slides is about management information system's(MIS) sub topic enterprise resource planning's(ERP) sub topic business process re-engineering.

1. Nitin gulgulia
MBA Fin.(iibs)
• BUSINESS PROCESS RE-ENGINEERING
Nitin gulgulia

2. Objectives
• Explain what business process reengineering
is ??
• Why it is important???
• Present different options that organizations
can use to reengineer processes within their
organizations
Nitin gulgulia

3. Why Reengineer?
• Historical ‘reality’ for organizations:
– High level of demand:
– Management (and IT!) focus – efficiency and control of
operations
• Modern ‘reality’ since 1990s:
– Hyper-competiveness
– Globalization
– Very demanding customers
– Management and IT focus: Innovation,
responsiveness/speed, quality and service.
Nitin gulgulia

4. What is Reengineering?
• Business Process Reengineering (BPR) is a
management approach aiming at improvements by
means of elevating efficiency and effectiveness of
the processes that exist within and across
organizations.
• It is a fundamental and radical approach by either
modifying or eliminating non-value adding
activities. (Wikipedia).
• Reengineering can be accomplished through the
implementation of ERP systems…..but is this the
best approach?
Nitin gulgulia

5. Business Process Reengineering
Definition
• BPR first introduced in 1990 in a Harvard
Business Review article by Michael Hammer:
– Reengineering Work: Don't Automate, Obliterate.
• Hammer/Champy
– Reengineering the Corporation (1993)
• Provided this definition:
– “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.”
Nitin gulgulia

6. Business Process Reengineering-
TYPES
• Fundamental
– Need to understand why an organization does what it does – question
all of the rules and assumptions that exist
• Radical
– Radical redesign means disregarding all existing structures and
procedures, and inventing completely new ways of accomplishing
work. Reengineering is about business reinvention, begins with no
assumptions and takes nothing for granted.
• Dramatic
– Not looking for marginal or incremental improvements or modification
– Goal is dramatic improvements in performance.
• Processes
– Focus on the way the organization adds value – through cross-
functional business processes
– Move away from function view; task based thinking
Nitin gulgulia

7. Ford Motor Company
• Accounts Payable function
• 500 people
• Most work on mistakes between
Purchase
Orders
Receiving
Documents Invoices
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8. Ford (cont)
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9. Ford (cont)
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10. Risks in BPR
• Advocates report failure rates of 50% to 70%
• Some RISKS are::
– Employee resistance to change
– Inadequate attention to employee concerns
– Inappropriate staffing
– Inadequate technologies
– Mismatch of strategies used and goals
– Lack of oversight
– Failure of leadership commitment
Nitin gulgulia

11. BPR best practices
• Combine multiple tasks and assign a single point of contact
for each process. EMPOWERMENT
– An important feature of BPR is integrating activities and
assigning business process responsibility to one individual
– a ‘generalist’.
• Allow workers to make decisions. Avoid decision hierarchies
that require workers to go through layers of management for
decisions about the work they are doing.
• Perform process steps in their natural order. Rather than
following a linear sequential set of tasks, perform process
activities as needed, sometimes in parallel.
Nitin gulgulia

12. How do you figure out what
processes to reengineer?
• What’s broken the most?
• What process has the greatest
impact on the customer?
• Which of the processes are most
susceptible to successful redesign?
(feasibility and scope)
Nitin gulgulia

13. How do you know if it’s broken (or at
least in major trouble?)
• Extensive information exchange,
data redundancy, and re-keying of
data into multiple systems
• High ratio of checking and control to
value adding
• Reworking and iteration
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14. Reengineering/Redesign Choices
• What are the choices?
• What are the advantages / disadvantages
of each?
• Who should or does use which?
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15. Reengineering/Redesign Choices
• Technology Enabled (Constrained) Reengineering
– Choices are a direct function of the software
– Not altering software makes time and cost lower
– Also called “Concurrent Transformation”
• Clean Slate Reengineering
– “Start from scratch” with no structures or
documents
– Software must be made to fit the “needs” of the
firm
– Costs in terms of time and dollars is generally
greater Nitin gulgulia

16. Technology Enabled (Constrained)
Reengineering
• A particular technology (or portfolio
of technologies) is chosen as a tool
to facilitate reengineering.
– Thus, reengineering choices are a
function of the technologies chosen.
– The technology drives the
reengineering.
Nitin gulgulia

17. Technology Enabled (Constrained)
Reengineering Advantages (cont)
• ERP provides the tool and structure to facilitate
change
• Proven and based on best practices
• Forces change to happen
• ERP bounds the design
• Design is feasible and we know it works (it’s
been proven – in other companies)
• Cheaper than clean slate
• Designs likely can be implemented in a timely
manner
• Less risky
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18. Clean Slate Reengineering
• Process design starts with a clean
slate
• Also referred to as “starting from
scratch” or green field.
• Theoretically, no limits
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19. Advantages of Clean Slate
• Provides freedom from tools constraints
– Avoids tool biases by using a portfolio of tools
– Not limited by the constraints of a single software package
• Provides freedom from predefined structures
– Can develop own unique, leading-edge processes
– Not limited to the ‘configuration options’ within a single
software package
• Separates BPR and technology implementation
– Clearly defines costs as one or the other
• Permits immediate use of new technology
– Don’t have to wait for the software company to ‘catch up’
with an advance Nitin gulgulia

20. Advantages of Clean Slate (cont)
• Competitive advantage:
– Allows an organization to develop
innovative software that is not
available through existing ERP software
• May be the only option:
– For some firms in ‘niche’ industries,
clean slate reengineering is the only
option
Nitin gulgulia

21. Need for BPR
• O’Leary [2000] survey of SAP R/3 users
–Technology enabled strategy dominated
–Prior to ERP implementation, 16% thought
BPR needed prior to SAP implementation
• 33% thought BPR unnecessaary
–After ERP implementation, 35% thought BPR
needed prior to SAP implementation
• 10% thought BPR unnecessary
• So BPR seems to be a useful exercise
Nitin gulgulia

22. Which Firm Should Use Which
Approach?
Depends on
• Firms Size
• Available Resources
• Time Pressure
• Strategic Gain
• Uniqueness of solution
Nitin gulgulia

23. Blend - Somewhere Between the Two
• The approach claimed to be used by most
firms is Technology Enabled Reengineering,
simultaneous with ERP software
implementation.
• In actuality, there are few projects that are
“purely” clean slate or technology enabled
• More of a spectrum
Technology
Enabled
MOST
FIRMS
Clean
Slate
Nitin gulgulia

24. Implementation methodology
Of ERP
• Assuming a decision on an ERP has been
taken, the implementation normally consists
of five stages:
• Design
• Implementation
• Stabilization
• Continuous improvement
• Transformation
Nitin gulgulia

25. STEPS TO IMPLEMENT ERP
• The structured implementation programme
can speed system deployment and return on
investment. This can be done in the following
manner:
• Conducting an effective gap assessment
• Business and technical processes
• Organizational measures
Nitin gulgulia

26. STEPS TO IMPLEMENT ERP
• Data conversion and data clean-up
• Agreeing on the implementation boundaries
• Project sponsorship and governance
• The implementation strategy is ultimately
built on a foundation of people, processes and
product
• http://www.eresourceerp.com/erp-
implemenation.htm
Nitin gulgulia

27. Nitin gulgulia

28. Thank you
Nitin gulgulia