Unit-7 Multiskilling & BPR

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Re-engineering ,Multi-skilling & Business

Process Reengineering

Unit-7

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What is a Process?

• A specific ordering of work activities across time and space, with a beginning, an end, and clearly identified inputs and outputs: a structure for action.

(Davenport, 1993)

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What is a Business Process?

• A group of logically related tasks that use the firm's resources to provide customer-oriented results in support of the organization's objectives

• Business processes are simply a set of activities that transform a set of inputs into a set of outputs (goods or services) for another person or process using people and tools.

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Business Process

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What is a Re-engineering?

• Reengineering (or re-engineering) is the radical redesign of an organization's processes, especially its business processes.

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Why Reengineer?• Customers– Demanding– Sophistication– Changing Needs

• Competition– Local– Global

• Change– Technology– Customer Preferences

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Business Process Reengineering

• Business Process Reengineering is a management approach that examines aspects of a business and its interactions, and attempts to improve the efficiency of the underlying processes. It is a fundamental and radical approach by either modifying or eliminating non-value adding activities.

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Business Process Reengineering

• Reengineering is the fundamental rethinking and redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service and speed.

(Hammer & Champy, 1993)

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Business Process Reengineering

• Business process reengineering is the redesign of business processes and the associated systems and organizational structures to achieve a dramatic improvement in business performance. The business reasons for making such changes could include poor financial performance, external competition, erosion of market share or emerging market opportunities.

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BPR is the examination and change of five components of the business.

• Strategy • Processes • Technology • Organization • Culture

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BPR

• "BPR, seeks radical improvement rather than merely continuous improvement. It escalates the efforts of JIT and TQM to make process orientation a strategic tool and a core competence of the organization. BPR concentrates on core business processes, and uses the specific techniques within the JIT and TQM ”toolboxes” as enablers, while broadening the process vision."

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BPR Methodology• Envision new processes

• Secure management support • Identify reengineering opportunities • Identify enabling technologies • Align with corporate strategy

• Initiating change • Set up reengineering team • Outline performance goals

• Process diagnosis • Describe existing processes • Uncover pathologies in existing processes

• Process redesign • Develop alternative process scenarios • Develop new process design • Design HR architecture • Select IT platform • Develop overall blueprint and gather feedback

• Reconstruction • Develop/install IT solution • Establish process changes

• Process monitoring • Performance measurement, including time, quality, cost, IT performance • Link to continuous improvement

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Key Steps

Select The Process & Appoint Process Team

Understand The Current Process

Develop & Communicate Vision of Improved Process

Identify Action Plan

Execute Plan

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1st Step-Select the Process & Appoint Process Team

• Two Crucial Tasks

– Select The Process to be Reengineered

–Appoint the Process Team to Lead the Reengineering Initiative

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Select the Process• Review Business Strategy and Customer

Requirements

• Select Core Processes

• Understand Customer Needs

• Don’t Assume Anything

• Select Correct Path for Change

• Remember Assumptions can Hide Failures

• Ask - Questionnaires, Meetings, Focus Groups

Focus Group• A focus group is a form of

qualitative research in which a group of people are asked about their perceptions, opinions, beliefs and attitudes towards a product, service, concept, advertisement, idea, or packaging.

• Questions are asked in an interactive group setting where participants are free to talk with other group members.

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Appoint the Process Team

• Appoint BPR Champion

• Members were chosen from all the specialist areas

• Establish Executive Improvement Team

• Provide Training to Executive Team

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2nd Step-Understand the Current Process

• Develop a Process Overview• Clearly define the process –Mission–Scope–Boundaries

• Set business and customer measurements

• Understand customers expectations from the process (staff including process team)

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Understand the Current Process

• Involves the examination of relevant documentation ,interviews with relevant personnel's.

• Clearly Identify Improvement Opportunities

• Document the Process–Cost– Time –Value Data

• Carefully resolve any inconsistencies

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Develop & Communicate Vision of Improved Process

• Communicate with all employees so that they are aware of the vision of the future

• Always provide information on the progress of the BPR initiative - good and bad.

• Demonstrate assurance that the BPR initiative is both necessary and properly managed

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3rd Step-Develop & Communicate Vision of Improved Process

• Promote individual development by indicating options that are available

• Tackle any actions that need resolution

• Direct communication to reinforce new patterns of desired behavior

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4th Step-Identify Action Plan

• Develop an Improvement Plan

• Simplify the Process to Reduce Process Time

• Remove any Bureaucracy that may hinder implementation

• Remove non-value-added activities

• Standardize Process and Automate Where Possible

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Identify Action Plan

• Up-grade Equipment

• Plan/schedule the changes

• Construct in-house metrics and targets

• Introduce and firmly establish a feedback system

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5th Step-Execute Plan

• Frequent monitoring is essential

• Define and eliminate process problems

• Evaluate the change impact on the business and on customers

• Ensure No negative effects on employee morale

• Provide advanced team training

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Barriers to Business Reengineering

• Potential Project Implementation Success : No drastic results

• High Project Risk: Depends on Knowledge Management of project (risk factors)

• Implementation Barriers: Obstacles to overcome on a day-to-day basis

• Role of a Leader/ Manager is crucial: Managing human resources is critical at every stage

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LIMITATIONS OF BPR

• It only combines the element of older concepts.

• Do not devote enough attention to power issues and change management

• BPR provides minimal or no methodological support to implementation.

• BPR is impossible to be conducted totally .

• BPR advantages are short lived

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The Principles of Business Reengineering

• Concentrate on outputs rather than inputs, and link performance measures and rewards to customer related outputs.

• Give priority to the delivery of value rather than the maintenance of management control .

• Encourage involvement and participation. This requires error-tolerant leadership.

• Ensure people are equipped, motivated and empowered to do what is expected of them.

• Where ever possible, people should assume full responsibility for managing and controlling themselves.

• Build learning, renewal, and short feedback loops into business processes.

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The Principles of Business Reengineering

• Focus on harnessing more of the potential of people and applying it to those activities which identify and deliver value to customers .

• Encourage learning and development by building creative working environments.

• Think and execute as much activity as possible horizontally, concentrating on flows and processes (including communication) through the organization.

• Remove non-value added activities, undertake parallel activities, speed up response and development times.

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Success of BPR

• Top Management Sponsorship • Strategic Alignment • Compelling Business Case for Change• Proven Methodology • Effective Change Management • Line Ownership • Reengineering Team Composition

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HR AND BUSINESS PROCESS REENGINEERING

BPR HR

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HR’S ROLE IN REENGINEERING

• Building Commitment

• Building Teams

• Redesigning Compensation

• Redesigning the Work Itself

• Moving from Controlled to Empowered Jobs

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CASE STUDY

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MAHINDRA & MAHINDRA LTD.

Facts:

• 1945:J.C.Mahindra and K.C.Mahindra,

• 1948:Renamed Mahindra & Mahindra Ltd.

• Employed: Over 17000 people

• Fact-Six state-of-the-art manufacturing facilities spread over 500,000 square meters.

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M&M's Problem In the mid-1990s:

• M&M was facing serious problems at its Igatpuri and Kandivili plants in Maharashtra.

• Suffering: manufacturing inefficiencies, poor productivity, long production cycle, sub-optimal output.

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M&M's Problem

The reason:• Highly under-productive• Bloated workforces• Lenient towards running the plants • Frequently crumbled under the pressure of

union demands. • Very unhealthy and corruption was widespread

in various departments

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M&M's Problem

• The unions went on a strike• Senior staff come down to the plant and work in

their place. • 100 officers produced 35 engines a day 1200 employees producing 70 engines • After five months, the workers ended the strike.• Focus on two issues : Reengineering the layout Method of working, and productivity.

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New Organizational Model

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Critique • BPR concerns the strict focus on efficiency and technology and

the disregard of people in the organization that is subjected to a reengineering initiative .

• Lack of management support for the initiative and thus poor acceptance in the organization.

• Exaggerated expectations regarding the potential benefits from a BPR initiative and consequently failure to achieve the expected results.

• Underestimation of the resistance to change within the organization.

• Implementation of generic so-called best-practice processes that do not fit specific company needs.

• Over trust in technology solutions. • Performing BPR as a one-off project with limited strategy

alignment and long-term perspective. • Poor project management

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CONCLUSION

• BPR deals with Changes in all aspects of businesses and people.

• It requires not only jobs and skills change but

also people's styles. • Indispensable factors to determine whether

reengineering succeeds or not.

• Leaders must help people to cope with these changes.

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Multi-skilling

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Multi-skilling• Multi-Skilling is usually defined as " a technician of one skill of

a high level who is trained in theory and practice to perform at least two or more skills to a basic, or pre defined level.

• Multi-skilling- the ability of an employee to perform more than one function or the cross-training of an employee in several disciplines or tasks.

• A "skill" , is a trade for every industry; Electrical, Instrument, Mechanical and Operations technicians.

• Dual Skilling is little less adventurous; but much more realistic and workable. It is defined as " a technician of one skill of a high level who is trained in theory and practice to perform one more skill to a basic level or above".

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Multi-skilling• Managers views of Multi skilling Unless the manager comes from an engineering/operational

background they will have little comprehension of skill levels and what it takes in training, experience, theoretical knowledge and motive skills to become a proficient technician. Multi/Dual skilling is primarily seen as a way to reduce costs by cutting manpower.

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Personal Check-In: Skills Inventory

Can you use a scale accurately?Do you have communication skills?Do you have time management skills?Can you interview candidates for an open position

and select the most qualified?

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How skill inventory is created? Job Analysis: The study of what the employees are doing and what the job is expected to accomplish.

Requirements of the job:TasksDutiesEquipment used

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Job Analysis: The study of what the employees are doing and what the job is expected to accomplish.

Requirements of the employee:Training or educational tasksPhysical demands of the jobTechnical and computer skillsInterpersonal skillsAttitude requirements

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Job Assessment: Assess the accuracy of the current job description with the information derived from the job analysis.

Job Description: Here condition is that every organization should update the job descriptions regularly.

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Advantages of Multi-skillingWork force is more flexible.Employees become more aware of the workflow.Employees are better prepared to anticipate

problems or requirements of other areas.Employees can assume other tasks when there is

absenteeism.Employees can be moved into other positions at

peak times of the operation.A new employee at a job may have new ideas to

fine-tune that job.

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Advantages of Multi-skilling

Employees overcome feelings of having a dead-end job.

Jobs remain interesting and challenging.Tedious tasks can be spread around,

decreasing turnover.Boredom in the workplace is reduced.Cohesiveness is enhanced.

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Disadvantages of Multi-skilling

Possible reduction in productivity during the training period.

Increased supervisory time is required until the employee is up to speed.

Competence assessments may be more detailed than in traditional systems.

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Reality Practice: Case Study

A rural district on the eastern seaboard is experiencing a tremendous growth in population. The beach has attracted a great deal of tourism, increasing the hospitality industry. With that, the permanent resident population has truly exploded, and the school board has had to build two new elementary schools to accommodate the influx of students. Mary Smith, the manager at Lincoln Elementary with an enrollment of 750, has had a stable staff for over ten years. All her employees know their jobs well, and Ms. Smith was very proud that her staff had won numerous awards for zero absenteeism over the years.

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This year, with the opening of two new schools, half of Ms. Smith’s staff has requested a transfer to the new schools. They have told Ms. Smith they really like working with her; but they want to see what it’s like working in a new school, and the new schools are a little closer to their homes. At the end of the school year, Ms. Smith will be left with a baker, cold/salad prep person, and the dishwasher. She will have to replace at least four of her current employees—two cashiers, one veg. cook, and one non veg. cook.

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Reality Practice: Case Study Worksheet

Q1-Could there be another reason why so many of Ms. Smith’s workers chose to leave their current jobs to start with a new manager?

Q2-With such a stable work force, how could Ms. Smith have averted this situation?

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Reality Practice: Case Study Worksheet

• Ms. Smith has to determine how she is going to utilize her remaining employees. List the skills each remaining employee has.

• How many of these skills can be applied to the other positions that will be vacant? List the skills and positions below:

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Checking Out: Skill Development

Think about the advantages of having multiskilled employees in your operation. Using the skill list from the Reality Practice, group different jobs in the kitchen which may have similar skill requirements. Develop a plan to cross-train your current employees in a systematic fashion until you have achieved your goal of a multiskilled team.

Job Skill Required____________

____________________________________________

________________________________

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The End