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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

Continued from Page 1

For instance, the business activities that took place during the customer service call described in the previous example result in the following events: The validation of customer information creates a customer lookup event; the validation of a product or service creates a product/service lookup event; and the collection of the customer's complaint creates an issue event.

This level of information isn't always captured by the operational application (such as customer service, accounts receivable, or order management system) that supports business activities. Traditionally, information from such an action is stored in a transactional database. A better approach is to "capture and forward": Use business events to spawn a separate workflow, analysis, or notification that could drive additional action based on specific criteria.

BEM's premise is that actions taken in a business activity create events that can be used for any purpose. The challenge for organizations is to leverage this information in a "capture and forward" method for optimizing both functional departmental and crossfunctional organizational business activities.

Leveraging Activity and Event Management

Where do these terms and software capabilities fit in your organization? And how do you apply BAM and BEM if you want to improve operational performance? Although the concepts behind BEM and BAM are related, the technologies involved in each differ.

You can use BAM systems to define and manage business activities and tasks and provide monitoring and alerting from the transactional database alone. A BEM system, on the other hand, lets you listen to events in an application, but usually doesn't update to the underlying transactional database. Instead, you use the BEM system to drive information into downstream operational or informational systems. BEM can run independently of BAM, depending on your requirements, but an effective BAM system should have BEM technology to provide contextual monitoring and alerting.

These concepts are critical underlying requirements for any business process management system that helps electronically map together two or more business activities and tasks into a business process. In fact, some solution providers have the modeling, rules, workflow, and basic reporting integrated together for fulfilling BAM and BEM requirements. Although many of them can't evolve past their modeling and workflow roots, two key players in this market, Savvion Inc. and Vitria Technology Inc., address these requirements with their customers.

The business intelligence (BI) market has been slow to fully support BEM and BAM requirements, but some vendors have built monitoring and alerting capabilities into their BI platforms. Cognos Inc.'s NoticeCast, an event-notification tool, is moving down this path, and Information Builders Inc. already has BEM technologies integrated into its BI suite. Some newcomers are also addressing these customer requirements: Actimize Ltd. has built predictive BAM solutions for financial services, Identitech Inc. for visual driven BAM solutions, and SeeRun Corp. has built analytic BAM solutions for service-level performance management.

Looking Ahead

Business activities and underlying business tasks are the nucleus of how organizations operate on a daily basis. Building an operational performance management strategy involves deciding on the best place to integrate BAM and BEM technologies to meet business requirements. Organizations that want to become proactive and responsive — centered on processes and workflows, not just on transactions — must learn how to use business events. This process-centric model can lead to optimizing performance across functional areas of the organization, where heterogeneity of underlying systems will mandate an operational performance management backbone.

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Mark Smith [mark.smith@ventanaresearch.com] is the CEO and senior vice president of research at Ventana Research, an advisory services and research firm providing insight and education on best practices and technology in performance management.