Week 8 - Redesign Process

This lecture took a deeper look on Phase 3 (Five Phases Approach of BPR methodologies). In last lecture, it briefly introduced the five steps of business redesign. This is scoping, modeling, analysis, redesign and integration. In order to better understand the process, a case study of Paloma Bank was used to explain what should be exactly done during every phase. And this lecture focused on the third phase, process redesign.

With the support of BPR software, both scoping and integration stage can share process knowledge. The followings are the seven activities in scoping the process:

1)     OPERATIONALIZE PROCESS PERFORMANCE TARGET
The BPR team needs to carefully understand the stated BPR goals and objectives as defined and developed by the BPR project sponsors and the process owners in the earlier 2 phases of BPR. These stated goals need to be operationalized into concrete process performance targets.
It is very important that the fuzzy goals are made concrete and misunderstandings about goals are cleared up before the process redesign begins. A consensus on targets focuses the efforts of the BPR participants.

2)     DEFINE PROCESS BOUNDARIES
In this step, we can discover and decide what boundaries of a selected business process, and where should the process start and it end. It builds and initial common high-level portrait of the process scope and what process does. Also, It is easy to inadvertently find oneself in a huge BPR project that is not doable in a reasonable amount of time. We must carefully define the process scope very early in the process reengineering phase.

3)     IDENTIFY KEY PROCESS ISSUES

      This activity provides the starting assessment point for the BPR team. That is to identify the key issues for the work environment, highlight the areas need attention and ensure early input from participants through interview or questionnaire. Make use of the input, the team can brainstorms the problems and strengths of the process issues and categorize the issues.

The next is to summarize the results of the agenda by using SWOT analysis for the process or based on an assessment of the work environment like IT infrastructure, HR and empower, organizational structure and policies, and the linkages to external parties.

4)     UNDERSTAND KNOWN BEST PRACTICES AND DEFINE INITIAL VISIONS

Understanding known best practices is not benchmarking in the formal or rigorous sense. The BPR team mainly has three missions. Firstly, understand known best practices and list the selected one out. Secondly, each member in the team has to get familiar with them. And thirdly, to define and document the initial vision at high level, even it may be change during the process.

5)     FAMILIARIZE PARTICIPANTS WITH BPR SOFTWARE

It is a pre-modeling phase, so the various BPR participants must become familiar with the selected BPR software and its capabilities. There are some degrees of familiarization with BPR software suitable for different types.
a) Conceptual Familiarization

  A conceptual introduction, a demo, and a capability overview for the selected BPR software package and how these capabilities will be useful in the BPR project are sufficient.

b) Test Drive

   All members of the BPT core team should test drive the BPR software.

c) Learn to Use

   Member of the BPR core team who will be directly involved with modeling, analyzing, and redesigning the process must learn how to use the software.

6. OUTLINE DATA COLLECTION PLAN AND COLLECT BASELINE DATA

    This activity is important that collecting data is difficult. Difficulties include that people may not give     sufficient effort on the BPR for variety of reasons behind or the data collected are unnecessary. A well organized plan can save time and help to collect useful data, and an early started data collection speeds up the baseline modeling phase. A good plan includes the key sources of data, data type required, data collection methods, etc. Such methods are by using the documentation or data in hand and conducting survey through interviews or questionnaires.

7      PROCESS SCOPING REPORT

     The deliverable of this phase is a Process Scoping Report. This report should be provided to the process owners for reporting and feedback purposes. It is very import that if we have carried out the steps, the components of the deliverable are ready to be packaged into a crisp document without modification.

Lecture 7 BPR Methodologies

What is methodology?

In fact, methodology is a set of guidelines that provide an analyst a way or method to solve the specific problems.

So, BPR methodologies are the set of methods that separate the differences between business activities and organizational strategy, current and desired productivity of organizational resources.

As you know, BPR cannot occur if it is without a unstructured manner. If we want a BPR to be successful, targets, budgets, tools, etc. should be assigned and organized clearly.

In a large BPR project, we can separate different part to show the BPR clearly. They are design, implementation, and maintenance. There are a variety of descriptions of how BPR can be systematically carried out in practice and what the phases of a BPR project are.

After reading different articles and papers, I find that most of them conclude that there are 5 phases in a BPR project, as we can see that on the left hand side.

Phase 1, it is stated that a BPR project begins with some sort of trigger, such as performance problem and pressure from a supply chain partner. It can also be driven primarily by an executive vision of how a particular aspect of the company should be. The discussion will be taken place at this phase and the proposals will eventually be made.

Phase2, BPR mobilization occurs by selecting a project leader and forming a core BPR team. The processes to be redesigned are selected and a preliminary assessment of IT infrastructure around those processes is made. A BPR plan and budget is proposed.

Phase 3, In this phase the business process is redesigned and performance comparisons are made, sometimes through benchmarking with other companies. The process design is also readied for implementation.

Phase 4, The implementation and organizational transformation stage is the toughest phase to execute. It includes designing the IS and modifying the IT infrastructure. Is also involves introducing and instituting the new process with its accompanying organizational design changes, training people and possibly re-skilling them and dealing with the political and human problems that occur whenever a large organizational change is made.

Phase 5, Ideally BPR is not a one-shot effort and the process needs to be monitored on a continuous basis so that the process can be maintained and modified when conditions require.



The Participants in a BPR project

There are a variety of participants in a BPR project as shown in above picture. At the heart of a BPR project is a core BPR team that mesy manage the project and coordinate the differnet participants. The team includes a project leader.

Any BPR project needs executive sponsors who are often champions fo rthe project. Also, there is anouther important set of particiants is the process owners. They need someone who has responsibility and accountability for a business process. It is pointless to reengineer a business process if the process owners are not involoved and engaged in the project

Week 5 - BPR Basic (part I)

In this lecture, it focuses on the definition, relationship and properties of the business process and an introduction of Business Process Reengineering (BPR).

What is BPR?

There are a lot of ideas of BPR. For example, in Redesigning enterprise process for e-Business, this book mention that “BPR is in essence a performance improvement philosophy that aims to achieve quantum improvements by primarily rethinking and redesigning the way that business processes are carried out.”.

Also, Michael Hammer and James Champy, in Reengineering the Corporation show that “A collection of activities that takes one or more kinds of input and creates an output that is of value to the customer. “.

After reading different articles, I can conclude that BPR searches for quantum improvements rather that incremental ones (even though that may not always be possible.) and it effort will try to use IT to enable the process to be done in new ways that are qualitatively different.

Relationship of BPR and IT

BPR differs considerably from other prevailing management tools, due to its provision of radical change to existing process practices, which offers opportunities of better performance. BPR can only apply when deficiencies in existing processes can be re moderated either by combination of strategic avenue and BPR or BPR alone. IT is capable of modeling not only structured workflow, but also unstructured problem solving, which is of wide use in the re-engineering of business processes in the ERP system. The process analysis and study simulation enabled by disruptive IT also make it easy to come out the best workflow practices, which avoids any physical changes of the business processes prior to the actual implementation of the processes. All the possibilities provided by IT paves way for improvements in cost, quality, service, and speed, all of them being the objectives and pre-requisites of BPR.

Types of BPR

Some articles pointed out that there are 4 major types in BPR, they are Small-r, Big-r, Extensive process change and minimal software change, and Minimal process change and extensive software change.

1.     Small-r

Small-r is the BPR type with minimal process change and software change. It is an attractive approach for small to medium sized corporations as they don’t have the resources required to make modifications to their ERP systems. With cheap and fast small-r, they don’t need to make any major changes to the organizational processes either. However, it may miss the opportunities provided by other ERP software that requires process change.

2.     Big-R

In big-R, organizations make changes to both EPR software and their business processes. Large enterprises with cutting edge processes and resources to accommodate the radical ERP software change and customization takes this option as it can make the company the first one to reap the benefits of the new ERP developed through big-R. With ERP vendor acts as project partner, some of the costs are covered and some part of the risk shared in the meantime. The expense of this approach is the high cost of EPR software change and affected software upgrade.

3.     Extensive process change and minimal software change

When organizations adopt this BPR method, business processes are changed extensively with minimal software change. Corporations choose this alternative with the thought that changing people is easier and more cost effective than changing the expensive and complicated ERP software. Taking this approach can provide the company with the best practices in the industry with standardized and proven business processes. Further, ERP software update is easier as software change is trivial. When all the organizational processes made consistent with the processes provided in the ERP modules, the disadvantage appears that value-adding processes replaced with generic standard processes, which may force the company to give up some of its competitive strategies bundling with the old processes. To make things worse, the change of business processes may not even work, as the best practices in the industry may not suit the company at all.

4.     Minimal process change and extensive software change

Organizations opting this approach usually possesses value-adding processes that are unique to the company, thus it chooses to make extensive ERP software change to match the business processes. The corporation taking this approach can have a customized ERP system with better business processes not available with the ERP system implemented, though upgrade of the ERP software can be quite difficult because of the software change.