In a business culture that has become obsessed with metrics, some insiders say the latest and greatest concept for bridging the jagged gap between business measurements and technology measurements is BAM – business activity monitoring.
“When an enterprise extends beyond its own borders, the question becomes ‘how do we fulfil our business promise through an entire organization that is now so decentralized and extended?'” said Jim Love, vice-president of management consulting with Fujitsu Consulting (formerly DMR), who hosted a recent teleconference on business process performance.
The answer, Love said, is a non-traditional, complementary approach that translates the plethora of IT metrics currently collected into an easily understandable form that red-flags potential problems, and gives a heads-up to everyone involved before the customer is affected.
Business activity monitoring – or BAM – describes the concept of providing real-time access to critical business performance indicators to improve the speed and effectiveness of operations, said Roy Schulte, a Mass.-based vice-president and research fellow with Gartner Inc.
“In a way this is the convergence of operational business intelligence (BI) and real-time application integration. BI, because we’re talking about surfacing information that’s going to help make business decisions, and real-time application integration, because we’re talking about things that take place across multiple applications systems – it is not simply monitoring things (emerging) from a single place,” Schulte said.
“This is a business strategy … a business goal. It is not a technical strategy, but it’s only the aggressive use of information technology that will enable this to happen. BAM is rare advance in IT because…it’s flashy, it demos easily and it’s understood even by non-technical managers and analysts who normally don’t want to know the details about how IS is doing its job. This really is going to be the killer application for application integration,” he said.
Today BAM is only being used by three per cent of all enterprises, but Schulte said that by the end of 2005 more than one-third of all large enterprises will have at least one BAM solution in production.
In a BAM system, Schulte said, the entire enterprise and all the participants that are working on a business process – business units, people, application systems, automated devices – can be thought of as subsystems in a holistic system. As soon as any person or application captures information in one place, the goal is to make it available to all other interested parties throughout the enterprise, including B2B partners.
After identifying areas of your business where fresh information can most improve operations, existing systems need to have wrappers, adapters and other connections built in to capture relevant events and filter them into a database, Schulte said. Similarly, he said, new apps need to come with the hooks to generate BAM information.
Then, Schulte said, rules engines and other software agents can correlate the events at multiple locations and present critical information in a flashy interaction layer that shows trends and anomalies without overloading the users.
For the past two years CIBC Mortgages Inc. has been using a new application for advancing mortgage funds to solicitors that was designed with BAM capabilities built into it, said Harry Hallworth, CIO of the bank’s mortgage unit.
“If our mortgage money doesn’t get to solicitors in time, house sales don’t close on time and people ultimately don’t get the keys to their house on the day the movers are showing up at the door. So we need to be able to mange and operate the technology infrastructure consistently to meet our business commitments,” he said.
As a result, Hallworth said, CIBC and DMR developed a dashboard that shows each step in the mortgage application process and can communicate an early warning of problems and their potential business impact. And on at last one recent occasion the BAM information has “saved our hides with 700 mortgage customers who would not have been happy with us,” he said.
“We did have a situation a few months ago where we had 700 EFTs (electronic fund transfers) going out on a late-day deposit. The process failed internally and historically we would not have caught it until too late. But the monitoring tools caught it, alerted our technicians who quickly put in a resolution and our EFTs were sent out in time to the solicitors’ accounts. If we had not had this in place we would have either missed (the transfer), or had to scramble to manually get 700 mortgage advances into solicitors’ accounts,” he said.
A final benefit of BAM was freeing up valuable resources for more productive activities, Hallworth said.
“We had people that were dedicated full time to watching these applications. As a result of the [BAM] tools these high-end systems administrator technicians are now free to work on more rewarding things instead of watching systems.”