Bpr Case Study

Slide 1

Continuous Improvement through BPR in Software Development and Usage

A CASE STUDY

N.Vivekananthamoorthy

Department of Information Technology

KCG College of Technology

[email protected]

Emerging Trends in Engineering and Technology

An Institutionally Secure Integrated Data EnvironmentSlide 2

Introduction

Business Process Reengineering means not only change -- but dramatic change. What constitutes dramatic change is the overhaul of organizational structures, management systems, employee responsibilities and the use of information technology.

It was introduced by Dr.Michael Hammer in 1990s This paper presents the re-engineering work done at BHEL(Trichy) using BPR

strategy in the software development and maintenance process as a CASE STUDY. It involves migration from COBOL to ORACLE based Client Server system

Successful BPR can result in enormous reductions in cost or cycle time. It can also potentially create substantial improvements in quality, customer service, or other business objectives


What is BPR?

"Business Reengineering is 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."

-- Dr. Michael Hammer


FORD EXAMPLE

Reengineering – a new management buzzword. The basic message is Many work flows, job designs, control mechanisms, and

organizational structures are either superfluous or obsolete and should be completely redesigned.

" We should reengineer our [organizations]; use the power of modern information processing technology to radically redesign our ... processes in order achieve dramatic improvements in their performance.... We cannot achieve breakthroughs in performance merely by cutting fat or automating existing processes. Rather we must challenge the old assumptions and shed old rules.“ --- Michael Hammer

Hammer illustrates reengineering with the revolution that took place in Ford’s system of accounts payable. In the early 1980’s, Ford’s auditors carefully studied accounts payable activities and concluded that, by consolidating, by rationalizing processes, and by installing new computer systems, staff could be cut twenty percent -- from 500 employees to 400.


Common Steps in BPR

Project Phases Required For Successful BPR: Phase 1: Begin Organizational Change Phase 2: Build the Reengineering Organization Phase 3: Identify BPR Opportunities Phase 4: Understand the Existing Process Phase 5: Reengineer the Process Phase 6: Blueprint the New Business System Phase 7: Perform the Transformation


Phase –I Begin Organizational Change

Assess the current state of the organization - Explain the need for change(Consolidate the

problems which can be converted into opportunities-Creates potential for trying new technologies)

- Illustrate the desired state - Create a communications campaign for

change


Phase -2 Build the Re-engineering Organization

Activities Establish a BPR organizational structure Establish the roles for performing BPR Choose the personnel who will reengineer


Phase3 –Identify BPR Opportunities

Activities

- Identify the core/high-level processes - Recognize potential change enablers - Gather performance metrics within industry - Gather performance metrics outside industry - Select processes that should be reengineered - Prioritize selected processes - Evaluate pre-existing business strategies - Consult with customers for their desires --- Quality,Delivery - Determine customer's actual needs ---- Sequential Delivery - Formulate new process performance objectives - Establish key process characteristics


Phase4 – Understand the existing process

Activities Understand why the current steps are performed - Model the current process - Understand how technology is currently used – COBOL – Unix

based system - Understand how information is currently used – batch system

– non interactive – text based terminals(NO GUI) - Understand the current organizational structure(slow to

react to customer needs) - Compare current process with the new objectives – cycle

time reduction – fast in reacting to customer needs – compettetive in market


Phase5 – Re-engineer the process

Activities - Ensure the diversity of the reengineering team – Top

management,User Group,Developers Group) - Question current operating assumptions - Brainstorm using change levers – Selecting the correct

technology within Budget - Brainstorm using BPR principles - Evaluate the impact of new technologies – Competetive

Advantage,Cycle time reduction,Work life enrichment - Consider the perspectives of stakeholders – Faith in the

information system - Use customer value as the focal point – Quality and Delivery


BPR Principles

Several jobs are combined into one; Workers make decisions; The steps in a process are performed in a natural order; Processes have multiple versions; Work is performed where it makes the most

sense(Capture data where it originates – Eg BOM from Design Dept);

Checks and controls are reduced; Reconciliation is minimized; A case manager provides a single point of contact; Hybrid centralized/decentralized operations are prevalent. -- Dr. Michael Hammer


Phase 7 Perform the Transformation

Activities - Develop a migration strategy – A project plan - Create a migration action plan – PERT network with important

milestones - Develop metrics for measuring performance during

implementation - Involve the impacted staff – Consult Users who are going to use

the system - Implement in an iterative fashion - Building proto types - Establish the new organizational structures - Assess current skills and capabilities of workforce - Map new tasks and skill requirements to staff - Re-allocate workforce - Develop a training curriculum


Phase 6 Blueprint the new Business System

Activities - Define the new flow of work - Model the new process steps - Model the new information requirements - Document the new organizational structure - Describe the new technology specifications - Record the new personnel management

systems - Describe the new values and culture required


CASE STUDY Ancilliary Development Computer System – BHEL(Trichy)

Hardware set up First decentralized computer system (PDP11) established in 1986 Unix based Multiprocessor system introduced in 1990 – HCL Magnum

Problems faced Existence of information islands with fragmented systems Cobol based systems was huge and difficult to maintain User has access to lot of data but he is not getting the information he

wants. Integration exists only in paper. Usage of variety of software packages in a module Accountability down the line is poor. Currency of data is poor. Difficult to get adhoc reports and to answer queries



Hardware set up Client server Technology with RDBMS introduced in

1997 with HP 9000 unix server

The Solution Try Business process reengineering Exploit new software capabilities Upgrade the computer system to Client Server

Technology with RDBMS Oracle Improve data integration Empower working staff



BPR Objectives Cost Reduction ( Mainly operating cost can be

drastically cut by reducing cycle time of processes and by eliminating unwanted steps)

Time and space shrinkage (Cutting processing time from weeks to days and eliminating unwanted intermediate outputs)

Quality enhancement(By eliminating errors,exercizing various controls which becomes amenable due to BPR)

Work Life enrichment(By eliminating monotonous steps in jobs by introducing creativity and by introducing new things to learn)

Profit improvement



Steps in BPR Develop Business Vision and Process

objectives Identify processes to be reengineered Understand and measure existing process



Strategy Study the existing system(Around 500 COBOL programs

and Job Modules with no systematic documentation) Evolve the sytem design from first principles(Then only

we can expect dramatic results). Development of Data Model(ER Diagram) after Business

Data Analysis(Mapping from Flat file System to Relational Data Model).

Identification of entities,attributes and relationships and Integrity Constraints.

Batch to online conversion(COBOL to ORACLE) Eliminate many steps in the existing system which are

unnecessary(Merging tables dealing with same entity etc)



Development of Interactive forms

Study For data capture at source and populating and changing the database content(Using front end tool –Developer 2000 – Many cobol programs map into a single form- The program logic is converted as triggers and PL/SQL Procedures)

Incorporation of Business Rules Eg Income tax and recovery calculation in

Bills(Database triggers and PL/SQL procedures)



Development of Interactive forms TRIG Name DCDATE TRIG TRIG Name KEY-NEXT-ITEM TRIG declare TRIG myrcd varchar2(2); TRIG mm varchar2(2); TRIG yy varchar2(2); TRIG dd varchar2(2); TRIG yymmdd varchar2(6); TRIG begin TRIG yymmdd := to_char(:blk2.dcdate,'yymmdd'); TRIG mm := substr(yymmdd,3,2); TRIG yy := substr(yymmdd,1,2); TRIG dd := substr(yymmdd,5,2); TRIG if mm in ( '01','02','03') then TRIG myrcd :=to_char( to_number(substr(yy,2,1))-1)||substr(yy,2,1); TRIG else TRIG begin TRIG if yy = '99' then TRIG myrcd := '90'; TRIG end if; TRIG end; TRIG myrcd := substr(yy,2,1)||to_char(to_number(substr(yy,2,1))+1); TRIG end if; TRIG :blk2.dcyrcd := myrcd; TRIG NEXT_ITEM; TRIG end;




Trial Assembly















SYSTEM SIMPLIFICATION ANDRE-ENGINEERING THROUGH ORACLE IMPLEMENTATION

RE-ENGINEERING Many computer process and intermediate steps eliminated while migrating from COBOL to ORACLE Redundant data storage avoided Business Rules rewritten RE-ENGINEERING EXAMPLES

Faster Generation of other area indents due to automatic area code identification at DU absorption Rate Schedule eligibility check while loading a supplier On line DC posting, Bill Processing and DCN processing keeps always AD data current. Acceptance of the bill based on multiple rates Extra Rate acceptance based on original Vs extra rate schedule matrix Bill error is corrected if the same is due to DC error by simultaneous attack on error Terminal date shown in different reports are taken from single source

SYSTEM SIMPLIFICATION Monitoring of critical DUs simplified due to exception reports in different sorting order DCN incorporation system simplified due to online implementation of IOM system Integrated hold up with non match tonnage statement has helped to identify critical items by clearing

which maximum matching can be obtained. Many user friendly enquiries have been developed which provides integrated information.









Conclusion The computer system successfully migrated from COBOL to

ORACLE using BPR strategy. Information islands bridged(Eg DBLINK facilty and

distributed database approach) Online System introduced due to which the information has

become current and the same is easily accessible by all users.

People are empowered and life style changed with job enrichment.

(Other examples of BPR are computerized Railway reservation and Banking operations – say easy passbook entry any time)

We can cope up with the shock due to technology change.



References Andrews, Dorine C. and Susan K. Stalick, Business Reengineering: the

Survival Guide, Yourdon Press, 1994. Davenport, Thomas H., Process Innovation, Boston, MA: Harvard

Business School Press, 1993. Hall, Gene and Jim Rosenthal and Judy Wade, How to Make

Reengineering Really Work, Harvard Business Review, November-December 1993.

Hammer, Michael, Reengineering Work: Don’t Automate, Obliterate, Harvard Business Review, July-August 1990.

Hammer, Michael and James Champy, Reengineering the Corporation, NY: Harper Business, 1993.

Harvard Business School Report, Business Process Reengineering: IT-Enabled Radical Change, June 1993

Petrozzo, Daniel P. and John C. Stepper, Successful Reengineering, Van Nostrand Reinhold, 1994.

Bpr Case Study

Documents

change s s

ford examples s s s

s business reengineering

michael hammer s

organizational changes

organizational change

bpr opportunities phase

new business system