Business process re-engineering (BPR)

BUSINESS PROCESS REENGINEERING

Presented by Ramji Divya Uthirarajan Anitha Thevasena John paul

SIMPLE DEFINITION OF BPRMeans: “Starting Over”Does not mean: Tinkering with

what already exists or making incremental changes

Ask: “IF I were recreating the company today, given what I know and given current technology, what would it look like?”

Business Process Re-engineering or BPR is the analysis and redesign of workflow and processes within and between Organizations

BPR is the Fundamental rethinking and Radical redesign of Business Processes to achieve Dramatic improvements in critical measures of performance .. such as Cost, Quality, Service and Speed

- Michael Hammer & James Champy, 1993

THE NEED FOR BPRCustomersCompetitionChangeTechniques lag behind technologyProblem of the stovepipeFragmented piecemeal systemsIntegration

BPR PROCESS (1 OF 2)Frame the projectCreate the vision, values and

goalsRedesign the business operationConduct proof of concept

BPR PROCESS (2 OF 2)

Plan the implementationObtain implementation approvalImplement the redesignTransition to a continuous

improvement state

VALUE METRICSA Value metric is that which

determines an organization's behaviour and performance.

QualityServiceCostCycle Time

VALUE METRICS

Value =Quality X Service

Cost X Cycle Time

CHARACTERISTICS OF BUSINESS PROCESS REENGINEERING (1 OF 2)Several jobs are combined into

oneEmployees make decisionsSteps in business process: natural

orderProcess may have multiple

versionsWork is performed where it makes

the most sense

CHARACTERISTICS OF BUSINESS PROCESS REENGINEERING (2 OF 2)Controls, checks, other non value

added work is minimizedReconciliation is minimized -

minimize external contact pointsHybrid centralized / decentralized

operation is usedA single point of contact is

provided for the customer

BPR & RESTRUCTURING THE ORGANIZATION

Redesign of processesFrom mass production to mass

customizationCycle time reductionRestructuring organizations

THE 7 NEW QUALITY TOOLSGeneral Planning

Affinity DiagramInterrelationship Diagram

Intermediate PlanningTree DiagramMatrix DiagramMatrix Data Analysis

Detailed PlanningProcess Decision Program ChartArrow Diagram

AFFINITY DIAGRAMGathers large amounts of data and organizes it into groups based on the natural relationship between each item.

INTERRELATIONSHIP DIAGRAPM

TREE DIAGRAMSystematically maps out the full range of tasks/methods needed to achieve goal.

MATRIX DIAGRAMDisplays the relationship between necessary tasks and people or other tasks, often to show responsibility for tasks.

DATA MATRIX ANALYSIS

Temp

Humidity

PROCESS DECISION PROGRAM CHART (PDPC)

Maps out every conceivable event and contingency that can occur when moving from a problem statement to possible solutions.

Problem Statement

Solution x

Things that can go wrong

Countermeasures

Solved

ARROW DIAGRAM

ADDITIONAL TOOLS/METHODSBenchmarkingProcess SimplificationConcurrent EngineeringDemand Flow TechnologyActivity Based CostingEliminate Non-Value Added

Activities

9 CHANGES OCCASIONED BY BPR (1 OF 2) Work Units change

o from functional departments to process teams

Jobs changeo from simple tasks to multi-

dimensional work People’s roles change

o from controlled to empowered Job preparation changes

o from training to education

9 CHANGES OCCASIONED BY BPR (2 OF 2) Measures of Performance & compensation change

o from activity to results Criteria for career advancement change

o from performance to ability Values change

o from protective to productive Organizational Structures change

o from hierarchical to flat Executives change

o from scorekeepers to leaders4-22

CHALLENGES IN A BPR EXERCISE

1. Identifying Customer Needs & Performance Problems in the current Processes

2. Reassessing the Strategic Goals of the Organization

3. Defining the opportunities for Re-engineering

4. Managing the BPR initiative5. Controlling Risks 6. Maximizing the Benefits7. Managing Organizational Changes8. Implementing the re-engineered Processes

CRITICAL SUCCESS FACTORS IN BPR1. Clear Vision for Transformation2. Top management commitment3. Identification of Core Processes

for BPR4. Ambitious BPR team5. Knowledge of Reengineering

techniques6. Engaging external consultants7. Tolerance of “genuine failures"8. Change Management

CRITICAL FAILURE FACTORS IN BPR

1. Trying to Fix a process instead of Changing it

2. Lack of focus on Business-critical Processes

3. Lack of holistic approach4. Willingness to settle for minor results5. Quitting too early6. Limiting the scope of BPR by existing

constraints7. Dominance of existing corporate culture8. Adopting bottom-up approach9. Poor leadership10. Trying to avoid making anyone unhappy11. Dragging the BPR exercise too long.

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