Business process-reengineering

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Business process-reengineering

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  • Business process-reengineering

    1. 1. Business Process Reengineering CEM 515 For: Dr. Abdulaziz Bubshait By: Hassan Al-Bekhit
    2. 2. Presentation OutlinePresentation Outline  General IntroductionGeneral Introduction  Business Process ReengineeringBusiness Process Reengineering BPR SymbolsBPR Symbols  Understand and be able to implement a BPR StrategyUnderstand and be able to implement a BPR Strategy  Understand the main challenges in implementing a BPRUnderstand the main challenges in implementing a BPR StrategyStrategy  Conclusion: SummaryConclusion: Summary
    3. 3. Spectrum of ChangeSpectrum of Change  AutomationAutomation  RationalizationRationalization of proceduresof procedures  ReengineeringReengineering  Paradigm shiftParadigm shift
    4. 4. AutomationAutomation  refers to computerizingrefers to computerizing processes to speed upprocesses to speed up the existing tasks.the existing tasks.  improves efficiency andimproves efficiency and effectiveness.effectiveness.
    5. 5. Rationalization of ProceduresRationalization of Procedures  refers to streamlining ofrefers to streamlining of standard operatingstandard operating procedures, eliminatingprocedures, eliminating obvious bottlenecks, soobvious bottlenecks, so that automation makesthat automation makes operating proceduresoperating procedures more efficient.more efficient.  improves efficiency andimproves efficiency and effectiveness.effectiveness.
    6. 6. Business Process ReengineeringBusiness Process Reengineering  refers to radical redesign ofrefers to radical redesign of business processes.business processes.  Aims atAims at  eliminating repetitive,eliminating repetitive, paper-intensive,paper-intensive, bureaucratic tasksbureaucratic tasks  reducing costsreducing costs significantlysignificantly  improvingimproving product/service quality.product/service quality.
    7. 7. Paradigm ShiftParadigm Shift  refers to a more radicalrefers to a more radical form of change whereform of change where the nature of businessthe nature of business and the nature of theand the nature of the organization isorganization is questioned.questioned.  improves strategicimproves strategic standing of thestanding of the organization.organization.
    8. 8. 3 Business Process ReengineeringBusiness Process Reengineering  ““Reengineering is theReengineering is the fundamentalfundamental rethinking andrethinking and radicalradical redesign ofredesign of businessbusiness processesprocesses to achieveto achieve dramaticdramatic improvements in critical, contemporaryimprovements in critical, contemporary measures of performance such as cost,measures of performance such as cost, quality, service, and speed.”quality, service, and speed.”
    9. 9. 4 Key WordsKey Words  FundamentalFundamental  WhyWhy do we do what we do?do we do what we do?  IgnoreIgnore what iswhat is and concentrate onand concentrate on whatwhat should be.should be.  RadicalRadical  BusinessBusiness reinventionreinvention vs. businessvs. business improvementimprovement
    10. 10. 5 Key WordsKey Words  DramaticDramatic  Reengineering should be brought in “when a needReengineering should be brought in “when a need exits for heavy blasting.”exits for heavy blasting.”  Companies in deep trouble.Companies in deep trouble.  Companies that see trouble coming.Companies that see trouble coming.  Companies that are in peak condition.Companies that are in peak condition.  Business ProcessBusiness Process  a collection of activities that takes one or more kindsa collection of activities that takes one or more kinds of inputs and creates an output that is of value to aof inputs and creates an output that is of value to a customer.customer.
    11. 11. BPR & TheBPR & The OrganizationOrganization
    12. 12. BPR is Not?BPR is Not?  BPR may sometimes be mistaken for the following five tools:BPR may sometimes be mistaken for the following five tools:  1.1. AutomationAutomation is an automatic, as opposed to human,is an automatic, as opposed to human, operation or control of a process, equipment or a system; or theoperation or control of a process, equipment or a system; or the techniques and equipment used to achieve this. Automation istechniques and equipment used to achieve this. Automation is most often applied to computer (or at least electronic) control ofmost often applied to computer (or at least electronic) control of a manufacturing process.a manufacturing process.  2.2. DownsizingDownsizing is the reduction of expenditures in order tois the reduction of expenditures in order to become financial stable. Those expenditures could include butbecome financial stable. Those expenditures could include but are not limited to: the total number of employees at a company,are not limited to: the total number of employees at a company, retirements, or spin-off companies.retirements, or spin-off companies.
    13. 13. BPR is Not?BPR is Not?  3.3. OutsourcingOutsourcing involves paying another company toinvolves paying another company to provide the services a company might otherwise haveprovide the services a company might otherwise have employed its own staff to perform. Outsourcing isemployed its own staff to perform. Outsourcing is readily seen in the software development sector.readily seen in the software development sector.  4.4. Continuous improvementContinuous improvement emphasizes small andemphasizes small and measurable refinements to an organization's currentmeasurable refinements to an organization's current processes and systems. Continuous improvements’processes and systems. Continuous improvements’ origins were derived from total quality managementorigins were derived from total quality management (TQM) and Six Sigma.(TQM) and Six Sigma.
    14. 14. 16 Reengineering & ContinuousReengineering & Continuous Improvement--Improvement--SimilaritiesSimilarities Reengineering Continuous Improvement Similarities Basis of analysis Process Process Performance measurement Rigorous Rigorous Organizational change Significant Significant Behavioral change Significant Significant Time investment Substantial Substantial
    15. 15. 17 Reengineering & ContinuousReengineering & Continuous Improvement--Improvement--DifferencesDifferences Reengineering Continuous Improvement Differences Level of change Radical Incremental Starting point Clean slate Existing process Participation Top-down Bottom-up Typical scope Broad, cross-functional Narrow, within functions Risk High Moderate Primary enabler Information technology Statistical control Type of change Cultural and structural Cultural
    16. 16. What is a Process?What is a Process?  A specific ordering of work activities across timeA specific ordering of work activities across time and space, with a beginning, an end, and clearlyand space, with a beginning, an end, and clearly identified inputs and outputs: a structure foridentified inputs and outputs: a structure for action.action.
    17. 17. What is a Business Process?What is a Business Process?  A group of logically related tasks that use theA group of logically related tasks that use the firm's resources to provide customer-orientedfirm's resources to provide customer-oriented results in support of the organization'sresults in support of the organization's objectivesobjectives
    18. 18. Why Reengineer?Why Reengineer?  CustomersCustomers  DemandingDemanding  SophisticationSophistication  Changing NeedsChanging Needs  CompetitionCompetition  LocalLocal  GlobalGlobal
    19. 19. Customer Demands • expect us to know everything • to make the right decisions • to do it right now • to do it with less resources • to make no mistakes • expect to be fully informed
    20. 20. Why Reengineer?Why Reengineer?  CompetitionCompetition  LocalLocal  GlobalGlobal  ChangeChange  TechnologyTechnology  Customer PreferencesCustomer Preferences
    21. 21. Business Process Reengineering WHY ? Integrate people, technology, & organizational culture To Respond to rapidly changing technical & business environment and customer’s needs to achieve Big performance gains
    22. 22. Why Organizations Don’tWhy Organizations Don’t Reengineer?Reengineer?  ComplacencyComplacency  Political ResistancePolitical Resistance  New DevelopmentsNew Developments  Fear of Unknown and FailureFear of Unknown and Failure
    23. 23. PerformancePerformance  BPR seeks improvements ofBPR seeks improvements of  CostCost  QualityQuality  ServiceService  SpeedSpeed
    24. 24. BPR SymbolsBPR Symbols
    25. 25. Business Process FlowchartBusiness Process Flowchart SymbolsSymbols An Activity A Document A Decision Data (input as outputs)
    26. 26. Business Process FlowchartBusiness Process Flowchart SymbolsSymbols A Predefined Process The Start of a Process The End of a Process Representing a Relation Start End
    27. 27. Business Process FlowchartBusiness Process Flowchart SymbolsSymbols Continuation of the process at the same page at an equal symbol with the same number. Used when a relation arrow crosses another relation arrow Off-Page Connector - Process will continue on the next page Integration Relation - A relation to another module is identified and described
    28. 28. Data Flowchart SymbolsData Flowchart Symbols An Activity A Document A Decision Flat Data File (input as outputs)
    29. 29. Data Flowchart SymbolsData Flowchart Symbols Manual Data Item A Database File Representing a Relation Continuation Off-Page Connector
    30. 30. Rules For DataRules For Data SymbolsSymbols
    31. 31. Rules For Data SymbolsRules For Data Symbols Start End Generate Purchase Order OK? Yes No Symbol used to identify the start of a business process Activities must be described as a verb Decisions have only two possibilities (Yes & No) Crossing lines are not allowed If one side of the decision has no further processes defined this symbol has to be used
    32. 32. Rules For Data SymbolsRules For Data Symbols Purchase Order Posting of Bonus I A Continuation symbol within the same number must be present twice on the same page Name the document Off- Page Connector is used to continue a process at the next page or to let the process to flow over at the previous to the next page. If more than one is needed use A, B, C, D … Name the data
    33. 33. Rules For Data SymbolsRules For Data Symbols Sub-Process Delivery BC 4.04 Predefined Processes always have a relation to level and stream by a number in the line below a sub-process description A predefined process must be described in a different flowchart. To make the relation clear between the predefined process and the belonging flowchart a unique alpha numeric number should be assigned to this predefined process.
    34. 34. Version ManagementVersion Management  For different versions of a business process orFor different versions of a business process or data flow some mandatory information must bedata flow some mandatory information must be on the flowchart.on the flowchart.  Name of the business processName of the business process  Unique number of the business processUnique number of the business process  Revision numberRevision number  Date of last changeDate of last change  AuthorAuthor  Page number with total pagesPage number with total pages
    35. 35. Implementing a BPRImplementing a BPR StrategyStrategy
    36. 36. The C’s related toThe C’s related to Organization Re-engineering ProjectsOrganization Re-engineering Projects The 3C’s of organization Re- engineering: The 4C’s of effective teams: - Customers - Competition - Change - Commitment - Cooperation - Communication - Contribution
    37. 37. Key StepsKey Steps Select The Process & Appoint Process Team Understand The Current Process Develop & Communicate Vision Of Improved Process Identify Action Plan Execute Plan
    38. 38. 1.1. Select the Process & AppointSelect the Process & Appoint Process TeamProcess Team  Two Crucial TasksTwo Crucial Tasks  Select The Process to be ReengineeredSelect The Process to be Reengineered  Appoint the Process Team to Lead theAppoint the Process Team to Lead the Reengineering InitiativeReengineering Initiative
    39. 39. Select the ProcessSelect the Process  Review Business Strategy and CustomerReview Business Strategy and Customer RequirementsRequirements  Select Core ProcessesSelect Core Processes  Understand Customer NeedsUnderstand Customer Needs  Don’t Assume AnythingDon’t Assume Anything
    40. 40. Select the ProcessSelect the Process  Select Correct Path for ChangeSelect Correct Path for Change  Remember Assumptions can Hide FailuresRemember Assumptions can Hide Failures  Competition and Choice to Go ElsewhereCompetition and Choice to Go Elsewhere  Ask - Questionnaires, Meetings, Focus GroupsAsk - Questionnaires, Meetings, Focus Groups
    41. 41. Appoint the Process TeamAppoint the Process Team  Appoint BPR ChampionAppoint BPR Champion  Identify Process OwnersIdentify Process Owners  Establish Executive Improvement TeamEstablish Executive Improvement Team  Provide Training to Executive TeamProvide Training to Executive Team
    42. 42. Core Skills RequiredCore Skills Required  Capacity to view the organization as a wholeCapacity to view the organization as a whole  Ability to focus on end-customersAbility to focus on end-customers  Ability to challenge fundamental assumptionsAbility to challenge fundamental assumptions  Courage to deliver and venture into unknownCourage to deliver and venture into unknown areasareas
    43. 43. Core Skills RequiredCore Skills Required  Ability to assume individual and collectiveAbility to assume individual and collective responsibilityresponsibility
    44. 44. Use of ConsultantsUse of Consultants  Used to generate internal capacityUsed to generate internal capacity  Appropriate when a implementation is neededAppropriate when a implementation is needed quicklyquickly  Ensure that adequate consultation is soughtEnsure that adequate consultation is sought from staff so that the initiative is organization-from staff so that the initiative is organization- led andled and notnot consultant-drivenconsultant-driven  Control shouldControl should nevernever be handed over to thebe handed over to the consultantconsultant
    45. 45. 2.2. Understand the Current ProcessUnderstand the Current Process  Develop a Process OverviewDevelop a Process Overview  Clearly define the processClearly define the process  MissionMission  ScopeScope  BoundariesBoundaries  Set business and customer measurementsSet business and customer measurements  Understand customers expectations fromUnderstand customers expectations from the process (staff including process team)the process (staff including process team)
    46. 46. 2.2. Understand the Current ProcessUnderstand the Current Process  Clearly Identify ImprovementClearly Identify Improvement OpportunitiesOpportunities  QualityQuality  ReworkRework  Document the ProcessDocument the Process  CostCost  TimeTime  Value DataValue Data
    47. 47. 3.3. Understand the Current ProcessUnderstand the Current Process  Carefully resolve any inconsistenciesCarefully resolve any inconsistencies  Existing -- New ProcessExisting -- New Process  Ideal -- Realistic ProcessIdeal -- Realistic Process
    48. 48. 3.3. Develop & Communicate VisionDevelop & Communicate Vision of Improved Processof Improved Process  Communicate with all employees so that theyCommunicate with all employees so that they are aware of the vision of the futureare aware of the vision of the future  Always provide information on the progress ofAlways provide information on the progress of the BPR initiative - good and bad.the BPR initiative - good and bad.  Demonstrate assurance that the BPR initiative isDemonstrate assurance that the BPR initiative is both necessary and properly managedboth necessary and properly managed
    49. 49. 3.3. Develop & Communicate VisionDevelop & Communicate Vision of Improved Processof Improved Process  Promote individual development by indicatingPromote individual development by indicating options that are availableoptions that are available  Indicate actions required and those responsibleIndicate actions required and those responsible  Tackle any actions that need resolutionTackle any actions that need resolution  Direct communication to reinforce new patternsDirect communication to reinforce new patterns of desired behaviorof desired behavior
    50. 50. 4.4. Identify Action PlanIdentify Action Plan  Develop an Improvement PlanDevelop an Improvement Plan  Appoint Process OwnersAppoint Process Owners  Simplify the Process to Reduce Process TimeSimplify the Process to Reduce Process Time  Remove any Bureaucracy that may hinderRemove any Bureaucracy that may hinder implementationimplementation
    51. 51. 4.4. Identify Action PlanIdentify Action Plan  Remove no-value-added activitiesRemove no-value-added activities  Standardize Process and Automate WhereStandardize Process and Automate Where PossiblePossible  Up-grade EquipmentUp-grade Equipment  Plan/schedule the changesPlan/schedule the changes
    52. 52. 4.4. Identify Action PlanIdentify Action Plan  Construct in-house metrics and targetsConstruct in-house metrics and targets  Introduce and firmly establish a feedback systemIntroduce and firmly establish a feedback system  Audit, Audit, AuditAudit, Audit, Audit
    53. 53. 5.5. Execute PlanExecute Plan  Qualify/certify the processQualify/certify the process  Perform periodic qualification reviewsPerform periodic qualification reviews  Define and eliminate process problemsDefine and eliminate process problems  Evaluate the change impact on the business andEvaluate the change impact on the business and on customerson customers  Benchmark the processBenchmark the process  Provide advanced team trainingProvide advanced team training
    54. 54. InformationInformation Technology & BPRTechnology & BPR
    55. 55. Benefits From ITBenefits From IT  Assists the Implementation of BusinessAssists the Implementation of Business ProcessesProcesses  Enables Product & Service InnovationsEnables Product & Service Innovations  Improve Operational EfficiencyImprove Operational Efficiency  Coordinate Vendors & Customers in the ProcessCoordinate Vendors & Customers in the Process ChainChain
    56. 56. BPR ChallengesBPR Challenges
    57. 57. Common Problems with BPRCommon Problems with BPR  Process Simplification is Common - True BPR isProcess Simplification is Common - True BPR is NotNot  Desire to Change Not Strong EnoughDesire to Change Not Strong Enough  Start Point the Existing Process Not a BlankStart Point the Existing Process Not a Blank SlateSlate  Commitment to Existing Processes Too StrongCommitment to Existing Processes Too Strong  REMEMBER - “If it isn’t broke …”REMEMBER - “If it isn’t broke …”
    58. 58. Common Problems with BPRCommon Problems with BPR  Process under review too big or too smallProcess under review too big or too small  Reliance on existing process too strongReliance on existing process too strong  The Costs of the Change Seem Too LargeThe Costs of the Change Seem Too Large  BPR Isolated Activity not Aligned to theBPR Isolated Activity not Aligned to the Business ObjectivesBusiness Objectives  Allocation of ResourcesAllocation of Resources  Poor Timing and PlanningPoor Timing and Planning  Keeping the Team and Organization on TargetKeeping the Team and Organization on Target
    59. 59. How to Avoid BPR FailureHow to Avoid BPR Failure  To avoid failure of the BPR process it is recommended that:To avoid failure of the BPR process it is recommended that:  BPR must be accompanied by strategic planning, whichBPR must be accompanied by strategic planning, which addresses leveraging Information technology as a competitiveaddresses leveraging Information technology as a competitive tool.tool.  Place the customer at the centre of the reengineering effort,Place the customer at the centre of the reengineering effort, concentrate on reengineering fragmented processes that lead toconcentrate on reengineering fragmented processes that lead to delays or other negative impacts on customer service.delays or other negative impacts on customer service.  BPR must be "owned" throughout the organization, not drivenBPR must be "owned" throughout the organization, not driven by a group of outside consultants.by a group of outside consultants.  Case teams must be comprised of both managers as well as thoseCase teams must be comprised of both managers as well as those who will actually do the work.who will actually do the work.
    60. 60. How to Avoid BPR FailureHow to Avoid BPR Failure  The Information technology group should be anThe Information technology group should be an integral part of the reengineering team from the start.integral part of the reengineering team from the start.  BPR must be sponsored by top executives, who are notBPR must be sponsored by top executives, who are not about to leave or retire.about to leave or retire.  BPR projects must have a timetable, ideally betweenBPR projects must have a timetable, ideally between three to six months, so that the organization is not in athree to six months, so that the organization is not in a state of "limbo".state of "limbo".  BPR must not ignore corporate culture and mustBPR must not ignore corporate culture and must emphasize constant communication and feedback.emphasize constant communication and feedback.
    61. 61. SummarySummary  Reengineering is a fundamental rethinking andReengineering is a fundamental rethinking and redesign of business processes to achieveredesign of business processes to achieve dramatic improvementsdramatic improvements  BPR has emerged from key managementBPR has emerged from key management traditions such as scientific management andtraditions such as scientific management and systems thinkingsystems thinking  Rules and symbols play an integral part of allRules and symbols play an integral part of all BPR initiativesBPR initiatives
    62. 62. SummarySummary  Don’t assume anything - remember BPR isDon’t assume anything - remember BPR is fundamental rethinking of business processesfundamental rethinking of business processes

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