The Digital Lab

Trainspotting was a movie that above everything but becoming a hipster. The characters where real like, embodied in some past memory we lived during our 20’s. Twenty years something after, version 2 of the movie is released. Together with the soundtrack of the latest incarnation, apart of Iggy Pop’s Lust for life, it was released an umpteenth version of Underworld’s Born Slippy, probably, the song that catapults the band to the mainstream.
During this week I attended a digital transformation academy and the only component that caught my attention was the need to deploy a digital creative lab. A place on which companies will experiment, test, fail and learn the road ahead of digitise operations.
On 2014, Underworld created a DJ set on the influences of the album dubnobasswithmyheadman for BBC’S Radio 6 program, the 6 mix. Karl Hyde mentioned across the broadcast – a tribute to the bands that influenced the production of the record – hey were meeting in SoHo with other important bands at the time like The Chemical brothers, Moby, Goldie the Orb and many others, and how they shared experiences and ideas for the records they were producing, in a way that some of the remixes that Underworld and their peers created for other bands – pay it forward – included the best of its work, feeling they were giving away instead of using it on their own records. The trade-off as they learned, is about the importance of being part of the animal collective creative process and how all the musicians learned how to produce much better music.
When I was an entrepreneur, I used to work time to time, at LX Factory in Lisbon, a co-work space – hotels where a depressing place to be, like to in house arrest – on which I could meet other entrepreneurs, artists, fashion hairdressers and designers. Co-work facilities always have rooms for people to ideate, however, the best place on which I share, learn and watch passing by so many inspiring ideas, was at the cafeteria where people meet to grab a cup of coffee and a sandwich. There, we were in full bloom. I remember how no-one blocked other people ideas, values and pre-conceptions, everyone was learning and was adding always news ways of interpretation, translating to his owns words or better, to his own domain expertise. For example, in those days, the Adaptive Case Management (ACM) was taking off and looming in the corporate agendas, opposite to the workflow automation. When I was referring about that fact and how it was being used in a project I was leading for an healthcare clinic in Berlin, someone that was doing some work in literature, told me about William S. Burroughs’s Naked Lunch. A book that does not follows the natural law of a narrative – ultimately, drove me to Der Mann ohne Eigenschaften – and like ACM, which the process closure is defined by the human when the goal is achieved, opposite to workflow automation that reaches the same outcome over and over again by the art of infinite repetition. Understanding the way Naked Lunch writing technique was used – the cut-up technique is an aleatory literary technique in which a text is cut up and rearranged to create a new text [1], opened to myself a new perspective how to articulate the ACM driven solution instead of using the common references around system thinking theory.
Digital transformation requires a new mind-set, creating a digital transformation lab that is not about being able to execute the toolbox, like creating rapid and agile idea prototype or storyboarding or apply design thinking techniques, it is how companies create an human interaction environment of highly creative people, that by the combination of multidisciplinary domain expertise they craft the next big idea. This is more a human resources challenge, upskilling your workforce rather than create the facility and the collaboration tools for people to ideate.
Image credit – LX Factory

BPM a year in review 2016

During 2016 we heard a lot about digital transformation, considered as the new Industrial Revolution 4.0, providing the catalyst for new business models, products, services and customer experiences that impact not only businesses but society overall. The societal impact will not reach the end of property or the end of financial flows or money but will increase the power of commons in a more open society.

Technology is playing an increasing role in everything we do, collectively with our customers shaping growth, disrupting industry landscapes and providing the catalyst for change. The ability to connect and manage all assets, products, employees and customers globally, like a network, has not really ever been possible or feasible, as well. Why is this important?  Because we are definitively in the era of the platform. We cannot optimize parts of the platform once we will sub-optimize the whole. We cannot be solely focused on social listening and incorporate it in customer and marketing management, we must listen and empower the commons to participate in the creation of changing business models and promote the efficiency of the ecosystem we belong. Recently, Tesla provided what is leading trough digital transformation. Sparked by a customer complain, that could not use the vehicle charging bays, in 6 days only, Tesla re-invented the service and induced efficiency and increased customer satisfaction as follows. As the Tesla example shows, digital transformation is about move beyond just thinking about our customers and start thinking like them, or if you prefer, put in your customer shoes.


Business model change – time to market: 6 days

We designed the Supercharger network to enable a seamless, enjoyable road trip experience. […] we understand that it can be frustrating to arrive at a station only to discover fully charged Tesla cars occupying all the spots. To create a better experience […] we’re introducing a fleet-wide idle fee that aims to increase Supercharger availability. […] The Tesla app allows […] alerting them when their charge is nearly complete and again once fully charged. For every additional minute a car remains connected to the Supercharger, it will incur a $0.40 idle fee. If the car is moved within 5 minutes, the fee is waived.
The era of the platform is contributing slowly to the end of asset ownership. But contrary of many views, similar of Ida Auken, member of the Danish parliament, this is not the beginning of the end of capitalism. The total cost of ownership will decrease, but will not be eliminated, money will continue to flow towards a consumption based economy and will be re-invested by companies to innovate and to create new products.
Previously businesses models were designed to create a product, introduce in the market and, then customers bought it. That was the end of the era. Chemical companies are helping farmers to increase harvest regardless if the farmer relies on a IoT array of equipment or it communicate crop conditions using a mobile app, Healthcare providers changed their business model to extend life-expectancy by monitoring on real time vital signs, instead of reactive surgeries and post-surgery recovery. Today organizations are building in endless feedback loops – sensors in products, services, customer feedback from a variety of channels.
Business model transformation requires the development of an open ecosystem that merges technology, people and business process that enable these feedback loops, and define an organization’s competitiveness and ability to change the entire landscape of the industries in which it participates.
2015 entry and backward years can be found here.

BPM Blogs worth reading 2016

Here is the list of BPM blogs I think work reading for inspiration purposes. More than a hall of fame, make a reflection on how BPM is evolving by clicking in the last years list and backwards.

On BPM at large:

On Analytics:

On Social Business:

On Complexity:

On Enterprise Architecture:

  • Mastering ArchiMate – If you model architectures this is a great source to take a deep dive.

If you are interested in 2015 list click here.

BPM Conference Portugal 2017 – Artificial Intelligence

BPM Conference Portugal 2017 is going to talk about artificial intelligence.

Artificial Intelligence (A.I.) is for the time being and important new domain to be discussed. As far I am concerned, perhaps the most productive debate we can have at the conference in the 2017 edition isn’t the one of good versus evil, the rise of the machines or singularity is near. The debate could be about the guidelines instilled in the people and organizations using A.I., something that cybernetics tried to push back in the 60’s.

Why the human element still matters?
At the same time that demand for efficient, transactional, prediction-driven workplace systems is on the rise, just look around you and you will realize that most of the interactions you have with companies or even to perform daily tasks – like find the better route to commute – have embedded intelligence and are context aware, taking into consideration your location, profile and transactional history. However, there are a set of skills we seemingly don’t want systems to perform. Despite new techniques like deep learning are denting our ability to prevent we will become dispensable, emotional intelligence is said to be among the fastest-growing job skills, and some experts say the ability to collaborate and listen thoughtfully can even protect your position and help advance your career over the next decade as automation progresses. This is probably the reason that contact centers were not totally replaced by robots. Yet.

Ultimately, humans and machines will work together, not against one another. This is already a reality. Imagine if human and machine work together to solve society’s greatest challenges like providing healthcare services, probably one of the areas on which we have seen the deepest progress, as well as, fighting insurgency and keep our cities safe. Other area that is being disrupted is transportation. Some car manufacturing companies are already assuming that in the future most of the people will not own a vehicle and autonomous commute will be a de facto-standard in high density population areas.
This is probably one of the most sensitive areas of discussion, but we will see that today we can do much better humans if we combine our work together with A.I. systems.
How to enforce principles in the design of A.I. systems?
I would argue that perhaps the most productive debate we can have isn’t one of good versus evil. The debate should be about the values instilled in the people and institutions creating this technology. We must enforce technology with protections for privacy, transparency, and security. A.I. must be designed to detect new threats and devise appropriate protection and must be inclusive and respectful to the human being. This put an extra challenge –  more than discussing on rules, policies and how to implemented coding, is the foundation principle on what is right and what is wrong. The definition of a concept, a domain, is a consequence of the surroundings, of the environment we live and the multitude of human principles and beliefs. What in a society can be accepted as a practice, in other can be condemned.
If in the future A.I. can bring transparency, in what kind of transparent society we want to live? Being transparent means you are not afraid of hiding your medical records because it can save your life, as also you are not afraid of exposing your earnings and tax situation. Becoming transparent will also contribute to avoid crime, bribery, and corruption? Or being transparent is the realization of the classic Orwellian apocalypse that looms and take control of our society? Anyway, from a solution design perspective it is necessary to define the particulars about data protection and security, among others, setting-up specific rules concerning the processing of personal data in the electronic communication sector. What people most often want is a sense of control over their data (even if they don’t exercise this control very often). Many people feel that this control is a fundamental human right (thinking of personal data as an extension of the self), or an essential part of your property rights to your data.
To that end, this is something we must debate during the event.
Will A. I. power the next industrial revolution?
Advances in technology is powering the next industrial revolution, basically blurring the physical and the digitaldivide. Technology is today omnipresent. Capitalizing on this phenomenon is the key to innovation. From the rise of A.I. and related technologies, the challenge and opportunity for business leaders is to harness the ubiquitous, disruptive force of technology to be more agile, fuel efficiency and ultimately shape the shape of the industry destiny. Definitely in this next industrial revolution, we are facing a range of new technologies that combine the physical, digital and biological worlds. Failure to understand how to embrace A.I. into operations and business models, may end up of being out of market.
Having said this, should companies do a deep dive with A.I. or not?
How can we put A.I. work for the goodness of our own society?
For healthcare, A.I. can advance recommend the most effective treatments for their patients, as well as, predict human body organs failure and increase our life expectancy.
For transportation, A.I. can improve the efficiency transportation systems, integrating supply chain on real time, prevent incidents, optimize the fuel consumption and safety and support maintenance of infrastructure.
For public safety, A.I. can deploy predictive models for crime and help security forces to find associations in massive amounts of information to spot insurgency and handle complex crime cases.
For financial services, A.I. can manage must better risk exposure, by ingesting millions of data segments used in risk models, reduce fraud and tax evasion, assist in providing the best insurance coverage at the right cost combining data provided by the customer and its relationships.
For individuals, A.I. can assist humans in developing personalized recommendations based on the stage of life the individual is, combining data about the individual preferences, beliefs and transactions.
In this globalized world, economy growth crucially depends upon the creation of new business models that rewards more effective outcomes and overall benefits to society. If business model innovation was always behind differentiation and competitive advantage, A.I. is for sure a technology can enable a more innovative society.

BPM Blogs worth reading 2015

Here is the list of BPM blogs I think work reading for inspiration purposes. More than a hall of fame, make a reflection on how BPM is evolving by clicking in the last years list and backwards.

On BPM at large:

On Analytics:

On Social Business:

On Complexity:

On Enterprise Architecture:

  • Tetradian – Tom Grave´s writes about enterprise architecture.
  • Mastering ArchiMate – If you model architectures this is a great source to take a deep dive.
  • The Open Group Blog – By Open Group – Great place to look for upcoming references

If you are interested in 2014 list click here.

The Management side of BPM

The dark side of management

When I designed BPM Conference Portugal together with Rumos, I setup as a guiding principle that each year the event agenda should have a theme, like an orientating guide, and such theme should provide guidance for the session agenda that unfold into innovative talks. The presentations delivered by the speakers should help managers to make a reflexion about the future of their organisations and what and how needs to be implemented to tackle their challenges. At the same time, the content of the sessions should be based on experience, not in years to date reading hours about books and magazines you can buy about the theme.
2015 edition is oriented towards the M letter of the BPM, Management. Initially I had reluctance in putting such a stamp in next years event. Some of the reasons it made me not going forward with such a theme are related with the fact that it’s a mature, worn out, tired and tiering and because today everything is about the future of technology and how it turns and twist operations and our lives.
Nevertheless, management is important and it is forgotten. It’s forgotten, because managers are distracted looking into scorecards, to running process instances, trying to match agreed performance with customers. The art of management it is spoiled, ruined and rotten because such capillary approach (day to day shotgun management) deceives and shifts attention to define a vision of the future (that sometimes can last 3 short months only) innovation and make change happen. Under other perspective, I heard many professionals advocating what it should be pursued is real value chain management, aligning strategy, operations and execution, sparking new change initiatives, Business Process Management is called, instead of Process Management. Confused? So do I and I am a BPM addict, now imagine the poor Manager considering of adopting a BPM initiative in his organisation. This year, I attended a session during a conference, on Center of Excellence styles and organisation structure and how it shaped the practice of BPM. This should be a very interesting theme, once thought the act of proper governance, it is supposed to achieve the so called holist BPM these professionals are referring to. Unfortunately, not a single example was provided (not even organisational structure proposals). It was so vague and dry (despite the presentation was a spin off of documented academic research) that anyone did not understood what a center of excellence does and how it should be organised (yes, a size does not fit all).

Hence what it is left to talk about? Everything.

This year I decided to read Nassim Taleb’s Black Swan, after reading the latest book, anti-fragile. I was looking to search some answer shy decision makers make bad decisions and let companies perish, being overtaken by competition ou fail a new technological wave. I can say to you that I did not found any information to answer my questions, in a way that make me search for more (the book, in the Portuguese translation have 456 pages). The only interesting aspect I found interesting is a simplified version of how knowledge diffuses (in page 127). Still I prefer my version <link> that goes well beyond how knowledge is built and spreads. Regarding this theme you can read my book chapter based on a real world case study <link>.

During all this years I always questioned why managers make bad decisions and fail to adapt a correct change strategy. Many can think this all about how a change idea is sold to the board of management or how a return on investment is pitched (totally different that those studies full on fallacies on ROI). Based on my experience both as a consultant, as an entrepreneur, I witnessed managers to whom, it was presented, clearly in a crystal clear quantified way, how to avoid millions in losses and still the manager did not make a decision, to the point it let the organisation record the losses in the accounting journal entries as it was propelled by the newspapers. Again, why this kind of outcomes happen?
Some years ago, I was involved defining risk management frameworks in industries like oil & gas and airport management. The objective was construct a model for risk assessment and mitigation that was aligned with the value chain operation reality of those enterprises instead of a simplified version of probability versus impact (now you understand why I was so keen to read the black swan).
In one of the industries, the method to calculate risk included a manual correction of the calculated values, in a way that jeopardises any kind of mathematical formula and judgement. It drives crazy the ones that use carbon copy methods for years, also called professionally verified the correction (or distortion if you are not familiar with the concept) was to change the final vale of the evaluation,managed on operational tacit knowledge. For example the risk assessment team knew that some events were not registered (because people were hiding it) they automatically aggravate the risk value. The simple fact that those records were not in any spreadsheet, pirate database or system, make the corporate risk members (yes governance frameworks exists with this purpose) angry (that was the consequence of being as the operational called them, the lads of the office). In other example, if there was a crash between a vehicle an a tank, but that scenario never occurred, the risk value was typically low, even if the proportions of the impact were catastrophic. Under such circumstances, additional preventive measures were out into force, adulterating coercively the risk value. This is something that the ones that like precise formulas fight and argue (with very bad results by the reasons exposed).
In the book black swan, too much is written about the gauss curves used to measure probability. I assume that the book author was exposed many times to the curves, like radiation that entered in “peroxidation “. There is an interesting example to explore about the probabilities models. The accident at the nuclear station in Fucoshima in Japan. This example was also explore in the books Thinking fast and slow, as also the signal and the noise. Many authors state that the cause of the accident was negligence of the ones that designed the system. According to the experts, the nuclear station was build to hold an 8 scale earthquake measured on the Ristcher scale. Once that the probability of existence of an earthquake higher than 8 was very low (on thin particular aspect I am brothers in arms with Mr. Nassim) it happened what everybody knows. Still, there is an important aspect about this episode. The Ristcher scale erroneous ends in 10 (it is not a point scale) meaning that an earthquake of 12, it is still a 10 earthquake (the scale has no limit, but the maximum value it can be measured is 10, like when you drive in a descendent highway and the velocity of the vehicle is higher than what the dashboard instrument can measure). In this regard, I leave an important question to the referred book authors: how to build a nuclear station able to handle such extreme earthquake? To close this reflection, I would like to leave an important pointer: do or do not the Japanese have a long tradition and knowledge constructing buildings that deal with earthquakes (since those fancy oak villas with dynamic dumpers). Hence, again, I think that the issue is more related to an extreme event that we are not prepared to handle (just to remember how small we are embedded in Mother Nature).

These are some pointers only. Why we make sob bad decisions? Why we don’t change, when change is necessary? Why we put our customers filling forms and firms just to send a traceable letter when with a smart ID card it was possible to pour all the data into the form? Why some airports only offer 30 minutes of free internet assess, on a time were mass customisation is the trend? I hope you could find the answers in next edition of BPM Conference Portugal, because this will be the kind of sessions the distinguished speakers will deliver.

BES – the decay of intelligent BPM

Yesterday it was announced that Banco Espírito Santo (BES) was going to be broken into two. One, a bad bank, that will have only toxic assets and will continue to use the same bank name, with the same shareholders just before the bank be broken, meaning that they will face a huge loss, and other brand new, with the name Novobanco (literally new bank) with capital injected by a rescue fund created to support the sins of Portuguese banks, at the time when the IMF and the European Union bail out the country.

BES was a case study among the BPM community, by the sum of awards that collected over the years. More than that, it was a bank with huge societal influence and lobbing, that passed decades thought independently of the type of political orientation of the Portuguese government. For example, ruled before and during the dictatorial years and after the revolution, with the family leaders that were the main shareholders being put in prison under the “new” communist political orientation, that decided in 1975, banks, bankers were evil and should give all it’s fortune that was taken from the oppressed people. In the middle of the 90’s the bank was privatised and the Espírito Santo family took over and got back the control of the bank. BES was the only and single bank to achieve such status quo. It was until yesterday, the biggest private bank.

During the press conference given by the regulator, it was stated that the BES administration, did not comply with direct orders from the regulator with acts like: assuring premature reimbursement of creditors that bought bonds, like for example the government of Venezuela (lucky them, because others starting today, have a hand full of nothing); lend or warrant Ponzi borrowing operations from the organisations that belonged to the bank’s holding (meaning that they were making reimbursements or borrowing money using as collateral the bank’s currents and savings accounts). The regulator stated clearly, twice, for the record, that some acts raised questions related with criminal activity and were going to be investigated by the Portuguese prosecutors.

Having said that, based on facts, not on the vested interests and bubble gum hype, that in the last couple of years we read from the leading BPM and architects mavens, I would like to raise a question (that I assume that will have no answer, once it is inconvenient).

If under architecture principles a bank consumer it is not allowed to produce acts that can put the bank in jeopardy, independently , but mainly, in these new interaction channels (mobile) where the consumer have the power to solely and by himself execute such acts, why there is not a reverse architecture from the bank to the regulator that makes the bank to force compliance with acts that cannot be executed?