BPR

1
Information, Organizations, Processes and Control

• Hierarchical organizations of past years
• Today
• Process-oriented, Learning, Team-based, and
  Fast-cycle organizational models
• Flat, flexible, focused on core competence
• Inside, empowered, interfunctional teams of
  knowledge workers are reengineering and
  continually improving core business processes.
• Think globally and act locally

2
Flattening the Organizational Structure
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Information, Organizations, Processes and Control

• To accomplish the organizations of the year 2000
  and beyond firms must change the way they are
  organized, and employees at all levels must
  become information literate - not just computer
  literate.

4
Creating the Information Age Organization

• Transforming an Organization Requires more than
  just Changing the Structure.
• True change occurs deep within the organization
  as individuals and work teams redefine the way
  they work and the values that guide decision
  making and action.
• Managers need to rethink the nature of control
  and authority
• Smashing together the features of the hierarchy
  with features of an entrepreneurial firm will not
  work.
• Work must change and people must change
• New knowledge and skills are needed

5
Streamlining the Business Cycle

• Operating Cycle
• The activities through which an organization
  designs, produces, markets, delivers, and
  supports its product and services
• Management Cycle
• The activities through which an organization
  manages the design, produces, markets, delivers,
  and supports its product and services

Operational Process
Management Process
6

• Lecture note
• No single IT application - however sophisticated
  and state of the art it may be - could deliver a
  sustained competitive advantage. Rather,
  advantage is obtained through the capability of
  an organization to exploit IT functionality on a
  continues basis.
• This required a fundamental change in managerial
  thinking about the role of IT in organizational
  transformation, as well as an understanding of
  the critical components of IT strategy and its
  role in supporting and shaping business strategy
  decision

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BPR

• Business Process Redesign
• The fundamental rethinking and radically redesign
  of business processes to achieve dramatic
  improvement in critical, contemporary measures of
  performance such as cost, quality, service and
  speed.
• The implementation of deliberate and fundamental
  change in business processes to achieve
  breakthrough improvements in performance.
• Enabled by IT

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BPR

• Business Process Redesign
• Also known as Reengineering or Process
  Innovation is offered as an enabler of
  organizational transformation.
• Organization embrace a BPR approach when they
  believe that a radical improvement can be
  achieved by marring business process,
  organization structure, and IT change.
• Examples
• Taco have embraced BPR to enable the redefinition
  of their business

9
BPR

• Hammer and Champy
• It is an all-or-nothing proposition that produces
  dramatically impressive results. Most companies
  have no choice but to muster the courage to do
  it. For many, reengineering is the only hope for
  breaking away from the ineffective, antiquated
  ways of conducting business that will otherwise
  destroy them.

10
BPR

• BPR Objectives
• To dramatically reduce cost
• Reduce time
• To dramatically improve customer services or to
  improve employee quality of life
• To reinvent the basic rules of the business e.g.
• the airline industry
• taco bell from Mexican food to fast food to
  feeding people anywhere, anyhow.
• Customer satisfaction
• Organizational learning

11
BPR

• Change
• To transform an organization, a deep change must
  occur in the key behavior levels of the
  organization
• jobs, skills, structure, shared values,
  measurement systems and information technology.
• Role of IT
• BPR is commonly facilitated by IT e.g.
• Organizational efficiency
• Effectiveness
• Transformation

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BPR

• Efficiency
• Applications in the efficiency category allow
  users to work faster and often at measurable
  lower cost
• Mere automation of manual tasks, resulting in
  efficiency gains (least deep)
• Effectiveness
• Applications in the effectiveness category allow
  users to work better and often to produce higher
  quality work.
• Requires changes not only in technology, but in
  skills, job roles, and work flow (deeper).

13
BPR

• Transformation
• Applications in the the transformation category
  change the basic ways that people and departments
  work and may even change the very nature of the
  business enterprise itself.
• A major change in the organization, including
  structure, culture, and compensation schemes
  (deepest).

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BPR

• Process
• A process is set of logically related tasks
  performed to achieve a defined business outcome
• A collection of activities that, taken together,
  create value for customer e.g. new product for
  customer. This tasks are inter-related tasks

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BPR

• How can Companies Identify their Business
  Processes. Examples
• Manufacturing As the procurement-to-shipment
  process
• Product development as the concept-to-prototype
  process
• Sales as the prospect-to-order process
• Order fulfillment as the the order-to-payment
  process
• Service as the inquiry-to-resolution process

Business Processes
Business functions
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BPR

• How can Companies Identify their Business
  Processes.
• Dysfunction Which process are in the deepest
  trouble
• Important Which process have the greatest impact
  on customer
• Flexibility which process are the most
  susceptible to redesign.

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BPR

• Embarking on Re-engineering
• Persuade people to embrace or at least not to
  fight -the prospect of major change by developing
  the clearest message on
• 1 A case for action- Here is where we are as a
  company and this is why we cant stay here
• show your balance sheet
• show competitors balance sheet
• 2 A vision statement - This is what we as a
  company need to become

18
BPR

• Simple Rules
• Start with a clean sheet of paper.
• With my current experience what can I do today
• If I were to re-create this company today, given
  what I know and current technology, what would it
  look like.
• How will I be focusing, organizing and managing
  the company?
• Transition from a vertical functional departments
  to one that is horizontal, CUSTOMER focused and
  process-oriented?

19
BPR

• Simple Rules
• Listen to customer
• Enhance those things that bring value to the
  customer or eliminate those that dont
• Be ambitious, focus your commitment to radical
  change on the process

20
BPR

• Process Improvement and redesign Process

Improvement Innovation/Reengineering
Magnitude Increment Radical Improvement
30-50 10x-100x Sought Starting
base Existing Process Blank sheet Top
management Relatively low High commitment Role
of IT Low High Risk Low High