business process reengineering
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Business Process Re-engineering
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http://www.youtube.com/watch?v=PeShQ25-z7M
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What is BPR? (Geoff) Why Implement BPR? (Dan) Radical Change v Continuous Improvement
(Mark) Implementing BPR – the 7 steps (Murali) BPR and other methodologies (Yutian) Predictors of Success and Failure (Yos) Case Studies will be referred to (Tracy)
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Companies traditionally are organised to make decisions, operate, allocate resources and plan within functional specialisations ◦ Division of Labour (Adam Smith 1776)
BPR diverts attention away from functional, stove piping to cross functional, value creating processes
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It’s a rope! It’s a
snake!
A wall!
It’s a fan!
A tree
!
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- The complete set of activities or tasks that fulfil a customer’s specific requirement (Hammer)
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- A focus on process helps to rationalise enterprise-wide results over functional ones as opposed to functional thinking (which) concentrates only on individual performance, not enterprise performance.
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A fundamental rethink of the way things are done. Its primary purpose is to increase effectiveness of accomplishment of the company’s management, administrative and operational tasks
A radical redesign of processes in order to gain significant improvements in cost, quality and service
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BPR improves ◦ Customer experience/product quality
◦ Performance of business processes
◦ Refocus on value adding activity (eliminate waste)
◦ Alignment of all functions to corporate goals
◦ Ability to cope with external environment (competitive forces)
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Clean Slate (Hammer & Champy) ◦ Challenge underlying assumptions◦ Clean sheet – start from scratch◦ BPR is radical and dramatic change
Dirty Slate (Davenport & Stoddart)◦ Continuous improvement◦ Clean slate is a myth
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THE SEVEN STEPS
Hammer & Champy , 1993
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shows how a work flow through an organization
Which one is in deepest trouble? Which one gives greatest impact on customer? Which on is more likely feasible?
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Identifying number of steps in the process Task time/dead time/wait time Steps that fail to yield Value added? Blockage?
What the customer require from the process?
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‘most creative part and demands creativity, imagination, inductive thinking and touch of craziness’ – (Hammer & Champy, 1993)
Implementing proposed process on a small scale, for a limited time- to test
If the test is successful- the new process can be rolled out across the organization
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TQM◦ Continuous improvement
◦ Longer period
◦ Tinkers with existing processes NOT redesign it
◦ Primarily improve quality of activities
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Automation◦ Increase efficiency of task
◦ Normally retains old process but speeds it up
◦ Does not reorganise work
Downsizing◦ Rapid elimination of HR
◦ Reduce costs
◦ Does not restructure works and processes
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Management commitment
Employee involvement
Duration of BPR implementation
Communication & Resistance to Change
Realistic Goals & Expectations
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Selection of Processes for Reengineering
Holistic perspective
IT integration
Past processes embedded in culture
Politics & Power
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Questions?
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Overview 1990’s US firm, manufacturer of industrial automation
and control units Teams moved from a specific function into multi-
skilled teams to focus on entire product. Plant was shut down for intensive training sessions,
including the requirement to change (radically) Pay for Performance introduced Reduced defect rates (by 70%), rejects (57%), cycle
time on parts (72%), customer lead times (+70%), inventory investment (46%)
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Train, nurture and facilitate adaptation to change
Question everything Use a systematic methodology to conduct
BPR IT should support people, production and
services BPR must be aligned and continuous