

Truck ?

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Challenge : Disparate Vocabularies All stakeholders must be able to communicate effectively: •  Common Vocabulary

–  Non-ambiguous, understood by all –  Understood, or in a central reference –  Composes the “Concept Model”

•  Business Rules succinctly defined in near human language –  Not necessarily executable –  Closest to real language the better, but avoiding ambiguity

•  High level “happy path” processes modeled visually

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Project Spotlight : Railinc RPM Initiative

●  Concentrated (5 year) RPM effort ●  Canonical vocabulary and rule

definitions ○  Business Rules Solutions

●  Rules Development standards ○  Auditing ○  Traceability ○  Feedback

●  Program Assessments ●  Rules Training efforts ●  Rules Maturity Model

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Challenge : Different IT & Business Champions

Need all stakeholders to make a sincere commitment to collaborate:

●  The more management buy-in, the more hope of project success ○  Time-boxed modernization effort (typically 3 to 5 years) ○  Appetite to continue support of center of excellence beyond

inception

●  Need influential champions on both Business and IT side ○  IT left alone will mangle Knowledge IT to look like traditional IT ○  Business left alone will make infeasible goals

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Challenge : Different IT & Business Champions

Knowledge management is high-level and high-trust ●  Big responsibility… no other IT projects are closer to the

heart of the organization… ●  Often straddles business units/departments ●  Enable organization and collaboration

○  Tear down walls when appropriate ○  Will fail without sincere buy-in

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Project Spotlight : Large Mutual Insurance Company

●  Shortage of underwriters ●  Inconsistent risk ratings ●  Struggled with IT agility to push

services to help situation ●  Previous Project attempt failed ●  Built a rules engine group ●  Rules exposed as business centric service ●  Automated a large portion of the manual decision making

process ●  Underwriting approval process was reduced from 40 days to

under 5 days

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Challenge : Lack of 360 Feedback Loop

●  Are the Key Performance Indicators provided for processes/decisions?

●  Is the process “healthy”? ●  What are the bottlenecks? ●  Which rules were (or were not) applied

to arrive at a decision?

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Challenge : Lack of Visibility Across Business

●  Lost in translation? ○  From requirements to implementation ○  Reduce/simplify translation steps

●  Declarative definitions ○  BPMN/DMN

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Project Spotlight : PMI Rate Calculator

Fortune 500 Insurer providing Private Mortgage Insurance ●  Legacy Systems were out of date

and existing Rules Technology was being sunsetted

●  Business could not keep up with the rate of business rule changes

●  “States” and “Dates” ●  Performance was becoming an issue

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Going Forward: Process Assessments

Red Hat Offerings Empowering Digital Transformations

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SO YOU HAVE A MODEL, NOW WHAT?

AUTOMATING BUSINESS PROCESSES

BUSINESS PROCESS MANAGEMENT SYSTEM

BUSINESS RULES

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PROCESS PARTICIPANTS

ON-PREMISE SYSTEMS

CLOUD SERVICES

APPS APPS

APPS

Process Services

Decision Services

Business Central Process Server

PROCESS AUTOMATION WITH RED HAT

Your business experts build...

Process models

Decision models

Which are stored in the Red Hat repository...

Where they are packaged into applications...

And deployed... To the cloud...

or to servers in your data center.

PROCESS AUTOMATION WITH RED HAT AND SIGNAVIO

Your business experts build...

Process models

Decision models

Which are stored in the Red Hat repository...

Where they are packaged into applications...

And deployed... To the cloud...

or to servers in your data center.

Process Editor

Decision Manager

39

DEPLOY TO THE THE CLOUD?

40

DEPLOY TO THE THE CLOUD?

Decision Microservice

Process Application Planning Microservice

Payment Microservice

Modern microservices architectures

41

DEPLOY TO THE THE CLOUD?

Decision Microservice

Process Application Planning Microservice

Payment Microservice

Modern microservices architectures

Next-gen user experience

Siganvio: Business Transformation Suite

The smarter way to continuously translate between strategy and execution

Welcome, introduction ― David Gaudin,

SVP Sales, Signavio, Inc.

Today’s World

Agility is not a Buzzword, it’s a Necessity The pace, volume and complexity of change of today’s world demands that every organization becomes agile

▪  Rapid Pace of Technology Evolution

▪  Focus shift on Customer Experience

▪  New & Evolving Complex Regulations

▪  The Battle for Talent

▪  Decipher Volume of Intelligent Data

▪  Rising Security Threats

KeepingupwiththePace,Volume,Complexity,&CostsofChange

Today‘s World

What are we hearing

that is driving the

constant state of

Change?

VP/Director/Manager of…

•  Performance Excellence •  Business Transformation •  Customer Experience •  Process Excellence •  Risk and Compliance •  Operational Excellence •  Digital Transformation •  Employee Engagement •  Risks & Controls •  …..dozens more

KeepingupwiththePace,

Volume,Complexity,&Costs

ofChangeStruggling to keep up with

the Continuous State of

Change

The New Normal

•  Time & money wasted by multiple groups changing in isolation

•  High customer complaints & retention issues

•  Employees having poor process understanding or unable to access needed information

•  Change initiatives failing, lack of employee engagement

•  Rising costs of duplication and re-work

•  Knowledge gap between business and IT, leading to wrong system priorities, and wasted IT resources

Business Impact

Traditional

Approach to

Managing Change

as “Initiatives“

Reactive Approach

✓  Unmanageable Static Documents (Visio, PowerPoint, Word, Excel)

✓  Document Storage Initiatives (SharePoint, Box, OneDrive)

✓  Multiple All-Day Meetings

✓  Training Sessions & Initiatives

✓  Uncontrollable Volumes of Emails

✓  Post-It Notes Everywhere

✓  Tribal Knowledge & Superheroes Prevail

KeepingupwiththePace,

Volume,Complexity,&Costs

ofChange

Are you keeping

up?

KeepingupwiththePace,

Volume,Complexity,&Costs

ofChange

So what is on

your Mind?

Over the next 5 Years …

Organizations will be competing against,

partnering with, or serving customers they

never would have expected.

“We didn’t do anything

wrong, but somehow, we

lost”

- Nokia CEO

Hard Lessons: o  The advantage you have today

will be replaced by the trends of tomorrow.

o  You must innovate & improve, or one day become redundant & irrelevant.

Razor Wars: Gillette Vs. Harry’s Vs. Dollar Shave Club

The Current Uber Vs. Taxi Turf War

Hotels Vs. Airbnb: Let the Battle Begin

New Business Challenge: Agility & Innovation

▪  Accelerate our speed to market?

▪  Govern the pace & lower the cost of change?

▪  Shortcut traditional approaches?

▪  Align Business & IT on strategic outcomes?

▪  Impact customer journey vs. minor stovepipe improvements?

New Business Challenge:

Agility &

Innovation

So how can I…

✓  A single source of truth for – Business Process, Business Rules, Enterprise Architecture, Roles and Responsibilities, Risks and Controls, SOP’s, Training Resources

✓  Model-based Business – continuous business improvement and agile operating model

✓  Readily acceptable common language between business and IT teams to work collaboratively on strategic outcomes

✓  Leverage wisdom of the crowd to promote contribution to and sharing of process knowledge throughout the organization

✓  Visibility & Transparency for all to easily find information - anyplace, time, device - and through any lens, across barriers

✓  Visual gap analysis to view potential changes to current vs. intended state

KeepingupwiththePace,

Volume,Complexity,&Costs

ofChange

A Better Way

Signavio & Redhat The Best of Both Worlds

Business Community

Collaborative Design, Analysis, Validation, Optimization, Governance

IT Community

Develop, Deploy, Run, Monitor

Process Manager: An Intuitive BPM Solution

QuickModel: The Easiest Way to get started

Collaboration: Knowledge of the Crowd

Signavio https://editor.signavio.com

Visual Comparison & Version Control

Simulation: Optimize Costs, Time, Resources

Signavio https://editor.signavio.com

Roles & Responsibilities

Signavio https://editor.signavio.com

Data Dictionary: Consistency & Reuse

Reports & Documen- tation

Decision Manager: Decision Modeling

Signavio https://editor.signavio.com

Decision Manager: Decision Modeling

Signavio https://editor.signavio.com

Decision Manager: Decision Logic

Signavio https://editor.signavio.com

Decision Assistant

Signavio https://editor.signavio.com

Collaboration Hub: Your BPM Process Landscape

Collaboration Hub: Overview

Signavio https://editor.signavio.com

Process Intelligence: Insight into your Process Operations

Expected Path vs.

Actual Path

Global Financial Services

Regulatory Compliance ▪  Rapid growth of new

regulations ▪  Increasing

complexity ▪  Ever-changing

interpretations ▪  Very costly to

implement

Model for Success ▪  Thousands of

regulations modeled ▪  Rules visibility across

organization ▪  Business community in

control ▪  Governance & Audit

Trail

Results ▪  Lower cost of change,

dramatic savings $M

▪  Speed to market, change cycle: From 6-18 months to Days/Weeks

▪  Clear Visibility & audit trail

Major US Life Insurance

Market Opportunity ▪  New Customer

Journeys & Experiences

▪  New Products and Paths to Market

▪  Increase Innovation and Agility

▪  Slow Manual Legacy Systems & Processes

▪  Tribal knowledge

Innovative Approach ▪  Business Community in

Control of Process & Decision Logic

▪  Crowd Contribution and Knowledge Share

▪  Governance & Oversight of changes

▪  Seamless integration with IT Systems and Applications

Results ▪  New operating model for today

& tomorrow

▪  Wide audience contributing innovative ideas for new products and services

▪  Business community validation of business rules & logic before promoting to IT

▪  Dramatic reduction in change cycle, delivery reduction from 6+months to weeks

▪  Everyone on same page, awareness & notifications of changes

Signavio

2009 founded

1000+ customers

Offices: Berlin Boston Singapore

The first web-based modeling tool

The next generation business process and decision modeling platform

150+ employees

Small Company, Many Customers

Public Sector

Software & Internet Retail & Logistics

Manufacturing Communications

Banking & Insurance

Utilities and Energy

Academic Institutions

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