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.