Specification of Method Requirements and Design Objectives
To ensure that the Five Diamond Method is correctly used, we recommend applying it in certain situations. This is in line with the idea of SME. We characterize these situations in terms of context type and project type (Bucher et al. 2007).
Referring to the context type, we use the CAMAS method to assess the context in which the Five Diamond Method is applicable (vom Brocke et al. 2020). Therefore, it facilitates the assessment of BPM methods’ applicability in terms of BPM lifecycle stages (lifecycle dimension), goal orientation (goal dimension), and three context dimensions (process, organization, and environment) of the BPM context framework (context dimension). A detailed assessment of the Five Diamond Method is presented in Online Appendix 1. A summary is provided in the following.
Our method can be used within the redesign stage of the BPM lifecycle (lifecycle dimension) to foster the exploration of business processes (goal dimension). Referring to the context dimension, our method is especially applicable for core processes to create new value proposition (process dimension). It is important to note that our method presupposes various stakeholders who bring in different views on emerging opportunities. In principle, our method can be used in different kinds of organizations (organization dimension). However, it encourages the involvement of multiple roles and stakeholders, e.g., those dealing with strategy-related matters, as well as those dealing with process-related matters. Such resources and skills are typically found in medium-sized to large organizations in the product and/or service industry. This is because medium-sized or large organizations tend to have a well-developed process orientation (Harmon and Wolf 2018; Mikalef and Krogstie 2020; Neubauer 2009), which is presupposed for the use of our method. As we will show in Sect. 5, this assumption is supported by the evaluation of our method. Finally, offering new value propositions is indispensable in competitive environments with medium or high uncertainty (environment dimension). One needs to take into account, however, that organizations operate in environments with different constraints in terms of laws and regulations (vom Brocke et al. 2020). Arguably, an organization that specializes in visual effects for movies has more freedom to innovate as compared to an organization that produces pharmaceutical products. Such contingencies need to be considered, especially with respect to the implementation of new solutions.
Referring to the project type, we assume that an organization has an established business model and existing business processes. Although the organization may be operating successfully in the market by exploiting existing processes, we suppose that the organization sets out to explore new business processes by sensing, seizing, and transforming emerging opportunities arising from customer needs and digital technologies. Hence, the need for creating new processes with novel value propositions has been recognized. In terms of the designated target state, new business processes should be proposed to create new value propositions. Accordingly, the Five Diamond Method focuses on the initial phases of the digital innovation process (Kohli and Melville 2019), comprising the idea generation and idea selection phases.
To guide the development and evaluation process of the Five Diamond Method, we derived two DOs from the problem setting specified above (Peffers et al. 2012; Sonnenberg and vom Brocke 2012) and backed them with the literature introduced in Sect. 2. Accordingly, DO.1 is derived from the definition of explorative BPM (Grisold et al. 2019; Rosemann 2014). In contrast to the goal of exploitative BPM, i.e., improving (i.e., incrementally changing) or reengineering (i.e., radically changing) existing business processes based on existing problems to provide the same or an enhanced value proposition, the ambition of the Five Diamond Method is to create new processes based on emerging opportunities to provide new value propositions for customers. To foster innovation, DO.2 addresses the respective need for actionable advice to structure the innovation process (Tidd 2001), the importance of creativity that can be fostered by divergent and convergent thinking (Cropley 2006), and the relevance of recognizing opportunities arising from new customer needs and digital technologies (Herstatt and Lettl 2004; Kirzner 1973; Schumpeter 1942). Thus, we specified that the explorative BPM method should achieve following DOs:
(DO.1) BPM perspective: In order to identify and integrate opportunities into new business processes, a method needs to address the exploration goal of BPM by being (a) opportunity-driven, aiming to create (b) a new process in order to provide (c) new value propositions for customer.
(DO.2) IM perspective: In order to identify and integrate opportunities into new business processes, an explorative BPM method needs to be (a) structured along an innovation process, (b) ensure creativity-seeking, and include (c) business and (d) technology trends as opportunity sources.
Method Overview
Linking the Five Diamond Method to method attributes (goal orientation, systematic approach, principle orientation, repeatability) and elements (Sect. 2.1), the method assists organizations in identifying and integrating opportunities into new business processes to create new value propositions (goal orientation). Therefore, it entails various activities depicted as one overarching diamond and four underlying diamonds (Fig. 2). The four diamonds refer to (1) purpose, (2) business, (3) technology, and (4) integration. The diamond shape of these activities reflects the use of divergent and convergent thinking during the process, which are derived from IM (Sect. 2.2) (Cropley 2006). In visualizing our method and the underlying activities as diamonds, we follow popular models which have already been established (e.g., Clune and Lockrey 2014).
All activities (‘diamonds’) draw on existing knowledge from BPM and IM (Sect. 2) (principles orientation). Hence, the purpose diamond refers to the need of gaining awareness about the purpose of the organization as well as the given context at the beginning of the innovation process (left diamond) (Malnight et al. 2019; Mourkogiannis 2007) (Sect. 2.2). To recognize emerging opportunities, trend analysis plays a crucial role during the innovation process (Ortt and Smits 2006) (Sect. 2.2). According to established concepts in the IM discipline, business and technology trends are relevant opportunity sources. Thus, the business diamond aims to identify opportunities related to new opportunities for generating value, e.g., through emerging customer needs (upper middle diamond). As digital technologies are important drivers for innovation (Mendling et al. 2020; Yoo et al. 2010), the technology diamond aims to identify opportunities for utilizing them (upper lower diamond). The integration diamond combines the purpose of the organization with arising opportunities to design new business processes with novel value propositions (Sect. 2.1) (right diamond). The overarching diamond links all underlying diamonds and provides guidance on how to execute them (systematic approach).
Depending on the specific needs, an organization may choose different starting points and omit activities or the use of certain techniques. In most situations, it is useful to start with the purpose diamond. This allows participants to account for the organization’s broader context and to reflect on the strategic relevance of innovation. However, organizations have freedom in navigating through the activities. Furthermore, since the method aims to foster creativity and innovation, the application should be highly iterative. This is depicted by the bi-directional arrows between all pairs of diamonds. For example, an organization may start with the technology diamond and then proceed to the business diamond. Here, one may identify new business opportunities, which in turn can point to technology trends that have not been considered before. One logical requirement is that the method closes with the integration diamond. This is to ensure that novel and innovative ideas are being realized by means of new business processes with novel value propositions.
Figure 2 shows the iterative procedure model of the Five Diamond Method and Table 3 provides an overview of all diamonds. We introduce more details including the constitutive elements (activities, techniques, tools, roles, and output) for each diamond to support their execution in various contexts and among various users (repeatability) in Sects. 4.3 to 4.6. Table 3 stresses that the method aims to involve several stakeholders. This is to ensure that various aspects of the organization are considered during the innovation process. Like other innovation methods (e.g., design thinking), we suggest including at least one facilitator (e.g., researcher, consultant, experienced employee) who knows the method, moderates between participants and facilitates the overall procedure.
Table 3 Overview of the five diamond method’s elements Purpose Diamond
The purpose diamond aims to reveal the underlying driver of organizational activities. Hence, it abstracts away from what the organization is currently doing to what drives and motivates its business. Activity 1 is carried out by BPM-related stakeholders (e.g., BPM manager, process consultant) and (senior) managers who are familiar with or even involved in the planning of strategic goals (role).
During the divergent phase, activity 1 requires defining the purpose and context in which the organization is operating (technique). Reflecting on the purpose of the organization encourages participants to reveal and discuss underlying assumptions, values, and norms of the organization and define them in the absence of their products and services (e.g., the purpose of the car manufacturer BMW is not to produce cars, i.e., specific products, but to provide mobility, i.e., abstracting away from current products/services) (Blunck 2016). Furthermore, the organization should map out the future strategy considering the context of their industry and the customers they are addressing (e.g., BMW is operating in the automotive industry) (technique). This can be supported by means of industry classification schemes and discussion rounds (tool).
The convergent phase serves to define the purpose and scope of applying the Five Diamond Method (technique). This is important to align expectations as well as the foci of all participants. The scope of the methods’ application refers to the entire organization or a specific unit. Accordingly, the boundary conditions for the following activities are defined (output).
Business Diamond
The business diamond aims to identify opportunities arising from the business environment. Various BPM-related stakeholders (e.g., BPM manager, process consultant) and BPM-unrelated stakeholders are involved (e.g., business and market analysts, business developer) (role).
The activity starts with the divergent phase by identifying mega trends followed by industry trends (technique). Mega trends are global trends such as urbanization or mobility, while industry trends occur within a specific industry and reflect customer needs and/or activities by competitors (e.g., a higher demand for environmentally-friendly cars in the automotive industry). Related industries should also be considered, as they may unveil additional trends which could be transferred to the given context. Multiple sources such as internet research or market research institutes can be used to cover a broad spectrum of trends (tool).
Subsequently, during the convergent phase, the identified mega and industry trends are evaluated by considering the purpose defined in activity 1 (technique). Based on this evaluation, relevant trends for the organization at hand are selected (output).
Technology Diamond
The technology diamond aims to capitalize on opportunities arising from digital technologies. Therefore, BPM-related stakeholders (e.g., BPM manager, process consultant) and BPM-unrelated stakeholders providing a technology perspective (e.g., technology or digitalization expert) are involved (role).
During the divergent phase, this activity is concerned with the identification of emerging technology trends and existing digital technologies which could be relevant for the organization (e.g., digital ecosystems that can be created around vehicles, including apps and integrated GPS-tracking systems) (technique). Technology trends are often associated with digital technologies as important drivers for innovation (Mendling et al. 2020), both in terms of how organizations manage their processes and serve their customers’ needs (Yoo et al. 2010). Technologies can be potentially relevant even if there are no existing applications in the organization’s industry or context (Du et al. 2019). Again, multiple sources such as internet research or the Gartner Hype Cycle can be used (tool).
During the convergent phase, technology trends and digital technologies are discussed in relation to the applicability to the organization (technique). The selection of technologies should be in line with the purpose. Relevant technologies are selected in terms of how well they fit the organization. Based on this evaluation, relevant trends for the organization are selected (output).
Integration Diamond
The integration diamond combines identified opportunities with a BPM perspective to generate and design innovative process ideas. This is best done by BPM experts together with innovation managers, project portfolio managers, and senior managers (role).
During the divergent phase, this activity intends to integrate insights that have been gained in previous activities. It strives for generating innovative process ideas based on the purpose, business, and technology diamonds and independently from existing organizational constraints (e.g., processes related to car-sharing projects and initiatives to develop an infrastructure for electricity chargers) (technique). These process ideas can build on one or multiple opportunity sources. The idea generation can be facilitated by using creativity techniques (tool). In line with the definition of explorative BPM, these process ideas should offer new value proposition. To ensure a shared understanding, the generated process ideas are then translated into process blueprints (technique) using a process modelling language (tool).
During the convergent phase, the generated process blueprints are then evaluated based on selected criteria, e.g., feasibility, costs, expected value, and strategic alignment (technique). These criteria are then discussed in relation to organizational needs and the given context. Based on this evaluation, the most promising processes are selected. As a result, one or more process blueprints are generated to create a new process while offering a new value proposition for customers. They are thus in line with the idea of explorative BPM (output). Hence, the integration diamond capitalizes on the strengths that have been accumulated within the BPM discourse by explaining how novel ideas can be organized and managed (Mendling et al. 2020).