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Business Process Re-engineering (BPR): Role of IT
 

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Gives the detailed description of the Role of IT in Business Process Engineering.

Gives the detailed description of the Role of IT in Business Process Engineering.

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    Business Process Re-engineering (BPR): Role of IT Business Process Re-engineering (BPR): Role of IT Document Transcript

    • 23rd MarchBPR 2011 ROLE OF IT IN BPR Submitted By Abhinav Johnson (F09001)
    • Role of IT in BPR Table of ContentsINTRODUCTION...........................................................................................................................4RELATIONSHIP BETWEEN IT & BPR.......................................................................................6 IT Capabilities and Reengineering...................................................................................7 Phase 1: before the process is designed (as an enabler)...............................................8 Phase 2: while the process is being designed (as a facilitator)..................................10 Phase 3: after the design is complete (as an implementer) .......................................13ROLE OF IT IN REENGINEERING............................................................................................16 Principles of Reengineering by Hammer.......................................................................17 BPR – The Current focus in IT......................................................................................20 Concept of Database .................................................................................................20 Data Mining:..............................................................................................................20 Data Warehousing......................................................................................................21STRATEGIC USES OF IT AND CRITICALITY OF IT ............................................................21BPR TOOLS AND TECHNIQUES..............................................................................................22 The Nature of IT Support for BPR................................................................................23 Integrated Enterprise Models.....................................................................................23 Analysis......................................................................................................................26 2
    • Role of IT in BPR Software Functionality...............................................................................................28 New ways of building models....................................................................................29 Communication and Visualization.............................................................................29 Intended Users...........................................................................................................30Evaluation Criteria.........................................................................................................31 Enterprise Models......................................................................................................31 Analysis......................................................................................................................31 Visualization..............................................................................................................32Requirements for BPR Tools.........................................................................................32 Enterprise Models......................................................................................................32 Analysis......................................................................................................................33 Software Functionality...............................................................................................33 Integrated Environment for Tools..............................................................................33 Model Acquisition.....................................................................................................34 Visualization..............................................................................................................34 Intended Users...........................................................................................................34Management...................................................................................................................35Human Resources..........................................................................................................35 Enterprise Models......................................................................................................35 3
    • Role of IT in BPR Software Functionality...............................................................................................35 Degrees of Automation..................................................................................................36IT ENABLERS OF BPR...............................................................................................................37 IT Drives BPR................................................................................................................38 IT in reference process reengineering............................................................................39 Role of CIOs in Process Reengineering.........................................................................40FUTURE ROLE OF IT IN BPR....................................................................................................41CONCLUSION..............................................................................................................................42INTRODUCTION Todays environment is characterized by increasing levels of competition. Enterpriseswanting to increase their market share or obtain profits must adapt to changes in theenvironment. Consequently, many changes in business methods are beginning to appear. One ofthem is business process reengineering (BPR), defined as the fundamental rethinking and radicalredesign of business processes to achieve dramatic improvements in critical, contemporarymeasures of performance. Among the potential enablers of BPR is information technology (IT).IT makes it possible to obtain improvements in BPR. Enterprises can make their tasks easier,redesign their organization, change the way they work, and achieve spectacular improvementusing, among other enablers, IT. Market competition is forcing firms to reconsider how they are organized to compete. Asa basis for change, they are exploring a variety of concepts, including Time-based Competition,Quality Function Deployment, Activity-Based Costing, Quality Circles, ContinuousImprovement, Process Innovation, and Business Process Re-Engineering. Regrettably, most ofthe concepts are descriptive, if not ad hoc, and lack a formal model which would enable their 4
    • Role of IT in BPRconsistent application across firms. Business process re-engineering is very much in the "guild"mould of application; management consultants are the "masters" and they impart theirknowledge through "apprenticeship" to other consultants. The knowledge of business process re-engineering has yet to be formalized and reduced to engineering practice. Information technology (IT) has historically played an important role in the reengineeringconcept. It is considered by some as a major enabler for new forms of working and collaboratingwithin an organization and across organizational borders. Early BPR literature identified severalso called disruptive technologies that were supposed to challenge traditional wisdom about howwork should be performed. • Shared databases, making information available at many places • Expert systems, allowing generalists to perform specialist tasks • Telecommunication networks, allowing organizations to be centralized and decentralized at the same time • Decision-support tools, allowing decision-making to be a part of everybodys job • Wireless data communication and portable computers, allowing field personnel to work office independent • Interactive videodisk, to get in immediate contact with potential buyers • Automatic identification and tracking, allowing things to tell where they are, instead of requiring to be found • High performance computing, allowing on-the-fly planning and envisioning. Business Process Reengineering (BPR) calls for a radical redesign and systematicoverhauling of strategic systems and processes in an organization. In the technology-centricbusiness environment of today, more and more organizations are using Information Technology(IT) tools in their mainstream organizational processes. Hence, for BPR, it is required that the 5
    • Role of IT in BPRfunctionalities of these IT systems are modified. This paper will demonstrate the importance ofIT in one of the most prominent methodologies.RELATIONSHIP BETWEEN IT & BPR The term ‘‘reengineering’’ first appeared in the Information technology (IT) field and hasevolved into a broader change process. The aim of this radical improvement approach is quickand substantial gains in organizational performance by redesigning the core business process. Inthe late 20th century, many US companies embraced reengineering as an effective tool toimplement changes to make the organization more efficient and competitive. The motivation wasusually the realization that there was a need to speed up the process, reduce needed resources,improve productivity and efficiency, and improve competitiveness The changing economic environment has led to an increasing interest in business processreengineering (BPR) by progressive firms around the world. In the 1990s, significant reductionin the cost of IT resulted in enormous investments in IT applications that have stimulatedincreasingly complex organizational change. Information technology has been used to breakdown communication barriers between corporate functions, to empower line workers and to fuelprocess reengineering. In most cases, IT has been used to expedite office work rather than totransform it. Top executives consider IT a potent source of competitive advantage. 6
    • Role of IT in BPR Working together, BPR and IT have the potential to create more flexible, team-oriented,coordinative, and communication-based work capability. IT is more than a collection of tools forautomating or mechanizing processes. It can fundamentally reshape the way business is done andenable the process design. In leading edge practices, information technology makes BPRpossible and worthwhile. BPR and IT are natural partners, yet their relationships have not beenfully explored.IT Capabilities and Reengineering IT has penetrated the office and services environment since the 1978. The shift frommainframe to PC based technology is breaking down communication barriers betweenemployees and customers. Now managers and employees from various departments aredesigning and controlling complex business information systems. IT capabilities involveimproving information access and coordination across organizational units. It is so powerful thatit can actually create new process design options, rather than simply support it. In his book,Business @ the Speed of Thought, Bill Gates argues that if the 1980s were about quality and the1990s were about reengineering, then the 2000s will be about velocity. Gates advocates completedigitalization of all aspects of life. He argues that to be successful in the digital age, companiesneed to develop a new digital infrastructure similar to the human nervous system. This newdigital system enables companies to run smoothly and efficiently, makes them respond quickly toemergencies and opportunities, provides a mean for quickly getting valuable information to thepeople in the company who need it. This in turn empowers employees to make decisions andinteract with customers. What is the relation between BPR & Information Technology? Hammer and Champyconsider IT as the key enabler of BPR. Davenport argues that BPR requires taking a broaderview of both IT and business activity, and of the relationships between them. IT capabilitiesshould support business processes, and business processes should be in terms of the capabilitiesIT can provide. They believe IT’s promise and its ultimate impact is to be the most powerful toolfor reducing the costs of coordination. 7
    • Role of IT in BPR It has been argued that innovative uses of IT would inevitably lead many firms to developnew, coordination- intensive structures, enabling them to coordinate their activities in ways thatwere not possible before. Such coordination-intensive structures may lead to strategicadvantages. IT roles can be categorized into three phases: before the process is designed, while theprocess design is underway, and after the design is complete.Phase 1: before the process is designed (as an enabler) BPR is a strategic action and requires a clear understanding of customers, market,industry and competitive directions. Furthermore, like any other strategic action, it requiresconsistency between the company’s business strategy and vision. Defining business strategy anddeveloping a strategic vision requires understanding the company’s strengths and weaknesses,and the market structure and opportunities. The activities in this phase may include:  Developing a strategic vision.  Identifying the customer’s objectives.  Establishing goals/targets related to market share, costs, revenue enhancement, or profit margins.  Assessing the potential for reengineering.  Defining boundaries and scope of the appropriate process.  Keeping management committed. IT capabilities can provide good insight into the existing conditions. IT is one of severalenablers, including human resources and organizational change, that all must be consideredtogether to bring about change in business processes. Many companies ignore IT capabilitiesuntil after a process is designed. An awareness of IT capabilities can and should influence 8
    • Role of IT in BPRprocess design. Michael Hammer recommends companies to redefine the process first andautomate it second. IT can play important roles in this phase of BPR efforts as follows: 1. The opportunity IT provides is to utilize newer and better technology to develop a strategic vision and to help improve the business process before it is designed. For example, an important Wal-Mart vision was to eliminate unnecessary distribution steps and cost and to provide value to customers. To accomplish this, Wal-Mart developed a strategy that included linking its suppliers to its retail stores. IT, eventually enabled Wal- Mart to implement this strategy. An enterprise-wide information system was developed that directly connected all retail locations, distribution warehouses, and major supplies. 2. The capabilities of IT to track information and break down geographic and organizational barriers are useful in understanding the company’s strengths and weaknesses, and market structure and opportunities. Communication technology helps to overcome geographic barriers and thus enable broader acceptance of the process change. At General Electric e- mail systems are used to speed analysis and design sharing and to hold frequent virtual meetings between group from different regions and overseas. 3. The focus is on finding different approaches to manage a process. These approaches can be found and be adapted from practices of companies outside of the industry. The organization should benchmark against other industries and combine it with the experience and expertise of the team members to adopt an entirely new process technology. 4. BPR requires a flexible organization design. The existing rigid infrastructure of the organization must be altered to facilitate cooperation between various departments by using cross-functional teams instead of individuals working in isolated departments. Flexible infrastructures adapt to changing external drivers. Therefore, the flexible infrastructure includes processes for continuously evaluating existing tools to see what should be removed, and continuously seeking user input about what works or does not. 9
    • Role of IT in BPR 5. To achieve effective teamwork, each worker should develop several competencies. The IT organization is no exception. The demand for close collaboration with other functions dictates the need for IT staff to broaden their portfolio of skills especially in nontechnical issues such as marketing, customer relationships, etc. The combination of the Internet and the Intranet services allows a collaborative team effort from around the globe. 6. Alliances and other methods of cross company coordination are becoming common- place. In an attempt to gain market shares, many firms are teaming and collaborating with suppliers and distributors.Phase 2: while the process is being designed (as a facilitator) This stage involves two activities: technical and social design. During the technicalphase, information is consolidated, alternatives are redefined, process linkages are re-examined,and controls are relocated prior to applying technology. The social design focuses on humanaspects and involves employees who will affect corporate changes: defining jobs and teams,defining skills and staffing needs, and designing incentives are considered carefully. This stagealso requires development of test and rollout plans. After the objectives are identified, theexisting processes are mapped, measured, analyzed, and benchmarked, and then are combined todevelop a new business process. Development of people, processes, and technology areintegrated. During the process design, accountability for development, testing and implementationmust be clearly defined. Real benefits to the business result when IT becomes involved withmore fundamental changes to the business process itself. The crucial roles that IT plays in thisphase of BPR efforts are: 1. IT can facilitate the reengineering design process through the use of project management tools. These help identify, structure, and estimate BPR activities and help to control contingencies that arise during the process. Project management tools along with electronic communication, enable ongoing communication of the reengineering process between users and facilitators. 10
    • Role of IT in BPR2. Gathering and analyzing information about the performance and structure of a process is an important step in identifying and selecting process for redesign. Mapping or flow- charting the existing process and then measuring the results in terms of cost, quality and time are the most successful. IT can facilitate this step with the use of tools that provide modelling and flow simulation, document business processes, analyze survey data, and perform structuring evaluation. Technologies such as computer-aided systems engineering (CASE) are designed primarily to draw process models. The ability to draw models and make changes rapidly speeds redesign and facilitates the ‘‘process’’ of process design. At Xerox, for example several divisions are moving directly from process modelling to automated generation of computer code. They report high user satisfaction and improved productivity with the resulting systems. In addition, IT is capable of storing and retrieving unstructured, multimedia information that can be useful for developing process prototypes. The maintenance and operating workers at Union Carbide’s plant in Taft, Louisiana used flow-charting to redraw their old process and create new ones. The results were a saving of more than US$ 20 million.3. Computing technologies have facilitated a process- oriented approach to system development where a database is shared in different functional units participating in the same business process. Ford Motor Corporation, for example used databases in its accounts payable process to cut down many intermediate steps and to overhaul a sequential flow of paper documents among involved functions. As the project progressed, the reengineering efforts achieved a 75% reduction in the workforce. In addition to shared databases, imaging technology has facilitated a process-oriented approach because in processing loan applications, for example the digitized image of an application can be worked on by several employees directly.4. Telecommunication technologies such as LANs, groupware, etc. have improved collaboration among personnel of different functional units in their efforts to accomplish a common business process. At Texas Instruments, for example, the process for new product development was dramatically improved when a design team in different countries used global network to work on design directly without sequential flow of 11
    • Role of IT in BPR documents. As a result, the development cycle time for various products decreased substantially (more than 30% in some cases). At Ford, the process for new car design was improved when computer-aided design (CAD) systems were utilized. Members of design teams share a common design database across the Atlantic to exchange design ideas, criticism, and opinions without meeting face to face.5. Making data digital from the start can provide a whole range of positive results. When figures are in electronic form, employees can look at them in any detail or in any view they desire, can study them and pass them around for collaboration. For example, Seven- Eleven Japan used IT to not only improve inventory control, but to provide key information to management and improve quality of sales information to make better operation decision on a regional basis. In 1979, the company established an on-line network and from there introduced the Electronic Point of Sale (EPoS) system in 1982. At Hewlett-Packard Co., the sales process improved drastically as 135 sales representatives were trained to use laptop to retrieve up-to-date inventory information from the corporate database during the customer meetings. In addition, sales persons used these laptops to communicate with their peers and superiors. As a result, time spent in meeting decreased by 46%, travel time was cut by 13%, time spent with customers increased by 27% and sales rose by 10%.6. Input from employees and information on customer requirements is essential in reengineering. IT applications allow organizations to build a data base to track customer satisfaction, analyze complaints, and obtain employee’s feedback for ways to improve customer satisfaction. At Frito Lay each of the 10,000 salespersons uses a handheld computer to record sales data on 200 grocery products, reducing many clerical procedures. The data is transmitted to a central computer, which in turn, sends instructions (such as changes in pricing, and product promotions) to all salespersons through their hand-held computers. This process greatly enhances collaboration between marketing and sales and also makes weekly summaries and analysis available to senior managers. 12
    • Role of IT in BPR 7. IT capabilities are used for information exchange and to improve inner organizational collaboration. For example R.J. Reynolds Tobacco Co. used EDI technology in conjunction with varied technologies of electronic commerce such as document imaging with electronic work queues to reengineer its accounts payable function. 8. IT can also be used to help identify alternative business processes. IT can help companies to achieve multiple objectives in redesigning processes. Expert systems and technological databases can provide information on current and future capabilities of technology, human resources and organization change. American Express improved quality, cost, and time of its credit authorization process with an ‘‘Authorizer’s Assistant’’ expert system. The successful redesign led to 25% reduction in the average time for each authorization, a 30% reduction in improper credit denials and a 7 million annual reduction in costs due to credit losses. IT makes it possible to develop much richer processes.Phase 3: after the design is complete (as an implementer) The bulk of the reengineering efforts lie in this phase. The reengineering efforts includeplanning and managing people, processes, and technology and driving the implementationtoward the business vision. The objectives of this stage are to pilot test the new approach, tomonitor the results, and to provide extensive retraining of employees. As reengineering effortsgo forward it is important to define and redefine performance goals and objectives, maintain astrong commitment to the vision, break the barriers between the departments, and be flexible asthe business environment changes. IT can facilitate the following processes in this phase: 1. Implementation of the new process through the use of project management and process analysis tools. These help identify structure and estimate all associated activities. They facilitate tracking and managing employee’s expectations against commitments. Contingencies and problems that arise during the implementation phase can be handled and controlled. 2. Electronic communications enable ongoing and real time communication of the process between users and facilitators. IT helps to overcome geographic barriers. 13
    • Role of IT in BPR3. Evaluating the potential investments and returns of the reengineering efforts is absolutely essential. The reengineering team or management should have enough information to determine the value the new process contributes to the overall performance.4. A fundamental source of difficulties is the fact that process are reengineered but infrastructure is not. The rigid infrastructure of the organization must be altered to facilitate cooperation and to cross-functional barriers between departments. Cross- functional teams must replace individuals working in isolated departments. Recently, there has been a significant growth in collaborative computing products. These range from software for conducting meetings on-line to complex programs that enable a number of users to collaborate in real time, sharing documents, managing projects and handling different tasks. These include idea generation, brainstorming, group outlining, voting, teleconference, meet-me-service, etc.5. As other business divisions undergo reengineering process, IT organization should be improved to meet their increasing needs. For example, in 1993 CIGNA implemented reengineering of its 1000- person IT department—CIGNA Technology Services (CTS). The main reason was to meet the increasing needs of the business divisions. A team based structure resulted, and the benefits included a major change in the philosophy of the unit. Where the unit was previously technology focused, reengineering brought about a focus on using technology to meet business strategies. Management style changed from control-based and functional, to leadership-based and team-oriented. The hierarchy was flattened, increasing flexibility.6. ‘‘Digital feedback loop’’ makes it possible to have a specific definition of success, a specific beginning and end in terms of time and tasks, intermediate milestone and finally a budget. IT is only useful if it helps employees do their work better and differently. Organizations are not working with the employees in the organization to infuse technology. Successful reengineering requires that companies first concentrate on crucial business processes that effect competitive factors, customer service, cost reduction, product quality and time-to-market. Obtaining greatest benefit from IT requires that current processes not be simply automated or existing automation improved. 14
    • ROLE OF IT IN REENGINEERING Business process reengineering (reengineering) is a pervasive but challenging tool fortransforming organizations for radical improvement in all aspects of its performance.Information technology (IT) plays an important role by either enabling or constraining successfulimplementation of Reengineering. The role of IT in reengineering is not automating the businessprocess. Companies that think of IT as the tool for automating its business process cannotreengineer. IT can be an enabler for reengineering by enabling the organization to reengineer. ITallows the organization to do business process more efficiently. IT can also become an inhibitorof reengineering if the organizations IT Infrastructure is inadequate or inflexible. ITinfrastructure capability includes both the technical and managerial expertise required to providereliable physical services and extensive electronic connectivity within and outside the firm. Information technology (IT) has historically played an important role in the reengineeringconcept. It is considered by some as a major enabler for new forms of working and collaboratingwithin an organization and across organizational borders Early BPR literature identified several so called disruptive technologies that weresupposed to challenge traditional wisdom about how work should be performed. • Shared databases, making information available at many places • Expert systems, allowing generalists to perform specialist tasks • Telecommunication networks, allowing organizations to be centralized and decentralized at the same time • Decision-support tools, allowing decision-making to be a part of everybodys job • Wireless data communication and portable computers, allowing field personnel to work office independent • Interactive videodisk, to get in immediate contact with potential buyers • Automatic identification and tracking, allowing things to tell where they are, instead of requiring to be found • High performance computing, allowing on-the-fly planning and revisioning
    • Role of IT in BPR In the mid 1990s, especially workflow management systems were considered as asignificant contributor to improved process efficiency. Also ERP (Enterprise Resource Planning)vendors, such as SAP, JD Edwards, Oracle, PeopleSoft, positioned their solutions as vehicles forbusiness process redesign and improvement.Principles of Reengineering by Hammer Hammer (1990) considers information technology (IT) as the key enabler of BPR whichhe considers as "radical change." He prescribes the use of IT to challenge the assumptionsinherent in the work processes that have existed since long before the advent of moderncomputer and communications technology. He argues that at the heart of reengineering is thenotion of "discontinuous thinking -- or recognizing and breaking away from the outdated rulesand fundamental assumptions underlying operations. These rules of work design are based onassumptions about technology, people, and organizational goals that no longer hold." Hesuggests the following "principles of reengineering": (a) Organize around outcomes, not tasks (b) Have those who use the output of the process perform the process; (c) Subsume information processing work into the real work that produces the information; (d)Treat geographically dispersed resources as though they were centralized; (e) Link parallel activities instead of integrating their results; (f) Put the decision point where the work is performed, and build control into the process; (g) Capture information once and at the source. The major advantage of IT in reengineering lies in its disruptive power. IT has the power 17
    • Role of IT in BPRto break the rules and make people think inductively and give the company a competitiveadvantage. The company that used the disruptive power of IT to break all rules and gaincompetitive advantage was Amazon.com. Amazon.com broke the existing rules and sold bookswithout a physical presence for its customers, through Internet. Amazon.com in doing so has completely changed the book store business and broke allthe rules. The key to the effective use of IT lies not in moving the information faster but in doingright things with it. IT has to be used to make proactive decisions to improve businessperformance rather than report on it after the fact. In the design phase of implementation ofreengineering the capabilities of IT can be used to simulate a model of the design and there byvalidate the new design. Building an effective IT infrastructure is a vital factor in successful BPR implementation.An adequate understanding of technologies for redesigning business processes is necessary forproper selection of IT platforms. Effective overall system architecture, flexible IT infrastructureand proper installation of IT components all contribute to building an effective IT infrastructurefor business processes. The IT infrastructure and BPR are interdependent in the sense thatdeciding the information requirements for the new business processes determines the ITinfrastructure. In addition, recognition of IT capabilities provides alternatives for BPR. Buildinga responsive IT infrastructure is highly dependent on an appropriate determination of businessprocess information needs. This, in turn, is determined by the types of activities within a businessprocess, and the sequencing and reliance on other organizational processes. An effective ITinfrastructure follows a top-down approach, beginning with business strategy and IS strategy andpassing through designs of data, systems and computer architecture. Linkages between the ITinfrastructure components are important for ensuring integrity and consistency among the ITinfrastructure components. IT standards also have a major role in reconciling variousinfrastructure components to provide shared IT services that are of a certain degree ofeffectiveness to support business process applications. The IT infrastructure shared services andthe human IT infrastructure components, in terms of their responsibilities and their expertise, areboth vital to the process of the IT infrastructure composition. 18
    • Role of IT in BPR One main objective of BPR is to use IT to support radical change. Some authors view ITas the central implementation vehicle of BPR. However BPR has not really worked as itsproponents expected. Davenport and Short (1990) attribute this problem to a lack ofunderstanding of the deeper issues of IT. They claim that IT has traditionally been used toincrease the speed of work but not to transform it and BPR is about using IT to do thingsdifferently. Therefore, IT plays an important role in BPR. Properly implementing IT can improvethe competitive position of organizations. But inappropriately implementing IT may createbarriers to responding to the rapidly changing business environment. Further, simply picking ITpackages cannot achieve successful BPR if it is simply used to speed up the process rather thanreengineer it. As Davenport (1993) contends: “Information and IT are rarely sufficient to bring about the process change; most processinnovations are enabled by a combination of IT, information and organizational/human resourcechanges.” IT provides project management skills and experience, which is a key ingredient insuccessfully implementing reengineering. The IT group of the company has experience in largescale project as they are exposed to the structured demand of large scale projects. Reengineeringin a company is and should be undertaken as a project, this is the time when the projectmanagement expertise of the IT group becomes a key ingredient in the success of reengineering. IT can continuously reflect and reinforce bureaucratic and functional structures or IT canhelp to create a leaner, flatter and more responsive organization. For example, IT tools that aredesigned for functional hierarchies are primarily designed to support incremental improvementsand cannot achieve the radical change in BPR projects. While information systems provide fastprocessing and response, they often fail to provide the flexibility for human communication,which can lead to serious consequences. This means IT may sometimes have a negative impactby merely automating the existing processes. However, it could also have a positive impact if itis deployed correctly in conjunction with the organization’s goals. IT is the enabler to reengineerprocesses and is an important driving force for business transformation. Although, BPR has its roots in IT management, it is primarily a business initiative thathas broad consequences in terms of satisfying the needs of customers and the firms other 19
    • Role of IT in BPRconstituents. The IS group may need to play a behind-the scenes advocacy role, convincingsenior management of the power offered by IT and process redesign. It would also need toincorporate the skills of process measurement, analysis, and redesign.BPR – The Current focus in IT Apart from the usual ways of managing a process in any business information system, itis necessary to enhance the value of the process and also the methods used in improving theprocess. Some of the concepts of information management for effective information systems arethe traditional concept of database, the emerging concepts of data mining and data warehousing.Concept of Database Database is a data structure used to store organized information. A database is typicallymade up of many linked tables of rows and columns. For example, a company might use adatabase to store information about their products, their employees, and financial information.Databases are now also used in nearly all ecommerce sites to store product inventory andcustomer information. Database software, such as Microsoft Access, FileMaker Pro, and MySQLis designed to help companies and individuals organize large amounts of information in a waywhere the data can be easily searched, sorted, and updated.Data Mining: Data mining is primarily used as a part of information system today, by companies withstrong consumer focus retail, financial, communication, and marketing organizations. It enablesthese companies to determine relationships among “internal” factors such as price, productpositioning, or staff skills, and “external” factors such as economic indicators, competition, andcustomer demographics. And, it enables them to determine the impact on sales, customersatisfaction, and corporate profits. Finally, it enables them to “drill down” into summaryinformation to view detail transactional data. With data mining, a retailer could use point of salerecords of customer purchases to send targeted promotions based on an individual’s purchase 20
    • Role of IT in BPRhistory. By mining demographic data from comment or warranty cards, the retailer coulddevelop products and promotions to appeal to specific customer segments.Data Warehousing A data warehouse is a copy of transaction data specifically structured for querying andreporting. The main output from data warehouse systems are either tabular listings (queries) withminimal formatting or highly formatted “formal” reports on business activities. This becomes aconvenient way to handle the information being generated by various processes. Data warehouseis an archive of information collected from wide multiple sources, stored under a unified scheme,at a single site. This data is stored for a long time permitting the user an access to archived datafor years. The data stored and the subsequent report generated out of a querying process enablesdecision making quickly. This concept is useful for big companies having plenty of data on theirbusiness processes. Big companies have bigger problems and complex problems. Decisionmakers require access to information from all sources. Setting up queries on individual processesmay be tedious and inefficient. Data warehouse may be considered under such situations.STRATEGIC USES OF IT AND CRITICALITY OF IT Companies may use information systems strategically, or may use them in defensive orcontrolled ways. More and more businesses are beginning to use information systemsstrategically for competitive advantage. The speed, information processing capabilities, andconnectivity of computers and Internet technologies can substantially increase the efficiency of 21
    • Role of IT in BPRbusiness processes, as well as communications and collaboration among the people responsiblefor their operation and management. IT can also be used in one of the most important area of knowledge management.Knowledge management has become one of the major strategic uses of information technology.Many companies are building knowledge management systems (KMS) to manage organizationallearning and business know-how. The goal of KMS is to help knowledge workers create,organize, and make available important business knowledge, wherever and whenever it’s neededin an organization. This includes processes, procedures, patterns, reference works, formulas,“best practices,” forecasts, and fixes. Internet and Intranet web sites, groupware, data mining,knowledge bases, discussion forums, and videoconferencing are some of the key informationtechnologies for gathering, storing, and distributing this knowledge. For any business process the criticality of Information Technology has to be analysed.Information systems can be used in business process reengineering when large software systemsgrow old, when there are limitations in construction tools, when there are millions of lines ofcode are to be maintained etc.BPR TOOLS AND TECHNIQUES Market competition is forcing firms to reconsider how they are organized to compete. Asa basis for change, they are exploring a variety of concepts, including Time-based Competition,Quality Function Deployment, Activity-Based Costing, Quality Circles, ContinuousImprovement, Process Innovation, and Business Process Re-Engineering. Regrettably, most ofthe concepts are descriptive, if not ad hoc, and lack a formal model which would enable theirconsistent application across firms. Business process re-engineering is very much in the "guild"mold of application; management consultants are the "masters" and they impart their knowledge 22
    • Role of IT in BPRthrough "apprenticeship" to other consultants. The knowledge of business process re-engineeringhas yet to be formalized and reduced to engineering practice. This Part of our report deals with vision for BPR tools and also specifies criteria for thevaluation of these tools.The Nature of IT Support for BPRWe can consider any software tool for BPR as having five aspects: • Integrated enterprise models • Analysis (problem-solving capability) • Software functionality • Visualization and Communication • Intended UsersThese properties address two major themes: • What tasks do the tools perform? • What support do the tools require? The following sections consider more detailed questions for each of these aspects of BPRtools. We will then present some preliminary ideas for the nature of BPR tools for each stage inthe framework, and propose requirements for these tools.Integrated Enterprise Models An enterprise model is a computational representation of the structure, processes,information, resources, goals, and constraints of a business, government activity, or otherorganizational system. It can be both definitional and descriptive, spanning what is and whatshould be. The role of an enterprise model is to achieve model-driven enterprise design, analysis,and operation. 23
    • Role of IT in BPR Usually a “second generation knowledge engineering" approach is used for constructingthe enterprise models. Rather than extracting rules from experts, they are "engineeringontologies." An ontology is a formal description of entities and their properties, relationships,constraints, behaviours. It provides a common terminology that captures key distinctions and isgeneric across many domains. The approach to engineering ontologies begins with defining ontology’s requirements;this is in the form of questions that ontology must be able to answer. It is called the competencyof the ontology. For any task in which the ontology is to be employed, the task imposes a set ofrequirements on the ontology. These requirements can best be specified as a set of queries thatthe ontology should be able to answer, if it contains the relevant information. The competencyquestions are the basis for a rigorous characterization of the information that the ontology is ableto provide to the task. Competency questions are used to evaluate ontology in the sense that theontology must be necessary and sufficient to represent the tasks specified by the competencyquestions and their solution. These are also the tasks for which the ontology finds all and onlythe correct solutions. Tasks such as these can serve to drive the development of new ontologiesand also to justify and characterize the capabilities of existing ontologies. An integrated enterprise model provides the language used to specify an explicitdefinition of an enterprise. For reengineering, it is needed to explore alternative models in thedesign of enterprises spanning organization structure and behaviour. In order to reason aboutalternative designs for enterprises, it is necessary to explore different possible sets of constraintsfor enterprises within the language. Some questions should be asked like-- can a process beperformed in a different way, or can we achieve some goal in a different way? Can we relax theconstraints in the enterprise such that we can improve performance or achieve new goals? A related problem is the use of benchmarking in the reengineering process. Inbenchmarking, performance is compared between enterprise and then adopting processes andpractices from enterprises which are the best performers. However, not all practices can beadopted from other enterprises; the key is to realize that to identify opportunities forimprovement by analyzing the successes and failures of similar enterprises. Herein lies the 24
    • Role of IT in BPRproblem -- what is a similar enterprise? What is compared among enterprises when we usebenchmarking? It is difficult to compare the goals and activities among enterprises unless allconstraints and assumptions about the enterprise and its environment are made explicit. By representing the enterprise as a set of constraints using the ontologies, all of the abovequestions can be considered as either constraint satisfaction or logical entailment problems infirst-order logic. All of the relationships among the different constraints within the enterprise aretherefore made explicit. An enterprise is defined by the following set of constraints: • definitions of the activities performed by the enterprise. • constraints on resources required by activities performed in the enterprise. • constraints among organizational roles, positions, and agents within the enterprise. This includes constraints on the behaviour of agents. • constraints defining the goals to be achieved by the enterprise. • constraints on products, including product design requirements, quality constraints, and product standards. • Rather than manufacture and distribute products, many enterprises provide services to their customers, and there is a requirement to model these enterprises within the framework. This requires ontology for services, where a service is intuitively an activity performed by agents within the enterprise to either change the properties of some resource (e.g. delivering packages, painting buildings, dry cleaning, repair) or to provide information to customers. In this case, the definition of the enterprise must specify a set of constraints on products and information that define the activities the enterprise performs as services. • set of constraints on activities in the enterprise. This includes policies and performance constraints, such as the following examples: o All deliveries must be made within 15 minutes of placing the order. o When an order is made, a copy is sent to the regional office. 25
    • Role of IT in BPR • set of constraints defining the external environment of the enterprise, dealing with customers, markets, suppliers, and competitors. This also includes the definitions of the activities performed by agents external to the enterprise (e.g. suppliers, subcontractors), but whose effects are required by the activities within the enterprise. Using this framework, it is possible to characterize classes of enterprises by sets ofassumptions over their processes, goals, and organization constraints.Analysis A necessary first step is the precise definition of the analysis tasks performed by differenttools in the environment and the ways in which they interact. This specification is independent ofthe algorithms used to solve the tasks – it is needed to specify the problem and what constitutesa solution to the problem. In this way will define the functionality of each tool; this will requirethe definition of what is the appropriate input to each tool and what is the correct output. Thespecifications of these tasks for the tools will serve as competency questions for the differentontologies that are being designed. Each advisor is a constraint-based problem solver - given a set of goals and constraints, atool searches for a solution that optimizes the goals and satisfies the constraints. Tools also havethe ability to generate more than one solution, thereby the enabling the consideration ofalternatives and trade-offs.The tasks for each advisor fall into three main groups: • evaluation • analysis • guidance Evaluation tasks are either decision tasks (does the enterprise model satisfy some set ofrequirements, such as ISO 9003 compliance) or property evaluation of an enterprise model (whatis the cost associated with some set of activities). This requires the ability to compare twodifferent enterprise models along some dimension, such as cost or quality. In addition, the 26
    • Role of IT in BPRdistinction must be made between evaluation of the enterprise model (static set of activities) andthe evaluation of a plan or schedule at some point in time. Analysis tasks involve prediction, monitoring, identification, and explanation withrespect to an enterprise model. Prediction is the determination of the value of some proposition atpoints in the future. Monitoring is the determination of the value of some proposition afterexecuting some set of activities, and comparing this value to the predicted value. Identification isthe task of finding objects that satisfy certain properties in an enterprise model. Explanation isthe task of determining why a proposition has a certain value at some point in time; this requiresdeciding what set of event occurred and what propositions hold that entail the value of theproposition in question. For example, we may want to predict the cost associated with some setof activities and then monitor and compare the cost of the execution of the scheduled activities.We may want to know why a particular product has a given cost, or why the activity took so longto complete; these tasks require some mechanism for explanation. Another analysis task may bethe identification of the resource bottlenecks within an enterprise model, or the anticipation ofresource conflicts. The explanation tasks illustrate the relationship between evaluation and guidance for thetools. If a particular enterprise model fails to satisfy some property, it is needed know why itfails. This in turn suggests ways in which augment the enterprise model so that it does satisfy theproperty. For example, an enterprise may not be ISO 9003 compliant; the explanation task wouldrecommend that the appropriate quality control processes be included in order to satisfycompliance. Finally the guidance tasks for these tools, in which the tool suggests alternatives. The toolmust be able to represent and model the current status of a process and assess potential changes.For static models, this requires the ability to generate different models. This is also related to theevaluation tasks of the tools; if a process fails to satisfy certain requirements, the tool suggestsalternative models of the process which do satisfy the requirements. Comparing and evaluatingthe different alternative futures and possibilities for the processes in an enterprise with respect tothe execution of plans and schedules requires a mechanism for hypothetical reasoning. 27
    • Role of IT in BPRSoftware Functionality These are the capabilities of the tools that are independent of the reasoning tasks requiredfor analysis. They deal with properties of the implemented ontologies and analysis tasks, and canbe roughly categorized as follows: • Tool integration environment • Enterprise model management tools • Enterprise model construction • Project management toolsIntegration of Enterprise Models and Tools A major theme in the BPR framework is the creation of an integrating environment fordifferent tools. Toolkits for spot solutions exist, but there is no consistency among tools. In orderto address the problem of integrating different BPR tools and the different enterprise models thatsupport the tools, any IT environment for BPR should use integrated enterprise models spanningactivities, resources, organization, goals, products, and services. These integrated enterprisemodels would then serve as a common repository accessible by multiple tool sets. Further, these enterprise models must be extendible, allowing the incorporation of newclasses of constraints and the specialization of concepts and constraints for a particularenterprise. It is vital that the enterprise models and BPR tools used by different organizations withinthe same enterprise be shareable and usable across these multiple organizations. Enterprisemodels also provide representations that are reusable in other stages of BPR. Tools may bedefined with respect to a general class of enterprises or environments. To be useful, these toolsmust be customizable, both to the class of problems and the class of users, whether they bemanagers, consultants, or engineers. 28
    • Role of IT in BPRModel Management To address the problems of managing the different enterprise models to support the tools,it is needed to provide synthesis of multiple views of the enterprise. The tools must provideflexibility in information gathering, managing different kinds of data at different levels offormality and representing the enterprise at different levels of abstraction. In the construction of enterprise models, the tools must opportunistic in providinginformation by tracking the information that is required at the appropriate time. The tools mustalso be able to support partial models, and then combine these partial models into an integratedmodel of the entire enterprise.New ways of building models Any environment that we design to support BPR must provide new ways of buildingenterprise models, particularly in the acquisition and validation of an enterprise model. Such anenvironment must therefore have the following properties: • The process of constructing an enterprise model must be interactive and dynamic. • An environment for enterprise model design must support storyboarding.Communication and VisualizationCommunication Tools to support BPR must facilitate communication of the properties of an enterprisedesign or redesign. Minimally, there must be annotated enterprise models. We must also be ableto extract multiple pieces of the model in order to explain their interaction. Ability to produce summaries of the intelligence gathered to support various types ofcommunicating and reporting but retaining linkages to the sources of data.Visualization 29
    • Role of IT in BPR Another aspect of BPR is that the customers (subjects of the BPR endeavour) are learningabout their enterprise through the process of modelling the enterprise. The BPR tools shouldtherefore support this learning process for the customers. The first objective is the development of a symbology that depicts terms and concepts inthe associated enterprise models. The symbology should be precise and general enough tosupport visual programming for performing the modelling task. For those tasks that require multiple enterprise models, the primary issue will be thedesign of graphical interfaces that capture the dimensionality of the interdependencies and thepossibility of merging the visualizations of the relevant models.Intended Users The BPR tool may vary with the kind of user -- external consultant, internal consultant,manager, employee. The difference in the tool can include any of its properties, including theanalysis tasks, software functionality, and visualization. There is also the following distinction in the kind of BPR endeavour which must bereflected in the functionality of the tools: • Tools that support BPR as a single intervention in an enterprise. • Tools that support BPR within an architectural framework for a process-oriented enterprise, and which enable possible future BPR endeavours. One issue that needs to be explored further is whether there are implementationconstraints that should be accepted in the tools. Related to this is the question of what technologyis available to different users, which may determine the functionality of the implemented tools.Model acquisition may best be done using a notebook computer, while analysis of the model isdone using a more powerful workstation. 30
    • Role of IT in BPREvaluation Criteria In this section we present a set of questions which can be used to evaluate BPR tools withrespect to the BPR framework.Enterprise Models 1. How is a particular enterprise modelling language useful for supporting BPR at a particular stage in the framework? 2. What requirements must the enterprise modelling language satisfy in order to support BPR at some stage? 3. Identify the enterprise modelling language required to support the analysis tasks identified for a particular stage of BPR. 4. Specify the terminology required to specify a particular stage of BPR. This means defining the terms used in specifying that stage, as well as constraints on the meanings of these terms.Analysis 1. What kind of analysis is applicable at a particular stage of BPR, if any? Specify these analysis tasks. 2. What enterprise models are required to support the analysis? 3. How do the analysis tasks change with the intended users? In particular, consider the following questions: 4. Are there different tasks for single intervention BPR endeavours as opposed to BPR projects within a process-oriented enterprise? 5. Do managers require different analysis tasks than engineers or consultants? 6. What kind of analysis is being performed by the particular tool that we are evaluating? 31
    • Role of IT in BPRThis should be specified in terms of input and output.Visualization 1. What needs to be visualized? 2. How is the necessary information being visualized? 3. How is the visualization related to the kind of analysis task?Requirements for BPR Tools Tools for this stage of BPR can be characterized primarily as enterprise model acquisitiontools. We first define the requirements for all tools supporting this stage, and then propose aninitial set of tools.Enterprise Models The enterprise models must provide definitions and constraints for the following terms: enterprise, corporation, key process, vision, strategy, objective, goal, core competency,enterprise performance criteria, process performance measures, environment, customer,customer needs, expectations, requirements, market, opportunity, competitor capabilities,sponsor, expected outcome of process, critical success factor for process, ownership of process By using an enterprise modelling language, a normative model of the enterprise can beconstructed. This creates semantics for the enterprise and an extendable model that can later berefined, and which allows semantic transformations between different contexts. It can also createa network of relationships, keep track of what is linked and to whom, and explore and navigatethrough this network. It is needed to integrate global and local views of the enterprise. In particular, there is aneed to provide structural frameworks for high-level understanding and integration: • Mapping organizational metrics (business model) to the process perspective (process model). 32
    • Role of IT in BPR • Diagnostics for best practice (benchmarks). In this way, it is possible to drive out insights for opportunities. An enterprise model also provides us with mental modelling tools that assists participantsfor communicating and coming to an agreement. In using enterprise models, it is also needed to be aware of possible limitations for theenterprise model used by tools at this stage. In particular, how do we handle fuzzy issues, such aspolitical culture?Analysis The primary analysis tasks for this stage are: • Determining the completeness of the set of constraints defining the enterprise. • Model integrity checking -- determining the consistency of the constraints. • Rationale for objectives and performance criteria -- have the linkages and dependencies been made explicit? Formal specifications of the competency questions for these analysis tasks must beprovided.Software Functionality The essential capabilities required for model acquisition tools are concerned with theconstruction and editing of the model for a specific enterprise. There are also several aspects of this stage which require that we represent BPR as aproject (endeavour) within the enterprise. In this case, the tools must support the management ofthe endeavour.Integrated Environment for Tools The tools should be able to maintain consistency among themselves and the enterprisemodels, not necessarily uniformity. There may be the problem that the customer language is 33
    • Role of IT in BPRdifferent than the tool language. In this case, we must provide an environment that can representthe different meanings for terms used by different people ("meaning mapper"). This alsoinvolves identifying the relevant assumptions used by different people, tools, or enterprisemodels. and the ability to capture multiple synonyms and utilize them in translation to variousaudiences. Tools must be portable, able to access existing information that is available in differentforms and correlate the output of different tools.Model Acquisition At this stage of BPR, the one of the primary tasks is the acquisition of the model for aparticular enterprise. Any tool must therefore specify how we gather enterprise models, as wellas provide some mechanism for a model repository.Visualization The challenge at this stage is to design the appropriate interface for model acquisitiontools. The relationships among goals, activities, and organizational roles are made explicit in theenterprise model; these relationships must also be explicitly visualized in the tools through thesymbology of the associated enterprise models. There is also a requirement to represent the current enterprise in order to communicatethe problems and characteristics of the enterprise, as well as informally demonstrating that theenterprise model is complete.Intended Users At the stage of setting the context for the BPR endeavour, it is essential to make the casefor moving forward with the BPR endeavour. Any tools must therefore be able to effectivelycommunicate the problems and any preliminary solutions. 34
    • Role of IT in BPRManagement The necessary functionalities for tools to support management are similar to those for theOperate stage of the BPR endeavour. Both must provide mechanisms for describing andcommunicating to each affected employee any change requests, potential problems, and potentialsolutions. The tools must also define architecture for a process-oriented enterprise by providing arepository for the following: • Standards for consistent descriptions of processes, process strategy and plans. • the framework of entities necessary for effective process management • linkages showing how each employees job contributes to the building and delivery of value to the enterprises customers.Human ResourcesEnterprise Models To characterize human resources, we must identify the essential properties of agentswithin the enterprise. For example, we must represent the capacity of agents and behaviouralaspects of agents within the enterprise, such as motivation, culture, incentives, and adaptability.We must also represent the constraints on the behaviour of people, such as policies andpreferences and provide linkages from the process measurements to the organizationalincentives.Software Functionality Provide a simulation environment to support interactive training of change agents andpeople affected by new changes. 35
    • Role of IT in BPRDegrees of Automation The analysis tasks (problem solving capability) of tools can be evaluated on a continuumof the degree of automation in the tool and the interface between the user and the tool that isconsidered as an assistant. At one end of the continuum, there are tools which are simply visualizations of theenterprise models that facilitate communication and provide insight into the enterprise and itsproblems. By providing a mental model of the enterprise, the tool supports opportunityidentification as participants gain an understanding of how the enterprise succeeds or fails. As we move along the continuum, we encounter BPR tools that provide analysis of agiven model through evaluation, identification, and monitoring of different properties of theenterprise. In these different forms of analysis, we are considering alternative enterprise models,which includes alternative plans or schedules for activities, alternative organizations, oralternative sets of policies for people in the enterprise. We are also considering alternativeexplanations for different properties of the enterprise, and alternative predictions for possiblyhypothetical behaviour of the enterprise. Given this characterization of alternatives, the analysis tasks may simply comparealternatives models/explanations/predictions in a given set produced by the user of the tool. Thisis type of analysis performed by current simulation tools. 36
    • Role of IT in BPRIT ENABLERS OF BPR Over the decades it has become evident that one of the most important ways to facilitateeffective organization redesign through process engineering in organizations is through the useof information technology (IT) as an enabler of change. In fact, some have been willing to gobeyond that by saying that IT is not only a key enabler of change, but also an initiator and afacilitator. However, while IT played a significant role in changes in the nature of workresponsibilities in organizations, the results achieved over the years appear to be more often thannot to be slightly incremental and linear in nature. In other words the momentum of traditionalbusiness practices developed over the years overshadowed any ability of technology to shiftwork methods in a different direction or onto another plane. While information technology didindeed change work methods in terms of its nature, quality, speed and location that led to areduced need for human labor, multi decade lags between adoption and significant redesignexisted. While inventions of the nineteenth and twentieth centuries such as the telegraph andtelephone were well suited to expedite the business demands of the time, they did very little toactually change business practices in an immediate way. However, after decades of the simplistic 37
    • Role of IT in BPRuse of the telephone, the insight of the concept of call/contact centers revolutionized elements ofthe service industry into high growth, multi-billion dollar industries. Therefore, more was neededthan just innovation which was enabled by technology. What was needed and was seen to evolveeventually was a philosophy that technology should be a supportive supplement to go along witha drive to improve work processes and the overall system. The full extent of “world flatteners” were only truly employed after there was anemergence of managers, innovators, technology specialists and workers who were comfortablewith the horizontal collaboration and value creation processes developed by these new ideas andtechnological advancements. Therefore, both ideas such as BPR and IT should work in tandem toachieve desired radical redesigns of work processes and structure based on a comprehensive andcoherent strategy and goals. It is generally believed that change efforts should never be driven bytechnological goals alone. While the idea to continually introduce technological advancementsthat became essential elements in work methods was desirable because of their usefulness andusability, the concept of BPR was seen as a way to more fully capitalize on them as enablers forprocess innovation. For example, productivity that has been achieved from computers is really afunction of their combination with new business processes and new types of skills that go withthem versus the fact that they are readily available for various applications.IT Drives BPR In any organization worldwide, IT is the biggest enabler and driver of Business ProcessReengineering. Business Process Reengineering (BPR) aims at enhancing customer service by improvingproductivity, eliminating waste and reducing the cost. The drive for BPR is to realize dramaticimprovements by fundamentally rethinking how an organization’s work should be done insteadof mere process improvement that focus on functional or incremental improvement. Reengineering involves “radical improvements” and not any incremental changes. In thissense, reengineering without an IT support is nearly impossible. The evolution of IT provides 38
    • Role of IT in BPRmultiple options for process execution that were not possible erstwhile, which opened thepossibility of reengineering in the first place. IT system helps in process automation, integration of multiple processes and ensuresconsistency, thereby improving productivity and quality of the processes and reducing the cost.IT is an enabler of process reengineering and not a substitute for it. Role of IT in BPR is quite significant and continuous update on technology will help. ITenabled BPR ensures achieving larger target, reducing the risk and providing measures insustaining results over a longer time. IT had a major role to play in BPR. The reason for that isvery simple—IT is perhaps the only department in any organization which has a holistic view ofthe organization from a process perspective—from the perspective of what are the bottle necks,choke points, etc. Few years back, IT used to provide support to the business, then it startedplaying the role of an enabler, and now it drives the business. It is tough to think of BPR withoutIT, as the contribution of IT in these processes is around 80%-90%. IT also helps to improvebusiness and enhance customer expectations. The need of IT, especially in today’s slowdownscenario, is more and thus there is more expectation from it.IT in reference process reengineering IT will have an increasing role to play with reference process reengineering. It is not aone-time exercise, it needs to be done, say every three-four years, since different ITdevelopments provide new and disruptive options every few years. IT is the enabler of implementation of reengineered business processes; and in a fewcases IT could also be a driver. This is typically experienced during the deployment of newtechnology solutions. Business processes can be reengineered without IT support and this is truefor processes which do not currently depend on IT for their outcomes. In the case of ShoppersStop, IT has been the key driver of some of the reengineering projects even though thereengineered processes did not always have IT dependencies. 39
    • Role of IT in BPRRole of CIOs in Process Reengineering The function of IT in any business needs to be externally oriented. The CIO needs tocontinuously keep a tab on new developments in the arena of IT. They need to have a thoroughknowledge of the business wherein they can map the new IT developments to the current andfuture opportunities for executing business processes in a new, more efficient manner. As IT has a holistic view of the organization, the CIO can do the homework and presentto business managers an analysis of processes and give his views on possible areas which arecandidates for BPR. While IT is an enabler in BPR and most of the BPR in today’s time would involve IT, itshould be kept in mind that BPR is done from business process perspective and not IT. In simpleterms, CIOs need to understand the business challenges, put themselves in shoes of businessmanagers, and then discuss what changes should be done. A CIO’s role can be effective in all stages, viz. planning stage, execution stage,realization stage and continuous improvement stage. For example, a CIO can contribute in thedecision of choosing appropriate technology, implementation, flow of information system foreffective deployment, project management and so on. CIOs can also take the lead towardsfacilitating BPR exercises within their enterprise as they have visibility across all functions andinterdependencies. Since most IT organizations are typically not aligned to any specific functionand thereby seen as politically agnostic, they are in an advantageous position to seize thisopportunity. CIOs need to have in-depth knowledge about various departments, communities andeven industries. They should adopt the best practices and solutions that have relevance to theirbusiness, as the adoption of IT depends on the nature of the business and vary from oneorganization to another. CIOs need to involve key business leaders into IT so that the ideas for reengineeringemerge out of a well aligned exercise between the business and IT. An IT mind is typically“operations oriented” one wherein the tendency may be to follow the conventional path most ofthe times. IT leadership should consciously attempt to come out of it. A CIO also needs to 40
    • Role of IT in BPRfacilitate setting up a cross functional team to carry-out inter-dependant collaborative exercise togenerate ideas of process reengineering. Every BPR project should have clear cut target and recourses for effectiveimplementation. In today’s times when IT is all pervasive and entrenched in all processes in anyorganization, it is almost impossible to reengineer without support of IT.FUTURE ROLE OF IT IN BPR With IT advancing at a rapid pace every day the future role of IT in reengineeringbecomes more critical. In the survey conducted by Prosci Research and Publishing Companyamong CEOs of 205 companies across the globe. The future role of IT has been identified intothree main categories. 1. Participate as a member of the reengineering team, but do not take control of the project 2. Define technology solutions to enable new business processes and take time to educate operational managers about new technology. 3. Implement technology needed to support the new business processes. Be sure to set expectations and define deliverables clearly IT managers and staff have to become business analysts, knowledgeable of businessneeds and able to combine a business orientation with technical expertise. This will help inintegrating business knowledge with technical skills. With the advent of Internet and e-commerce, businesses are getting closer to thecustomers. In future Internet will change the way business is carried out. E-commerce will affectreengineering more than present day IT. E-commerce initiatives will be business led activitieswith an implicit acceptance of process change and often involving the use of high-energy changeinitiatives like reengineering. 41
    • Role of IT in BPRCONCLUSION It is not possible to reengineer without IT support. IT is not only an enabler forreengineering it has also become an essential and integral part of all reengineering efforts. In theimplementation of reengineering IT is crucial and it provides the skills and tools that are neededto effectively reengineer. 1. IT provides project management skills that are important in the successful implementation of reengineering as a project. 2. In the design phase of implementation of reengineering the capabilities of IT can be used to simulate a model of the design and there by validate the new design. 3. The disruptive power of IT helps in the design phase of implementation of reengineering. The disruptive power helps organizations to break all the rules and think inductively about the business that they are in to gain competitive advantage. 4. If not used properly IT can become an inhibitor of reengineering if the organization’s IT Infrastructure capabilities are inadequate or inflexible. 5. IT capabilities of the organization should not directly influence the IT solutions that are needed for the company. 6. IT is an indispensable tool in implementation of reengineering in the way that IT supports redesigned business process and facilitates cross-functional workflow. 42
    • Role of IT in BPR Companies have to understand that the role of IT in reengineering is not to automate thebusiness process. In future companies will not be able to reengineer without involving IT department of thecompany. The staff of the IT department will become the members of the reengineering team.REFERENCES http://www.expresscomputeronline.com/20090406/management01.shtml http://www.springerlink.com/index/W290659N0L600875.pdf http://www.eil.utoronto.ca/grpdoc/bprtool.html www.emeraldinsight.com/journals.htm?articleid=1746936&show=pdf http://www.anterron.com/cgi-bin/white_papers/docs/Role_of_IT_in_BPR.pdf http://jobfunctions.bnet.com/abstract.aspx?docid=165413 43