MANUFACTURING ENTERPRISE MODEL & PROCESS

21 st Century Manufacturing Enterprise SOCIETAL ENVIRONMENTAL LEGAL PROCESSES STAKEHOLDERS PEOPLE CUSTOMERS SUPPLIERS COLLABORATIVE COMMUNICATIONS SHARED KNOWLEDGE SYSTEMS

Customers The goal of the enterprise is to realize profits by delivering value to the customer The enterprise must have a range of processes and support systems that enable its people to manage customer relationships Key Processes Marketing Sales Customer Support Product Life Cycle Management PROCESSES PEOPLE CUSTOMERS COLLABORATIVE COMMUNICATIONS SHARED KNOWLEDGE SYSTEMS

The goal of the enterprise is to realize profits by delivering value to the customer

The enterprise must have a range of processes and support systems that enable its people to manage customer relationships

Key Processes

Marketing

Sales

Customer Support

Product Life Cycle Management

Suppliers Suppliers provide the inputs that the enterprise needs to deliver value to the customer The enterprise needs effective channels to work with its suppliers Key Processes Sourcing Forecasting Procurement Logistics Management PROCESSES PEOPLE SUPPLIERS COLLABORATIVE COMMUNICATIONS SHARED KNOWLEDGE SYSTEMS

Suppliers provide the inputs that the enterprise needs to deliver value to the customer

The enterprise needs effective channels to work with its suppliers

Key Processes

Sourcing

Forecasting

Procurement

Logistics Management

Processes These are examples of the core business processes that enable the enterprise to create value Other supporting processes are needed to manage and conduct the operational goals of the enterprise DEFINE MARKET SOURCE PLAN MAKE DELIVER SUPPORT SELL RETURN PROCURE FORECAST PEOPLE CUSTOMERS SUPPLIERS COLLABORATIVE COMMUNICATIONS

These are examples of the core business processes that enable the enterprise to create value

Other supporting processes are needed to manage and conduct the operational goals of the enterprise

Collaborative Communications Collaborative communications are increasingly being used to connect the actors across the extended enterprise Collaborative Engineering and Collaborative Forecasting are examples of these activities PROCESSES PEOPLE CUSTOMERS SUPPLIERS COLLABORATIVE COMMUNICATIONS

Collaborative communications are increasingly being used to connect the actors across the extended enterprise

Collaborative Engineering and Collaborative Forecasting are examples of these activities

Shared Knowledge Systems Integrated information services enable actors across the value chain to access information that provides a global view of the enterprise Shared knowledge systems can range from very broad enterprise applications such as Enterprise Resource Planning , Supply Chain Management, or Customer Relationship Management or process specific applications such as cell control, material handling, or machine tool control. PROCESSES CONTENT INFRASTRUCTURE APPLICATIONS PEOPLE CUSTOMERS SUPPLIERS COLLABORATIVE COMMUNICATIONS

Integrated information services enable actors across the value chain to access information that provides a global view of the enterprise

Shared knowledge systems can range from very broad enterprise applications such as Enterprise Resource Planning , Supply Chain Management, or Customer Relationship Management or process specific applications such as cell control, material handling, or machine tool control.

People People are the most important part of the enterprise. Managing the “human capital” of the enterprise is fundamental to the success of the organization. Key processes: Planning Staffing/Sourcing Labor Relations Education and Training Compensation & Benefits Recognition/Advancement PEOPLE

People are the most important part of the enterprise. Managing the “human capital” of the enterprise is fundamental to the success of the organization.

Key processes:

Planning

Staffing/Sourcing

Labor Relations

Education and Training

Compensation & Benefits

Recognition/Advancement

Stakeholders The manufacturing enterprise is part of a variety of communities. Those communities can be defined on the basis of their geographic, national, market, or industry. It has responsibilities to those communities and to other constituents such as: Investors Customers Suppliers Employees Trading Partners Government STAKEHOLDERS PEOPLE SUPPLIERS CUSTOMERS

The manufacturing enterprise is part of a variety of communities. Those communities can be defined on the basis of their geographic, national, market, or industry.

It has responsibilities to those communities and to other constituents such as:

Investors

Customers

Suppliers

Employees

Trading Partners

Government

Legal The manufacturing enterprise depends on a stable legal and regulatory environment. Business depends on a framework that promotes trust. Consistent enforcement of laws and regulations are the basis of that trust. Key Processes Contract Management Intellectual Property Management Risk and Liability Management Labor Management Dispute Resolution Litigation

The manufacturing enterprise depends on a stable legal and regulatory environment. Business depends on a framework that promotes trust. Consistent enforcement of laws and regulations are the basis of that trust.

Key Processes

Contract Management

Intellectual Property Management

Risk and Liability Management

Labor Management

Dispute Resolution

Litigation

Environmental Manufacturing Enterprises have a special obligation to be stewards of the resources they employs to create and deliver value to their customers. The management of resources and wastes throughout their lifecycle is becoming increasingly important to ensuring a sustainable future (try to write it by own) Key processes: Green Manufacturing Recycling Waste Stream Management Regulatory Compliance Environmental Product and Process Design

Manufacturing Enterprises have a special obligation to be stewards of the resources they employs to create and deliver value to their customers. The management of resources and wastes throughout their lifecycle is becoming increasingly important to ensuring a sustainable future (try to write it by own)

Key processes:

Green Manufacturing

Recycling

Waste Stream Management

Regulatory Compliance

Environmental Product and Process Design

Societal The 21 st Century Manufacturing Enterprise exists in an increasingly global environment. Successful enterprises will consider how global factors influence their strategies, product/service offerings, and value chain relationships Key Processes Currency Management Sourcing and Procurement Sales and Distribution Cultural Integration Community Relations

The 21 st Century Manufacturing Enterprise exists in an increasingly global environment.

Successful enterprises will consider how global factors influence their strategies, product/service offerings, and value chain relationships

Key Processes

Currency Management

Sourcing and Procurement

Sales and Distribution

Cultural Integration

Community Relations

Integrated Business Management Model

Enterprise resource planning Customer relationship management employees stakeholders Supply chain management Selling chain management Kalakota and Robinson, 1999:103 integration Knowledge Admin, HRMS, ORMS Purchasing Finance, accounting, control Customers, resellers… Buyers, distributors… E-business application architecture Logistics Production Distribution Marketing Sales Customer service SAP R3 Siebel Ariba PeopleSoft Oracle J.D.Edwards Procurement

Business Process Management

Business Process Management Business Process Automation Business Process Improvement Business Process Transformation Business Process Management and the IS development cycle

Business Process Automation

Business Process Improvement

Business Process Transformation

Business Process Management and the IS development cycle

Business Process Management Business process management is when the organization attempts to improve the efficiency and effectiveness of their operation by focusing on their business processes. Companies normally hire when the economy is booming. Companies look for ways to cut costs during down economic times.

Business process management is when the organization attempts to improve the efficiency and effectiveness of their operation by focusing on their business processes.

Companies normally hire when the economy is booming.

Companies look for ways to cut costs during down economic times.

Business Process Management Business Process Automation (BPA) involves automating some aspect of the business process through the application of information technology. Business Process Improvement (BPI) involves employees looking for ways to improve the process incrementally. Business Process Transformation (BPT) examines how the business operates and then looks for ways to fundamentally and radically change those operations.

Business Process Automation (BPA) involves automating some aspect of the business process through the application of information technology.

Business Process Improvement (BPI) involves employees looking for ways to improve the process incrementally.

Business Process Transformation (BPT) examines how the business operates and then looks for ways to fundamentally and radically change those operations.

Business Processes A process perspective encourages managers to: See every aspect of the business as customer driven. Make employees responsible for the whole process, rather than for just one task in it. Focus on how work is done, rather than just on what is done.

A process perspective encourages managers to:

See every aspect of the business as customer driven.

Make employees responsible for the whole process, rather than for just one task in it.

Focus on how work is done, rather than just on what is done.

Business Process Automation Business process automation is where a manual process is replaced by one that is supported by an information system. Automated order entry system replacing a manual inventory count and manual order. Using Quicken to process and print payroll checks. Using bar code scanners to replace keying in the product code.

Business process automation is where a manual process is replaced by one that is supported by an information system.

Automated order entry system replacing a manual inventory count and manual order.

Using Quicken to process and print payroll checks.

Using bar code scanners to replace keying in the product code.

BPI and BPT Business Process Re-engineering (BPR) was the original term. ( fr slide 10) “ Re-engineering is the fundamental rethinking and redesign of business processes to achieve dramatic improvements in critical measures of performance.” (Hammer and Champy 1990) Now it is called either BPI or BPT depending on the scope of the re-design effort.

Business Process Re-engineering (BPR) was the original term. ( fr slide 10)

“ Re-engineering is the fundamental rethinking and redesign of business processes to achieve dramatic improvements in critical measures of performance.” (Hammer and Champy 1990)

Now it is called either BPI or BPT depending on the scope of the re-design effort.

Business Process Improvement Other Philosophies for change: Continuous Improvement Total Quality Management (TQM) BPI is a more general term, and encompasses both CI and TQM. BPI takes longer to implement than these other philosophies. BPI tends to be driven by the bottom up approach.

Other Philosophies for change:

Continuous Improvement

Total Quality Management (TQM)

BPI is a more general term, and encompasses both CI and TQM.

BPI takes longer to implement than these other philosophies.

BPI tends to be driven by the bottom up approach.

BPI Business Process Improvement (BPI) involves employees looking for ways to improve the process incrementally. Implies an ongoing search for excellence. Involves everyone in the company continually search for incremental improvements in everything the company does. BPI tends to be driven by the bottom up approach – with strong input from the workers.

Business Process Improvement (BPI) involves employees looking for ways to improve the process incrementally.

Implies an ongoing search for excellence.

Involves everyone in the company continually search for incremental improvements in everything the company does.

BPI tends to be driven by the bottom up approach – with strong input from the workers.

Principles of Business Process Improvement Quality is what the customer says it is. Think of yourself as the customer. Customer satisfaction is impossible without employee satisfaction. Improve continuously. Leadership and accountability make quality happen. Focusing on quality increases efficiency; focusing on efficiency often decreases quality. If you can’t measure it, you can’t manage it.

Quality is what the customer says it is.

Think of yourself as the customer.

Customer satisfaction is impossible without employee satisfaction.

Improve continuously.

Leadership and accountability make quality happen.

Focusing on quality increases efficiency; focusing on efficiency often decreases quality.

If you can’t measure it, you can’t manage it.

BPT Business Process Transformation (BPT) examines how the business operates and then looks for ways to fundamentally and radically change those operations. BPT tends to be driven by the top down. Tends to be short-term and discrete (one-shot) projects. Usually most of the re-design work is done by consultants from outside the company.

Business Process Transformation (BPT) examines how the business operates and then looks for ways to fundamentally and radically change those operations.

BPT tends to be driven by the top down.

Tends to be short-term and discrete (one-shot) projects.

Usually most of the re-design work is done by consultants from outside the company.

Principals of BPT( do it) Organize around outcome, not tasks. Have those that use the output of the process perform the process. Subsume information processing work into the real work that produces the information. Treat geographically dispersed resources as if they were centralized. Put the decision point where the work is performed, and build control into the process.

Organize around outcome, not tasks.

Have those that use the output of the process perform the process.

Subsume information processing work into the real work that produces the information.

Treat geographically dispersed resources as if they were centralized.

Put the decision point where the work is performed, and build control into the process.

IS and Business Process Management Developing information systems should not be viewed as a separate activity from business process management. First we need to redesign the process (if necessary) Then design the IS to support the new process. Don’t automate unnecessary activities and procedures. Before paving the cowpaths, straighten it!

Developing information systems should not be viewed as a separate activity from business process management.

First we need to redesign the process (if necessary)

Then design the IS to support the new process.

Don’t automate unnecessary activities and procedures.

Before paving the cowpaths, straighten it!

Implementing ERP Systems Should we change our business practices to match the way the software works, or should we try to change the software to match the way we currently do business? Customization issues Integration issues Upgrading issues

Should we change our business practices to match the way the software works, or should we try to change the software to match the way we currently do business?

Customization issues

Integration issues

Upgrading issues