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Business Process Reengineering: Dhruv Mukeshkumar Prajapati

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BUSINESS PROCESS

REENGINEERING

DHRUV MUKESHKUMAR PRAJAPATI


Organizational Transformation
Traditional organization Transformed organization
Structure Hierarchical Networked

Worker focus Blue-collar/white collar Knowledge worker

Scale Large, stable Flexible

Orientation Operations Customer

Effort Individual Team

Key resources Capital People, information

Rewards Loyalty and seniority Performance and competence

Economic relationships Mergers and acquisitions Strategic alliances

Competitive calibration Multinational Global

Information technology Support Enabling

Direction Sound management Leadership


These changes are arising from the new realities, which
include:

Customers demand unique products and faster service.


Technological innovations happen at a faster rate.
New products develop more quickly.
Product life cycles are shorter.
Governments are forced to reduce deficits.
Global economy is experiencing low growth.
No protection exists from global competition.
What Is BUSINESS PROCESS REENGINEERING?
A business process is an activity or set of activities that will accomplish a
specific organizational goal.

Business process reengineering (BPR) is the fundamental redesign of an


organization and its operations to achieve dramatic performance
improvements in the areas of cost, quality, and cycle time.

Two types of Business processes:

1. Operational/core processes carried out by frontline workers in


delivering services to customers
2. Management support processes that assist the frontline workers in
delivering customer services
After reengineering:
Corporate Culture Change From To
Work units Functional departments Process teams

Jobs Simple tasks Multidimensional work

Peoples roles Controlled Empowered

Organization structure Hierarchical Flat

Performance measures Activity Results

Advancement criteria Seniority Performance

Managers Supervisors Coaches

Executives Scorekeepers Leaders


Where BPR Can Be Applied?
BPR can be applied to virtually any organization in both the public and
private sectors. Industries that have achieved significant success with BPR
include banking and finance, construction, insurance, airlines, and
manufacturing.

Benefits from BPR:


Costs can be dramatically reduced.
Quality can be improved.
Processes are streamlined.
The work environment is enhanced.
SIX GUIDING PRINCIPLES

1. Be customer driven.
2. Look at function first, then form.
3. Position technology as an enabler, not as a solution.
4. Think cross-functional processes, not individual tasks.
5. Set measurable performance targets.
6. Demonstrate success early.
ORGANIZING TO REENGINEER

Reengineering project is usually organized around four separate


entities.
1. The sponsor.
2. The project management team.
3. Design teams.
4. Steering committee.
EXECUTIONTHE NINE DIMENSIONS OF BPR
#1. BUSINESS DIRECTION
Since this step will determine the focus for the entire reengineering program, it requires a
great deal of emphasis. The critical elements of the business are as follows:

1. Confirming the mandate.


2. Identifying our critical success factors.
3. Identifying our reengineering targets.
4. Determine the measurable results.
5. Confirming our shared values and principles.

Customer-focused Reengineering Targets:


Customer stakeholder Performance indicators Reengineering targets
requirements
Quick and on-time service Cycle time per Reduce service delivery cycle time by
transaction 30%

Accuracy Number of errors Reduce number of errors to 0%


Cost Cost of service Reduce cost by 40%
#2. SCOPING AND TARGETING
When the business direction has been confirmed, it is possible to begin the
step of reviewing existing business processes and selecting those to be
redesigned.

1. Information Gathering and Data Collection (Multiple Lines of Evidence).


As-is process modeling
Interviews
Research

2. Identification of Opportunities.
Analysis based on the process models
i. Identification of bottlenecks, redundancies, and inefficiencies.
ii. Assessment of current performance and refining performance targets.
iii. Identification of potential enablers,
Benchmarking.
Ideas from interviews with staff.
Screening of opportunities.
i. Proof of concept
ii. Project team challenge
iii. Cost-benefit analysis
Identification of potential enablers:

Need Possible IT Solution


Reduce storage costs Imaging
Allow user wider access to Expert systems, networks
information
Speed access time Touch screens
Provide fast data entry Bar codes, pen-based computing
Improve item tracking Bar codes
Standardize information Electronic commerceEDI
Increase flexibility Client/server infrastructure
Increase systems user-friendliness Graphical user interface
Speed transaction flow Kiosks, interactive voice response, fax back
Reduce defect rate Bar codes, expert systems
#3.PROCESS DESIGN
The key to achieving breakthroughs in productivity is to start with a clean
slate. Trying to build on existing process designs tends to limit creativity and
will usually not yield the dramatic improvement that management is seeking
through BPR. By starting fresh, process design can reflect the full creative
forces of the design team and often leads to entirely new and better ways of
achieving the desired result.

Principles :
1. Identify what, not who or where.
2. Design processes for the vast majority of situations, then look after the
exceptions.
3. Minimize permanent control functions.
4. Confirm that each function adds value to the delivery of products or
services.
5. Screen all functions for consequences of elimination.
6. Confirm consistency with the business direction.
#4. INFRASTRUCTURE ALIGNMENT
#5. IMPLEMENTATION PLANNING AND FINANCING

The outputs from this dimension will include:

Detailed implementation work packages.


Bundling of work packages into transition phases.
Final cost estimates for reengineering initiatives.
Schedule for each phase.
Financing options for the transition period.
#6. IMPLEMENTATION
CHANGE MANAGEMENT
At the Start of the Project
Throughout the Project
Continuous Improvement

FUTURE TRENDSBUSINESS PERFORMANCE IMPROVEMENT


CASE STUDY: #1 BEFORE
AFTER
CASE STUDY: #2 FORD MOTOR COMPANY
500 people & Most works on mistakes between
BEFORE
AFTER

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