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Reengineering

Reengineering. Created by Michael Mann Operations Management 345. Topics. What is Reengineering Can you use it in your organization What is involved How it works Examples Exercise Conclusion. Reengineering Defined.

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Reengineering

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  1. Reengineering Created by Michael Mann Operations Management 345

  2. Topics • What is Reengineering • Can you use it in your organization • What is involved • How it works • Examples • Exercise • Conclusion

  3. Reengineering Defined Reengineering is also known as Business Redesign. Business Process Redesign is "the analysis and design of workflows and processes within and between organizations" (Davenport & Short 1990).

  4. Business Process Reengineering • Has been around for a long time. • Written on extensively in trade journals and research articles. • Is it a fad? • Technology is vital to the Reengineering process.

  5. The success of Business Process Reengineering • Around 70% of all BPR projects fail. • Lack of management commitment and leadership • Unclear definition of the BPR project • Unrealistic scope and expectations • Resistance to change • Lack of resources

  6. Can you use this in your organization • Ask these questions about the project. • Is the process needed? • Can and should it be redesigned? • What purpose does it serve? • Who is responsible for it? • What competencies are needed for someone to successfully complete it?

  7. Organizations seeking to reengineer • Make the customer the starting point for change -- by identifying customer wants and creating the infrastructure to support these expectations • Design work processes in light of organizational goals • Restructure to support front-line performance.

  8. Reengineering Recommendations • BPR must be accompanied by strategic planning, which must address leveraging IT as a competitive tool. • Place the customer at the center of the reengineering effort -- concentrate on reengineering fragmented 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. • BPR must be sponsored by top executives, who are not about to leave or retire. • BPR projects must have a timetable, ideally between three to six months, so that the organization is not in a state of "limbo".

  9. Surviving Reengineering • BPR calls for radical change • Change brings out negative reactions in many people • How to cope: • Spend time with co-workers who have the most positive attitudes. • Do one thing differently each week. Break the old habits. • Talk to outsiders who have gone through reengineering. • Read trade and business publications to put reengineering in perspective

  10. Goals of BPR • Increase service level • Reduce total process cycle time • Increase throughput • Reduce waiting time • Reduce activity cost • Reduce inventory costs

  11. Tools for developing a BPR • Flow diagramming-based simulation tools • System dynamics-based simulation tools • Discrete event-based simulation tools

  12. Implementing BPR • Analysis • Is the redesign feasible? • Which issues will pose the most complexity? We will need to allocate resources to these issues?

  13. Implementing BPR • Software Functionality • Tools are assistants for participants in the implementation plan. • Tools are needed to guide the implementation through the different phases. • Tools must provide the overall roadmap.

  14. Implementing BPR • Management plans • Standards for consistent descriptions of processes, process strategy and plans. • The framework of entities necessary for effective process management. • Linkages showing how each employee's job contributes to the building and delivery of value to the enterprise's customers.

  15. Implementing BPR • Human resources • Identify essential agents within the organization. • The behavioral aspects of the agents • Motivation • Culture • Incentives • Adaptability

  16. Summary of Implementing BPR • Define • Model • Analysis • Software • Management • Human resources

  17. Real World Example • Xerox • Redesign of the organizational structure • To facilitate the reorganization of the Corporate Information Management Function • Response to expiration of patents and competition from Fuji and Canon.

  18. Real World Example Continued • Main goal of Xerox was to increase market share and their return on assets • Focused on four major areas • Corporate strategies and programs • Corporate technology strategies • Corporate telecommunications strategies • Executive and office information systems

  19. Real World Example Continued • A new CIO was selected • Objectives to hire and train the right people for the new CIM • Defined roles and responsibilities for the new CIM group

  20. Xerox Continued • Three level architecture was developed • Data processing • Distributed processing • Workstations and OIS

  21. Xerox Case Summary • Primary focus to redesign the organizational structure • People and technology were both needed to be successful

  22. Ask these questions for a reengineering exercise • What changes in the present system are needed? • How quickly should the changes be made, draft a time line. • In what order will the changes be scheduled? • What approvals, buy-ins and partner involvements are needed?

  23. Exercise continued • What is the strategy for gaining these approvals? • Who will be responsible for what, when, where and how? • Identify each person • Draw a table for each implementation step.

  24. Exercise Continued • Identify strategies for possible major obstacles that might emerge. • Plan for monitoring and working out problems. • What staff changes will be needed? • Establish schedules and objectives for communication and training.

  25. Exercise continued • Look at all new working arrangements and new shifts. • Are any equipment or facility changes needed?

  26. Summary • The first question to ask is “What needs to be done” • Over time BPR involves changes in • People • Processes • Technology

  27. Summary • Set objectives • Do you want to increase service level • Reduce total process time • Increase your throughput • Reduce waiting time • Reduce your activity cost • Reduce your inventory time

  28. Summary • BPR is used for • Combining duplicate activities • Eliminate multiple reviews & approvals • Reduce batch sizes • Put processes in parallel • Implement demand pull • Outsource inefficient activities • Eliminate movement of work • Organize multifunctional teams

  29. Conclusion • Remember over 70% of BPR projects fail • Proper understanding of BPR is needed before taken on a project. • BPR is used for radical redesign and improved work processes

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