Course: EWIS

Batch: 2013

Prof. Riyanka Dwivedi

AgendaWhat is ProcessFunctional View of OrganisationProblemsBusiness process analysisBusiness Process MappingBusiness Process ReengineeringCase Studies

Process View

A process consists of the following:

• Roles and responsibilities of the people (roles) assigned to do the work

• Appropriate tools and equipment to support individuals in doing their jobs

• Procedures and methods defining “how” to do the tasks and relationships between the task

Definition :

A systematic series of activities directed to some end

Process Diagram

PROCESSINPUTS OUTPUTS

FACTORSPEOPLE, TECHNOLOGY, INFRASTRUCTURE

Activities + Process Owner

Business Process Definition Business processes are sequences and

combinations of business activities. They break into external customer facing processes, that deliver products and services of value, management, and support processes. Management processes control and coordinate these activities and ensure that business objectives are delivered.

Support processes, as the name implies, provide infrastructural and other assistance to business processes. Business Processes can be further differentiated into knowledge-based( Research Based/Product development) and operational processes (Core Process)

R/3

FIFinancialAccounting

COControlling

PSProjectSystem

WFWorkflow

ISIndustrySolutions

MMMaterials Mgmt.

HRHumanResources

SDSales and Distribution

PPProductionPlanning

QMQualityMgmt.

PMPlant Maintenance

SMServiceMgmt.

Client / ServerIntegrated BusinessSolution

ECEnterpriseControlling

AMFixed AssetsMgmt.

Functional View of Organisational Structure

Example Case :

WoodLand Organisational Structure

WoodLand company Functional divisions and process flow

Problems of Functional Divisions BPR approach identifies many problems and constraints

that are common to the Functional View of organizations:fragmented processes, duplicated effort, unnecessary tracking rework,manual and paper intensive processes, inadequate software and systems training,lack of systems integration (barriers to information

sharing and maintenance),inaccurate and untimely information

Varieties of Processes“As-is”

• Defines how you are doing business today

• Provides a baseline for future improvement efforts

“To-be”

• Defines future (e.g. new and improved) process with a desired end-state

Benefits of defining your processes and procedures:

• Provides visibility into areas of quality, productivity, cost and schedule

• Improves communication and understanding

• Aids in the planning & execution of plans

• Provides the ability to capture Lessons Learned

• Helps facilitate the analysis/execution of organization-wide processes

• Provides basis for training & skills assessment

Functional Division Example Materials Management Department

MaterialsManagement(MM)

LogisticsInvoiceVerification

MaterialMaster

PhysicalInventory

Valuation

MRP

ServiceEntrySheet

ServiceMaster

ProductCatalogPurchasing

InventoryMgmt.

ForeignTrade/Customs

January 2008© SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 12

Example of Process : Procurement Process (Procure-to-Pay)

Purchase Requisition

Paymentto Vendor

Notify Vendor

VendorShipment

InvoiceReceipt Goods

Receipt

Purchase Order

3-WayMatch

Sales andDistribution(SD)

SalesSupport

Sales

CreditMgmt.

ShippingTransport

Billing

ForeignTrade

SalesInformationSystem

MasterData

FUNCTIONAL DIVISIONS SALES AND DISTRIBUTION

Process Orientation of Business   Process Orientation is a new paradigm for the organization

of a business. Instead of the traditional inward-bound functional orientation, which divides the company into functions like sales, production, procurement, and product development, process orientation organizes companies around their processes.

The basic idea is, to have everybody in the company in a systematic way better and directly serve the customer, who is at the receiving end of business processes.

Process thinking and managing is at the heart of Business Reengineering. Members of the organization are no longer looking upward into the hierarchy, but ahead to the customers, who ultimately drive the organization.

Business Reengineering aims at fundamental or frame-breaking change. A reengineering exercise challenges the existing framework, questions attitudes and behaviors, and might suggest the introduction of new Information Technology. In practice though, simplification and reengineering can overlap and together form the process orientation of an organization (Coulson-Thomas, 1994).

What is Business Process Analysis??

What is Business Process mapping??

What is Business process Reengineering??

Framework/ Model For BPR

The Four Major Steps of Process Mapping

Process identification -- attaining a full understanding of all the steps of a process.

Information gathering -- identifying objectives, risks, and key controls in a process.

Interviewing and mapping -- understanding the point of view of individuals in the process and designing actual maps

Analysis -- utilizing tools and approaches to make the process run more effectively and efficiently.

Flowchart Symbols For Mapping Refer word Document

Process Mapping

The terms process mapping, process description, and process modeling are often

used interchangeably. However, they identify three different, although similar, tasks.

Process mapping Is a method of gathering and displaying an intuitive

(phenomenological) graphical display of the process situation.

Process description It is the gathering and structuring of the enterprise knowledge about

the process. It is focused on documentation of the facts (or beliefs) which are known to the owners, operators, and customers of a process.

Process modeling is a mechanism for constructing a simplified or ideal view of

the process that is suitable for quantitative analysis (e.g., consistency completeness, simulation, and cost/benefit model analysis). Each has its place in BPR efforts. Normally we start with constructing a process-map.

Business Process Analysis

Causal AnalysisCausal Analysis is an important component of

business system and business process analysis. The main goal of causal analysis in BPR is to

identify cause and effect chains that link aspects of the system (usually the “controllable” system factors) to the performance goals of the system.

An important step in causal analysis is to identify causal associations between system factors.

Cause & Effect (or Fishbone) diagrams are commonly used at this stage to identify causal associations.

Fishbone diagramsDraw a fishbone /Ishikawa diagram for Supply

chain Process ProblemsDraw a fishbone /Ishikawa diagram for

Unsuccesful Project Management

Process FlowchartsDraw Process Flow for Cheque Book Issue

process in SBI Bank.

Case : IBM Solution Delivery ProblemWhen IBM started reengineering in 1992, the guiding

principle was to become more customer-centered. Twelve customer relationship processes were identified and used as a basis for the reengineering project. One example is "solutions delivery": a contract between IBM and the customer for a complete IT system, including hardware, software, technical support, consulting services and third party products. The redesigned process moved the responsibility for pricing to the case team, who used "pricing tool" software. This eliminated a nearly two month delay that formerly occurred when pricing was referred to IBM headquarters.

Q . Map As Is and To Be after Redesign

Business Process Analysis AS-IS Process Documentation of the sequence in which

activities are performed. This phase is the documentation and

description of the existing business processes using methodologies which will highlight the relationships between the various functions or activities within the enterprise.

These functions or activities are essentially those essential pieces that are needed to perform the business process. As-Is Analysis phase of BPR is aimed specifically at identifying disconnects within existing business processes

Example

Draw an AS IS Flow for Driving Licence Issue process At RTO ( Class Exercise)

TO-BE Process The goal of To-Be process design is to produce one

or more alternatives to the current situation, which satisfy goals of the enterprise as stated in the business case analysis and which satisfy the change-requirements.

We propose a model to depict how process can be redesigned more efficiently achieving business benefits.

Draw an TO BE Flowchart for Driving License Issue process At RTO ( Class Exercise)

Business Process Re engineering

"Business 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."

-- Dr. Michael Hammer

BPR Methodology/ Steps of BPR

Project Phases Required For Successful BPR:Phase 1: Begin Organizational Change Phase 2: Build the Reengineering Organization Phase 3: Identify BPR Opportunities Phase 4: Understand the Existing Process Phase 5: Reengineer the Process Phase 6: Blueprint the New Business System Phase 7: Perform the Transformation

Phase 1-Begin Organizational Change

Activities: - Assess the current state of the organization - Explain the need for change - Illustrate the desired state - Create a communications campaign for change

Phase 2-Build the Reengineering Organization- Identify the core/high-level processes - Recognize potential change enablers - Gather performance metrics within industry - Gather performance metrics outside industry - Select processes that should be reengineered - Prioritize selected processes

Phase 3-Identify BPR Opportunities

- Evaluate pre-existing business strategies - Consult with customers for their desires - Determine customer's actual needs - Formulate new process performance objectives - Establish key process characteristics - Identify potential barriers to implementation

Phase 4 -Understand the Existing ProcessActivities: - Understand why the current steps are performed - Model the current process - Understand how technology is currently used - Understand how information is currently used - Understand the current organizational structure - Compare current process with the new

objectives

Phase 5: Reengineer the Process Activities: - Ensure the diversity of the reengineering team - Question current operating assumptions - Brainstorm using BPR principles - Evaluate the impact of new technologies - Consider the perspectives of stakeholders - Use customer value as the focal point

Phase 6-Blueprint the New Business System

Activities: - Define the new flow of work - Model the new process steps - Model the new information requirements - Document the new organizational structure - Describe the new technology specifications - Record the new personnel management systems - Describe the new values and culture required

Phase 7-Perform the Transformation

Activities: Develop a migration strategy and migration action plan Develop metrics for measuring performance during

implementation Involve the impacted staff Establish the new organizational structures Map new tasks and skill requirements to staff and Re-allocate

workforceEducate staff about the new process and new technology used Decide how new technologies will be introduced Transition to the new technologies Incorporate Continuous process improvement mechanisms

Advantages / Benefits Of BPR

1.Reduction in cost/Time/Resources2.Better Customer satisfaction3.Less manual work4.Integration of Information5.Increase in Quality6.Less Effort but more impact

Example of BPR tools

Case Study

1.RJ corp Case Study2.Income Tax Department, Government Of India

BPR Project case3.IBM caselet