In today's world customer is the king and Reengineering demands that employees deeply believe that they work

for their customers, not for their bosses."

Business Process Reengineering

3Cs
Customer Change Competition

Re-Engineering Definition
Re-engineering is nor reorganizing or restructuring. Re- engineering also does not mean downsizing Rejection of the classical concept of labour specialization and engineering of tasks.

 Re-engineering focuses on rethinking. Eliminates works that is not necessary Considers more effective ways of doing work Re-engineering is about creating value for customers Value- Lower cost, High quality and increased response time.

Definition
The Term is Coined by Michael Hammer
Reengineering is the fundamental rethinking and radical redesign of Business processes to achieve dramatic improvements in critical, contemporary measures of performance such as cost, quality, service and speed

This definition has 4 key words Fundamental Radical Dramatic Processes

Business Process
According to Davenport business process is a set of logically related tasks performed to achieve a defined business outcome.

Why BPR?
To Accelerate slow processes, To Improve productivity, and To Control costs. These improvements lead to: Increased customer satisfaction, Increased productivity and market share Greater employee satisfaction, and ultimately Increased profits.

Need For BPR

Business Efficiency Improved Techniques New requirements Facilitates Match Eliminates Hierarchy

BPR
According to Hammer and champy BPR can be defined as Re-engineering the corporation, a manifesto for business revolution

Drivers of BPR
Business

Customer

Competition

Change

Principles of Reengineering By Davenport

Organize around outcomes not tasks

Have those who use the output of the process perform the process
Merge information-processing work into the real work that produces the information Treat geographically dispersed resources as though they were centralised. Put the decision point where the work is performed and build control into the process

 Link parallel activities instead of integrating their results. Capture information once- at the source

Transformational Scope of BPR

Change Focus Frequency Scope Participation Quantum Leap Start Again One Shot Broad,Cross Functional Top-Down High

Risk and Reward Type of Change

Role of IT Aids

High Structural,Culture,Roles
Key Enabler Methods and Tools

Companies Currently Engaged in BPR

NO 17%

Source:Cutter Consortium June,19,2002

YES 83%

Person Responsible for BPR

20 15 10 5 0
CE O CI O PM IT D VP M Ch an ai ag rp e r er D s on ire ct or D CP CT O CF O CO O O th er s

Source:Cutter Consortium June,19,2002

Industries that Reengineer

Heavy
Insurance Telecommunications Electric Power Utilities

More recently
Electronics Computers Chemicals

Still lagging
Retailers Banks Government Agencies

The Reengineering Process

Develop the Business Vision and Process Objectives Identify the Processes to be Reengineered

Implement the Reengineered process

Understand the Current Processes

Design the Reengineered Process

Evaluate Enablers of Reengineering

Identify the Process for Reengineering

Which processes are currently most problematic? Is the process antiquated or is the technology used outdated? . Which processes are likely to be successfully redesigned? What is project scope, and what are the costs involved? What are the strength of the reengineering team, and the commitment of process owners and sponsors?

Back

Understand the Current Process

Current performance capabilities need to be studied through tools like:

Flow Charts Fishbone Diagrams Quality Function Deployment

Observation and participation in process Dont over study the current process

Back

Evaluate Enablers of Reengineering

Information technology Human/organizational enablers

Examples Walmart Ford

Back

Designing the New Process

Since BPR is performance oriented the methodology must be able to predict performance during design. For any design proposal we must be able to assess feasibility, risk and benefit It would be difficult to achieve the previous objectives unless the methodology was strongly based on prototyping. Back

Implement the reengineered Process

Manage the change Support reengineering teams through all phases of implementation Phased introduction Post-implementation assessment.

NEXT

The Mckinsey Way

(11) Diagnostic I-6 months

(8) Redesign 3-6 months

(8) Implementation 2-4 months

5 Final Considerations
Objective
Reengineering is a targeted effort to gain substantial improvements in business unit performance. One time Effort

Approach
by reconfiguring activities and information flow

Scope
that are sufficiently broad to comprise core processes

Concurrent information Activity/information and activity flow required to deliver redesign Values Focus on high leverage areas Driven by fact base Iterative Design Cut across organizational boundaries Holistic Process View

Major Bottom line Impact

Breakthrough Performance Goals Simultaneous Improvements Phased Impact

 Phase 1: Begin organizational change Phase 2: Building the Reengineering organization Phase 3: Identifying BPR opportunities Phase 4: Understanding the existing process Phase 5: Reengineer the Process Phase 6: Blueprint the new Business system Phase 7: Perform the transformation

Steps in BPR

Phase 1
Begin Organizational change 1.Assess the current state of the organization 2.Explain the need for change 3.Illustrate the desired state 4.Create a communication campaign for change

Phase 2
Building the reengineering organization 1.Establish a BPR organizational structure. 2.Establish the roles for performing BPR. 3.Choose the personnel who will reengineer.

Phase 3
Identifying BPR opportunities 1.Identifying the core/high- level processes. 2.Recognize the potential change enablers 3.Gather performance metrics within the industry 4.Gather performance metrics outside the industry

5. Select the process that should be reengineered 6. Prioritize selected process 7. Evaluate pre-existing business strategies. 8. Consult with customers to know their desires 9. Determine the customers actual needs 10. Formulate new process performance objectives 11. Establish key process characteristics 12. Indentify potential barriers to implementatiom

Phase 4
Understanding the existing process
1. Understand why the current steps are being performed. 2. Model the current process 3. Understand how technology is currently used 4. Understand how information is currently used 5. Understand the current organisational structure 6. Compare current process with new objectives

Phase 5
Reengineer the process
1. Ensuring the diversity of the reengineering team 2. Question current operating assumptions 3. Brainstrom using change levers 4. Brainstrom using BPR principles 5. Evaluate the impact of new technologies 6. Consider the perspective of stake holders 7. Use customer value as the focal point

Phase 6
Blueprint the new business system
1. Define the new flow of work 2. Model the new process steps 3. Model the new information requirements 4. Document the new organizational structure 5. Describe the new technology specifications 6. Record the new personnel management systems 7. Describe the new values and culture required

Phase 7
Perform the transformation 1.Develop a migration strategy 2.Create a migration action plan 3.Develop metrics for measuring performance during implementation 4.Involve the impacted staff 5.Implement in an iterative fashion 6.Establish the new organisational structures

7. Assess current skills and capabilities of workforce 8. Map new tasks and skill requirements to staff 9. Reallocate work force 10. Develop a training curriculum 11. Educate the staff about the new process 12. Educate the staff about the new technology used 13. Educate the management on facilitation skills

 Decide how the new technologies will be introduced Transition to the new technologies Incorporate process improvement mechanisms.

Re-engineering the structure

Leader Process owner Re-engineering team Steering committee Re-engineering czar

Examples
FORD (the extra staffing levels in the accounts payable section were reduced by 75 % )

ALU LADDER CORPORATION (succeeded to be the French market leaders ) STOMIL SANOK S.A. (Time reductions in production cycle time are over 90%.)

Why BPR Projects Fail?

Almost 70% of the BPR Projects fail. The biggest obstacles that reengineering faces are: Lack of sustained management commitment and leadership Unrealistic scope and expectations;
Resistance to Change.

Change management and BPR

Assemble a change management team Establish a new direction for the organization Prepare the organization for change Set up change teams to implement change Align structure,systems and resources to support change.

 Identify and remove roadblocks to change Absorb changes into the culture of the organisation

BPR and IT
Overcome barriers Facilitate reengineering design Helps in gathering and analyzing information Facilitate process oriented approach Facilitate database Identify alternative business Handled and controlled contigency

Reengineering Recommendations
BPR must be accompanied by strategic planning. Place the customer at the center of the reengineering effort -- concentrate on processes that lead to delays or other negative impacts on customer service. BPR must be "owned" throughout the organization, not driven by a group of outside consultants.

Reengineering Recommendations
Case teams must be comprised of both managers as well as those will actually do the work.

BPR projects must have a timetable, ideally between three to six months, so that the organization is not in a state of "limbo".
BPR must not ignore corporate culture and must emphasize constant communication and feedback.

Thank You
Sources: www.prosci.com BPR Action Kit Michael Balle:

Advantages
Increases effectiveness Reduces cost Provides meaningful jobs to employees Improves organizational approach Facilitates growth of business

Limitations
Reengineering too many processes at initial stages Inadequate training Unclear knowledge of Re-Engineering Wastage of time Fear of failure Delay in showing results Inadequate resources Limited awareness among employees