Bpr 02 Principles

  • October 2019
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Business Process Re-engineering 02 – Principles & Dimensions

Dimensions & Characteristics Fundamental changes to process, technology and human factors to achieve dramatic improvements in key measures The dimensions & characteristics: • Balanced attention to processes, people and technology • Cross functional, process based perspective • Judged by measurable results achieved

Slide 2 of 21

Process: The Basic Concept •

• •

What is a process? - “a collection of business activities that creates value for a customer - a transformation of inputs(s) into output(s): a state of change Re-engineer processes, not functions or organisations Some typical processes: - concept to prototype : develop product - target to customer order : acquire customer - customer order to pay : fulfill order - purchase request to payment : procure materials - enquiry to resolution : service Slide 3 of 21

Process viewpoint

Identification and mapping - identify, name and relate the processes to each other • Ownership - assigning owners for all processes • Measurement - establishing and communicating end-to-end customer driven process measures and measurement mechanisms •

Slide 4 of 21

Process viewpoint

Management - evaluate process performance against customer needs and competitive benchmarks • Awareness - creating appreciation of the organisation’s processes and customers - develop a process-oriented mindset •

Slide 5 of 21

The Business operation The business operation diamond

e t de

in rm

e

Business Processes

Jobs and Structure re q

ui r

e

en

ab

le

Values and Beliefs

Management and Measurement Systems

er t s fo

Slide 6 of 21

The Impact of BPR The business operation diamond in context Competitor actions Customer needs

Technological and environmental factors Assessment of capabilities

Business Processes

Jobs and Structure INFRASTRUCTURE Values and Beliefs Management and Measurement Systems Slide 7 of 21

Elements of BPR

• Process focus • Radical change • Dramatic improvement BPR is about competitiveness.

Slide 8 of 21

Process Focus

• A set of linked activities that adds value to the process to create an effective output • Focus should be on core business processes that addresses the external customer and supplier

Slide 9 of 21

Radical Change

• The objective is to address competitiveness and marketdominance • Radical change provides a new way of building core competencies and good investment management

Slide 10 of 21

Dramatic improvement

• To achieve major improvement in the core process • Planning, procedures and resources are required • Measure, control and manage the process

Slide 11 of 21

BPR Model Competitiveness BPR Process focus

Radical change

Dramatic improvement

Change and risk management Best practices - the foundation for success

Slide 12 of 21

Why re-engineer ?

• • • • • • • •

Downsizing / Rightsizing Customer satisfaction Quality improvement goals Functional performance improvement Reduce costs Increase speed (of service) Overcome a competitive threat Change of organisational structure

Slide 13 of 21

Process Improvement Possibilities

• • • • • • • •

Eliminate duplicate activities Combine related activities Eliminate multiple reviews and approvals Eliminate inspections Simplify processes Reduce batch size Outsource inefficient activities Centralise or decentralise functions / activities

Slide 14 of 21

Reasons to improve processes • Invisible – Managers delegate their knowledge – Process performance is not measured • Inconsistent – Jobs, measures and infrastructure are not aligned with the current process • Ignored – Processes often unmanaged and rarely updated • Ill conceived – Processes and policies are developed piecemeal and informally rather than designed as a whole Slide 15 of 21

BPR is different

• High ambition – Improvements in key performance measures, such as cost, quality, service or speed • Process focus – A customer-oriented viewpoint. No organisational boundaries

Slide 16 of 21

BPR is different

• Creative rule-breaking – Finding assumptions about normal business practice and customers’ needs • Information technology to enable the above – IT enables new ways of working through substitution and automation

Slide 17 of 21

Typical benefits BPR produces

• • • • • • •

Improve customer service Reduce cycle time Improve quality Reduce costs Increase market share Reduce product development time Increase sales

Think of specific examples for various processes

Slide 18 of 21

Value-chain analysis • Developed by Michael Porter : – To classify, understand and analyse an organisation’s value-added processes to achieve competitive advantage – To analyse how to improve cost structure (productivity) and add value (differentiation) – Applicable to any industry – Processes classifed into 5 Primary activities and 4 Support activities

Slide 19 of 21

Value-chain analysis Firm Infrastructure

PR O

Human Resource Management Technological Development

FI T

Service

Marketing and Sales

Outbound Logistics

Operations

Inbound Logistics

Procurement

P

T I F O R

Slide 20 of 21

Value-chain analysis Financial Policy Flight/ Route and Yield Analysis Training

Accounting Pilot Training Pilot Safety

Regulatory Compliance Baggage Handling Training

Computer Reservation System/ Inflight System/ Flight Scheduling System/ Yield Management System

Legal

Community Affairs

Agent Training

Inflight Training

Human Resource Management

Product DevelopmentBaggage Tracking Market Research System

Technological Development Procurement

Information Technology Communications • Route selection • Ticket counter • Baggage system • Promotion • Passenger operations • Flight connections• Advertising service system • Gate operations • Rental car and • Advantage • Yield • Aircraft operations Hotel reservation programmes management • Onboard services system • Travel agent system (pricing) • Baggage handling programmes • Fuel • Ticket office • Group sales • Flight scheduling • Crew scheduling • Facilities planning • Aircraft acquisition Inbound Logistics Operations Outbound Logistics Marketing & Sales

• Lost baggage services • Complaint follow - up

Service Slide 21 of 21

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