Week 10 – Redesign Principles and Tactics (1)

Source / Reference:

1. http://higheredbcs.wiley.com/legacy/college/turban/0471229679/add_text/ch09/el_sawy.pdf

2. https://www.flagstar.com/about-flagstar/flagstar-bank-history.html

3. http://cache.lego.com/upload/contentTemplating/AboutUsAboutUsContent/otherfiles/download6777A03AA55057F7EE86D771CA3A1D79.pdf

Subject:
Principles of restructuring the process

 Response:

There are three types of redesign principles and tactics, which are restructuring the process, informating the process, and minding the process. Under each type, there are several principles. In this article, we will focus on the principles of restructuring the process.

Lose Wait, Orchestrate, Mass-Customize and Synchronize are the four principles of restructuring the process. There are various common tactics under each principle.

Principles:

1.          Lose Wait

It aims to squeeze out waiting time in process in order to create value. Several common tactics are used to support this principle, namely, concurrency, closed-loop, not gating main process, continuous flow, and upstream relieves downstream.

2.          Orchestrate

It means shifting the execution the different parts of process to the most efficient and capable enterprises. Partnering, outsourcing, insourcing, and routing through an intermediary are the common tactics of this principle.

3.          Mass-Customize

Making the process more flexible for any time, any place, any way. There are four common tactics, including flexing time, flexing space, modularity, and dynamic customization.

4.          Synchronize

The physical and virtual parts of the process should be synchronized. Match offerings, common process platforms, and track movement are the common tactics.

Real life examples:

Principle 1:

Flagstar Bank(MI, USA) had redesigned their online services through lose wait.

Principle 2:

UPS had insourced the delivery process back to their firm in order to increase the efficiency.

Principle 3:

Dell allowed customers to customize the product they desired. This act utilized the principle 3.

Principle 4:

The Lego Group had provided integrated and reliable process platform to support the business strategy and the operation.

Comment on Law Wai Ching’s week 8 blog:

Ref: http://lawwc-2391.blogspot.com/2012/03/week-8-process-redesign1.html

Crystal had introduced the five phases of BPR methodology and focus on describing the steps of how to scope an enterprise process. The diagram shown clearly illustrated the steps. I agreed with her that scoping a process is a very vital step of process redesign.

Week 8 – Process Redesign (1)

Source / Reference:

1. EL SAWY, Omar A. (2001). Redesigning Enterprises Processes for e-business, Irwin/McGraw-Hill, New York, USA.

Subject:
How to scope an enterprise process?

 Response:

In business process redesign (BPR), there are several key phases. The table below showed the three main phases in BPR with software, namely, scoping the process, modeling, analysis, and redesign of the process, and planning process integration. In this article, we will focus on the first phase, scoping enterprise process.

There are seven chief activities in the phase of scoping the process.

1.      Operationalize process performance targets

To accomplish this step, BPR team should communicate with the process owners and sponsors to understand the trade-offs and priorities. BPR team leader should act as a coordinator in this step.

2.      Define process boundaries

In order to define the process boundaries, BPR team should hold a group meeting. The contents to be discussed are about customers, inputs, outputs, external entities and sub-processes, etc.

3.      Identify key process issues

A certain number of direct process participants such as customers, employees, and external entities and the inputs from them are needed for the sake of identification of key process issues. BPR core team needs to find out the key process issues with the help of inputs from the direct process participants.

4.      Understand best practices and define initial visions

Listing of known best practices should be responsible by a BPR team member based on the interaction with other members. Other team members should get to understand the known best practices through reading, visits, seminars, and consultants if they do not fully comprehend the practices.

5.      Familiarize participants with BPR software

The participants have to familiar with the selected BPR software and there are three types of familiarization for different kinds of participants. Conceptual Familiarization is get to know what the selected BPR software is, an overview of the software, all participant is suitable for this type. Another type is Test Drive which is to understand the use of basic functions of the software. This type is suitable for all BPR core team members. Last type is Learn to Use. The selected team members for modeling and redesign processes suitable for this type.

6.      Outline data collection plan and collect baseline data

There are the steps to achieve this activity. First step is to identify the sources of data which mean determine who will be the primary sources of data. Selection of case categorization criteria is the second step. Then, types of data needed and data collection methods have to be defined. Lastly, Members may start to collect the baseline data.

7.      Plan for modeling phase

The deliverable of this phase, which is the process scoping report, can effectively support the modeling phase.

Scoping the process is the foundation of BPR and it is very important to BPR. If this phase was not being done well, BPR may fail even though performances in other phases are good. The above activities guide the enterprise how to scope the process in a correct way.

Week 6 – Basics of BPR (2)

Source / Reference:

1. Exploring the relationship between information technology and business process reengineering, by Mohsen Attaran

2. The role of information technology in business process reengineering, by A. Gunasekaran

Subject:
How information technologies help BPR?

 Response:

In general, information technology (IT) increases the efficiency and the accuracy of the business processes. As less human mistakes are made in some complex or repetitive processes, the cost for correction can also be saved. Besides, the communication barriers between managerial staff and operational staff or among employee can be getting over due to ease of internet access. Apart from the capabilities of IT in general, IT help BPR in many different aspects, namely, order flow, strategic process, product, marketing/ sales, services, accounting and personnel.

1.      Order flow

The information and materials along the supply chain should be analyzed in order to reduce the lead-time of order flow. IT such as shared database, AI and Expert Systems, CIM may help to simplify and standardize the flow of material and information and improve the co-operative tasks in factory, thereby the overall system performance of reengineering is enhanced.

For example, the supply chain of Dell Computer is reengineered with the help of IT. Dell adopted internet based technology to reduce the delivery time. The delivery time of customized products reduced to 5 days or less.

2.      Strategic process

In order to support strategy formulation, huge amount of data and information process need to be handled. Technology like Netscape, multimedia may help to collect and process data.

3.      Product

The productivities can be increased and the cost can be reduced in the product design, process planning stages with the adoption of computer-based tools. Controller-based supervisory control, execution systems, and computer-aided design program are some of the example of IT that helps in this aspect.

For instance, Deere Company used CAD and CAM for design, production and materials management. Consequently, the inventory costs have been reduced and the chance of manufacturing overhead decreased.

4.      Marketing/ Sales

For the sake of understanding of customers’ expectation of products and services, marketing research need to be done. Multimedia and internet systems can be used to assist the collection of customer data and the exchange of information within the firm.

5.      Services

IT helps to cut cost and improve the services to customers. Information automation systems can facilitate the operations of distribution and logistics.

6.      Accounting

Collection of information about product price, making make-or-buy decisions and budgeting decisions, and deciding capital investment can be support by on-line shared database and computerized information system.

7.      Personnel

Human factors in BPR are very crucial. Technologies like CAD/CAM may help to reduce the stress of workers and also improve the cooperation of employees with business strategies.

The adoption of IT assists BPR in many different aspects. IT takes an important supportive role of BPR.

Week 5 – Basics of BPR

Source / Reference:

1)      http://wiki.mbalib.com/zh-tw/BPR

2)      http://www.hitachiconsulting.co.uk/staging/0132.cfm

3)      http://www.ehow.com/list_6775695_success-factors-business-process-reengineering.html

4)      http://www.prosci.com/factors.htm

 Subject:
When BPR is needed? How to perform a successful BPR?

 Response:

Business Process Reengineering is the redesign of business processes to achieve great improvements in business performance. BPR involves the reduction of business cycle time, the improvement of customer services, the improvement of product qualities, the reduction of operating costs and the renovation of technology, etc. In order to reap the benefits of BPR, reconstruction of the organization may be required.

 

 

BPR is needed when a firm with the below characteristics.

1.      Recognize the competitive edges of main competitors is much stronger

2.      Recognize the technology of the firm is far behind the current market

3.      Core operational flow is based on outdated business assumption or technical establishment

4.      The objectives of the firm seems cannot be achieve

5.      Enhance the operational capability of new vision and strategy

BPR may help the company to release from the difficult position. BPR may also solve the potential problems that may threaten the core business. BPR help to increase the efficiency of business processes and improve the performance of a firm.

After recognizing is there any needs of performing BPR, the success factors of BPR will be introduced.

1.      Strong support from top managers. If managerial stuff do not provide money, resources, or leadership, the reengineering project properly cannot move forward and it will fail.

2.      Alignment of business goals and the strategy of reengineering project. If the strategic direction is not consistence, contradiction may occur and it can be counterproductive.

3.      Create a clear and well-documented business case for change. The business case should be simple and easily understandable. Furthermore, the business case can be modifying throughout the implement of the reengineering project.

4.      Appropriate change management. Leadership with concise and frequent communication is required to manage changes. If some members of BPR team disconnected with the changes and left out, unexpected delays may occur.

All the factors demonstrated above is essential and crucial to perform a successful BPR.

Week 3 - The strategic framework

Source / Reference:

1) Sullivan, "Systems Planning in the Information Age," Sloan Business Review, 1985
2) http://www.ownway.eu/academy/marketing/marketing-methods/swot-analysis/

 Subject:
The strategy development by applying PEST analysis and SWOT analysis

 Response:

PEST analysis and SWOT analysis are techniques that help to formulate the strategy.

PEST analysis mainly used to analyze the external environmental factors. It analyzes the external environment through 4 aspects, namely, political factors, economic factors, social factors, technical factors.

1.      Political factors include government regulations, policies and laws.

2.      Economic factors include the inflation, change of economic environment and the purchasing power of customers.

3.      Social factors mean the change of social activities that affecting the needs of customers. For example, ageing change the age distribution.

4.      Technological factors include the technological change and automation.

Strategy cannot be created by only using PEST analysis since it illustrates only the macro-environment. By emerging with SWOT analysis, the situation can be analyzed and a complete strategy can be developed.

SWOT analysis may analyze both internal and external business environment. Strengths and weaknesses contribute to the internal analysis while opportunities and threats are attributes of the external analysis.

  

1.      Strengths mean the merits of a firm that may help the business growth.

2.      Weaknesses mean the potential shortcomings of a firm that may badly affect the business activities.

3.      Opportunities denote the potential chances from external conditions that may help the business.

4.      Threats are the potential dangers from the external environment that may be the barriers of achieving the business goals.

By using SWOT analysis, the current state of company can be known. There are several strategies with respect to different state of the firm. The basic concept is shown below:

 

If a firm has more strengths than weaknesses and chances more than risks, MAX-MAX strategy can be used. It means to strengthen the merits of the firm and to get more opportunities in order to achieve the objective.

If there are many weaknesses but quite a lot of opportunities, MIN-MAX strategy should be used. This strategy is to reduce the weaknesses and to increase the chances to make the business run more smoothly.

If a firm has numerous strengths with many potential threats, MAX-MIN strategy could be applied. Enhancing the strengths and minimize the threats is the strategy that should be implemented.

In order to survive in the competitive market, a firm with many weaknesses and potential threats should execute MIN-MIN strategy. Correcting firms’ flaws and minimize the threats is the way to survive.