Business Process Re-engineering

Business process Re-engineering Prepared by:

Kalpesh Patel (221121) Srinivas Patil (221125) Avradip Paul (221127)

BUSINESS PROCESS

Business processes are simply a set of activities that transform a set of inputs into a set of outputs (goods or services) for another person or process using people and tools. We all do them, and at one time or another play the role of customer or supplier

Why Re-engineering • Businesses to stay competitive in today's • • • • •

marketplace Customers are demanding for better and better products and services Organisation often inwardly focused Vertical chains of command Lack of trust Limited training

What is Business process Re-engineering Fundamental re-thinking and radical redesign of business processes to achieve, dramatic improvement in critical, contemporary measures of performance, such as cost, quality, service and speed… ……………Michael Hammer

Objectives Lower the cost Increase quality & Increase the quantity of service

Key areas Emphasize customer satisfaction  Use performance improvement programs and problem

solving techniques Focus on business processes Use teams and teamwork  Bring about changes in values and beliefs  Work to drive decision making down to lower levels in the organization  Require senior level commitment and change management for success

Characteristics Process based Fundamental rethink Radical improvement Integrated change People centred Mindset change

Process-based Replace traditional management

philosophy Look at business from outside in Concentrate on end-to-end management of processes

Fundamental Rethink A zero-based approach to the redesign of key

processes Three key issues The extent current structure detracts from creation

and delivery of value The retarding effect that structure can have The unresolved cross-functional conflicts and tensions

Radical improvement Avoid scaling down ambitions Emphasis on achieving dramatic and

sustainable leaps in performance Re-engineering not appropriate if alternative approach will achieve same gains

Integrated Change Major change adds pressure Personal ambition and competing

initiatives - divert attention and resources The approach should deliver a balanced and holistic solution People and training put in place

People Centred Understanding of business goals Knowledge of processes Ability to make decisions and take risks

on behalf of organisation Coaching of staff

Mindset Change Discard prior conditioning Build and communicate a shared

understanding of the organisation’s future Create an environment and infrastructure that promotes learning and imagination to guide decisions

A five-step approach to Re-engineering Develop the business vision and process objectives - Cost reduction - Time reduction - Quality improvement

Identify the business processes to be redesigned Understand and measure the existing processes - avoid the repeating of old mistakes - provide a baseline for future improvements

• Design and build a prototype of the new

process • Identify IT levers

Process

Role of Information technology Shared databases, making information available at many

places Expert systems, allowing generalists to perform specialist tasks Telecommunication networks, allowing organizations to be centralized and decentralized at the same time Decision-support tools, allowing decision-making to be a part of everybody's job

Wireless data communication and portable

computers, allowing field personnel to work office independent Interactive videodisk, to get in immediate contact with potential buyers Automatic identification and tracking, allowing things to tell where they are, instead of requiring to be found High performance computing, allowing onthe-fly planning and revisioning

Critics of the BPR approach label BPR was used for major

workforce reductions Lack of management support for the initiative and thus poor acceptance in the organization. Exaggerated expectations regarding the potential benefits from a BPR initiative and consequently failure to achieve

Cont…… • Implementation of generic so-called best-

practice processes that do not fit specific company needs.

• Underestimation of the resistance to

change within the organization.

• Over trust in technology solutions. • Performing BPR as a one-off project with

limited strategy alignment and long-term perspective. • Poor project management.

Success Procter and Gamble General Motors American Airlines Southwest Airlines Dell Ford

Case Study: Re-engineering Process successfully implemented at a hospital in Singapore for improving the services provided to the customers (Patient) and increase the efficiency without sacrificing the quality

Patient type and Utilization

Location

Capacity

Total Entries

1

45.65

80.69

33.26

Pre Op

20

63.65

3012.29

Recovery

16

50.85

31.49

92.43 (Bottle neck)

Exit

1

50.85

0.00

0.00

OT (CLR)

1

5.20

199.75

10.24

OT (CTS)

1

2.75

286.62

8.18

OT (ENT)

1

4.90

286.56

14.26

OT (GES)

1

18.45

279.87

69.09

OT (GYN)

1

6.10

194.34

11.58

OT (Others)

1

6.60

1478.34

88.87

OT (OTO)

1

6.10

1790.40

100.00

OT (PLS)

1

2.25

350.80

8.56

Entrance

Average minutes per entry

Utilization (%)

0.99

18.25

No 1 to 8- Surgeons

12.37

%

No 9- Anaesthetist 6.26 4.11 1.55

1.10

2.23

1.29

0.90

Simulation Models Model 1- Shift Model Model 2- Shift Model with Increased Staff Model 3- Declassified Operating Theatres Model The three suggested models for Re-engineering were

similarly run for 168 hours with a warm-up period of 48 hours, with 20 replications

Utilization (%) Location

Original Model

Model 1

Model 2

Model 3

Entrance

33.26

59.16

55.76

23.00

Pre Op

92.43

96.40

96.06

69.36

Recovery

0.99

1.05

0.97

1.90

Exit

0.00

0.00

0.00

0.00

OT(CLR)/OT1

10.24

9.23

10.29

92.44

OT(CTS)/OT2

8.18

10.34

9.18

91.13

OT(ENT)/OT3

14.26

13.05

15.85

92.49

OT(GES)/OT4

69.09

78.37

69.21

93.94

OT(GYN)/OT5

11.58

10.46

9.42

92.77

OT(Others)/OT6

88.87

91.04

83.37

94.27

OT(OTO)/OT7

100.00

100.00

100.00

94.15

OT(PLS)/OT8

8.56

7.34

7.45

94.12

Original

Model 1

Model 2

Model 3

45.30

44.50

64.80

Model Efficiency

45.60

(%)  Source BUSINESS PROCESS REENGINEERING AT THE HOSPITALS: A CASE STUDY AT SINGAPORE HOSPITAL Arun Kumar and Linet Ozdamar School of Mechanical & Production Engineering Nanyang Technological University 50 Nanyang Avenue, SINGAPORE-639798