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July 18, 2003

The Big BAM

Business activity monitoring (BAM) is a key technology concept behind today's "real-time enterprise" sizzle. Will BAM enable you to increase the value of your enterprise resource application investments?

by Stewart McKie

Continued from Page 1

BAM Yin, BAM Yang

Is BAM about process automation and workflow management, or is it about business intelligence and performance management? You could argue that BAM is the next level in business process management or a key component in any corporate performance management system. In reality, it's both. It can help to optimize business processes and as a result improve your understanding of both operational and strategic performance.

A business activity has to be intelligently automated for it to be monitored: The monitoring has to be intelligent and the results easy to access, visualize, or act upon to derive value. That's why a prerequisite for successful BAM is likely to begin with what some call an activity modeling phase. This phase is used to identify activities worth monitoring, define their steps and events, and tie those events to some sort of performance indicator metric relevant to these activities. These are the metrics that are used to act either as decision influencers or drivers.

Whether provided by one or more best-of-breed applications bolted on to an ERP system or from across a range of functionality found within an integrated ERP suite from a single vendor, a BAM capability depends on a wide range of technology working together. Typically, this technology stack will include

Extract, transform, load (ETL) technology to gather data from multiple sources that may be relevant to a cross-application activity visualized by ...
Process modeling technology that defines the scope of relevant activities and identifies the individual process steps in those activities that are subject to ...
Rules engines that define and apply the rules that enable significant events within those activities to be recognized and responded to using ...
Messaging servers that package and communicate or propagate the response to these events in a variety of formats in order to act as a provider to ...
In boxes, portals, dashboards, and Web services that consume these responses to expose them to decision makers who can act on them, or systems that can process them further (perhaps to trigger another event or whole workflow).

If the activities and events benefit from a historical perspective, then the BAM system may also require a data warehouse to maintain a repository of event-related data and responses to facilitate deeper contextual analysis of a business activity over time.

Market Response

BAM's promise as a critical technology mix has generated new alliances in the marketplace. Some examples include the alliance between WebMethods and Informatica and the acquisition of Praja by Tibco Software. It's also why top-tier ERP vendors such as Oracle, PeopleSoft, and SAP are enhancing their suites to better deliver BAM. These solution vendors are moving to deliver new products and services that generate new add-on revenue; they recognize that BAM has the potential to significantly improve the ROI customers can get from their existing ERP investments.

BAM approaches taken by these ERP leaders exemplify the different spins that can be put on BAM when the concept is applied to actual products. For SAP, BAM is regarded as another means to further optimize business processes within and across mySAP applications. For Oracle, it's a way to push down both strategic and operational "intelligence" to individual employee roles using Oracle Applications. For PeopleSoft, BAM delivers additional contextual information to help employees perform an activity step more effectively or managers to better understand what a scorecard is telling them. Let's look in a little more detail at how each of these three vendors is approaching the BAM opportunity.