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May 13, 2003

Driving Operational Performance

Business activity monitoring and event management are key components in a successful operational performance strategy

by Mark Smith

There's a renewed focus and initiative in organizations today to find better ways to optimize operational performance. This imperative includes providing relevant and timely information so organizations can improve the efficiency and quality of their business operations. This information should provide insight leading to actions that reduce operational costs and optimize interactions between customers, employees, and suppliers.

The industry and software vendors' marketing efforts have stirred up a flurry of conversation and debate around concepts and capabilities in business activity monitoring (BAM), business event management (BEM), and business process management. Although most vendors seem to think that these areas operate independently, seeing how they fit into an integrated framework for understanding, optimizing, and aligning business activities and processes is critical to developing an operational performance strategy.

The Business Activity

So what is a business activity? At the simplest level, a business activity is a set of tasks an individual performs. This activity could be writing a sales order, taking a customer service call, or any activity that occurs in one department or functional area of the organization. Each of these tasks is defined and typically supported in an application as a set of procedures that lets individuals accomplish them in some repeatable process.

For example, a customer call center has a service call, a business activity, which includes the following tasks: validating the customer and product or service information, collecting the issue or complaint, and planning the resolution for the situation. This customer interaction might occur electronically or over the phone, and it may be supported by one or more underlying systems.

Information from this business activity could improve response time or customer satisfaction in several ways. However, traditionally, customer service call information is captured as a transaction and accessed through an operational reporting system, or extracted into a data warehouse for historical analysis and reporting. The time lag in making the information actionable doesn't accommodate current business requirements for personalized customer interaction and immediacy.

The BAM concept states that monitoring your business activities provides a method to notify individuals to take action; its basic objective is monitoring and setting alerts for your operational systems. The challenge is how to provide this information on a timely and as-required basis to meet these organizational needs. In addition, the individual systems often don't capture all the information in the right form for monitoring business activities.

The Business Event

What is a business event? A business event is an action that results from a business activity. The event can be an interaction with an individual, the completion of a business task, or the collection of certain types of information. Although the event can take many forms, it's the lowest form of system information that can be captured.