Posted by: Adam Deane | 24/11/2010

nI-edistuO :MPB

BPM Outside InI spend quite a lot of time reading about different BPM approaches, different opinions and different points of views.
Some are more interesting than others, some are bolder than others, some I agree with and some I don’t.
But all of them make you stop and think, revalidate you assumptions.

One of them is the ‘Outside-In’ approach.
‘Outside-In’ is more of a philosophy than a methodology.

‘Inside-Out’ BPM tends to concentrate on what’s going on inside the enterprise,
‘Outside-In’ BPM looks at the customer experience.

The core premise of Outside-In is that adding new value to customers presents the only sustainable way to continue adding new value to the company. To create new customer value, Outside-in rethinks the company from the customer in―first aligning strategies with customers; next aligning process to customer-focused strategies; then aligning technology to customer-focused process.

The best explanation that I found on the ‘Outside-In’ approach is the Interview with Steve Towers, CEO & Founder of BP Group

And if you’re interested there is a list of Outside-In resources here

Criticism of the Outside-In approach

I’m still not convinced.
Am I missing the point here, the bigger picture, the enlightenment?

I agree that when designing business processes you should always think of the customer – the end result, it’s just common sense.
“Organisations are not truly customer-centric. If they just build processes around the customer – they will succeed…”

It sounds a bit simplistic.
Not all of the organisation’s business processes are customer related. Some are internal processes, some are required by law, and some are interactions with internal systems.

Making everything customer experience oriented is not always good for the customer.
Investing in great customer support desk processes instead of investing in QA processes might make customers happy in the short term, but will cause them grief in the long term.

Some of the slogans used seem to me a bit out of touch with the real hardships of business process management.

* Is this process right, or is it the right process?
* Be Optimistic. Feint heart never won fair lady
* The Customer Experience is the Process

It’s like saying “Keep it simple”. It’s a nice phrase, and makes sense, but how do you implement it? What are the actions needed? (and don’t tell me that it’s just a mindset…)

ROI
Outside-In suggests that in using this framework, simultaneous improvements can be achieved in revenue, costs and customer service. If I remember correctly CRM marketing uses these “added values” slogans also, so does ECM, ERP, SOA, CMS and my local supermarket.
I’ve yet to see real numbers.

Nick Malik had this to say in his post “Creating context between BPM and EA

The key observation from this combination is that “Outside-In” BPM is really all about providing ideas for improvement, but if those ideas are not fed in to the executive pipeline, and don’t result in a formal strategy from the business, then they are not part of the focus that the business is asking for. In other words, if an executive says “we should focus resources on creating new products,” she is not going to be happy to hear someone say “but we should focus on improving customer experience instead!” The result of that conversation is obvious: “I’ll back that, if you don’t spend any money on it.”

Name Dropping
“Southwest Airlines, Apple and Best Buy represent mature approaches to BPM adopting outside-in viewpoints”
It’s nice to see big successful companies used as examples of Outside-In success, but I’m not sure these companies owe all their success to Outside-In, and not to their good products, good business decisions, good timing, or innovative business models.

I’m a bit surprised that other customer-centric organisations were not mentioned.
How about the Banks for example – very customer-centric. A customer wants a mortgage but probably can’t repay it – give it. The customer is always right. Audit processes and regulation are internal processes – forget them. (…maybe we should blame Outside-In for the credit crunch… ;-> )
Here is a few more companies that embraced the customer experience approach and didn’t get a mention: Pan-Am, Swissair, Napster, Woolworths, Sharper Image, Planet Hollywood and Portsmouth_F.C. – RIP

Ok.. I got carried away with the cynicism here… my apologies.. but the point I’m trying to make is that successful outcomes is not a result of an outside-in approach, (nor inside-out by the way) – it’s finding the right balance.

I think my frustration here is that after reading and reading on the subject – I couldn’t find the action items, the physical steps that are needed to make this work.
Maybe the action is to keep building your process as before, but don’t stop at your regular end-point. Continue it to include the customer.

I’ll finish off with Thomas Olbrich‘s brilliant presentation explaining the concept of customer focused processes


Responses

  1. Adam, I am also somewhat sceptical about methodologies and best practices. Each business is and ought to be unique. In terms of process creation one actually needs all perspectives. Inside-out from management, outside-in from customers, Top-Down from the executive and bottom-up from business knowledge. One cannot create business processes with just one of these perspectives as the sole or key focus. That is the balance that you are talking about. But how do we get there?

    As I wrote in one of my posts a few days ago: ‘ACTION creates the future not strategy.’ So what actions does one need to take to fulfill the above balance?

    I propose that rocesses have to be created for clear and achievable goals that are defined based on and linked to strategic objectives and operational targets. Each of those above perspectives has to be considered. The way to consider them is to create a process environment that allows all of the above participants to enter their goals, perceptions, knowledge and judgement into the process. One could consider that a ‘social’ approach, but simply chatting or twittering on the subject won’t do anything. We seem to agree that value is produced in processes and thats what ‘social’ lacks.

    I therefore focus on empowering process participants to define objectives, targets, goals, and execute and judge processes based on those. As this doesn’t require and would’t work with upfront encoding of flows, learning, improvement and innovation are an integral part of that approach.

    More in this post: http://isismjpucher.wordpress.com/2010/11/21/process-goals-rules-patterns-and-templates/

  2. Adam – I think your post entirely encapsulates my thoughts on Outside-In. I often hear the phrase ‘Focus on the customer’ in relation to OI. But then companies such as Ryanair are quoted. In my opinion there are few companies LESS focused on the customer than Ryanair. I, therefore, hit the same problem as you in having trouble identifying exactly what needs to be done to ‘focus on the customer’

    I would be interested to see if Mr Towers himself weighs in on this with some concrete answers to your questions rather than the usual “These companies are doing outside-in and they are successful therefore OI must be the reason” response.

    Great post.. Gary

  3. Chaps – you’re not quite getting it, but I don’t blame you. When I did the course with steve towers it took me 2 days to unthink everything I’d learned about process already. There is a very defined withod of doing this and I’m happy to send you my case study presentation on what I did for one client recently. the mistake most people make is confusing customer outcomes with customer service – that’s not correct. It is very simple in essence but that’s where it is a powerful method. Have a look at http://www.theprocessninja.com/outside-in/ – in particular my three part post explaining outside-in. There is also a great article by forester regarding the state of the customer experience 2010. Happy to help clarify any questions. Cheers, TPN

  4. TPN, you can’t solve it all by being a BPM warrior! A customer outcome is purely perception and what Outside-In does mostly is to look at the customer from the inside. I am therefore very weary of all methodologies, because they are the ‘self-help-books’ of IT! ‘Customer orientation in Eight Simple Steps’. Excuse me, but that is not it.

    I am not disagreeing with the concept or with Forrester (who would dare to?), but I am still missing in most of these approaches the true consideration of customer perception. In most cases it ends up in creating rigid processes and statistical fragmention of customer data in demographics. Understanding true customer perception at the ‘Moment of Truth = Interaction’ happens very little if at all.

    Just as a matter of interest: If you had to unlearn everything about BPM, why do you see yourself still as a ‘Process-Ninja’? How about ‘Customer’ or OI-Ninja?

  5. […] practices or oversimplified methodologies. Adam Deane … my favorite BPM poet … just posted critically on the subject of ‘Outside-In’ and I agree that one has to rather consider ALL aspects for process than just one – […]

  6. Hi Max, why is a customer outcome purely perception? Outside-in often (not always I will admit) involves working with the customers themselves and resources out there. You can take Bentley’s example of working with their customers directly to understand their successful customer outcomes. Outside-in isn’t restricted to a bunch of guys sitting in a room dreaming up customer outcomes.

    “In most cases it ends up in creating rigid processes and statistical fragmention of customer data in demographics. ” This is the very antithesis of outside-in – outside in is about agility and responding to the customer experience rapidly. Moments of Truth are a cornerstone of the method.

    I’m a process ninja because I optimise business processes – simple as that. Although I am a great fan of outside-in and the CEM Method, it isn’t the only method I use and I will never restrict myself by refusing to learn other methods as they arise.

    Cheers, TPN

    • TPN, I am not against Outside-In. I just see it as one element of creating, doing and improving processes. If you involve customers, executives, managers, process oweners and skilled performers into the process in real-time then you get all the perspectives you need. Pure social chat is however not enough as there is no value definition and verification.

      There is nothing in Outside-In that is in any way special or deserves some higher status because it focuses on customers. Everyone does. But each and every outcome is just perception. There is no other way. You can’t measure it. If you ask the customer he will respond based on his expectations, not based on what you wanted to achieve. Therefore we need real-time process interaction with customers so that simply each one can turn into a Moment-OF-Truth if so desired.

      Regards, Max

  7. Response to this: http://www.theprocessninja.com/2010/11/outside-in-myths-debunked.html

  8. Hi Adam,

    “Am I missing the point here, the bigger picture, the enlightenment?” Sounds like you answered your own question in your posting.

    In response to your comment “I’ve yet to see real numbers”, please refer to http://bit.ly/cdfeos

    Now, I’d like you to find a company who says they are not customer centric. The result will be zero. Every company tells us they are customer centric but the customer experience tells us otherwise.

    Now explain to me what a customer centric organisations looks like. Is it one which delivers what customers want? I bet a lot of organisations waste lots of money delivering what customers want. However, I wonder if the idea for the iPhone came from someone asking Steve Jobs what they wanted ….. OR was he able to understand the real customer NEED from the customer’s perspective (aka Outside In)?

    It’s funny, a long time ago people thought the world was flat and now….

    • Hi David,

      Thanks for your response.

      Regarding the real numbers graph… Are these companies – companies that studied Outside-In, implemented their solution based on Outside-In methodology… or are this just a graph of successful companies that Outside-In is piggy-backing on.

      If I ring up Google (number 1 in the list) – will they tell me that they have trained Outside-In consultants working for them, and that the CEO has based his business model upon the Outside-In he learnt from you guys…. or will they tell me that they have never heard of Outside-In in their life, and that Outside-In are just trying to ride on their glory…

      Cheers,
      Adam

  9. Hi Adam,

    The companies identified as Outside In have applied the Outside In method to at least 50% of their processes. And no, if you ask the Google CEO he may never have heard of the term “Outside In” because they may not call it Outside In despite using the methods. Call it what you like but the principle and methods are in use everyday. Call him and see what he says.

    Regards

    David

    • Apple by the way is not an Outside-In company. They do not ask their customers what they want. Apple innovates from the inside-out. Their success with the Apple stores shows that they believe in direct customer interaction and not just ‘moments’ of truth. Steve Jobs gives very strong top-down guidance and is not outside-in. Google on the other hand has never cared what their customers think and they still don’t. They are completely bottom-up! Their culture is about radical innovation complete disconnected from market epxectations. They killed ‘Google Wave’ despite a huge outcry from the users. An outside-in company wouldn’t have done that.

      Outside-In is just one important aspect of running a business, nothing more.

  10. Hi Max,

    Actually, Apple is one of the most Outside In companies around – that is, the inspiration for their innovation comes from understanding customer needs – if you call this inside out then so be it. Outside In represents a view taken of the organisation, that is, from the customer’s perspective.

    As for the Apple stores, yes, they do believe in direct customer interaction. Where a customer process deserves to exist, there is an optimum number of moments of truth. What Apple have done is take inspiration for their stores not from other retailers, but from Four Seasons Hotels. In doing so, they have challenged the traditional retail approach and also optimised the number of moments of truth along the way.

    I am intrigued about your comments:
    Google on the other hand has never cared what their customers think and they still don’t. They are completely bottom-up!

    Google (as with Apple) is a company whose approach enables them to change customer’s and market expectations but to believe they don’t care about what their customers think sounds ill-informed. If your customers don’t want to use your products or services then logically, you can quickly go out of business.

    As for Google Wave, probably way before its time. I certainly didn’t hear a huge outcry and it was obviously not enough for them to continue with it. The decision to drop it sounds to me like a pure business decision.

    There is more to running a business than Outside In, but as a strategy, it can be used to develop, or at least contribute to the success of an organisation.

    I do agree with your comment, Outside In

  11. Great debate, but a debate nonetheless, and probably just that??!!

    Customer Orientation, Outside-In, Customer-focused organization,… are all philosophies and concepts that one embraces, and lives. Putting a methodology around it is an attempts to get our arms around it – need for consistency, need for repeatable success, need for controlled outcome. Which is fair and which is why, Adam, your question is fair.

    But, at the essence of it lies the practice and not the theory or methodology. If one needs to be a practitioner of OI, or any such concept/discipline (same applied to BPM, mind you!) it’s much less about the methodology and much more about practicing the principles and consistently doing it, learning from it and growing wiser…

    As for the success stories on such topics, no large company is successful just because they did one thing and only that one! They get successful by doing a lot of things, a helluva lot of things…!!! In retrospect we can say GE was six-sigma and Totota was J-I-T or TQM, but they built great organization, great leaders, great processes, formidable systems, maintained enormous discipline, drove and motivated people, sustained consistent and progressive culture…. list is long…!

    So, let’s practice, not debate! Peace.

    Great Post, BTW, Adam!!! 🙂 🙂 🙂

    – Cheers,
    Ashish

  12. As Corleone once said in the Godfather, “Just when I thought I was out, they drag me back in…”

    The whole Outside-In thing is nothing more than a business enterprise, not a real methodology. Having been through it in the early inception when the BPGroup when through various guises and “exec appointments”. You’ll find that the same companies again and again are quoted as adopting and achieving the “triple crown” through Outside-In methods (Virgin, Southwest Airlines etc) but now they’re turning their focus on companies in today’s social sphere.

    Come on, are we that gullible we believe Apple attribute their success to Outside-In, or that the methodology should claim credit for it ? (they’re a Sigma house for anyone who cares)

    BPGroup research is also a bit flaky, clever questions and multiple choice designed to get the results required.

    If you’ve actually read the books by Steve and Terry Schurter you’ll find nothing of note backed by hard fact. In fact you’ll be hard pressed to find a recommendation for Outside-In from real clients other than those in developing BPM nations that have been targeted for rich pickings.

    It’s Six Sigma and Lean with different words, Voice of the Customer anyone ? The world doesn’t need a made-up methodology that exists in other forms already. We’re all professionals who can adapt and use tools to the given situation.

    Why learn how to speak with a Liverpudlian accent when the language is English ? Same applies with Outside-In. It’s what you know already with different words.

    Certification ? In what ? By what authority ?
    Case closed.

    Outside-In is another phrase for State the Bleedin’ Obvious.

    If I’m a little harsh here it’s because I’m extremely jaded by this, this kind of nonsense erodes the real value of BPM. Surprised this became a debate at all….

    I’ll now go back into retirement. Until the next time.

    Theo

  13. Hmm… I’d agree that Outside-In is nothing revolutionary or innovative but just a bit of common sense given a label. But that doesn’t make it any less relevant.

    Adam rightly pointed out that “Making everything customer experience oriented is not always good for the customer.”, and I’d go even further and say that the moment you apply Outside-In to a process you put yourself in a trade-off position between effectiveness and efficiency which many companies and indeed people are unable to handle on a continuous basis.

    Where I find Outside-In to be helpful is as a sort of check and balances list:

    In our coffee example, the customer process clearly begins before the provider (coffee bar) process – that understanding alone can be helpful in at least understanding customer behaviour and process performance. Whether any process change follows from that understanding is a different issue (which is where I differ from Steve T.)

    The second advantage lies in evaluating the scope and benefits of planned projects. I know that I’m endlessly repeating the same thing on this, but I do believe that most process related projects are based on “because we can” instead of “because we should”. Outside-In may just offer an additional litmus test for these projects.

    The danger – as always – lies in regarding Outside-In (like all other approaches) as the one and only absolute truth. It’s not, but it can broaden our understanding of process behaviour and mechanisms.

    Thomas

    p.s. The fun part is that Outside-In has brought up the question of “Who is your customer?” If you’re in need of a quiet chuckle, start collecting the answers 🙂


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