The problem is, most BPM software vendors (and frankly, many industry pundits) have a limited view of what Social BPM really is. They relegate it to collaborative process design – making it easier for a handful of pre-designated people to work together in developing a process diagram. This is, at best, a single. The grand-slam homerun happens when Social BPM is applied to real-time collaborations across all employees (and customers) while business processes are being executed.

Let’s say you work in customer support for a large insurance firm. A customer has logged a trouble ticket for a rather mundane issue, and you have received a task with an appropriately moderate priority level. Let’s also say that, unbeknownst to you, a sales rep is sitting in a meeting with that customer discussing a large up-sell opportunity. While the support issue is nothing major, it is sticking in the customer’s craw and jeopardizing the deal. Through a Social BPM activity stream, the rep can do a search for the customer name, pull up all info related to that customer (including the trouble ticket event) and instantly post a comment about the sudden and unexpected urgency to resolve it. You instantly see the comment, take care of the mundane issue, and before the rep leaves the meeting, the problem is fixed.

If you’re using Appian, all of that took place via a single unified interface that’s as easy to use as Facebook. Unlike Facebook, however, Appian unites complex back-end enterprise systems, such as those used across your support and sales departments, and allows you to read data from and take action on those various systems from that single interface.

Social BPM isn’t limited to internal system and human events, either. Here’s another example:

You work for a property management company in Chicago. You have set up your Appian Social BPM feed to automatically track and post Twitter tweets containing the word “relocation.” A post appears in your Appian interface that says, “About to announce HQ relocation to Chicago. Start the apartment hunting!” You check the poster’s profile and see that she works for ACME, Inc.

ACME hasn’t issued their corporate press release on the HQ move yet, so your sales team has an opportunity to scoop competitors. Still in the Appian interface, you launch a case called “Jump on this Chicago relocation opportunity,” and add the comment “We have lots of Chicago apartments. Find ACME’s HR contact and offer some incentives.” This case goes immediately into process, gets assigned to your Chicago rep, and you’re off to the races.

These are just two examples. Once you get your head around the real potential for run-time Social BPM, the possibilities are virtually unlimited.

Ben Farrell, Director, Corporate Communications

But a closer inspection of Guidewire, made possible through their IPO regulatory filings, shows their solutions are novel only in comparison to the ancient IT systems and paper-based processes used extensively by P&C insurers today.  Guidewire is a big advance over those, but only a few steps in the BPM direction.

First, let me share my congratulations to the Guidewire team.  They created software that’s leaps and bounds ahead of what is in use at most insurers.  They have 103 of the more than 7,000 P&C insurers around the globe using their products and solving real problems.  Well done!

Guidewire’s products address some of the most significant pains insurers have today.  Here’s an example.  Inadequate data capture and ineffective process controls in legacy systems lead to real costs such as “claims leakage.”  Claims leakage is where the amount paid on a claim exceeds the amount to which a claimant is entitled.  It is a prevalent problem, accounting for 4-6% of claim payments.  That’s $50 billion lost annually across the industry.  Claims leakage is entirely preventable.  If fixed, it would improve insurance carriers’ operating incomes by the same 4-6% as claim amounts paid improperly would otherwise drop to the bottom line.

Going after big expense gaps like claims leakage is very enticing, but only if a solution can be put in place quickly, cost effectively, and without disrupting operations.  Here’s where the bloom starts to come off Guidewire’s rose, as evidenced by facts and statements within their IPO filing.

Guidewire promotes that they have an “innovative modern software platform” that allows business rules, workflows, and user interfaces to be configured “without modification of the underlying code base, allowing customers to easily make changes in response to specific, evolving business needs.”

If I were a leader at an insurance company, that message would strike home and I’d be ready to sign up.  I’d want easily configurable software operating in all core functions across my enterprise as quickly as possible.  But the reality behind that vision is not so pretty.

Here are some important things prospective Guidewire clients should know that come straight out of their IPO document:

• “We sometimes commit to include specific functions in our base product offering at the request of a customer or group(s) of customers…. providing this additional functionality may be time consuming.” Sounds like you’re still beholden to a software vendor’s roadmap to get functionality you want.  Not everything can be configured by you to fit your business.
•  “Implementation and testing of our products by our customers lasts 6 to 24 months… depending upon the nature and complexity of our customers’ systems the implementation and testing of our products may take significantly longer than 24 months.”  This is definitely not off-the-shelf software.  Any value realized will be delayed a long time… and cost lots as you pay for consultants to do the implementation.
• “We have designed our applications based on our in-depth understanding of the P&C insurance industry.”  Guidewire’s products reflect the vendor’s understanding of your business, not your own.  Whatever they develop, and whatever specialization you request that ends up back in their product, becomes available to all your competitors.  Commoditization is becoming rampant in insurance.  The only way to be consistently profitable is to have unique capabilities and processes that you run your entire business upon.  It’s hard to be unique when you’re working with software designed for all insurance companies and in use by your competitors.
• “[Our] licenses are priced based on the amount of direct written premiums that will be managed by our solutions.”  So the more you use them, the more you pay.  Combine that with long implementations and you’re looking at expensive solutions that lack natural economies of scale.

The pains in P&C insurance that Guidewire addresses are clear and acute.  Their solution is definitely an improvement, but follows the old model of enterprise software requiring large “rip and replace” transformations of systems which are highly risky.  The IPO document notes that most customers have only deployed Guidewire for claims which mean the rest of their systems are still siloed and full of legacy code.  It also means full transformations will take a long time.  It’s not uncommon to find insurers 3-4 years into a full transformation and only at the half-way mark.

What insurers need is a faster way to get the same benefits Guidewire promotes, but with less risk, less time delay, and much less cost.  They need a platform upon which they can create whatever applications they want, built entirely around their unique processes and preserving their competitive advantages.  That platform needs to be able to “wrap and extend” existing applications to avoid highly risky wholesale replacement.  It also needs to have a licensing model that provides economies of scale making subsequent development and deployment less expensive, not linearly additive.  It also needs to provide an environment where users can access all enterprise applications, whether written in the platform or not, and from any desktop or mobile platform.

Any insurers interested in the value Guidewire targets need to recognize their solutions are only a few steps down the path that business process management (BPM) has already traveled.  Appian is seeing great adoption in BPM for insurance because we offer the most modern BPM platform that allows for rapid, iterative development of applications, a complete social BPM environment to foster communication and action, and mobile BPM so that any process can also be a mobile process.

Before you embark on a transformation that could be years-long and leave your operations exposed, consider the old saying, “the only things you find in the middle of the road are yellow streaks and dead skunks.”  Take a close look at how adopting BPM for insurance could get you the same benefits in less time with fewer risks and a lower price tag, keeping you from being exposed in the middle of crossing the road.

To learn more, please download my whitepaper titled “BPM for Insurance:  Four Paths to Outdistancing Your Competition” and join us for a webinar on February 16^th titled “Fueling Insurance Provider Success with BPM” featuring Ellen Carney from Forrester Research.

Evan McDonnell

Vice President of Solutions

Some insurers, like GEICO, are doing great.  Geico has found innovative ways to use the same technology that’s otherwise pushing towards commoditization to its advantage.  Take for example what GEICO’s done with their mobile SNAP-Quote application where all a customer has to do to get insurance is take a picture of their driver’s license with their smart phone.

But for every GEICO who’s using technology to get ahead, there are fifty other insurance companies lagging behind.  This is ironic because the insurance industry spends 15% more on information technology than other industries.

The reasons behind this paradox become clear when you look beneath the surface.  Insurers have been technology pioneers because they had to be.  Products in insurance have always been similar so companies differentiate on process and service.  It takes good information systems to scale process and service advantages and make them stick.  Most insurers invested heavily in custom designed applications to systematize their processes.  This proved to be a good path, at first.  But the high cost of maintenance has turned those custom applications into money pits.  Worse yet, their lack of flexibility is stifling innovation, preventing insurance providers from rapidly adapting to market changes, and making them easy targets for competitors.

Most insurers know they are behind.  They have traditionally addressed this through large scale “rip and replace” initiatives.  But the high costs, long time horizons, and inevitable delays make such projects highly risky.  However, forward thinking insurers like Crawford, TIO, and Vermont Mutual are taking a new approach, using business process management software (BPM) to fix challenges and grow new capabilities without “rip and replace.”

These companies are applying BPM to enhance the customer experience, reduce costs, get smarter about pricing risks, and become the top choice for independent agents.  The ways they use BPM range from innovative and dramatic (such as mobile BPM and social BPM) to incremental and operations focused.  And even a series of small incremental improvements can make a big difference in a world where insurers not using BPM are effectively strangled by their existing applications, unable to move ahead.

When I step back and look at this situation, it reminds me of an old joke with the punch line, “I don’t need to outrun the bear…”  To hear the whole joke and to gain an understanding of the many ways insurers are using BPM to get ahead of their competitors, please read Appian’s newest white paper titled “BPM for Insurance:  Four Paths to Outdistancing Your Competition.”

Evan McDonnell

Vice President of Solutions

The report places the top vendors in the “Shortlist” category, with others placed in “Explore” or “Consider” categories. We’ll have the report available as a download on our site shortly, but in the meantime, here are some stand-out quotes:

“Exceptional Technology and User Sentiment scores lead us to assign a ‘Shortlist’ rating to Appian, the only BPM specialist in the top Decision Matrix category.”

“Appian scores the highest for the technology dimension, beating behemoths such as IBM.”

“Appian’s User Sentiment score is remarkable, and unmatched by any other vendor with a ‘Shortlist’ rating.”

“Appian has made good use of contemporary user interface constructs and smartphone applications.”

“Cloud-delivered BPM is the other notable aspect of Appian’s portfolio.”

Being the innovation leader can sometimes be tricky, because while customers experience the real-world value, industry pundits can be slow to pick up on it. The BPM team at Ovum clearly understands how Appian is driving BPM software to new heights of enterprise value in the mobile and social age.

-Ben Farrell, Director, Corporate Communications

In the article, Kate talks about the importance of knowing your customer, knowing how they like to communicate, and providing a consistent experience across all possible channels. BPM software’s value in stitching together disparate enterprise silos is well established, but Social BPM extends that value to the new world of social media. One powerful aspect of the Appian Tempo social interface is that is can incorporate social channels like Twitter into a business event feed. This gives companies an easy way to know when its customers are talking about the company – and that knowledge can be fed directly into process so that appropriate action can be taken in real-time. With peer-to-peer social dialogue on the rise, corporate marketing is no longer the generator and controller of the message. What matters now is knowing what conversations are happening, and having the business agility to participate.

Social BPM is more than just “social” because in addition to enabling direct customer conversations and collaborations – which any social enterprise platform can do – it also provides the means to track those interactions, keep them as an audit trail in the customer case, and learn from them to improve the product and service experience.

Disintermediation of the message is only one part of the equation. There’s also the proliferation of media platforms. As Kate points out, “Your service experience should let customers start an interaction over one communication channel and complete it over another. To make this happen, CIOs must ensure that channels are not implemented in silos, but are integrated so that agents have a full view of all customer interactions.” We’re past phone and email. Consumers are increasingly using new channels – particularly mobile platforms. This is where Mobile BPM becomes vital to an integrated strategy. By providing a native mobile app to consumers that is tied to enterprise process – the same processes running the call centers and web service platforms – consistent cross-platform service becomes a reality, not a pipe dream.

This holistic process and data exposure is equally key to another of Kate’s main points: making sure service reps are armed with the data they need to deliver a stellar customer experience. “Customer service systems must be more than just the front end of a database of customer information and cases,” she says. “They should also be integrated with back office applications so that agents can retrieve real-time answers to questions such as ‘when did my order ship?’”

This is where real-time data access within mobile and social process is crucial. And not just for reps in the call center. Field service personnel need it. The field sales force needs it. Any employee who comes into contact with a customer needs it.

Mobile and Social BPM are integral to the customer service strategies of the future. They are lynchpins in moving from a “system of record” mentality to a “system of engagement” mindset that will exceed customer expectations.

-Ben Farrell, Director, Corporate Communications

The report uses data from a Forrester survey of insurance IT decision makers that highlights revenue growth as the #1 industry priority. Ellen cites that “innovation is viewed as a channel to revenue” because harnessing mobility and social into insurance business models will directly impact the customer experience. She says, “Mobile has changed the way we envision an insurance company…This change means that initiatives to deliver sales and customer service business capabilities must be mobiled. Social media are also maturing into a means to improve collaboration within the insurance ecosystem.”

This is precisely what Appian BPM is enabling our insurance customers to do. By putting full-featured process solutions as native apps on all popular mobile platforms, and utilizing a modern social interface, we are helping transform the industry. As Brian Flynn, global CIO at Crawford & Company has said, “The Appian BPM Suite, with its mobile and social capabilities, is truly an enabler that will change the way we work with our business partners and ultimately how we service our clients.”

What’s more, Appian also helps achieve the persistent objective of cost reduction by delivering those native mobile and social apps with ZERO additional development cost. This is above and beyond BPM’s traditional value in delivering, as the report says, “faster and cheaper processing of claims and disbursements, while ensuring that they’re paying claims the right way.”

Appian BPM precisely fits Ellen’s definition of the changing insurance IT landscape, where CIOs are moving from a limited focus on operations and cost containment to one in which “the role of technology is integral to support these new business disruptions.”

-Ben Farrell, Director, Corporate Communications

End your conference experience with free training workshops on getting the most from your Appian BPM Software. Seating is limited, so register for the training you need today!

In between the tours and the free training, Appian World 2012 will deliver something for everyone in the world of process improvement. Our three tracks of content are tailored to meet the needs of BPM Beginners, Developers and Business/Executives. The general sessions will cover all the latest thinking and BPM outlooks from a variety of industry analysts, customer success case studies and lessons learned, and the unveiling of the Appian 7 platform.

If you are part of the Appian community, or if you are just investigating the value and best practices for BPM software, you can’t afford to miss Appian World 2012. Register for the conference now, and we’ll see you in April!

-Ben Farrell, Director, Corporate Communications

Mobile app development is expensive, and a potential governance nightmare. But it doesn’t have to be.

A single mobile enterprise app is costly to develop (anywhere from $50K to $150K, by estimates). Now multiply that by the number of applications in your business. And that’s just to develop on one platform. Mobile Apps require specialized skills across numerous platforms that are constantly updating. With Appian’s Mobile BPM you take a huge bite out of that cost, time and skills equation. Extra development cost goes to zero, as any app created on the Appian platform becomes a native mobile app simply through a series of check boxes. Appian’s code-free composition means you compose a process application once and automatically publish it, with full native mobile capabilities, to every popular device platform.

The management headaches are another significant hurdle. In a blog post on ZDNet, Ted points out that already, 35% of US information workers use a smartphone for work. What should your device management policy be? How do you know the platform(s) your company chooses to support will still be leading the market (or even in the market) five years from now? Further, employees increasingly use their personal mobile devices for work, regardless of any official device policy (if one even exists). With Appian, you don’t have to choose. iOS, Android and RIM are all natively – and automatically – supported. And as the mobile platform market continues to evolve, Appian will adjust accordingly.

Mobile app development is becoming a must in the enterprise. The demographic trend is gaining force, and the clear business value afforded by mobility is starting to be realized. Corporate business and IT leaders (and their IT staff) are struggling to keep up with mobile workers’ expectations. Appian can remove some significant and complex obstacles. Read more in our white paper, “Business Agility in the Mobile Age.”

-Ben Farrell, Director, Corporate Communications

Appian’s BPM software platform and Acquisition Business Management (ABM) solution can’t increase a contracting organization’s budget or magically produce more 1102s. It can, however, help make existing resources more effective while allowing an organization to start small and incrementally tackle their acquisition system issues.

Appian ABM implementations have successfully automated tasks and provided efficiency gains for our numerous government acquisition customers. By removing manually intensive tasks and automating them in the Appian solution, contracting staff are able to spend more time on value added tasks.  And it doesn’t have to be done all at once.  Many of our acquisition customers have used an Appian ABM solution to help augment their existing systems, or to bridge gaps between systems.  The Appian solution does not need to be a costly rip-and-replace, all-or-nothing proposition.  We encourage our customers to tackle their most pressing issues first and build their solutions incrementally.  This helps reduce implementation costs while also increasing return on investment.

Parting Thoughts

The NCMA Government Contract Management Conference painted a vivid picture of many of the challenges facing the acquisition community over the next few years.  The Appian ABM solution is available to help meet many of these challenges and I look forward to working with the acquisition community to help provide innovative solutions to the contracting workforce and their customers.

As a final reminder, you can see the power of Appian’s Acquisition Business Management solution for yourself. Come to Appian World 2012, April 15-17 at the Reston Hyatt outside D.C. to see solution demonstrations and to hear presentations around roundtable discussions on next-generation IT for acquisition professionals. Register here.

-Ben Allen, Appian Professional Services

This has become a key initiative inside the DoD acquisition community.  It was very interesting to hear Nancy Gunderson’s (HHS) comments regarding the subject from the civilian agency side.  One of her comments was that we’re only as credible as our data, and that the demand for data and transparency will only increase.

I think Nancy is absolutely right and I wouldn’t be surprised to see civilian agencies adapt a procurement data standard similar to the one put forth by DPAP (Defense Procurement Acquisition Policy).  The DPAP Procurement Data Standard (PDS) is laying the groundwork for sharing acquisition data between the multiple government reporting systems as well as providing a standard for sharing data between systems involved in the acquisition process.

Appian’s BPM software suite is perfectly suited to take full advantage of a procurement data standard. In fact, the Appian system allows you to define custom data types, such as a line item, by simply importing the PDS xsd definition of a line item directly from the DPAP website.  No custom coding is required and the database storage for the data type can automatically be configured by the Appian system.  When it comes time to share the data, Appian provides built-in web service nodes that can be configured to point to other government systems.  Again, all without requiring any coding or costly customization.  The future of acquisition data is well-defined standards, with data shared across multiple government systems to provide transparency and credibility to the process.  The Appian suite, and our Acquisition Business Management solution, are ready to provide this to government contracting organizations now.

-Ben Allen, Appian Professional Services