BUSIAESS PROCESS

REEACIAEERIAC
BUSIAESS PROCESS REEACIAEERIAC:
1he process starts with customer need or request and
ends when the need is satisfied in terms of key business
improvement(kbp)
Objective of key business improvement are.
-making process efficient :minimising the resources used
-making process effective : producing the desired results
-making process adaptable : being able to adapt to
changing customer and business needs.
Parameters of excellence are : quality, cost, delivery,
safety and morale
Why BPR ?
Organisation is divided into specialised Iunctions e.g.
sales,engineering etc,
Management focus has traditionally been on the functional
hierarchy
Breakdown oI tasks and specialisation in each, leading to
- Barriers in procedures and inIormation Ilow
- Whole view oI business process Iragmented beyond
recognition by any manager
- Lack oI holistic view
And also.. Unnecessary process steps(non-value added)
Duplicated tasks and data
Time consuming,error prone manual procedures
BPR- basics
The basics oI BPR include
1) A process orientation
2) A horizontal Iocus across boundaries(rather than a
vertical,Iunctional approach within an organisation)
3) A customer perspective
4) Bench marking perIormance measures
5) Building organisational capabilities and competencies
6) Empowerment oI inviduals in the organisation
7) Improvement through application oI inIormation
technology.
BPR basics(continued)
Value chain analysis enables identiIying essential activities.
Each activity has both a physical and an inIormation
component. For example, in the past application oI
technology has usually Iocused on the physical component
oI the activity,Ior example robotics in manuIacturing.
Now systems analysts can approach the value chain as a
means oI identiIying areas, which can apply technology Ior
greater business beneIit in the value chain.
Structured approach is essential
-what needs to be done, when it should be done,how it
should be done and how it should it be controlled
Business Process - Terminology
usiness Process: A continuous and regular action or succession of actions,
taking place or carried on in a definite manner and leading to the
accomplishment of some result; a continuous operation or series of operations.
PR emphasises a process view which cuts across the functional hierarchies to
reach the customer.
Process Map: intended to represent a process in such a way that it is easier to
read and understand . Process map provides a focal point for discussion about
the way people work and will help create common understanding of work
patterns. Process maps give clearer explanation of a process than words. The
process of mapping spurs teams and individuals into improvement-visibility of
wasteful or plain silly process steps, makes people want to change them.
Simple Flow chart symbols:
Flow
Start/End
Task/Activity
Decision point
BPR Terminology.. continued
Controls : company policy, legal.
Inputs: Outputs:
Materials,inIo.. Product,inIo.
Mechanisms : people,
Systems,
Process
BPR Terminology(continued)
Lead Times: how long is the process, how long does it take to
complete each step and in between each step.
Dependences: should be clear, i.e where a task depends on the
output oI another.
Who is perIorming each task?
Problem areas: should be shown- those tasks that are diIIicult,
dirty or dangerous and those which Irequently experience
problems.
Value addition: whether a step 'adds value or merely adds
cost.
It is necessary to identiIy 'levels oI processes by indicating
each process step being broken down into more detail on
another chart.
BPR Consulting
consulting involves assisting clients in
developing strategies (i.e., product leadership,
operational excellence, customer intimacy,
etc.) and in improving business (and service
delivery) processes.
hy PR Consulting Industry is Growing ?
Market pressures on clients to reengineer their core
processes and eliminate non-core processes.
Globalization.
Need to better manage technology(including IT).
PR Consulting & the 5 Ps
Plants
Adding and locating new plants
Expanding, contracting, or refocusing facilities
Parts
Make or buy decisions
Vendor selection decisions
Processes
Technology evaluation
Process improvement and reengineering
PR Consulting & the 5 Ps (Continued)
People
Quality improvement
Setting/revising work standards
Learning curve analysis
Planning and Control Systems
Supply chain management
MRP
Shop floor control
arehousing and distribution
PR-Hierarchy within Consulting Firms
Partners
Managers
Consultants
Finders
Minders
Grinders
PR - Role of Consultants
Finders : Partners or senior consultants
whose primary function is sales and
client relations
Minders: Managers of consulting firm
whose primary function is managing
consulting projects.
Grinders: 1unior consultants whose
primary function is do the work..
hen are PR Consultants Needed
hen faced with major investment decision(s)
hen management believes it is not getting
the maximum effectiveness from the
organization`s productive capability.
Consulting Industry-Major Firms by Sector
Strategy(17)
McKinsey&Co
(www.McKinsey.com)
oston consulting
group(www.bcg.com)
ain&co
Deloitte&
Touche(www.dttus.com)
Operations -management(23)
A.T.Kearney
ooz Allen Hamilton
Pittiglio Rabin Todd &McGrath
Arthur D Little
PC
Source: www.Kennedy info.com
Information Technology(50)
IM
Accenture
Cap Gemini Ernst
&Young(ernie.ey.com)
CSC
EDS
Anderson Consulting ?
Human Resources(10)
Mercer HR Consulting
Towers Perrin
Hewitt Associates
Consulting Market Segmentation by
vertical industry
Sector-wise share:
: Government: 17
Financial Services: 18
Manufacturing: 16
Retail/wholesale: 10
Communications: 10
Others : 29
Source: www.Kennedy info.com
Major Consulting Firms Revenues
IM : $10.800bn
Accenture: $9.460bn
Cap Gemini Ernst &young: $5.875bn
Doeloitte consulting: $5.635bn
PC Consulting $5.547bn
CSC : $3.562bn
McKinsey&co: $3.293bn
EDS : $2.903bn
KPMG Consulting: $2.700bn
Mercer Consulting Group: $2.160bn
Source: www.Kennedy info.com
Reengineering
-Definition
Reengineering is defined as 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.
usiness process reengineering is
focused on reengineering business
processes.
Key ords in Reengineering Definition
Fundamental
hy do we do what we do?
Ignore what is and concentrate on what
should be.
Radical
usiness reinvention vs. business
improvement
Key ords in Reengineering Definition
(Continued)
Dramatic
Reengineering should be brought in ~when a need
exits for heavy blasting.
Companies in deep trouble.
Companies that see trouble coming.
Companies that are in peak condition.
usiness Process
a collection of activities that takes one or more
kinds of inputs and creates an output that is of
value to a customer.
Stages in PR Consulting Process
1. Sales & Development Proposal
2. Perform Problem Analysis
3. Design, Develop, and Test Alternative
Solutions
4. Develop Systematic Performance Measures
5. Present Final Report
6. Implement Changes
7. Assure Client Satisfaction
8. Assemble Learnings from the Study
Principles of PR
Organize around outcomes, not tasks.
Have those who use the output of the process
perform the process.
Merge information-processing work into the
real work that produces the information.
Treat geographically dispersed resources as
though they were centralized.
Principles of PR (Continued)
Link parallel activities instead of integrating
their results.
Put the decision point where the work is
performed, and build control into the process.
Capture information once and at the source.
Guidelines for PR implementation
Codification of Reengineering.
Clear goals and consistent feedback.
High executive involvement in clinical
changes.
PR Consulting - Road Map
Problem Definition: process,product,system
Mission Statement,Strategies,CSF,Performance Measures
Team Formation.
Data Gathering.
Data Analysis
Solution Development
Cost impact and pay off analysis
Implementation
PR Consulting - Road Map
Mission Statement : Define the goals /objectives of the company.
Strategies: Describe the method of achieving the mission defined above.
CSF: parameters for achieving the above strategy and to measure the success
of the PR exercise. Some of the CSFs are: profit margin,cost of capital,
timely/accurate data,information flow,company
coordination,integration,sales volume,production demand,production
costs,inventory control, optimisation of customer product delivery.
Performance Measures: Rating methodology to measure the fulfillment of
CSF.
Team Formation: Desirable to have a mix of people of different departments
to achieve a consensus.
PR Consulting - Road Map
Data Gathering : Analysis of present set-up,group discussions, individual
interviews,informal discussions. Using background
material,industry/application experience.
Data Analysis: De-compose AS-IS process/usiness function/job/tasks.
Identify CSF/PEM for the above.
Solution Development : Complete AS-IS analysis,perform current system
analysis, collect existing reports(outputs),establish benchmark for
improvement,define target business processes, define gaps,define data
requirements,envision target organisation,consolidate targets into
deliverable(cost/quality benefits)
Issues likely to be encountered during PR: organisation and data,time table
for change,OO+NTEOO,beware of existing reports,gaps and
resolution,interfaces,data conversion,mid-sream changes in scope and
strategy.
PR Consulting - Road Map
Cost impact and pay off analysis : Factors to be considered for value addition during
PR: competitive advantage,retain market share,low cost producer,gain market
share,create barriers to entry, create monopoly.
Implementation : Visualise the new way of doing business,assess data
requirements,and determine impact on jobs/tasks . HR,Union,
Government,1obs/skills.
Issues to be considered during implementation : impact on organisation, readiness
for change, communication,culture, skills,practices,facilities.
Do Not Ignore Culture, Ensure management agrees to organisational changes and
is ready,willing and able to manage change and the impact.
Reports: Avoid data rich information poor(DRIP)
Exit point: Address contractual issues, post impl issues, review schedule, impl plan for
future
PR Consulting - Methodologies
Issue Trees.
Customer Surveys
Gap Analysis
Employee Surveys
Five Forces Model : uyer Power,Potential Entrants,Suppliers,Substitute
products and Industry rivals .
SOT Analysis.
PR - Methods in Use
Some of the PR tools in vogue:
MO,Diversification, Portfolio
management, ench marking, Quality circles,
TQM, TPM, ISO, IT driven PR(ERP)