David McCoy

I’m doing some basic data gathering from several sources – typical work of an analyst.  In this blog posting, I’m looking for some current anecdotal evidence around BPM investment analysis mechanics – nothing fancy.  From our BPM survey, we know that cost savings are critical BPM measures of success.  I’m interested in the mechanics of how you measure those actual savings as a percentage of the total outlay:

1. Do you do project-level investment analysis of any kind (payback period, ROI, IRR, etc)?
2. Do you calculate a predicted ROI or IRR for your BPM projects before they are started?
3. Is a formal, predicted ROI or IRR a requirement for approval/funding?
4. Do you measure post-implementation ROI or IRR?
5. As you calculate the present value of your net benefit stream for your investment measures, do you cap the number of future years you will project out?
6. How long (number of years) is the typical benefit stream that you feel comfortable calculating?
7. What discount-rate ranges (interest rates, cost of capital, etc) do you use for your NPV calculations?
8. What investment levels (e.g., IRR levels) do you consider borderline for project approval?
9. What investment levels make you dance with glee?

Well over a decade ago, we determined that workflow projects met or exceeded ROI expectations about 90% of the time.  A BPMS is not a workflow tool, and this is 2009 – a lot of the low-hanging fruit is gone.  Are you seeing the same level of investment performance?

Let me hear from you, and thanks!

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Category: Business Process Management (BPM) Business Rule Management (BRM)     Tags: Business Process Management (BPM), David McCoy, Gartner

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