bpr 02 principles
TRANSCRIPT
Business Process Re-engineering02 – Principles & Dimensions
Slide 2 of 21
Dimensions & Characteristics
Fundamental changes to process, technology andhuman factors to achieve dramatic improvementsin key measures
The dimensions & characteristics:
• Balanced attention to processes, people andtechnology
• Cross functional, process based perspective • Judged by measurable results achieved
Slide 3 of 21
Process: The Basic Concept
• What is a process?- “a collection of business activities that creates value for a customer- a transformation of inputs(s) into output(s): a state of change
• Re-engineer processes, not functions or organisations• Some typical processes:
- concept to prototype : develop product- target to customer order : acquire customer- customer order to pay : fulfill order- purchase request to payment : procure materials- enquiry to resolution : service
Slide 4 of 21
Process viewpoint
• Identification and mapping- identify, name and relate the processes to each other
• Ownership- assigning owners for all processes
• Measurement- establishing and communicating end-to-end customer driven process measures and measurement mechanisms
Slide 5 of 21
Process viewpoint
• Management- evaluate process performance against customer needs and competitive benchmarks
• Awareness- creating appreciation of the organisation’s processes and customers- develop a process-oriented mindset
Slide 6 of 21
The Business operation
Business Processes
Values and Beliefs
Management andMeasurement
Systems
Jobs and Structure
deter
mine
require
enable
foster
The business operation diamond
Slide 7 of 21
The Impact of BPRThe business operation diamond in context
Business Processes
Values and Beliefs
Management andMeasurement
Systems
Jobs and Structure INFRASTRUCTURE
Customer needsCompetitor actions Technological and
environmental factors
Assessment ofcapabilities
Slide 8 of 21
Elements of BPR
• Process focus • Radical change• Dramatic improvement
BPR is about competitiveness.
Slide 9 of 21
Process Focus
• A set of linked activities that adds value to the process to create an effective output
• Focus should be on core business processes that addresses the external customer and supplier
Slide 10 of 21
Radical Change
• The objective is to address competitiveness and market-dominance
• Radical change provides a new way of building core competencies and good investment management
Slide 11 of 21
Dramatic improvement
• To achieve major improvement in the core process• Planning, procedures and resources are required• Measure, control and manage the process
Slide 12 of 21
BPR Model
Competitiveness
BPR
Process focus Radical change Dramatic improvement
Change and risk management
Best practices - the foundation for success
Slide 13 of 21
Why re-engineer ?
• Downsizing / Rightsizing• Customer satisfaction• Quality improvement goals• Functional performance improvement• Reduce costs• Increase speed (of service)• Overcome a competitive threat• Change of organisational structure
Slide 14 of 21
Process Improvement Possibilities
• Eliminate duplicate activities• Combine related activities• Eliminate multiple reviews and approvals• Eliminate inspections• Simplify processes• Reduce batch size• Outsource inefficient activities• Centralise or decentralise functions / activities
Slide 15 of 21
Reasons to improve processes
• Invisible– Managers delegate their knowledge– Process performance is not measured
• Inconsistent– Jobs, measures and infrastructure are not aligned
with the current process• Ignored
– Processes often unmanaged and rarely updated• Ill conceived
– Processes and policies are developed piecemeal and informally rather than designed as a whole
Slide 16 of 21
BPR is different
• High ambition– Improvements in key performance measures, such as
cost, quality, service or speed • Process focus
– A customer-oriented viewpoint. No organisationalboundaries
Slide 17 of 21
BPR is different
• Creative rule-breaking– Finding assumptions about normal business practice
and customers’ needs• Information technology to enable the above
– IT enables new ways of working through substitution and automation
Slide 18 of 21
Typical benefits BPR produces
• Improve customer service• Reduce cycle time• Improve quality• Reduce costs• Increase market share• Reduce product development time• Increase sales
Think of specific examples for various processes
Slide 19 of 21
Value-chain analysis
• Developed by Michael Porter :– To classify, understand and analyse an organisation’s
value-added processes to achieve competitive advantage
– To analyse how to improve cost structure (productivity) and add value (differentiation)
– Applicable to any industry– Processes classifed into 5 Primary activities and 4
Support activities
Slide 20 of 21
Value-chain analysis
PROFIT
PROFIT
Firm Infrastructure
Human Resource Management
Technological Development
Procurement
Inbo
und
Logi
stic
s
Ope
ratio
ns
Out
boun
d Lo
gist
ics
Mar
ketin
g an
d Sa
les
Serv
ice
Slide 21 of 21
Value-chain analysis
Human ResourceManagement
TechnologicalDevelopment
Procurement
Inbound Logistics Operations Outbound Logistics Marketing & Sales Service
FinancialPolicy Accounting Regulatory
Compliance Legal CommunityAffairs
Flight/ Route andYield Analysis
Training
Pilot TrainingPilot Safety
Baggage Handling Training
Agent Training InflightTraining
Computer Reservation System/ Inflight System/ FlightScheduling System/ Yield Management System
Product DevelopmentMarket Research
Baggage Tracking System
Information Technology Communications
• Route selection• Passenger
service system• Yield
managementsystem (pricing)
• Fuel• Flight scheduling • Crew
scheduling• Facilities
planning• Aircraft
acquisition
• Ticket counteroperations
• Gate operations• Aircraft operations• Onboard services• Baggage handling• Ticket office
• Baggage system• Flight connections• Rental car and
Hotel reservationsystem
• Promotion• Advertising• Advantage
programmes• Travel agent
programmes• Group sales
• Lost baggage services• Complaint follow - up