State of the Nation 2022: Netherlands

SAP Signavio White Paper | PUBLIC

© 2022 SAP SE or an SAP affiliate company. All rights reserved.

State of the Nation 2022: Business Process Transformation in the Netherlands

Unleash the power of process for next-gen operational excellence and customer experience

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Table of Contents 3

Introduction

4

Prioritization

5

Challenges

6

Process-Driven Organizations

7

Transformation Capabilities

8

Transformation Goals

10 Leading Transformation 11

Governance and Ownership

13 Key Findings

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Introduction This paper offers insights and suggestions based on an exclusive research report examining process maturity and business transformation levels across The Netherlands. It also reveals the ways business leaders in The Netherlands use process management to optimize their businesses.

The results highlight: • What stage of business process transformation respondents have reached • Where respondents want to get to as part of their organization’s transformation journey • How respondents quantify the effects of business process management (BPM) implementation, identify challenges, and evaluate success The research was conducted in late 2021 by Entourage BD, on behalf of the SAP Signavio team, and taps into the region’s “current state” for business process management.

More than 100 C-suite executives, IT specialists, business transformation specialists, VPs, managers, and directors, all from organizations with over 1,000 employees, responded to a range of questions about how and why they use process management solutions.

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Prioritization Business transformation can often be confused with operational excellence. However, as most survey respondents have identified, effective transformation is often the result of many process and operational excellence initiatives working in tandem. Of course, all transformation initiatives start with the best of intentions; leading organizations work hard to ensure the project does not become the exclusive domain of highly trained process experts working in isolation.

BPM should reflect the world as we find it, particularly with the rise of remote work. As such, SAP® Signavio® solutions strongly support expanding the focus of process initiatives beyond process design and into a more human-centric approach. This helps foster a culture of understanding and acceptance while breaking down internal silos.

In the same way, optimizing customer experiences by connecting customer journeys with the processes that underpin them can be a crucial step toward operational excellence.

This is because taking a 360-degree view of business processes reveals how an organization’s processes impact customer experience (the inside-out view), as well as how customers perceive those processes in operation (the outside-in view).

Prioritizing application transformation fits into the same broad category of ensuring businesses in The Netherlands maintain a competitive edge, in this case by bringing business-critical legacy applications forward into a modern context. By evolving from legacy applications to “always improving” applications, businesses can accelerate improvements, ensure agile responses to systems change, and remain relevant and aligned with the expectations of modern users.

What are your organization‘s top 3 business transformation priorities?

(Select up to 3 options)

1

Operational excellence.

80.5%

2

Optimizing your customer journeys.

70.3%

3

Application transformation.

68.6%

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Challenges Functional alignment and cultural change are well-recognized impediments to business process transformation, as revealed by this survey and many others. For companies in The Netherlands, the pace, volume, complexity, and cost of transformation can be perceived as a threat, especially when the necessity for change is not communicated clearly within an organization.

In any event, the more employees feel listened to, the more engaged, excited, and invested they will be in the transformation. Creating a transparent, open feedback loop with appropriate acknowledgement, discussion, and (most important) visible action shows employees their input is valued, and helps add value to the transformation effort overall.

As such, the best approach is to share transformation ideas, proposals, and plans widely. Seeking feedback from a broad audience, and being willing to refine plans based on that feedback, is crucial. The form this feedback takes will differ from company to company, but in general, collecting feedback is easier using modern process management tools with built-in commenting and sharing functions.

What are your biggest transformation challenges?

(Select up to 3 options)

1 2 3

Aligning of departments, functions and stakeholders.

76.3%

Driving cultural change and embedding new ways of working within the organization.

74.6%

Having the right resources allocated to transformation initiatives.

57.6%

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‘Process-Driven’ Organizations • Accelerating end-to-end throughput time, by With nearly 50% of respondents having highlighting delays and bottlenecks automated key processes and implemented • Enhancing responsiveness to customer process mining techniques within their requests, due to transparent fulfillment organizations, these businesses are well on processes their way to becoming process-driven. In addition, since the order-to-cash process (also known as O2C) is a critical focus area for For the minority of respondents whose the C-level in an increasingly digital economy, organizations have not yet started their it is positive to see 30% of respondents process transformation journey, it can be recognize this, and prioritize O2C and other challenging to know where to begin, let alone similar processes. achieve results quickly. For these respondents, as well as anyone contemplating transforming their business processes, the very first step is By monitoring and highlighting deviations simple: documenting the “as-is” state of an from that standard process, businesses can organization’s business processes. increase order and invoice handling speed and efficiency. After all, the more efficient and accurate the process, the better a company’s Once the current state of an organization’s operational performance, customer processes is documented and easily satisfaction, and cash flow management. In accessible (to both decision-makers and practice, this means: frontline workers), the inefficiencies and areas to improve within the processes are far easier to identify and resolve. After all, you can’t fix • Improving on-time deliveries and therefore increasing customer satisfaction, through early what you can’t see! identification of orders at risk of late delivery

Where do you feel your organization is in terms of becoming a ‘process-driven’ organization?

1

2 3 4

We are already taking steps to become a far more ‘process-driven’ organization by automating key processes, and have process mining techniques in place to extract relevant thresholds.

46.6%

We have designated certain processes e.g. O2C/P2P.

30.5%

We are planning to restructure the existing process landscape to the cloud.

15.3%

7.6%

We haven’t started yet.

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Transformation Capabilities More than 60% of respondents report using simple tools to model their process state – a good base to build on, as outlined in the analysis of the previous survey question. For these businesses, a more sophisticated and technology-driven approach to process management will form the core of any future transformation initiative, allowing them to visualize processes in a standardized, repeatable, and easily understood way.

Twenty-two percent of respondents note that their organization can identify the way processes work but cannot adapt them rapidly.

When considering process optimization, finding the issues is only half the battle – reacting to the insights quickly and effectively is how organizations can unlock the business value.

So what may be preventing this group of survey respondents from doing so? There is a range of possible reasons: general resistance to change within the organization, a lack of clear direction from decision-makers, a misalignment between teams responsible for assessing changes and implementing them, the need to keep specific processes running even as they are changed or upgraded, or even fundamental issues such as software solutions that do not allow for quick and easy process changes.

In each of these examples, an integrated response offers a possible solution: a combination of software and change management principles. This combined approach helps all employees understand the need for changes, visualize the resulting benefits for the organization, and access the tools needed to implement the changes.

What capabilities do you have or miss?

1 2

3

We just started and have simple tools to model across the business.

61.9%

We are able to analyze how processes are implemented and executed and are not able to change/implement processes fast.

22.0%

We are not able to analyze how processes are implemented and executed and are not able to change/implement processes fast.

16.1%

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Transformation Goals Cost savings was the clear winner when survey respondents were asked to select the top three goals of their transformation efforts, with a strong focus on customer excellence following close behind. The truly valuable insight here is that each of the goals listed below is interconnected: improving one will likely improve one (or more) of the others.

In essence, organizations fueled by process excellence can better monitor the processes that underpin business operations from finance and HR to manufacturing and sales. These organizations reap the benefits of efficiency and effectiveness from a single coherent process landscape that crosses IT system boundaries.

Then, applying process mining and customer journey modeling to these underlying business processes offers the bundled capability of better inside-out operational understanding and outside-in customer perspective, connected to the processes that deliver them.

So, improving customer experiences and understanding the customer journey can provide scope for improvement by itself, but can also become a strategic catalyst for efficiency improvements and cost savings across every part of the business.

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For example, one European regional energy, water, and telecommunications service provider was facing an environment of increased competition and ever-growing customer expectations, including more frequent communication and personalized service offerings.

At the same time, SAP Signavio solutions offered this company a way to understand these customer expectations in detail, manage the increasing number of service processes, and accelerate core operations such as damage reporting or household supply connection.

Using a combination of SAP Signavio technologies, the company was able to document, simplify, automate, and improve its daily business processes. In particular, the company realized significant cost savings by replacing time-consuming and inefficient e-mails, letters, and calls with automated to-do lists and messages.

The combination of better internal processes and more effective customer-facing processes meant that in addition to saving money, the company could dedicate even more time to enhancing the customer experience, creating a continuous improvement loop.

What do you hope this business transformation will enable you to achieve?

(Select up to 3 options)

1

Achieve cost savings.

78.8%

2

Better serve our customer.

61.0%

3

Improve the customer journey.

60.2%

4

Increase department collaboration.

55.9%

5

Competitive advantage.

22.9%

6

Become a process excellence organization.

14.4%

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Leading Transformation Business process transformation initiatives are most likely to be successful when there is strong support across the entire organization, beginning with effective C-level engagement.

Survey respondents in The Netherlands clearly recognize this requirement, with an absolute majority indicating their transformation projects are driven by the CEO or CIO. Less common, but in some cases just as important, is the role of the Center of Excellence (sometimes known as Center of Expertise). This is a deliberate concentration of employees with knowledge and experience in the theory and practice of process management, digital transformation, and related matters in a special organization within an organization.

In the context of process management and automation, concentrating expertise and resources through a centralized framework means a decreased turnaround time for generating additional workflows, along with reduced costs when scaling up production and realizing economies of scale.

Of course, this is not to say that frontline workers and subject matter experts do not have a role to play. In fact, without their expertise, the identification and implementation of changes will be slowed or even rendered impossible. It is the combination of employees with different roles and responsibilities, working together toward a common transformation goal, that will lead to the best results.

Where in your organization is your business transformation being driven from?

1

Office of the CEO.

47.5%

2

Office of the CIO.

28.8%

3

Center of Excellence.

8.5%

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Governance and Ownership Business transformation initiatives can quickly grow in size and complexity beyond initial specifications. As a result, collaborative documentation of processes is common practice for organizations seeking to build a foundation for optimal process and decision management. This means improved ways to capture, connect, govern, and communicate how work is done, resulting in higher consistency and efficiency throughout a company.

Organizations can set the stage for a successful transformation program by designating global process owners (GPOs). GPOs oversee the design and implementation of the end-to-end processes most affected by the program, helping ensure processes are designed in ways that best meet the needs of everyone involved. This relies on GPOs establishing close working relationships with leaders throughout their processes’ functions and with business users. Providing GPOs with decision-making authority for signoff on all related business policies and procedures is also useful for streamlining approvals.

Standardized process modeling, presented transparently across the whole organization, supports these roles in effective decision-making and collaboration. Common standards support employees with reliable points of reference and stable best practices, and support decision-makers by providing a framework to view and evaluate processes in a decentralized way.

One example concerns a multi-billion-dollar data management company with over 7,500 employees.

Providing services to thousands of businesses worldwide, this company faced enormous struggles with business stakeholders because each of its six unique support sites worked from their own “best practices,” which often contradicted or conflicted with the other global locations.

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This disconnect resulted in significant variations based on when, where, and how processes were interpreted and followed. To overcome this challenge, employees worked hard to consolidate process information from various systems into one common language and adopt a “single source of truth.”

Using SAP Signavio technology, the company reduced 800+ process PDFs to just 75 across 65 Business Process Modeling Notation (BPMN) visualizations, reduced the number of internal process repositories from nine to just one, and brought down process improvement cycle times by almost 80%

Do you have process management organization and governance structures established to lead, coordinate, and support process efforts for the organization?

1

Yes

66.1%

2

No

33.9%

Do you currently have owners for all processes in place?

1

Yes

37.3%

2

No

62.7%

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Key Findings • Operational excellence: 80% of respondents Combining all the critical elements for list operational excellence as their top operational excellence and customer-first transformation priority. thinking with the right technology and resources • Organizational alignment: Aligning enables effective business process departments, functions, and stakeholders transformation for organizations in The (76.3%) and driving cultural change (74.6%) Netherlands. are seen as the biggest challenges to effective transformation.

The goal is efficient process governance and • Change implementation: A majority of workflow management, powerful process respondents are able to analyze how processes mining, robust process modeling, and are implemented and executed in their customer-centric thinking tied to a single organizations – but 16.1% of respondents collaborative source of process truth. For more cannot, and have no ability to change or information, contact the SAP Signavio team introduce processes quickly. here.

• Reducing expenditure: A significant majority of respondents (78.8%) are seeking to achieve cost savings as a result of their transformation efforts.

• Executive buy-in: 47.5% of respondents reported that process transformation was driven by the office of the CEO.

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