The Critical Success Factors of Business Process Management

International Journal of Information Management 30 (2010) 125134

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International Journal of Information Management

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The cri m

Peter TrkUniversity of Lj

a r t i c l

Article history:

Keywords:Business proceCritical succesContingency tDynamic capaTasktechnolo

ent (blemropoic ca

s envt beo iden

1. Introdu

For40yeegy, structubasis for the1999). Thecinterest in iperformanc2001). Oneprocess maand practitioners interest in this area for more than a decade (Rheeet al., in press; Vergidis, Tiwari, & Majeed, 2008).

BPM is dened for the purpose of the paper as all efforts inan organization to analyze and continually improve fundamentalactivities such as manufacturing, marketing, communications andother major1997). A buset of activideliver valu& Kettinger

Althoughpositive cosuccess (McSkerlavaj, Inprehensivethe conceptpractical exand programtors (CSF)Gable, & Ro

Tel.: +386E-mail add

ir remainMela conwithas me wbe upaps, 2

of old ideas to t a newcontext, and that thiswas ultimately used todrive growth in the consulting industry (Newell, Swan, & Galliers,2000; Terziovski, Fitzpatrick, & ONeill, 2003).

Therefore the main contribution of this paper is to provide

0268-4012/$ doi:10.1016/j.elements of companys operations (adapted fromZairi,siness process is a complete, dynamically coordinatedties or logically related tasks that must be performed toe to customers or to fulll other strategic goals (Guha, 1993; Strnadl, 2006).

various empirical researches indicate that there is arrelation between process management and businessCormack & Johnson, 2001; McCormack et al., in press;dihar Stemberger, Skrinjar, & Dimovski, 2007) no com-andsubstantial benets that can justify thehypearoundhave been identied (Vergidis et al., 2008). Since theperience showed a large number of failed projectss, several papers tried to identify critical success fac-

of BPM (e.g. Ariyachandra & Frolick, 2008; Bandara,semann, 2005). However, most of those papers failed to

1 5892 512; fax: +386 1 5892 698.ress: [email protected].

a theoretical basis for the eld. A novel combination of threeunderlying theories, namely contingency, dynamic capabilities andtasktechnology theory is proposed. It establishes a basis for theexplanation of (un)successfulness of BPM efforts. This basis canthen be used to study CSFs in general and can be applied to analyzeCSFs in each particular example.

The structure of the paper is as follows: First, the need to furtherexamine the CSFs for BPM is established. Then the approach is the-oretically grounded and explained with the combination of threeunderlying theories. A case study of the bank that uses a theoreticalframework to identifyCSFs in their BPMefforts is presented. Finally,main implications and further research possibilities are discussed.

2. The need of CSFs for BPM and IT use

Since several different terms (e.g. business process reengineer-ing, business process change etc.) are often used to describe similarconcepts, the papers using different buzzwords are summarizedtogether as long as their denition matches the one used in this

see front matter 2009 Elsevier Ltd. All rights reserved.ijinfomgt.2009.07.003tical success factors of business process

man

ubljana, Faculty of Economics, Kardeljeva pl. 17, 1000 Ljubljana, Slovenia

e i n f o

ss managements factorsheorybilitiesgy t

a b s t r a c t

Although business process managemoretically grounded. This leads to profactors of BPM programs. The paper pof three theories: contingency, dynamprimarily the t between the businestinuous improvement and the properexist. The underlying theory is used tsector.

ction

ars the issueoftbetweenanorganizationand its strat-re, processes, technology and environment has been aory construction and research (Kanellis, Lycett, & Paul,hangingeconomicenvironmenthas led toan increasingmproving organizational business processes to enhancee (McCormack et al., in press; Ranganathan & Dhaliwal,of the elds dealing with these challenges is businessnagement (BPM) and there has been a surge of papers

put thestill re2007;

Asnized,BPM hdescribshouldsimilarWilliam/ locate / i j in fomgt

anagement

BPM) is a popular concept, it has not yet been properly the-s in identifying both generic and case-specic critical successses an underlying theoretical framework with the utilizationpabilities and tasktechnology t. The main premise is thatironment and business processes is needed. Then both con-tween business process tasks and information systems musttify critical success factors on a case study from the banking

2009 Elsevier Ltd. All rights reserved.

search within a theoretical framework. Therefore BPMs largely atheoretical (Karim, Somers, & Bhattacherjee,o & Pidd, 2000).sequence, the eld of research is currently disorga-

out a possibility to classify and/or compare such studies.ostly remained in the fad phase and papers still mainlyhat BPM actually means; what it constitutes; how itsed etc. Management consultants and academics writeers on those topics (Dale, Elkjaer, van der Wiele, &001). Some even claim that BPM was just a repackaging

126 P. Trkman / International Journal of Information Management 30 (2010) 125134

paper. The termBPM is used consistently to describe the previouslydened concept.

While there has been much research on process modeling tech-niques and corresponding tools, there has been little empiricalresearch insuccess (Bather, the slacked in eof differentof analysissuccess is pdeterminedlonger perio

Despitereport as mcessful (AbdMacintoshservice inducould bringet al., 2008detailed in(Abdolvand

CSFs in gresearchedlimited numwill assuremainly offefollowing asupport, prtion and in(Ariyachandal., 2007). Timportant& Dhaliwalcited in tradship, invest(Lu, Huang,

In additWhether thindustry caconrmed (another reagiven. In sutial differenapproach tomissing (Na

A closelyments, sincidentied iTrkman, 20Groznik, 20ness valueoften beenScheepers, 2a better ideness valuebe measureare expecteRay, Muhanthis paper arelation bet

3. Theoret

Interestidevelop a

ing ones. This may derive from the inherent complexity of theeld, since BPM challenges span from organizational, managerial,information systems and even social problems. However, the con-sequence is that the eld of research is still in its infancy (Hung,

andrizat, mistermn, 20refory itss, naands thenageesealain

CSFthesesropeto a

). Alsandtecreforand eion o. Theant ftheucceer onach on butinu

t betw

tingandons ms mutitive& Jucon

ere izatios andtweetheoom tunde effs of ts desof ims shor, 20omeme tch tor wicarePMto the success factors and the post hoc evaluation of itsndara et al., 2005). Before investigating CSF even fur-uccess of BPM must be properly dened; this oftenarlier studies. Since BPM can be initiated for a varietyreasons and the denition of success may differ by unit(e.g. project, organization) a very general denition ofroposed: BPM is successful if it continuously meets pre-goals, both within a single project scope and over ad of time.considerable investment in the area, most reviewsany as 6080% of BPM initiatives having been unsuc-olvand, Albadvi, & Ferdowsi, 2008; Karim et al., 2007;

& Maclean, 1999). It is therefore not surprising that thestry is not convinced that a business process approachsignicant tangible and measurable benets (Vergidis) and that the risky nature of BPM has motivated avestigation of its critical success and failure factorset al., 2008).eneral have been one of the earliest and most activelytopics (Lee & Ahn, 2008). They can be dened as aber of areas, in which results, if they are satisfactory,

successful performance (Rockart, 1979). The literaturers fairly similar and rather general CSFs for BPM. There almost always included in the list: top managementoject management, project champions, communica-ter-departmental cooperation, and end-user trainingra & Frolick, 2008; Bandara et al., 2005; Karim etop management is often considered to be the mostit must initiate and support BPM efforts (Ranganathan, 2001). Obviously other familiar factors that are oftenitional information systems management like leader-

ment, communication and training apply to BPMaswell& Heng, 2006).ion, identied CSFs for BPM are often case-specic.e CSFs of companies operating in one country or onen apply to those operating in other countries is rarelyLu et al., 2006). Usually no theoretical explanation orson for the choice of a specic type of organization isch way, neither generalized ndings nor the poten-ces among industries can be extracted. The systemicorganizational change and improvement seems to beslund, 2008).related topic is the assurance of success of IT invest-

e IT is usually both the enabler and facilitator of changesn BPM projects (Attaran, 2004; Groznik, Kovacic, &08; Hung, 2006; Trkman, Indihar Stemberger, Jaklic, &07). However, much debate has centered on the busi-of IT and the effect of IT on business performance hascontested (Brynjolfsson, 1993; Carr, 2003; Scheepers &008). Therefore theprocess-orientedperspectiveoffersntication of various ways of IT use to provide busi-(Karim et al., 2007). The value of IT should therefored at the activity/process level, where the prime effectsd to be realized (Melville, Kraemer, & Gurbaxani, 2004;na, & Barney, 2007). The proposed underlying theory inttempts to provide further insights by investigating theween IT investment and BPM programs.

ical background

ngly though, none of the studied papers tried to eithernew theory or to base their thinking into the exist-

2006)categoIn factof the(Attara

Thequentltheorietheoryfollowin maingly, rto exp1999).

TherstlyprocesThen pneededtheorycessesby task

Theneedssideratresultsimportone offor unsconsidfrom eisolatiothe con

3.1. Fi

ConnizingsituatizationcompeMiller,style isand thorganizationalso be

Theshift frto thethey arteristicproceslihood

ThiMansaavoid sto assuapproaanotheshouldtheir Btheoretical explanation and consequently analysis andion of both research and practitioners efforts is missing.understanding of the BPM concept and misapplicationis one of the most often cited reasons for BPM failure04).e the proposition of this paper is that BPM and conse-CSFs can be explained with the combination of threemely contingency theory; dynamic capabilities (DCs)tasktechnology t (TTF). The use of this combinationfact that it is difcult to examine research questions

ment using a single theoretical framework. Increas-rchers are integrating multiple theoretical frameworkscomplex strategic issues (Hoskisson, Hitt, Wan, & Yiu,

s in this paper are identied out of the premise thatt between the business environment and businessis needed (as claimed by the contingency theory).r organization and continuous improvement efforts aressure sustained benets fromBPM (as stipulated byDCso, the proper t between the tasks in the business pro-information technology/systems must exist (as foundhnology t theory).e, BPM should translate a rms strategy into specicnable the execution of the strategy. Any isolated con-f the above mentioned aspects will yield suboptimalsole focus on processes in the context of other equallyactors (e.g. technology) being ignored (or vice versa) ismain causes of failure (Grant, 2002). The main reasonssfulness of BPM projects can thus lie in the failure toe ormore of those linkages. Therefore, thendings/CSFsf the three proposed theories should not be studied int rather as an inter-connected set (as also outlined ination of this paper).

een the business environment and business processes

ency theory contends that there is no best way of orga-that an organizational style that is effective in someay not be successful in others (Fiedler, 1964). Organi-

st effectively align their strategy and structure with theenvironment if they are to perform effectively (Rogers,dge, 1999). In other words: the optimal organizationtingent upon various internal and external constraintss no universal or best way to manage. The design of ann must t with the environment and effective organi-not only have a proper t with the environment butn its subsystems (Iivari, 1992).ry was chosen, since the research interest has begun tohe justication of the value of BPM and similar practiceserstanding of the contextual conditions, under whichective (Sousa & Voss, 2008). The t between the charac-headoptingorganizationand the standardizedbusinessigns embedded in the adopted system affects the like-plementation success or failure (Morton & Hu, 2008).ws that best-practice approaches (see e.g. Reijers &05 as an example of this type) towards BPM may helpof the common pitfalls. However, it is very dangeroushat simply copying either the business processes or thewards their improvement from one successful case to

ll bring the same benets. Therefore each organizationfully study their contingencies and appropriately alignprograms. Finally, the adoption of a well-understood

P. Trkman / International Journal of Information Management 30 (2010) 125134 127

and replicable best practice is not likely to constitute a dynamiccapability (Winter, 2003), which is discussed in the next section.

3.2. Continuous improvement efforts to assure sustained benetsfrom BPM

The queadvantageThis theoryviewby adoresources ato adjust itsthe rms c

An impointernal anable producoften consid2002;Mlleoften beenmance (Ray2008). Althmance enha2004).

From abest-practiccompetitiveas a set ofdevelopme2004). The poptimizatio

Many prcesses and tproject butwith constaconstant asnology is atheir contin

3.3. The t

The roleuse of the Tto have a pif the capabform (Goodthe function(Dishaw & S

In orderTTF concepwill only hait matchesthat organifor organiza(Bleistein, Cused to undprocesses dmust be tigtions inform

Namely,and more cbeen reporbecoming ative advantconsiderablets due tostrategies (K

The ndings from TTF theory have to be closely connected withthe concepts of DC theory outlined in the previous section. Pastexperience showed frequent failures of a software system due topoor management of processes (Barjis, 2008), while on the other

PMmnt prportn te

aintaform

e stu

stic

ase sorete coy CSFeffo

ive lis inposeal vase-ssitupor

trol (ethoardt

hat and ira etn, 20kingthisvirorformonit

gatiddepeances of einespadhther,l actilikelndbf infcessinte

ndt &ere tn stroointring s

ethod

casen abankas coch fst for the achievement of sustainable competitivefrom BPM can best be described by the DCs theory.attempts to bridge the shortcoming of a resource-basedpting a process approach. DCs are a buffer betweenrmnd the changing business environment and help a rmresourcemix and therebymaintain the sustainability ofompetitive advantage (Vaidyanathan & Devaraj, 2008).rtant aspect is the identication of difcult-to-imitated external competencies most likely to support valu-ts and services (Teece, 2007). Business processes areered to be such a competence (Hafeez, Zhang, & Malak,r, 2006) and the effectiveness of business processes hasadopted as the dependent variable to measure perfor-, Barney, & Muhanna, 2004; Scheepers & Scheepers,ough DCs may not be sufcient to guarantee perfor-ncement, they are a necessary prerequisite (Sher & Lee,

process perspective, BPM is often regarded as ae management principle to help companies sustainadvantage (Hung, 2006). In this case DC can be denedspecic and identiable processes, such as product

nt, strategic decision-making, and alliances (Sher & Lee,rocess view allows analysis, design, management, andn of the dynamic structure of a business (Strnadl, 2006).oblems are related to the evolution of business pro-heir variability. This means that BPM is not a one-timeshould be a continuous effort within an organizationnt improvement in business processes. Consequently, asurance of the t between business processes and tech-lso needed. Both the renovation of the processes anduous improvement require proper informatization.

between business processes and technology

of technology in BPM can be best described with theTF theory. The TTF theory holds that IT is more likelyositive impact on individual performance and be usedilities of IT match the tasks that the user must per-hue & Thompson, 1995). IT will be used if, and only if,s available to the user support (t) his or her activitiestrong, 1999).to explain the lack of success from IT investment, thets are expanded to the organizational level; namely ITve a positive impact on organizational performance ifthe business processes (Karim et al., 2007). Ensuringzational IT is in alignment with and provides supporttions business strategy is critical to business successox, Verner, & Phalp, 2006). In such way this theory iserline the often claimed: IT does not matter, businesso (Smith & Fingar, 2003). The corporate IT functionhtly coupled to enterprise processes and the organiza-ation needs (Strnadl, 2006).it has been difcult to prove a positive gain from ITases of failed implementations than of success haveted (Dhillon, 2008). A well-known claim is that IT iscommodity that cannot bring a sustainable competi-

age (Carr, 2003). Despite signicant investments in IT ae number of rms have not been able to derive full ben-their inability to effectively deploy IT in their businessarim et al., 2007).

hand BFrequethe supbetweeand mvent in

4. Cas

4.1. Ju

A cthe thehow thidentifof BPMdenittheoriethe proextern

A catage incontemno contion m(Eisenhareas tstage a(BandaSamso

Banmaketive enthe pewide m& Tsalinto inimportbeneton busMukho

Furcentrain IT is2007) aumes oas a nedue to(De Baing whis oftemain pufactu

4.2. M

The2008 ias Skycase wapproaust begin to apply the capabilities of IT (Attaran, 2004).ocess changes then require a continuous adaptation ofing IS (Mutschler, Reichert, & Bumiller, 2008). A real tchnology and business processes must be establishedined, otherwise the users and managers may circum-ation systems (Bendoly & Cotteleer, 2008).

dy

ation of the case study

tudy has been used as a research method to underlineical ndings set out in the previous sections, i.e. to showmbination of three underlying theories can be used tos and to improve the likelihood of a successful outcomerts. The purpose of the case study is not to prepare astofCSFsbut to showtheconnectionof threeunderlyingthe identication of case-specic CSFs. Nevertheless,d CSFs are thoroughly theoretically grounded to assurelidity/generalizability of the ndings.tudy approach was chosen since it has a distinct advan-ations when how or why questions are asked about aary set of events over which the investigator has little orYin, 2003). Case studies typically combine data collec-ds such as interviews, questionnaires and observations, 1989). Finally, case-study research is used to tacklere still in the understanding, discovery and descriptions a recommended way to research an emerging areaal., 2005; Stuart, McCutcheon, Handeld, McLachlin, &02; Yin, 2003).industry was chosen as an example. Several reasonssector a particularly good example. It is a competi-nment, where BPM is constantly needed to improveance of business activities and to enable enterprise-oring and coordination. (Nikolaidou, Anagnostopoulos,ou, 2001). Banks often disaggregate their value chainndently operable functional units, which amplies theofBPM(Homann,Rill,&Wimmer, 2004). Banks reap theffective BPM due to the impact of process performance

s performance (Davamanirajan, Kauffman, Kriebel, &yayd, 2006; Rhee et al., in press).the acquisition and the treatment of information is avity in banking and the impact of process innovationsy to be larger than in other industries (Casolaro & Gobbi,anksnamely critically require IT to coordinatehugevol-ormation (Beckett, 2004). IT investments are perceivedity to pursue the rationalization and cost managementnsied competition and crisis in the nancial sectorDavis, 2000). While BPM is very important in bank-

he division of work between the back and front ofcesng and traditionally rooted (Tas & Sunder, 2004), the

s can also be generalized to other service or even man-ectors.

ology

study was conducted between June 2007 and Marchmiddle-sized Slovenian bank (hereinafter referred to; the name is ctional, all other data are real). Thenducted following a well-established methodological

or such projects (Indihar Stemberger & Jaklic, 2007;


Table 1Classication of CSFs.

Theory Main idea Critical success factors at Skybank

Contingency theory Fit between the business environment and business processes Strategic alignment, level of it investment, performance

Dynamic cap m

Tasktechno

Kovacic & Bstudyprotoand procedAll interviewanalysis res

A projecfrom Skybament/key inwere presepared. The l

The idenon the dencore procesfollowing w(individualsbanking, ancesses withstrategic valiquidity mment and h

For eacemployeescess modelsoftware wBanks documodels fromndings. Thments of emmodels wertasks and th

Allmodeees, middleconsultant.eling phasepostulationCSFs weresenior andposed apprTable 1 andSkybank mproposed im

4.3. CSFs ba

4.3.1. StrateIn order

BPM must bthe strategivalue fromlinkage betwis crucial (R

The mostive implemstrategy couness proces

nectone, & Sanedss stsed ince SkuseSeveise.pmeploy

ions.er alor w

on lentit al

ovidessuey weadercus

ffer,

Levelimp

cessfshedtionpernottitivethe mantl

roperher oterna4). Advancustot thntinenteve

softwlli, 20ce oabilities Continuous improvement to assure sustained benets from bp

logy t Fit between it and business processes

osilj-Vuksic, 2005). In order to assure reliability case-colwasprepared, including researchquestion,methodsures for data collection and data analysis guidelines.s, documentation, developedbusinessprocessmodels,

ults etc. were noted in a case-study database.t team composed of researchers and selected managersnk was created. Then a workshop for middle manage-formants was conducted. The main concepts of BPM

nted and the initial list of business processes was pre-ist was then rened within the project team.tied processeswere distributed into two groups basedition of the business process (Melo & Pidd, 2000). Theses are those that deliver value to the customers; theere identied: account management, credit approvaland organization), savings management, investment

d documentary operation. On the other hand the pro-out a direct value for customers but with an importantlue (called support processes in the case study) were:anagement, new services development, risk manage-uman resource management.h process semi-structured interviews with bankswere used for the preparation of detailed business pro-s and descriptions of individual tasks. IGrafx Processas used for the preparation of business process models.ments, legislative/regulatory framework and referenceprevious similar projects were used to triangulate the

e models were corrected and rened based on com-ployees performing the tasks. The developed businesse validated by banks employees (both the executer ofe middle management).lswere analyzed in the cooperationwith bank employ-and senior management assisted by an external

The suggestions of employees noted during the mod-were also taken account of in the analysis. The

s of all three theories were considered. The identiedpresented and discussed in a workshop, attended bymiddle management, who further validated the pro-oach and the list of factors. The main CSFs are listed inthoroughlypresented in the rest of thepaper. Currently,akes further corrections to the models and some of theprovements are under way.

sed on contingency theory

gic alignmentto reach long-term success and improved performance,e linked to the organizational strategy. Understandingc context of a BPM program is essential to maximize the

of conto beChongconcerbusinediscus

Sinshould2006).egy ardeveloage emreductwhethbranchbasedinvestmshouldnot prthose inamelon broers ande.g. Ho

4.3.2.The

to sucestabliassociaserviceshouldcompelizingsignic

Apegy, otthe exal., 200itive afromathe factant coinvestm

Howware,(Beccainuenprocess improvement (Hung, 2006) and close strategiceen competitive strategy and the operations function

hee & Mehra, 2006).t signicant predictor of BPM success is namely proac-entation of BPM as part of organizations businesspled with focused BPM efforts on core-customer busi-ses (Rhee & Mehra, 2006). On the other hand the lack

(Terziovski2007; Shu&IT accumulareason for timpact of Iative conseconnectionmeasurement, level of employees specializationOrganizational changes, appointment of process owners,implementation of proposed changes (quick-win strategy),use of a continuous improvement systemStandardization of processes, informatization, automation,training and empowerment of employees

ivity between strategy and BPM projects was foundof the main reasons for failures (Bandara, Indulska,diq, 2007). Additionally, IT strategic alignment, broadlywith the correspondence and compatibility of IT andrategy within an organization must also be reached (as

the next section).ybank can be classied in the prospector category, itBPM to improve its competitive position (Rhee&Mehra,ral important issues in relation to the Skybank strat-For example the main question of the new servicesnt process is whether Skybank should actively encour-ees innovativeness or should it rather focus on costThe main question of account management process isl activities of this process should be provided at each

hether smaller branches should become specializedocal market specics. A similar dilemma is whetherbanking process should focus on basic services or

so offer advanced service (e.g. derivatives). BPM can-a comprehensive answer to such questions; most of

s should be tackled in the strategy formation phase. It isll established that the strategy of the rm is contingenteconomic variables, industry structure, market, suppli-tomers variables and organizational characteristics (see1975).

of IT investmentortance of aligning IT strategy with business strategyully face the competitive market place has been well(Ariyachandra & Frolick, 2008). The nding there is nobetween the level of IT spending and relative customerformance (Ray et al., 2007) indicates that companiesform a mistaken belief that IT by itself will bring aboutadvantage (Chae, Yen, & Sheu, 2005). In fact rms uti-ost recent technological inputs have market returns

y below the mean (Heeley & Jacobson, 2008).level of IT investment is contingent on companys strat-rganizational resources, which interact with IT and onl environment (Duh, Chow, & Chen, 2006; Melville etdditionally, IT itself does not bring about any compet-tage; managers must reengineer their core processesmer perspective (Terziovski et al., 2003). This amplies

at the environment of an organization is an impor-gent variable in the determination of the level of IT.r, the impact of different types of IT investment (hard-are and services) on banks performances is mixed07). Similar surveys have found a low or non-existingf IT on the efciency and performance of banks

et al., 2003), while other studies (e.g. Casolaro & Gobbi,Strassmann, 2005)have founda signicant inuenceoftion on banks productivity and protability. The mainhese differences may lie in the difculty to measure theT and the fact that IT can have both positive and neg-quences; we argue that this often depends on efcientbetween BPM and strategy.


IT investments are perceived as a necessity to pursue the ratio-nalization and cost management due to intensied competitionand crisis in the nancial sector (De Bandt & Davis, 2000). There-fore, Skybank needs to determine both the level of IT investmentand the proThe currenttance of souSkybank:itExcel than ters are deeminvestmentof business

4.3.3. PerfoPerform

improvemeoften stemsument and2008). It islevel wherebe process-aggregate p2007).

New proquality, and(Guha & Keform, easilyoriginally a1998). All kresults meatomer requcycle time aas claimed btance of eac2004).

New meprocess at Sfor credit aSkybank ismeasures isvices. The rloop in ordetheory). Thas a basis freluctance t

4.3.4. LevelAnother

the use of sactivities intask, while& van der Aand may haresult theyother handtheprocessand general2005) and ror the other

A typicaare needed(the so-calofces). A sa completespecics. Sinot named

not be provided. The answer is namely contingent on the strategyand desired performance outcomes.

4.4. CSFs based on dynamic capabilities

Orgainv

ge inunatat mstomes inaniza-end

potefunccansilosn pr

tley,ultipns hzatioed (Rkybaofferinession oyeesnto, IT ated.n of rSkybses w

Appomo

tradiammdesiblerogrcessd supceedsibilits pit (

dditiremeed pd skof asss prointmmimannessuentir sup. Theiativo thejects that will be supported within the limited budget.nancial crisis has even further increased the impor-nd decisions. In the words of the project leader frommay often be cheaper to perform certain activities ino informatize every possible exception. Process own-ed responsible to choose an optimal level andmix of IT

sthose that will contribute most to the improvementprocesses.

rmance measurementance measurement is crucial for achieving sustainablent. The reluctance to invest in an organizational changefrom the lack of consistent and effective ways to doc-track the nature and extent of its impact (Lee & Ahn,important that it is measured at the activity/processthe prime effects are expected. Applications tend tospecic and the prots may not be reected in itserformance (Leem, Yoon, & Park, 2004; Ray et al.,

cesses must be measured for time, costs, productivity,capital, then compared to the processes they replacedttinger, 1993). Usually though, the provision of uni-understood measures can be a greater challenge than

nticipated (Wareham, Bjoern-Andersen, & Neergaard,ey processes should be tracked with in-process andsures taken at critical steps in the process to meet cus-irements, prevent errors, reduce variability, improvend increase productivity (Lee & Dale, 1998). However,y contingency theory the selection and relative impor-h measure is contingent on strategic priorities (Hoque,

trics for measurement efciency/successfulness of eachkybankwereproposed (e.g. the average/maximumtimepproval) and quantied. Since the strategic focus ofon customer service/satisfaction the main focus of theto assure quick and quality execution of customer ser-

esults of process improvement should form a feedbackr to ignite continuous improvements (as found by DCs

e results/achievement of those objectives can be usedor employees reward system, but initial employeeso such changes may be expected.

of employees specializationimportant contingent variable is the trade-off betweenpecialist and generalist employees for conducting theeach process. A specialist is able to perform exactly onea generalist is able to perform more of them (Mulyaralst, 2005). Specialists build up routine more quicklyve a more profound knowledge than a generalist. As awork more quickly and delivers higher quality. On the, the availability of generalists adds more exibility to(Reijers&Mansar, 2005). Theoptimal ratioof specialistsists in a process has to be found (Mulyar & van der Aalst,esourcesmaybe turned fromspecialists into generalistsway round (Reijers & Mansar, 2005).

l question at Skybank is whether specialized employeesto prepare contracts in the process of credit approvalled middle ofce in addition to the front and backimilar question is whether each branch should provideservice or only specic services based on local marketnce the process owner for the process in question wasat that time, the nal question to this dilemma could

4.4.1.BPM

a chanUnfortture ththe cuuct linan orgend-to2000).

Thetion ofwhichzontalbetwee&Weshave mnizatioorganireport

At Sshouldof busdenitemplogrow icessesconnecdivisioees atproces

4.4.2.The

and aers (HclearlyresponWell-pof protive anTo sucresponsuringperform

In ameasua denrequirechargebusine

Appand comiddlecessfulconseqfor theeffortsgic initthem t2007).nizational changesolves a thorough analysis of the organization and oftenan organizational structure (Guha & Kettinger, 1993).

ely, many banks and other organizations have a cul-ay be inconsistent with the desire to organize arounder, and a set of processes that are siloed along prod-stead of customer lines. Different departments withintion often operate as silos and consequently horizontalcustomer processes are not well understood (Peppard,

ntial problems of process organization include duplica-tional expertise and increased operational complexityresult in an escalation of costs, the emergence of hori-, inconsistency in the execution of functional decisionsocesses, and general erosion of the efciency (Silvestro2002). Such organizationmeans thatmost professionalsle bosses, which is often problematic and many orga-

ave failed in an attempt to establish process-orientedn; however, several successful examples were alsooss, 1999).nka creationofbusinessprocessofcewas suggested. Itamethodological support for continuous improvementprocesses and coordinate those activities. A properf tasks, competence and required knowledge of its

is needed. Eventually the business process ofce shoulda department with responsibilities for business pro-nd organization, since those three areas are closelyThe creation of such organizational unit requires a newesponsibilities and clarication of the roles of employ-ank. Most employees participate in multiple businesshich could cause confusion about lines of reporting.

intment of process ownersst visible difference between a process enterprisetional organization is the existence of process own-er & Stanton, 1999). All processes should have aned owner who reviews process performance and isfor its continuous improvement (Lee & Dale, 1998).

essed organizations seem to name a higher proportionowners who are more often at both a senior execu-ervisory/frontline level (Pritchard & Armistead, 1999).

, a process owner must be a permanent role with reality for and authority over designing the process, mea-erformance, and training the frontline workers whoHammer & Stanton, 1999).on, the continuous review and update of performancent system should also be constituted as a process withrocess owner, who is in charge of development of theills (Kuwaiti, 2004). In such way process owners are insuring the dynamic improvement of the capabilities ofocesses.ment of process owners can also increase the inclusiontment of middle management to BPM. The reluctance ofagement is namely one of the main reasons for unsuc-of such projects (Terziovski et al., 2003). The buy-in andly active support from middle management is crucialport and involvement in the continuous improvement

y should have enough freedom to test/select new strate-es through the autonomous process before convertingdiscipline of the induced process (Burgelman & Grove,


The main challenge of appointing process owners at Skybankwas both the identication of suitable persons and the overcomingof the reluctance of employees and middle management. Severalof them proposed appointing one person for each departmentinvolved innamely it w

4.4.3. ImpleThe succ

dent on thejoint effortboth the miin the procpre-implemchange, it limplementis importantion (Herziga small numprojects for& Stoddardzational chhelp determneeded (Alm

Obviousshould be sduce BPMportion of pble to showeasier to atment and oof an actionon the frequciency andapproximat

4.4.4. Use oThe mai

ments are nformal strucial both in(Guha, Groceed in ach1999). A printegrationapproachesmust be thment/procedriving forc

At Skybemployeesand nanciformalizedher suggestshouldhaveels. The mothat they re

4.5. CSFs ba

4.5.1. StandAt a min

it must worfore processindustries,regulations

Beimborn, Weitzel, & Knig, 2008). Only the standardized pro-cesses bring standardized tasks that can be supported by a propertechnological solution (as stipulated by TTF). BPM systems can the-oretically lead to an increase in standardization, since the processes

ecuteKngn scies acche ovan, 2kybant bro clieormncho arrrdizanceries inservtitive

Inforndd reles thlf wiluctedeed tn etel ofre mses oul coic v

ancinetsFurters;bill,

eralT. Ashierole cstemcaset stahich

tion old implan

Autoselyreferanc

an be. In gee, &ations ent001)bettf sucation(Erlthe process; this is exactly the opposite of the goal;ould even increase the siloed nature of an organization.

mentation of proposed changesess in implementing organizational changes is depen-quality of the implementation process. It requires a

between a manager and achange agent (in our caseddle management and the employees conducting tasksess) (Ives & Olson, 1984). While the uncertainty in theentation stage focuses on the strategic concept of theater mainly relates to the appropriate procedures tochanges. Middle managers uncertainty managementt in assisting their employees in the change transi-& Jimmieson, 2006). The usual focus is therefore onber of key processes, since simultaneous renovationall identied processes are bound to fail (Davenport

, 1994). Nevertheless, the nature and causes of organi-anges are not yet understood and further research toine how to implement and manage a major change isaraz, 1994).

ly, both the initial quick-wins and long-term solutionought at Skybank. Since its previous attempts to intro-have failed, the main suggestion was that at least aroposed changes is implemented as quickly as possi-rst results of the program. In this way it would be

tain a continuous support from top, middle manage-ther employees. Another proposal was the preparationplan that would specify improvement priorities (basedency of each process, its contribution to Skybank ef-also the willingness of employees to participate) ande time schedule.

f a continuous improvement systemn proposition of DC theory is that continuous improve-ecessary and that both the organizational culture and

ctures should encourage it. Change management is cru-BPMprograms and to assure the payoff of IT investmentver, Kettinger, & Teng, 1997) but few companies suc-ieving continuous improvement (Ahmed, Zairi, & Loh,oper system therefore needs to be designed with theof different quality and process-oriented improvement(Davenport & Stoddard, 1994). The top management

e authoritative key supporters while middle manage-ss owners (see also Section 4.4.2) should be the keyes to popularize the concept (Savolainen, 1999).ank both formal and informal encouragement forinnovativeness was proposed (various praise-based

al benets). The suggestion process should be partlyand each employee should receive a response to his orion from the process owner. In addition, all employeesaccess to the current versions of business processmod-dels should be constantly reviewed in order to assuremain up-to-date despite constant improvements.

sed on tasktechnology t theory

ardization of processesimum, in order for something to qualify as a capability,k in a reliable manner (Helfat & Peteraf, 2003). There-standardization is desirable and, particularly in serviceoffers technical interchangeability, compliance with, and improved customer condence (Wllenweber,

are exrules (art thareduceavoid tTushm

At Sdifferecards ters infthe braclient tstandathat coactivitthe precompe

4.5.2.The

ing anindicatby itseAs dedcess n(Trkmatain levsoftwaprocesa carefeconomand nthe be2005).customof each

Sevfrom IThe cathe whtion syof theaccountasks wmentaIt woucareer

4.5.3.Clo

whichperformtasks cments(Shi, Lautomenableet al., 2with ament oautomnologyd in a way that is consistent with specications and& Hagen, 2007). However, many processes are morence. Imposing rigid rules on them squashes innovation,ountability, andharmsperformance. Companies shoulder-standardization of such artistic processes (Benner &003; Hall & Johnson, 2009).nk the same process is often conducted differently inanch ofces. A typical example is distribution of creditnts. While some branch ofces send them by post, oth-the clients by telephone that they can pick the card inofce. Others simply archive the cards and wait for theive. The developed models can be used as a tool to easetion; all employees should have access to the modelsn their activities, along with preceding and successivethe process. The main challenge of standardization is

ation of needed exibility, which is currently one of theadvantages of Skybank.

matizationing there is no associationbetween the level of IT spend-ative customer service performance (Ray et al., 2007)at companies should not form a mistaken belief that ITl bring about competitive advantage (Chae et al., 2005).from the TTF theory; both the technology and the pro-

o be renovated in order to reap the desired benetsal., 2007). The same applies to software adoption - a cer-process renovation should be involved, as the packageday be incompatible with the current needs and businessf the organization (Ngai, Law, & Wat, 2008). However,st-benet analysis has to be conducted to estimate theiability of informatization, to obtain top managemental support (Hur, Mabert, & Hartley, 2007) and to assureare indeed attained (Love, Irani, Standing, Lin, & Burn,

her savings are possible in the communications withe.g. IT can eliminate the costs of printing and sendingwhich amounts to USD 25 (Dunlap, 2005).

Skybank BPM problems arise from inadequate supporttypical example is a credit card approval sub-process.has to check the credit map (stored on paper) sinceredit rating of the client is not evident in the informa-. Several usual problems were identied in the scopestudy, such as client-bank communication (sendingtements by post) and insufcient support for certainare still conducted manually. In addition an imple-

f human resource management system was suggested.prove the overview of available knowledge and easierning.

mationconnected to informatization is process automation,s to the use of IT to assist or replace employees in thee of a business process (Harmon, 2003). Many routineautomatedwhile othersmay still need human involve-eneral, tasks can be fully/semi-automated or manualKuruku, 2008). Business process modeling and theirimprove the performance of business activities and

erprise-wide monitoring and coordination (Nikolaidou. Automated can be executed faster, with less cost, ander result. An obvious disadvantage is that the develop-h system can be very costly and sometimes the requiredis not even possible due to inherent limitations of tech-

, 2005; Reijers & Mansar, 2005).


At Skybank, the business process modeling and analysisrevealed several un-automated tasks, where business logic doesnot require human intervention. Those procedures could be codedas independent atomic software components and fully automated(Shi et al., 2tem (WFMSWeske, & Gprocesses wmated, whiwhich canapprove thbring considtime, servicder Aalst, 2

Anotherreports (e.ginformationness procesprocess of glead to the eSection 4.5.and enableearlier reseis spent on

4.5.4. TrainThe na

time into thees. Technobank wants& Howcroftlation betwperformancincreasingly(Pritchard &tionwith thto the bank

Further,be spent onworkers areresult in smreduction oreduces theMansar, 200

Skybankbusiness premployees.business prprograms deesmotivamanagemen

Employethe complicbe used exA typical suapproval byfrom top mmonitoredfraud by em

5. Discussi

Several ition systemand the cas

nation of three theories to respond to the question of the nature ofcompetitive advantage and the role of BPM in it. Both the literaturereview and the presented case-study support the premise that asimilar combination is needed to explain the complex interactions

ous ationspaptherce chld cperxibilld tses aecifyempselys inch c

rcomationrise aan,

o the. Howationformbe epapereturn thlied iocesntribeasenmen

eral lshou

willic gomendrs tolp intch be inses.reforframhis ible thpetitan bshowntingcomena

timeandcesss neost onoted phownseq008). The introduction of a workow management sys-) (Mentzas, Halaris, & Kavadias, 2001; van der Aalst,

rnbauer, 2005) to support the enactment of improvedas also suggested. Several tasks could be fully auto-

le semi-automated tasks can be supported with WFMS,warn an employee of his or her pending tasks (e.g.e document). Earlier research found that WFMS canerable business process improvement in terms of lead

e time,wait time, and resource utilization (Reijers & van005)suggestion was the replacement of specially prepared. in pdf or xls format) with the possibility of accessingon the y. Another nding was that succeeding busi-ses at Skybank (e.g. the opening of bank account andranting a credit) were not seamlessly integrated, whichntry of the same data twice. Automation (coupled with2) would free Skybanks employees from routine workthem to improve customers service and experience. Anarch showed that up to 40% of the total employee timeanswering simple customers queries (Beckett, 2004).

ing and empowerment of employeesl identied CSF was the need to invest more funds ande training and consequently empowerment of employ-logy namely changes services in commodities; if theto be distinctive it has to invest into people (Durkin

, 2003). Previous research conrmed a positive corre-een banks investment into training and their businesse (Beccalli, 2007). In addition, employees training isconsidered to be a prerequisite for a success of BPMArmistead, 1999). The quality of employees interac-

e clients is namely amaindeterminant of clients loyalty(Ndubisi, Wah, & Ndubisi, 2007).in traditional business processes, substantial time mayauthorizing work that has been done by others. Whenempowered to take decisions independently, it mayoother operations with lower throughput times. Thef middle management from the business process alsolabor cost spent on the processing of orders (Reijers &5; Trkman & McCormack, in press).has an appropriate level of knowledge about its

ocesses, yet it is not properly disseminated amongAdditional trainingabout services,market situationandocess execution is needed. Several previous trainingid not bring sufcient results due to the lack of employ-tion. A training sub-process (within thehuman resourcet process) has to be explicitly dened and monitored.es should thenbeempoweredwith thesimplicationofated approval system. Only one approval level shouldcept for very important transactions, e.g. large loans.ggestion was an increase in the threshold for creditmiddle management (without the need of approval

anagement). Obviously, this process should be carefullyin order to mitigate possible risks due to mistakes orployees.

on and conclusion

nteresting ndings and considerations for the informa-s eld arise from the proposed theoretical frameworke study. First, the paper has proposed a unique combi-

of variadapta

Theof wheembrait shouthe prothe eIt shouprocesalso spwhere

Clochangeport suto oveinformenterpBuchanto go tp. 310)duplictionalshould

Theof thelenge iIT appness prfully coan increnviroarea.

Sevpaniesalonestrategrecomanswecan heter mavariablproces

ThereticalCSFs. Tto enaa comtives cstudythe coof theshoulda one-cessesfor succhangecess. Mshouldimprov

As sand cospects, such as business processes, IT and continuousto a variety of contingent variables.

er offered new considerations regarding the questionconsistency or change is better. The company shouldange to enhance its competitive advantage; however,arefully align its business processes (supported withimplementation of IT) with its environment and assureity and continuous adaptations of its core processes.herefore establish which business processes are keynd contribute to the competitive advantage. It shouldwhich business processes should be standardized andloyee may have certain exibility.connected with that is the need for organizationalorder to assure the infrastructure needed to sup-hanges. Process organization seems a promising waye functional silos that can create barriers to effectiveow, constrain the value that can be generated by thendcanalso lead to isolated systemsdevelopment (Gibb,& Shah, 2006). In the silo organization problems havetop to get sorted (Coughlan, Lycett, & Macredie, 2005,ever, several problems were also identied such as theof authority. Therefore, in order for such an organiza-to succeed a difcult balance between the studied CSFsstablished and maintained.r alsopresentedapartial answer to theeternal questionn/evaluation of IT investments which has been a chal-e last four decades (Renkema & Berghout, 1997). Onlyn such a way to both match the current state of busi-ses (as stipulated by TTF theory) and to enable DCs canute to a sustainable strategic advantage. The search forof exibility of ISs to match the changes in turbulentts is thus one of the main challenges of research in this

imitations of BPMas a conceptwere also outlined. Com-ld not mistakenly believe that the adoption of BPM

bring any contribution to either their operational orals. Namely, even the best BPM program (following theations in this and other similar papers) cannot offer

the question of the proper focus of an organization. BPMthe execution of a strategic program by enabling a bet-etween the organizational strategy (that is a contingentour proposed framework) and a companys business

e, the paper proposed a much needed underlying theo-ework for BPM and used it for identifying case-specics crucial for BPM to move out of the hype phase ande scientic exploration of the role of BPM in attaining

ive advantage. Consequently, the CSFs of such initia-e explored in a much more systematic manner. Theed that a success of BPM originates in identifyingent variables that largely inuence both the strategypany and the most critical areas for success. Then itble continuous improvement (rather than serving asproject), while assuring the t between business pro-the information systems used. Both are namely crucialBPM should also trigger the necessary organizational

eded for the increased likelihood of continuous suc-f such improvements are supported by IT. IT, however,be considered a panacea but rather as a tool to supportrocesses.n by the case study, the implications of all three theoriesuently their identied CSFs are closely inter-related. For


example, organizational changes (appointment of process owners)and performance measurement are a prerequisite for assuring aproper level and mix of IT investments. Hence the identied CSFsshould not be taken in successive order (as reported in the paper)but as a sesimultaneo

The properal. Due toto provideproposed thnizations frCSFs. The caframeworknian bank.assure the ltime due toobviously tmay shift to

The papto several oBPM.Withoagers are ooutside conwhich shoutop managetions strateA necessaryance of up-

The papframeworkthe theoretspecic CSFshould berather broacess is needthat succesmagnitudeCSFs, identialso be ben

Acknowled

The reseResearch Athank Dr. Aducting the

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Peter Trkman is an assistant professor at the Faculty of Economics of the Uni-versity of Ljubljana in Slovenia. His research interests encompass e-government,telecommunications, technology adoption andvarious aspects of supply chain, busi-ness process and operations management. He has participated in various researchand consulting projects and published over 60 papers/book chapters, includingpapers in Computers & Operations Research, European Journal of OperationalResearch, Government Information Quarterly, IEEE Transactions on EngineeringManagement, International Journal of Production Economics, International Journalof Production Research, Journal of Computer Information Systems, Online Infor-mation Review, Technology Forecasting & Social Change and TelecommunicationsPolicy.

The critical success factors of business process managementIntroductionThe need of CSFs for BPM and IT useTheoretical backgroundFit between the business environment and business processesContinuous improvement efforts to assure sustained benefits from BPMThe fit between business processes and technology

Case studyJustification of the case studyMethodologyCSFs based on contingency theoryStrategic alignmentLevel of IT investmentPerformance measurementLevel of employee's specialization

CSFs based on dynamic capabilitiesOrganizational changesAppointment of process ownersImplementation of proposed changesUse of a continuous improvement system

CSFs based on tasktechnology fit theoryStandardization of processesInformatizationAutomationTraining and empowerment of employees

Discussion and conclusionAcknowledgmentReferences

The Critical Success Factors of Business Process Management

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