The Long Tail of Process Automation

This content has been archived. It may no longer be relevant

The phrase The Long Tail was first coined by Chris Anderson in an October 2004 Wired magazine article[fusion_builder_container hundred_percent=”yes” overflow=”visible”][fusion_builder_row][fusion_builder_column type=”1_1″ background_position=”left top” background_color=”” border_size=”” border_color=”” border_style=”solid” spacing=”yes” background_image=”” background_repeat=”no-repeat” padding=”” margin_top=”0px” margin_bottom=”0px” class=”” id=”” animation_type=”” animation_speed=”0.3″ animation_direction=”left” hide_on_mobile=”no” center_content=”no” min_height=”none”][1] to describe certain business and economic models such as Amazon.com or Netflix. Businesses with distribution power can sell a greater volume of otherwise hard to find items at small volumes than of popular items at large volumes. The term long tail is also generally used in statistics often applied in relation to wealth distributions or vocabulary use.

The long tail theory can also be applied to process automation and process management. Organizations have thousands of interconnected business processes. This patchwork of process and logic includes human tasks as well as computerized activities that access and update enterprise systems and applications. While all of these processes work collectively to support the goals and strategies of the organization, enterprise software has typically been targeted toward high demand process that are roughly similar across the organization (CRM, ERP, HCM, sales force automation, etc.) For each process automated in one of these enterprise software applications ther are hundreds of highly customized, unique organizational processes that are nota dequately addressed by these systems. These processes are often being managed through e-mail, MS Excel, faxes and telephone calls or handled by custom coded software written by external consultant or internal IT organizations.

The Internet reduced inventory and distribution costs making selling niche products profitable. Similarly, BPM (business process modeling) helps meet niche requirements in areas where historically, enterprise software has fallen short, making the automation of all types of processes more affordable and cost-effective.

Commoditized processes such as order fulfillment and invoicing commonly lack variance and often they are the staple of rigid, off the shelf software such as traditional ERP (enterprise resource planning) software.

Typical processes that are roughly similar activities that differ across organizations are require some customization such as capital planning and IT provisioning due to minor variances, they may be streamlined by pure-play BPM software products.

Unique processes require highly specific activities that are organization-specific and often create sustainable competitive advantage, such as strategic sourcing, customer engagement management, have a higher cost of customization, and therefore require specialized knowledge and tools.

A recent MIT Sloan Management Review article, titled “From Niches to Riches: Anatomy of the Long Tail,” examines the Long Tail from both the supply side and the demand side and identifies several key drivers. On the supply side, the authors point out how e-tailers’ expanded, centralized warehousing allows for more offerings, thus making it possible for them to cater to more varied tastes.

The Long Tail may threaten established businesses. Before a Long Tail works, only the most popular products are generally offered. When the cost of inventory storage and distribution fall, a wide range of products become available. This can, in turn, have the effect of reducing demand for the most popular products.

For example, Web content businesses with broad coverage like Yahoo! or CNET may be threatened by the rise of smaller Web sites that focus on niches of content, and cover that content better than the larger sites. The competitive threat from these niche sites is reduced by the cost of establishing and maintaining them and the bother required for readers to track multiple small Web sites. These factors have been transformed by easy and cheap Web site software and the spread of RSS.


No World Borders BPO / BPM team can help you determine which processes, tools and team members will help optimize your value stream projects. Whether you are optimizing your loss mitigation process in a mortgage servicing company or improving your Internet marketing and lead development plan, we have lived through these projects before and we can add immediate value.

[/fusion_builder_column][/fusion_builder_row][/fusion_builder_container]

Michael F. Arrigo

Michael Arrigo, an expert witness, and healthcare executive, brings four decades of experience in the software, financial services, and healthcare industries. In 2000, Mr. Arrigo founded No World Borders, a healthcare data, regulations, and economics firm with clients in the pharmaceutical, medical device, hospital, surgical center, physician group, diagnostic imaging, genetic testing, health I.T., and health insurance markets. His expertise spans the federal health programs Medicare and Medicaid and private insurance. He advises Medicare Advantage Organizations that provide health insurance under Part C of the Medicare Act. Mr. Arrigo serves as an expert witness regarding medical coding and billing, fraud damages, and electronic health record software for the U.S. Department of Justice. He has valued well over $1 billion in medical billings in personal injury liens, malpractice, and insurance fraud cases. The U.S. Court of Appeals considered Mr. Arrigo's opinion regarding loss amounts, vacating, and remanding sentencing in a fraud case. Mr. Arrigo provides expertise in the Medicare Secondary Payer Act, Medicare LCDs, anti-trust litigation, medical intellectual property and trade secrets, HIPAA privacy, health care electronic claim data Standards, physician compensation, Anti-Kickback Statute, Stark law, the Affordable Care Act, False Claims Act, and the ARRA HITECH Act. Arrigo advises investors on merger and acquisition (M&A) diligence in the healthcare industry on transactions cumulatively valued at over $1 billion. Mr. Arrigo spent over ten years in Silicon Valley software firms in roles from Product Manager to CEO. He was product manager for a leading-edge database technology joint venture that became commercialized as Microsoft SQL Server, Vice President of Marketing for a software company when it grew from under $2 million in revenue to a $50 million acquisition by a company now merged into Cincom Systems, hired by private equity investors to serve as Vice President of Marketing for a secure email software company until its acquisition and multi $million investor exit by a company now merged into Axway Software S.A. (Euronext: AXW.PA), and CEO of one of the first cloud-based billing software companies, licensing its technology to Citrix Systems (NASDAQ: CTXS). Later, before entering the healthcare industry, he joined Fortune 500 company Fidelity National Financial (NYSE: FNF) as a Vice President, overseeing eCommerce solutions for the mortgage banking industry. While serving as a Vice President at Fortune 500 company First American Financial (NYSE: FAF), he oversaw eCommerce and regulatory compliance technology initiatives for the top ten mortgage banks and led the Sarbanes Oxley Act Section 302 internal controls I.T. audit for the company, supporting Section 404 of the Sarbanes Oxley Act. Mr. Arrigo earned his Bachelor of Science in Business Administration from the University of Southern California. Before that, he studied computer science, statistics, and economics at the University of California, Irvine. His post-graduate studies include biomedical ethics at Harvard Medical School, biomedical informatics at Stanford Medical School, blockchain and crypto-economics at the Massachusetts Institute of Technology, and training as a Certified Professional Medical Auditor (CPMA). Mr. Arrigo is qualified to serve as a director due to his experience in healthcare data, regulations, and economics, his leadership roles in software and financial services public companies, and his healthcare M&A diligence and public company regulatory experience. Mr. Arrigo is quoted in The Wall Street Journal, Fortune Magazine, Kaiser Health News, Consumer Affairs, National Public Radio (NPR), NBC News Houston, USA Today / Milwaukee Journal Sentinel, Medical Economics, Capitol ForumThe Daily Beast, the Lund Report, Inside Higher Ed, New England Psychologist, and other press and media outlets. He authored a peer-reviewed article regarding clinical documentation quality to support accurate medical coding, billing, and good patient care, published by Healthcare Financial Management Association (HFMA) and published in Healthcare I.T. News. Mr. Arrigo serves as a member of the board of directors of a publicly traded company in the healthcare and data analytics industry, where his duties include: member, audit committee; chair, compensation committee; member, special committee.

Leave a Reply