Data Forecast Demand Machine capacities Bill of Materials Routings Data Bill of Materials Product/Part Inventories Vendors Economic Order Quants Data Prospects Quotes Sales Forecasts Data Customers Products/Configurations Employee Data Data Bill of Materials Machine Usage Labor Charges Cost Allocations Supply Chain Management Application Systems and Data Sales Force Automation Order Entry Materials Management Production SchedulingCost Accounting Data Customers Orders Payments Accounts Payable

Production Sched. Data Forecast Demand Machine capacities Bill of Materials Routings Materials Mgmt Data Bill of Materials Product/Part Inventories Vendors Economic Order Quants Sales Force Automation Data Prospects Quotes Sales Forecasts Order Entry Data Customers Products/Configurations Employee Data Cost Accounting Data Bill of Materials Machine Usage Labor Charges Cost Allocations Answering Managerial Questions about Supply Chain Operations Accounts Payable Data Customers Orders Payments

How quickly will a new order show up in production scheduling? How much trouble will it be to answer a CEO’s question: “Which category of customer is most profitable to us?” when the data maintained in the different divisions is not organized or defined the same way.

Application Program Payroll Data Employee Data Time Clock Data Application Program Order Entry Data Order Data Customer Data Employee Data Application Program ESOP Tracking Data Employee ESOP Data Employee History Application Program Cost Accounting Data Bill of Materials Machine Costs Employee Costs Application Program Production Scheduling Data Bill of Materials Machine Capacities Employee Data Order Data Data Order Data Customer Data Employee Data Product Data Extract Translate and Clean Data Access Tools Data Warehouse A data warehouse solves the data access problem by copying all data to a single database. [The operational problems are not solved.]

Data Customers/Prospects Orders/Quotes Product/Part Inventories Bill of Materials / Routings Machine capacities Production Schedules Vendors Economic Order Quants, Etc. Sales Force Automation Order Entry Materials Management Production SchedulingCost AccountingAccounts Payable ERP systems provide for operational coordination, in addition to the {potential} query capability of a Data Warehouse

Five primary concepts that make up reengineering (Davenport) A “clean sheet of paper” approach to org design and change An orientation to broad, cross-functional business processes, or how work is done. The need for, or possibility of radical change in process improvement Information technology as an enabler of change in process performance Changes in organizational and human arrangements that accompany change in technology.

Process Improvement vs. Process Innovation (Davenport, 93)

CSC Index’s findings, The State of Reengineering (1995): 50% of companies responding said most difficult aspect of reengineering efforts is dealing with Fear and Anxiety in their organization

CSC Index’s findings, The State of Reengineering (1995): 50% of companies responding said most difficult aspect of reengineering efforts is dealing with Fear and Anxiety in their organization 73% said they were using reengineering to eliminate on average 21% of workforce

CSC Index’s findings, The State of Reengineering (1995): 50% of companies responding said most difficult aspect of reengineering efforts is dealing with Fear and Anxiety in their organization 73% said they were using reengineering to eliminate on average 21% of workforce Of 99 completed reengineering efforts, 67% were judged as producing mediocre, marginal or failed results.

Davenports Lessons: Implementation is harder than Design. Big Risks of Failure Clean sheet of paper is expensive. Top down hits rocks when it changes the way people do their work. The big lesson is still that we must focus on improving our business processes Information Technology is only useful if it helps people do their work better (and perhaps differently)

Stoddard and Jarvenpaa’s comments: Distinguish between Design and Implementation. Design must be radical (to be reengineering) Radical Implementation is tough unless: self contained units an acknowledged crisis, battle for survival deep pockets [excellent project management skills ability to borrow from outside willingness to use revolutionary path] Incremental Implementation translate it into a series of operation crises make it pay its way fit into an organization culture of continuous improvement