Bpr Business Process Reenigneering

CONTENTS Topics Page no(prenominal) Introduction 4 Overview 5 History 6 BPR Methodology 7 Advantages and disadvantages of BPR 9 Case study- I 11 Case study- II 13 Conclusion 24 References 24 1. INTRODUCTION credit line process re-engineeringis a vexation management strategy, origin on the wholey pioneered in the premature 1990s, reduceing on the analysis and design of realizeflows and processes within an organization. BPR aimed to doorganizationsfundamentally afterthought how they do their work in fix up to dramatically improveclient service, blowoperational cost, and become creation-classcompetitors.In the mid-1990s, as many as 60% of the Fortunecompanies claimed to either consume initiated reengineering efforts, or to suck plans to do so. BPR seeks to care companies radically restructure their organizations by focusing on the ground-up design of their telephone line processes. According to Davenport (1990) a fear process is a set of logically connect problems pe rformed to achieve a defined concern outcome. Re-engineering emphasized aholisticfocus on worry objectives and how processes related to them, encouraging all-out recreation of processes rather than iterative optimization of sub processes. logical argument process re-engineering is resemblingly k instantlyn as business process redesign, business transformation, or business process qualifying management. Fig 1 2. OVERVIEW Business process re-engineering (BPR) began as a private sector technique to help organizations fundamentally rethink how they do their work in order to dramatically improve guest service, cut operational costs, and become world-class competitors. A key remark for re-engineering has been the continuing development and deployment of sophisticated nurture systems and networks.Leading organizations atomic payoff 18 becoming bolder in using this technology to die hard innovative business processes, rather than fine-tune current manners of doing work. Reengin eering guidance and relationship of Mission and Work playes to breeding Technology. Business Process Re-engineering (BPR) is basically rethinking and radically redesigning an organizations existing resources. BPR, however, is more than in rear(p) business improvising it is an approach for redesigning the way work is through with(p) to better realise the organizations boot and reduce costs.Reengineering passs with a high-level assessment of the organizations mission, strategic goals, and customer strikes. Basic questions be asked, such as Does our mission need to be redefined? Are our strategic goals aligned with our mission? Who are our customers? An organization whitethorn find that it is operating(a) on questionable assumptions, particularly in basis of the wants and needs of its customers. Only after the organization rethinks what it should be doing, does it go on to decide how best to do it.Within the framework of this basic assessment of mission and goals, re-engin eering focuses on the organizations business processesthe travel and procedures that g everywheren how resources are used to tangibleise products and services that meet the needs of particular customers or marts. As a structured ordering of work steps across period and place, a business process kindle be decomposed into specific activities, measured, modeled, and improved.It net similarly be completely redesigned or eliminated alto requireher. Re-engineering identifies, analyzes, and re-designs an organizations core business processes with the aim of achieving dramatic improvements in critical performance measures, such as cost, quality, service, and speed. Re-engineering recognizes that an organizations business processes are usually fragmented into sub processes and tasks that are carried out by several(prenominal) specialized functional areas within the organization.Of disco biscuit, no one is responsible for the general performance of the entire process. Re-engineering maintains that optimizing the performance of sub processes stern result in virtually benefits, but cannot yield dramatic improvements if the process itself is fundamentally ineffectual and outmoded. For that reason, re-engineering focuses on re-designing the process as a whole in order to achieve the greatest possible benefits to the organization and their customers.This drive for realizing dramatic improvements by fundamentally re-thinking how the organizations work should be done distinguishes re-engineering from process improvement efforts that focus on functional or incremental improvement. 3. HISTORY In 1990, Michael Hammer, a former professor of computer science at the Massachusetts impart of Technology (MIT), published an article in the Harvard Business Review, in which he claimed that the major challenge for managers is to obliterate forms of work that do not bring value, rather than using technology for automating it.This statement implicitly accused managers of having centre on the wrong issues, namely that technology in general, and more specifically information technology, has been used primarily for automating existing processes rather than using it as an enabler for making non-value adding work obsolete. Hammers claim was simple Most of the work creation done does not add any value for customers, and this work should be removed, not accelerated through automation. Instead, companies should re line a line their processes in order to emergence customer value, while minimizing the consumption of resources required for delivering their product or service.A similar idea was advocated by Thomas H. Davenport and J. Short in 1990, at that time a member of the Ernst & Young research center, in a makeup published in the Sloan Management Review This idea, to unbiased review a inwardnesss business processes, was rapidly adopted by a huge number of firms, which were striving for re sunrise(prenominal)ed competitiveness, which they had lost due to the market entrance of outside(prenominal) competitors, their inability to satisfy customer needs, and their insufficient cost structure.Even substantially-established management thinkers, such as Peter Drucker and Tom Peters, were accepting and advocating BPR as a cutting appliance for (re-)achieving success in a slashing world. During the following years, a card-playing growing number of publications, books as well as journal articles, were dedicated to BPR, and many consulting firms embarked on this trend and substantial BPR methods. However, the critics were fast to claim that BPR was a way to dehumanize the work place, increase managerial control, and to justify downsizing, i. e. major reductions of the ork force, and a rebirth of Taylorism under a different label. Despite this critique, reengineering was adopted at an accelerating pace and by 1993, as many as 60% of the Fortune 500 companies claimed to either have initiated reengineering efforts, or to have plans to do so. This trend was fueled by the fast adoption of BPR by the consulting industry, but also by the study make in America, conducted by MIT, that showed how companies in many US industries had lagged tin their foreign counterparts in terms of competitiveness, time-to-market and productivity.Development after 1995 With the publication of critiques in 1995 and 1996 by some of the early BPR proponents, coupled with abuses and misuses of the concept by others, the reengineering fervor in the U. S. began to wane. Since then, considering business processes as a starting point for business analysis and redesign has become a widely accepted approach and is a prototype part of the change methodology portfolio, but is typically performed in a less radical way as originally proposed.More recently, the concept of Business Process Management (BPM) has gained major attention in the corporate world and can be considered as a successor to the BPR wave of the 1990s, as it is evenly driven by a stri ving for process energy supported by information technology. Equivalently to the critique brought forward against BPR, BPM is now accused of focusing on technology and disregarding the people aspects of change. 4. BPR methodology BPR methodology is a structured sequence of activities that constitutes the typical BPR project. BPR refers to a re-design of business processes by using IT.Its methodology is to give a guideline or growth of how the business process to be re-designed. There are number of methodologies for an organization to practice. According to S. Muthu, L. Whitman and S. Hossein Cherahhi , there are 5 frameworks of BPR methodologies. To be simple, a consolidated methodology has been developed from those 5 methodologies. That is similar to the 5 phases mentioned in class visioning, mobilization, process redesign, implementation and monitoring & maintaining. Fig 2 level 1 Triggering & Execution VisioningThis phase is to design the visions and steerings that a beau monde should go with in order to improve faculty of the targeted business processes and customer satisfaction. In this gift, the organization should identify the reengineering opportunities, enabling technologies and direct impact on customers. phase angle 2 Mobilization In this phase, a reengineering squad should be formed. The team should outline the performance goals, BPR plan and budget. Processes to be redesigned should be selected. IT people are involved to make assessment on IT base of operations and provide information for better business process redesign.Phase 3 Process Redesign This leg is to analyze and compare AS-IS processes and TO-BE processes. After identifying the potential improvements of the existing processes, modeling methods can be used to develop the TO-BE models. Integration can be done afterwards. Phase 4 Implementation Training designs are initiated in this stage to provide the skills of fitting the TO-BE processes. IT infrastructure and the organizat ion are also need to be adjusted to fit the TO-BE processes. Phase 5 Monitoring and MaintainingThe new processes should be monitored and modified on a continuous basis, especially the progress of action and the results. To carry out a good BPR methodology, organizations are recommended to consider each phase carefully. Each phase should be comprehensive copious for execution to drive for a success in achieving the organizations vision and strategy. Business Process Reengineering Principles * Organize around outcomes, not tasks . * abide those who use the output of the process perform the process. Subsume information-processing work into the real work that produces the information. * Treat geographically dispersed resources as though they were centralized. * nexus parallel activities instead of integrating their results. * Put decision points where the work is performed and get up controls into the process. * Capture information once and at the source. 5. ADVANTAGES AND DISADVAN TAGES OF BPR Business process reengineering (BPR) is a programme that systemically breaks down the process a business uses and starts over with new, more efficient methods basically a redesign or a reboot.A business process is a collection of procedures, steps or activities the business uses to get the product from development to the customer. Businesses use BPR for various reasons, including cutting costs and change overall ware. Nevertheless, BPR also has its drawbacks. * Identifies Waste and Encourages Ideas The aim of BPR is to help businesses pinpoint obsolete steps, items or workers in a business process. For example, if four workers perform a task, the business may discover only two workers can get the job done during reengineering. BPR encourages employee input and participation.The workers who have familiarity with the processes under study can point out flaws and voice ideas for improvement. * Requires Investment and the Right Business Types BPR typically requires an i nvestment, particularly in technology. Outdated methods, such as doing a task by hand, face replacement by computer programs. The programs improve efficiency and reduce errors, but the company must invest in the package and training, a costly option for companies looking to cut expenses immediately. Not all business types benefit from BPR. For example, a manufacturing company may not have the option of edesigning processes without sacrificing safety or product quality. * Cuts Costs and Improves Functionality Removing unnecessary steps cuts down on time and confusion among workers. Assigning tasks that multiple workers would typically handle to one worker gives customers a clear point of click for help or service. Even by investing more silver in technology at the start, companies typically save money over time with the redesigned methods. For example, improving or updating electronic components incurs an up-front cost, but saves money over time by eliminating errors due to outdat ed components. Lowers Worker esprit de corps Some workers may not adapt to the BPR changes, and those assigned new responsibilities can become overwhelmed. Other workers become obsolete if their primary function is eliminated as part of a process overhaul. Management must provide support and guidance during BPR. failure of the management team to assist workers and set an example during the BPR process may lead to failure, disorganization and staff problems. RISKS IN BPR * Advocates encompass failure rates of 50% to 70% * Sutcliffe 1999 reviewed difficulties * Employee resistance to change * piteous attention to employee concerns Inappropriate staffing * Inadequate tools * Mismatch of strategies & goals * Lack of oversight * Failure of leadership commitment 6. CASE STUDY- II Mahindra & Mahindra Implementing BPR Abstract The role examines the reasons behind automobile major Mahindra & Mahindras decision to implement a Business Process Reengineering (BPR) program. The case explores in detail the implementation procedure at the company and the benefits that accrued from the BPR program. In addition, the case discusses the concept of BPR, its benefits, and the steps that need to be taken to ensure the success of such initiatives.Issues Examine the benefits that a BPR program can offer to an organization when it is effectively implemented MMs task Plants In the mid-1990s, Indias largest multi utility vehicle (MUV) and tractor manufacturer MM was facing serious problems at its Igatpuri and Kandivili coifs in Maharashtra. The plants were suffering from manufacturing inefficiencies, poor productivity, long production cycle, and sub-optimal output. The reason highly under-productive, militantly unionized, and bloated workforces.The company had over the years been rather lenient towards running the plants and had frequently crumbled under the pressure of union demands. The work civilization was also reportedly very unhealthy and overcastion was widespread in va rious departments. Alarmed at the plants dismal condition, Chairman Keshub Mahindra tried to reference point the problem by sacking people who allegedly indulged in corrupt practices. M&M also tried to implement various unforced retirement schemes (VRS), but the unions refused to cooperate and the company was unable to reduce the get the picture force.During this period, M&M was in the process of considering the implementation of a Business Process Reengineering (BPR) program throughout the organization including the manufacturing units. Because of the problems at the Igatpuri and Kandivili plants, M&M decided to implement the program speedily at its manufacturing units. The program, developed with the help of the UK-based Lucas Engineering Systems, was first implemented on an experimental basis at the engine plant in Igatpuri. Simultaneously, an purpose was initiated to assess the potential benefits of implementing BPR and its effect on the unions.M&Ms management was not surpri sed to learn that the unions expressed organic displeasure at the decision to implement BPR and soon went on a strike. However, this time around, the management made it clear that it would not succumb to union demands. Soon, the workers were surprised to see the companys senior staff come down to the plant and work in their place. With both the parties refusing to work out an agreement, observers began casting doubts on the future of the companys grand plans of reaping the benefits of BPR. Background NoteMahindra Mahindra Ltd. (MM) was the flagship company of the Mahindra radical, one of the top ten industrial houses in India. The companys history dates back to 1945, when two brothers, J. C. Mahindra and K. C. Mahindra, decided to start a business of general-purpose utility vehicles. The brothers formed a company, Mahindra & Mohammed Ltd. , in association with their friend Ghulam Mohammed. In October 1947, the first batch of 75 jeeps was released for the Indian market. In 1948, t he company was renamed Mahindra & Mahindra Ltd.Over the next few decades, the group promoted many companies in areas as diverse as hotels, financial services, auto components, information technology, infrastructure development and trading to name a few (Refer Exhibit I for M&Ms history). Though MM had established itself in the markets and was among the spark advance players in many of the segments it operated in, it realized that some of its businesses were not closely related to its core business. This realization marked the beginning of the biggest change exercise since the companys inception. In 1994, a major restructuring exercise was initiated as part of a BPR program.M&M introduced a new organizational model, in which various divisions and companies were regrouped into six limpid clusters of related businesses, each headed by a president. M&Ms core activities, automotive and tractors were made autonomous business units. The other activities of the group were organized into infrastructure, backup and financial services, telecommunication and automotive components. According to company sources, the whole exercise was intended to develop a conceptual map to provide direction for the future growth of various business lines.It was decided that, in future, the group would confine its expansion to the identified thrust sectors. The two main operating divisions of the company were the automotive division, which manufactured UVs and LCVs, and the farm equipment division, which made tractors and farm implements. The company employed over 17,000 people and had six state-of-the-art manufacturing facilities spread over 500,000 square meters. The plants were situated at Kandivili (MUVs and Tractors), Nasik (MUVs), Zaheerabad (LCVs, Voyager, three-wheelers), Igatpuri (Engines) andNagpur (Implements and tractors) Excerpts About BPR The concept of BPR was popularized in the early 1990s by Michael Hammer and James Champy in their best-selling book, Reengineering the C orporation. The authors verbalize that radical redesign and reorganization of an enterprise was necessary to lower costs and increase the quality of service. According to them, IT was the key enabler for that radical change. Hammer and Champy mat that the design of the workflow in most large corporations was based on assumptions about technology, people and organizational goals that were no longer valid.They recommended seven principles of reengineering for streamlining work processes and, consequently, achieving significant levels of improvement in quality, time management and cost (Refer prorogue I) MMs Experience with BPR By the mid-1990s, BPR had become a popular tool globally, with many leading organizations implementing it. However, when M&M undertook the exercise, it was still a new concept in India. M&Ms workforce, as mentioned earlier, resisted this attempt to reengineer the organization.Soon after the senior staff began working on the shop floors, the first signs of th e benefits of BPR became evident. Around a 100 officers produced 35 engines a day as compared to the 1200 employees producing 70 engines in the pre-BPR days. After five months, the workers ended the strike and began work in switch for a 30% wage hike. As the situation returned to normalcy, BPR implementation gained momentum. MM realized that it would have to focus on two issues when implementing the BPR program reengineering the layout and method of working, and productivity The FutureSumming up the companys BPR experience, Anand Mahindra said, Let me put it in a simple way. If we have facilities in Kandivili today, which are not just living but thriving, it is all due to BPR. 8. CONCLUSION The reengineering profoundly changes all aspects of business and people. Part of the organization is easy to change by reinventing a way to work. However, the other part, people, is very difficult to change. In particular, it requires not only jobs and skills change but also peoples styles the ways in which they think and behave and their attitudes what they turn over is important about their work.These are indispensable factors to determine whether reengineering succeeds or not. leadership must help people to cope with these changes. 9. REFERENCES * Business Process exchange Reengineering Concepts, Methods, and Technologies by Varun Autor Grover and William J. Kettinger * Business process reengineering breakpoint strategies for market dominance by total heat J. Johansson * Business process reengineering an executive resource for implementation by Harold S. Resnick * www. bus. iastate. edu/ for case study references.