Bpr ppt

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Bpr ppt

  1. 1. REENGINEERING WORK: DON’T AUTOMATE, OBLITERATE PRESENTED BY: ASVINI SHRADDHA RUCHA ABHISHEKA PALLAVI
  2. 2. WHY REENGINEERING?
  3. 3. Michael Hammer : Michael Hammer, besides being one of the founders of BPR, he is also the president of Hammer and Co., a management education company. Hammer started out as an engineer and was a professor at MIT in the computer science department. Both TIME (1996) and Business Week (2002) listed Hammer as one of the Top 25 most influential businessmen of all times.
  4. 4. WHAT IS REENGINEERIING? Hammer and Champy’s definition… “…… the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical contemporary measures of performance, such as cost, quality, service, and speed.”
  5. 5. Background  Process rationalization and automation (i.e. the usual methods for boosting performance) didn't yield the dramatic improvements companies needed at that time.  Information technology - Companies left existing processes intact and used computers simply to speed them up - Heavy investments in IT delivered disappointing results  The watchwords of the new decade were - Innovation, speed, service and quality
  6. 6. WHAT IT IS THEN? Reengineering effort strives for dramatic levels of improvement It should use information technology not to automate an existing process but to enable a new one Reengineering cannot be planned meticulously and accomplished in small and cautious steps Rather than looking for opportunities to improve the current process, we should determine which of the steps really add value and search for new ways to achieve the result
  7. 7. EXAMPLES OF REENGINEERING • FORD MOTOR COMPANY : Reengineered account payable process • MUTUAL BENEFITS LIFE (MBL) INSURANCE : Reengineered processing of insurance application
  8. 8. FORD’S ACCOUNT PAYABLE DEPT. BEFORE REENGINEERING • Affected : more than 500 people MAZDA’S : • Account payable organization consisted only of 5 people. • Aim of reengineering:  To cut cost  To reduce head count by 20%
  9. 9. FORD’S OLD PROCESS PURCHASING DEPARTMENT VENDORMATERIAL CONTROL DEPARTMENT ACCOUNTS PAYABLE DEPARTMENT “WE PAID WHEN WE RECEIVED INVOICE” INVOICE PAYMENT RECEIVING DOCUMENT GOODS PURCHASE ORDER PURCHASE ORDER
  10. 10. DATABASE FORD’S NEW PROCESS PURCHASING DEPARTMENT VENDOR MATERIAL CONTROL DEPARTMENT ACCOUNTS PAYABLE DEPARTMENT “WE PAY WHEN WE RECEIVE THE GOODS” PAYMENT GOODS INFO. PURCHASE ORDER RETURN GOODS IF NOT OK CHECK ACCEPT TRANSACTION IF OK
  11. 11. FORD MOTOR COMPANY AFTER REENGINEERING • Achieved 75% reduction in head count • No discrepancies between financial records and the physical records
  12. 12. MBL’APPLICATION PROCESS BEFORE REENGINEERING • Long, multistep process involved • An application include : 30 discrete steps , 5 departments and involved 19 people • Time required : 24 hours (min.) 5-25 days(max.) • Actual value added(VA) time needed : 17 minutes Aim: To improve customer service 60% improvement in productivity
  13. 13. MBL’S OLD PROCESS CUSTOMER DEPARTMENT 1 DEPARTMENT 2 DEPARTMENT 3 DEPARTMENT 4 DEPARTMENT 5 SEQUENTIAL PROCESS
  14. 14. MBL’S NEW PROCESS CUSTOMER CASE MANAGER + WORK STATIONS COMPUTER NETWORK CASE MANAGER CASE MANAGER DATABASE MAIN FRAME AND SHARED DATABASE
  15. 15. • Could complete an application in minimum 4 hours. • Average time required for entire application processing reduced to 2-5 days. • Elimination of 100 field office positions. • Capacity increased by more than 2 times. MUTUAL BENEFIT LIFE INSURANCE AFTER REENGINEERING
  16. 16. PRINCIPLES OF REENGINEERING 1. ORGANIZE AROUND OUTCOMES, NOT TASKS 2. HAVE THOSE WHO USE THE OUTPUT OF THE PROCESS PERFORM THE PROCESS 3. SUBSUME INFORMATION-PROCESSING WORK INTO THE REAL WORK THAT PRODUCES THE INFORMATION
  17. 17. 4. TREAT GEOGRAPHICALLY DISPERSED RESOURCES AS THOUGH THEY WERE CENTRALIZED 5. LINK PARALLEL ACTIVITIES INSTEAD OF INTEGRATING THEIR RESULTS 6. PUT THE DECISION POINT WHERE THE WORK IS PERFORMED, AND BIULT CONTROL INTO THE PROCESS 7. CAPTURE INFORMATION ONCE AND AT THE SOURCE
  18. 18. Gujarat Cancer Research Institute, India 21500000 22000000 22500000 23000000 23500000 24000000 24500000 25000000 25500000 26000000 2002-03 2003-04 2004-06 COMPARISION INCOME AND EXPENDITURE INCOME ₹ EXPENDITURE ₹
  19. 19. Their Existing Process : OLD STRUCTURE DIRECTOR DEPUTY DIRECTOR ADMINISTRATIVE OFFICER
  20. 20. A new organization structure DIRECTOR DEPUTY DIRECTOR MEDICINE DEPUTY DIRECTOR SURGERY DEPUTY DIRECTOR RESEARCH ADMINISTRATIVE OFFICER
  21. 21. DRUGS AND MEDICINES General tablets and capsules Anti -cancer oral Anti-cancer injectibles general injectible drugs so on........ •Selection of vendors •List price •Selection A NEW SYSTEM FOR VENDOR SELECTION BASEKET OF ITEMS
  22. 22. 1200 Purchase orders every year 4-5 per working day A new prescription for placing purchase orders Old system
  23. 23. Leading digits: 1-4 Digits 5-7 Last digits: 8-10 Major group code Minor group code Serial number of the item 12 Purchase orders every month Vendor Hospital New system •A computerized database
  24. 24. Benefits of the new system
  25. 25. 0 100 200 300 400 500 600 700 800 Old system New system Old system New system Old system New system No. of vendors No. of purchase orders No. of items in inventory Impact of BPR Drugs and medicines Lab supplies X-ray items Surgical items

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