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Enterprise Resource Planning - Erp: Content Taken From The Slides of Muhammad Adil

The document discusses business process reengineering and improvement. It defines business processes and lists common problems. Business process reengineering aims for radical redesign through clean slate or technology-enabled approaches. Business process improvement focuses on gradual, evolutionary changes. Key steps involve identifying processes in need of change based on customers, core competencies, and competition. Stakeholder buy-in is important for successful business process transformation.

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Benjamin adeel
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68 views

Enterprise Resource Planning - Erp: Content Taken From The Slides of Muhammad Adil

The document discusses business process reengineering and improvement. It defines business processes and lists common problems. Business process reengineering aims for radical redesign through clean slate or technology-enabled approaches. Business process improvement focuses on gradual, evolutionary changes. Key steps involve identifying processes in need of change based on customers, core competencies, and competition. Stakeholder buy-in is important for successful business process transformation.

Uploaded by

Benjamin adeel
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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ENTERPRISE RESOURCE PLANNING - ERP

CONTENT TAKEN FROM THE SLIDES OF MUHAMMAD ADIL


ERP AND BUSINESS PROCESS REDESIGN

 Be aware of goals for business processes


 Identify types of problems with business processes
 Compare and contrast business process improvement and business process reengineering
 Explain the relationship between business process reengineering and ERP
 Summarize the steps in business process improvement
INTRODUCTION

 Organizations optimize their business processes


 Two methods for transformation of business processes:
 Business process reengineering - BPR
 Business process improvement - BPI
BUSINESS PROCESS

 A series of activities that are linked together to convert inputs into a product or service output
 Simple and complex business processes
o In terms of steps involved
 Short running and long running business processes
o In terms of time
 Formal and informal business processes
o In terms of rules
BUSINESS PROCESS…

 Advantages of Formal processes:


 Can get work accomplished faster
 Improve consistency of product
 Lead to accountability
CRITERIA FOR OPTIMIZED BUSINESS PROCESS

 Cost efficiencies
 Customer satisfaction and differentiation
 Standardization
 Value-added activities
 Improved agility and speed
COMMON PROBLEMS WITH BUSINESS PROCESSES

 Authority ambiguity
 Bottlenecks
 Cycle time
 Data duplication
 Handoffs
 Intermediaries
 Manual steps
 Old ways
 Paper records
 Quality control
 Rework
 Role ambiguity
 Segregation of duties violation
BUSINESS PROCESS REENGINEERING

 fundamental, radical redesign of business processes that an organization undertakes to achieve breakthrough
performance in key measures of cost, quality, speed, and service
 Act of re-thinking the way you do important things in your business
 Result in significant improvements
 Important because of advent of new technology
 Research conducted by Hammer
o Companies don’t change their core competencies
BUSINESS PROCESS REENGINEERING…

 BPR brings radical change


 What is radical change?
o 60% improvement
 Two ways of BPR are:
 Clean Slate Reengineering
 Technology Enabled Reengineering
CLEAN SLATE REENGINEERING

 Process is started from scratch and completely redesigned


 Fewer bounds and constraints
 Free flow of ideas can result in unique process
 Can result in competitive advantage
 “As is” process & “to be” process
CLEAN SLATE REENGINEERING…

 Business process reengineering principles


 Empower workers
 Centralized resources
 Link parallel activities
 Organize around processes
 Use self-service so that employees and business partners can access information and perform routine tasks
 Put the decision point where the work is performed and build controls into the process
 Capture information once and at the source
CLEAN SLATE REENGINEERING…

 Disadvantages
 Costly
 Requires time
 Radical change sometimes lead to lost job
TECHNOLOGY ENABLED REENGINEERING

 Technology facilitates reengineering process


 Technology imposes constraints
o Constrained Reengineering
 End up with old expensive processes
TECHNOLOGY ENABLED REENGINEERING…

 Advantages
 Provides transformation roadmap
 Less risky
FACTORS FOR REENGINEERING SUCCESS

 Scaling up and down


 Thinking outside the box
 Looking at other companies for similar solutions to similar processes
 Recognizing that a process is just one aspect of success
 Delivering sooner than later
 Considering the competition
 Remembering the employee
BUSINESS PROCESS IMPROVEMENT

 Involves gradual improvement to business processes over time


 Incremental and evolutionary process
 General rule is if process is close to expectations it can be improved
 Takes times, resources, patience and expertise
PROCESS IN NEED OF CHANGE

 Three Cs should be kept in mind by company while determining process in need of change:
1) Customer
Business should be made easy for customers
2) Core
Core competency should be efficient
3) Competition
Company should have competitive processes
PROCESS IN NEED OF CHANGE…

1) Customer-Facing Process
 How well company is satisfying its customer?
 Performance of Current process should be compared to customer expectations
 Yield customer’s view by conducting surveys

2) Core Competency Process


 Input is transformed to unique product
 Can be large operation with sufficient economies
 Company’s bread and butter
 Benchmarking is used to measure performance
o It Its key areas are financial performance, efficiency, asset utilization, reliability and service quality
PROCESS IN NEED OF CHANGE

3) Competitive Process
a. High Volume, Low Margin Processes
 Considerable price pressure
 High volume leads to considerable revenue
 Low margin leads to efficiency need
 Requires capital assets
 Needs inventory storage costs
b. High Defect, High Reward Processes
c. High Skill, Time Intensive Processes
 Require highly skilled workers
 Company will try to simplify the process
 Same people or low-paid workers will be empowered to perform the process
d. High Complexity, Specialized Resource Processes
 Keep it simple, stupid
 Complex requirements, complex solution and complex process
 Difficulty in growth
e. Processes built around Obsolete or Changing Technology
 Companies using legacy systems have obsolete business models
 Companies should go for new business process models
 Advantages – flexibility, scalability, standardization, user friendly interface, normalized data structure
STAKEHOLDERS FOR BUSINESS PROCESS TRANSFORMATION

 Business transformation plan should be successful for following stakeholders:


1) Customers
o Customer relationship focused process help with customer satisfaction, retention and profitability.
2) Employees
o Frees up time for employees
3) Information Technology Staff
o Helps in implementation
o Has ability to contribute to project’s success by answering few questions
4) Executive Suite
o Should be willing to address issues to those who might be resistant to change
o Higher rank of sponsors, less objections from employees
5) Business Partners

6) Suppliers
o Better information to them leads to accurate and efficient operations

7) Other Interested Parties

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