Business process management is changing in its scope from a transaction support to a transformational tool for a firm with the application of cloud computing.
Many companies are using BPM services as it provides solutions without firms have to make capital expenditure themselves. Cloud technology has enabled BPM vendors to set up models which are more suitable for risk averse and smaller enterprises, hat doesn’t have millions of dollars to invest upfront. The innovative pricing model by BPM providers also attracts many small and medium businesses to use the service. The pay-as-you-go pricing models have enabled the small and medium enterprises to avail the services which were once restricted only to large players due to the high cost involved.
The new development to BPM is the use of cloud computing popularly known as Business Process as a Service (BPaaS). BPaaS provide companies with people and process expertise for transforming business process upon a pay-per-user model. The system provides a platform for companies to avail the solution from any part of the world. This helps them to set up their operation in any geographical part of the world and gives an opportunity to grow and expand much faster. BPaaS allows companies to enter a new market and or to upgrade the existing system or process without much infrastructural cost.
A real life example could be cited from Life Science Pharmaceuticals (LSP) where a sales representative was unable to get accurate and timely data when they had to make marketing calls. The reason was that the company’s marketing and sales systems were not integrated properly. BPaaS enabled to aggregate all the latest marketing and sales information from all the departments of the company and gave access to the information to users across the world.
BPaaS is widely used by the companies when it comes to acquisition, mergers and diversification. BPaaS allows companies to integrate the new value addition to the existing ERP system without a structural change.
Cost involved in diversification or entry to new market can be reduced by the application of BPaaS, and to some extent the risk involved can also be reduced.
Challenges in using BPaaS
- Most companies face difficulty to set up agreements with BPaaS providers as they are concerned with the security issues. The firms are not used to avail business process management services on a cloud, and this increases their security concerns and apprehensions.
- The companies when contracting for the process fails to evaluate the complete outcome of the process.
- The companies should make sure that they own the process modification while entering into an agreement. The firms should also bring clarity on intellectual property ownership.
BPaaS have turned out to be a new method for companies seeking innovative solutions for improving their process. But it is for companies to evaluate and see if the BPM solutions on BPaaS would provide them the desired outcome.