Business Process Reengineering
and Information Technology
4-1
Basic Concepts
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Business process
Value added
Business Process Reengineering (BPR)
Demand chain
Supply chain
4-2
Basic Concepts
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Supply chain management
Extended supply chain
Networked organization
Organizational transformation
4-3
The Need for BPR
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Customers
Competition
Change
Techniques lag behind technology
Problem of the stovepipe
Fragmented piecemeal systems
Integration
4-4
The Principles of BPR
and The Role of IT
• Characteristics of BPR
• Methodologies and frameworks for BPR
• Enabling role of IT
4-5
Characteristics of Business
Process Reengineering
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Several jobs are combined into one
Employees make decisions
Steps in business process: natural order
Process may have multiple versions
Work is performed where it makes the most
sense
4-6
Characteristics of Business
Process Reengineering
• Controls, checks, other nonvalue-added
work is minimized
• Reconciliation is minimized - minimize
external contact points
• Hybrid centralized / decentralized operation
is used
• A single point of contact is provided for the
customer
4-7
Business Process Reengineering
and
Restructuring the Organization
• Redesign of processes
• From mass production to mass
customization
• Cycle time reduction
• Restructuring organizations
4-8
The Networked Organization
• Structure of networked organizations
• Empowerment
– IT / empowerment relationship
• Teams
4-9
Virtual Corporations
A virtual corporation is an organization
composed of several business partners
sharing costs and resources for the purpose
of producing a product or service.
4-10
Virtual Corporations
Major Attributes
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Excellence
Utilization
Opportunism
Lack of borders
Trust
Adaptability to change
Technology
4-11
Total Quality Management
and Reengineering
• Rate of change
• TQM: continuous improvement
• Reengineering: dramatic improvement
4-12
TQM versus Reengineering
4-13
Implementing Reengineering
• Redesign
• Retool
• Reorchestrate
4-14
Tools for BPR
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Simulation
Flow diagrams
Work analysis
Application development
Workflow software
4-15
Reorchestrate:
Organizational Change
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Leadership
Corporate values
Cultural change
Incentives
Accountability
Zeal
4-16
Reorchestrate:
Organizational Change
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Communication
Ambiguity
Obstacles to change
Celebrate success
4-17
Implementation Issues
• Continuous evaluation
• Eliminating jobs
4-18
Continuous Evaluation
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Is reengineering truly transformational?
Will reengineering improve customer relations?
Has reengineering cut across the organization?
Is information technology playing a integral role
in the reengineering solution?
• Does it hurt?
4-19
When to Use BPR?
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Failure rate as high as 75-85%
Improperly aligned BPR and IT
Expensive
Organizational resistance
4-20
Managerial Issues
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Ethical issues
BPR implementation
Incremental improvement programs
BPR tools
Role of IT
Failures
TQM and BPR
4-21
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4-22