- Introduction
- Benefits of BAM
- Measuring Business Performance with BAM
- BAM Business Scenario #1: Circuit Procurement System
- BAM Business Scenario #2: Risk Management System
- Conclusion
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Like this article? We recommend
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BAM Business Scenario #1: Circuit Procurement System
A worldwide firm annually spends tens or hundreds of millions to procure and manage circuits (T-1 lines, phone lines, frame relays, etc.) to provide connectivity to various offices. These circuits are provided by multiple vendors, each of whom commits to different service-level agreement (SLA) terms per circuit type. That is, vendor A may commit to installing a T1 line in two weeks, whereas vendor B may commit to installing a T1 line in four weeks.
Before BAM, the firm would run paper reports showing that the T1 line installation is behind schedule after it's already late. A more useful capability is to designate specific thresholds throughout the lifecycle of the installation, which allows the user to be notified if a particular threshold is exceeded during the installation.
For example, assume that installing a T1 line is composed of 10 activities for vendor A and the normal turnaround time is two weeks. With BAM, the user can specify that if activity 3, confirming the receipt of the order, is not finished by five days after the order has been initiated, then the order will most likely be late. In that case, the user should be notified via some graphical display (typically a red bar to indicate that a threshold has been exceeded). Additionally, the BAM solution can be configured to notify the user via email so that he can then notify the affected parties or consider an alternative solution. Afterward, he can drill down to the individual activity to get additional details on why the order was late (lack of resources, for example).
Now suppose that the same user specifies that he wants to be alerted via an updated graphical display or email if the number of retries for a given order (that is, the number of round trips between any two activities) is three or more, because this high number can indicate a faulty order, or lack of training of the staff handling the order.
This example illustrates process-oriented metrics: timeliness and quality level. These metrics, along with others such as the number of circuits completed in a timeframe (throughput), can be used to enforce the SLA terms with a particular vendor.