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Business Process Reengineering & Innovation. Chou-Hong Chen, Ph.D Professor of MIS School of Business Administration Gonzaga University Spokane, WA 99223 [email protected]. Innovation as a Response to Change in Market and Technology. Technological Opportunities. Advances in Technology. - PowerPoint PPT Presentation
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Business Process Reengineering & Innovation
Chou-Hong Chen, Ph.D
Professor of MIS
School of Business Administration
Gonzaga University
Spokane, WA 99223
Innovation as a Response to Change in Market and Technology
Innovation as a Response to Change in Market and Technology
INNOVATION
Socio-politicalChanges
Technological Opportunities
Advances in Technology
New Products and Services
Market Needs
EFFICINCY
EFFECTIVENESS
INNOVATION
Time Market
What is Business Process and Business Reengineering?
Business process: A set of logically related tasks performed to achieved a defined business outcome
Business reengineering means radically changing how people work - changing business policies and controls, systems and technology, organizational relationships and business practices, and reward programs.
Dr. Chen, The Trends of the Information Systems Technology TM -3
Principles of Re-engineering(by Michael Hammer)
Organize around outcomes, not tasks Have those who use the output of the process
perform the process Include information processing work into the real
work that produces the information Treat geographically dispersed resources as though
they were centralized Link parallel activities instead of integrating their
results Put the decision point where the work is performed.
BPR
Radical Change = New organization + IT
Types ofOrganizational =Strategies
IndustryStructure +
CompetitiveStrategies +
CooperativeStrategies
1. Develop business vision, process objectives
2. Identify process to be redesigned
3. Understand, measure performance of existing processes
4. Identify opportunities for applying information technology
5. Build PROTOTYPE of new process
BUSINESS REENGINEERING STEPS:
Dr. Chen, The Trends of the Information Systems Technology TM -6
Figure 3-6 Reengineered Accounts Payable Process (from Hammer[1])
Before
Purchasing
Vendor
Receiving
Accounts Payable
Goods
Payment
Invoice
Receiving Document
Copy of Purchase Order Purchase
Order
Figure 3-6 Reengineered Accounts Payable Process (from Hammer[1])
After
Purchasing
Vendor
Receiving
Accounts Payable
Goods
Purchase Order
Payment
Database
Implementing Re-engineering
The key activities of re-engineering can be organized into three phases referred to as the 3R’s Re-engineering– Redesign– Retool– Reorchestrate
Tools for BPR
Simulation Flow diagrams Work analysis Application development Workflow software
Reorchestrate:Organizational Change
Leadership Corporate values Cultural change Incentives Accountability
Zeal/commitment Communication Comfortable with
ambiguity Obstacles to change Celebrate success
The C’s related toOrganization Re-engineering Projects
The 3C’s of organization Re-engineering:
The 4C’s of effective teams:
- Customers
- Competition
- Change
- Commitment
- Cooperation- Communication
- Contribution
CONSTRUCTION
DESIGN
ANALYSIS
PLANNING
Information Engineering
What is Information Engineering
The application of an interlocking set of formal techniques for the planning, analysis, design and construction of IS, applied ton an enterprise-wide basis or across a major sector of an enterprise.
An enterprise-wide set of automated disciplines for getting the right information to the right people with the right form at the right time.
SupportsSupports
Business Plan Strategic Factors System Project
3 Decrease direct labor and overhead by 20%
3 Increase our customer order-filing rate to 95%
3 Produce timely tracking and sales information for inventory managers
3 Increase labor productivity
3 Improve service differentiation
3 Provide managers with better information
3 A standard cost accounting system that provides online labor rate and efficiency variances
3 An inventory management system that provides reorder points, EOQ’s, quantity on hand, and sales by item and salesperson.
Figure: Relationship and linkage of proposed system projects with strategic factors and the business plan
Objective Proposal
The Emergence of a Strategic Role for IT in Organizations
IT as a strategic resource
Technology Push
t Cost-performance trends
t Connectivity capabilities
Competitive Pull
t Innovative IT-enabled applications to obtain differential benefits in the marketplace to stay competitive
1. Develop business vision, process objectives
2. Identify process to be redesigned
3. Understand, measure performance of existing processes
4. Identify opportunities for applying information technology
5. Build PROTOTYPE of new process
BUSINESS REENGINEERING STEPS:
Dr. Chen, The Trends of the Information Systems Technology TM -17
Figure 3-6 Reengineered Accounts Payable Process (from Hammer[1])
Before
Purchasing
Vendor
Receiving
Accounts Payable
Goods
Payment
Invoice
Receiving Document
Copy of Purchase Order Purchase
Order
Figure 3-6 Reengineered Accounts Payable Process (from Hammer[1])
After
Purchasing
Vendor
Receiving
Accounts Payable
Goods
Purchase Order
Payment
Database
