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8/22/2019 Business Process Re-Engineering - Lecture 8-9
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Reengineering Business Processes Called BRP or simply Reengineering
Fundamental rethinking and radical redesign ofbusiness processes
Seeks to achieve improvements in cost, quality, speed,and service
Potential payback is high, but so is risk ofdisruption and failure
Organizational redesign approaches are animportant enabler of reengineering Includes use of IT, process teams, case managers
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Role of IT IT plays a major role in reengineering most business
processes
Can substantially increase process efficiencies Improves communication
Facilitates collaboration
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A Cross-Functional Process Many processes are reengineered with
Enterprise resource planning software
Web-enabled electronic business and commercesystems
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Reengineering Order Management IT that supports this process
CRM systems using intranets and the Internet
Supplier-managed inventory systems using the Internet andextranets
Cross-functional ERP software to integrate manufacturing,distribution, finance, and human resource processes
Customer-accessible e-commerce websites for order entry, status
checking, payment, and service Customer, product, and order status databases accessed via
intranets and extranets
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Becoming an Agile CompanyAgility is the ability to prosper
In rapidly changing, continually fragmenting global markets
By selling high-quality, high-performance, customer-configured products and services
By using Internet technologies
An agile company profits in spite of Broad product ranges
Short model lifetimes
Individualized products
Arbitrary lot sizes
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Strategies for AgilityAn agile company
Presents products as solutions to customers problems
Cooperates with customers, suppliers and competitors
Brings products to market as quickly and cost-effectivelyas possible
Organizes to thrive on change and uncertainty Leverages the impact of its people and the knowledge
they possess
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Creating a Virtual CompanyA virtual company uses IT to link
People
Organizations
Assets
Ideas
Inter-enterprise information systems link
Customers Suppliers
Subcontractors
Competitors
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sco ys ems r uaManufacturing
Most people who have heard of Cisco Systems (www.cisco.com)would not be surprised to learn that Cisco is the worlds largestsupplier of telecommunications products.
What they may be surprised to discover, however, is the answerto the question, What does Cisco manufacture?
Answer: Absolutely nothing!
Cisco sells solutions to their customers, but their products comefrom an innovative virtual manufacturing company arrangement
with Jabil Circuit and Hamilton Standard, two large electronicssuppliers and manufacturers.
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An order placed for a Cisco product arrives simultaneously atCisco in San Jose, California, and Jabil in St. Petersburg, Florida,
via Ciscos online ordering system. Jabil immediately starts to build the product by drawing parts
from any or all ofthree onsite inventories: one owned by Jabil,one belonging to Cisco, and one owned and controlled byHamilton Standard.
When the manufacturing process is complete, the product istested and checked against the order in St. Petersburg bycomputers in San Jose, then shipped directly to the customer by
Jabil. The shipment triggers the generation of a Cisco invoice sent to
the customer and electronic bills from both Jabil and HamiltonStandard sent to Cisco in San Jose.
Ciscos virtual manufacturing company alliance with Jabil Circuitand Hamilton Standard gives them an agile, build-to-ordercapability in the fiercely competitive telecommunicationsequipment industry .
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Virtual Company
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Virtual Company Strategies Basic business strategies
Share information and risk with alliance partners
Link complimentary core competencies
Reduce concept-to-cash time through sharing
Increase facilities and market coverage
Gain access to new markets and share market orcustomer loyalty
Migrate from selling products to selling solutions
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Knowledge-Creating companyA knowledge-creating company or learning
organization
Consistently creates new business knowledge Disseminates it throughout the company
Builds it into its products and services
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Kinds of Knowledge Explicit Knowledge
Data, documents, and things written down or stored in
computers Tacit Knowledge
The how-to knowledge in workers minds
Represents some of the most important informationwithin an organization
A knowledge-creating company makes such tacit knowledgeavailable to others
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Knowledge Management Successful knowledge management
Creates techniques, technologies, systems,
and rewards for getting employees to sharewhat they know
Makes better use of accumulated workplace andenterprise knowledge
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Knowledge Management
Techniques
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Knowledge management systems
Knowledge management systems
A major strategic use of IT
Manages organizational learning and know-how Helps knowledge workers create, organize, and make
available important knowledge
Makes this knowledge available wherever and whenever
it is needed Knowledge includes
Processes, procedures, patents, reference works,formulas, best practices, forecasts, and fixes