1. P3 Business Analysis

2. 2 Section D: Business Process Change D1. The role of process and process change initiatives D2. Improving the process of the organisation Designed to give you the knowledge and application of:

3. 3  Appraise business process change initiatives previously adopted by organisations.  Establish an appropriate scope and focus for business process change using Harmon's process-strategy matrix.  Advise on the implications of business process outsourcing.  Recommend a business process redesign methodology for an organisation.  Describe a range of process redesign patterns.  Assess the feasibility of possible redesign options. D1 & D2: The role of process and process change initiatives and improving the processes of the organisation Learning Outcomes

4. 4 Organisational structure Process: arrangement of resources that transforms inputs into outputs able to satisfy customer needs. Analyse current processes to identify where they can be improved How do we determine the strategic value of a process? How to improve competitive position?  successfully redesign business processes to make them more: Well designed More valuable  business processes are fundamental to an organisation’s success as they: increase effectiveness (value for customer) increase efficiency (lower costs)

5. 5 Levels of process change In view of the external environment, should we change the overall processes? Do any of our processes require an overall improvement? Should we bring in more automation? Do we need to further develop our stable existing processes? Process improvement Process redesign Process re- engineering Strategic level Tactical level Intermediate level Remember, a business process starts with a customer’s particular need and ends with that customer’s need being fulfilled.

6. 6 Process redesign patterns Process re-engineering Simplification Gaps and disconnects Value-added analysis Eliminating redundancies and duplications in established processes Ensure proper checks and controls are in place in order to effectively coordinate the efforts between departments Rethinking existing processes to achieve major efficiency improvements Concentrate resources and efforts on value adding activities

7. 7 Harmon’s process strategy matrix A technique used to identify and categorise the various processes and ways of improving the processes adopted by an organisation. LowHigh Low Outsource: complex processes not part of the company’s core competency BPR and improvement: Complex dynamic processes of high value Automate / outsource: Straightforward, static, commodity process Automate: Straightforward, static and valuable: Strategic importance Complexity

8. 8 Business process outsourcing "Business process outsourcing (“BPO”) occurs when an organisation contracts out an entire business function to an external party" Contract with specialist company to develop all of the IS / IT operations, maintenance and development activities Total outsourcing Different approaches to outsourcing Contract where the host company can purchase equipment as and when necessary and maintain its internal staff organisation Multiple / selective sourcing Enter into joint venture with supplier and retain in house IS / IT function Joint venture, strategic alliance Buys maintenance and development services from specialist and retains own centralised IS / IT function In sourcing

9. 9 Business process outsourcing benefits v. limitations  Cost control: makes use of economies of scale in input costs  Business improvement: host organisations can concentrate on core competencies  Avoid growing shortage of specialist staff  Bring in more focus on quality and customer service Benefits Limitations  Seen as a way of offloading problems  Security and confidentiality problems  Loss of responsiveness to environmental changes  Difficult to switch specialists at the end of the contract

10. 10 Feasibility Feasibility: concerned with whether an organisation has the resources and competences to deliver a strategy Organisationalfeasibility Can the organisation convert its objectives into reality in the given time frame with the given resources? Technicalfeasibility Are sufficient technical inputs available and will there be any compatibility issues and bottlenecks in the future? Financialfeasibility Is the organisation capable of raising funds to cover the related investments and the costs involved? Socialfeasibility Is management and the organisation’s staff committed to achieving the project? Environmentalfeasibility Does implementing the project result in consequences that are harmful to society or any groups?

11. 11 Business Process Re-engineering (BPR)  fundamental thinking + radical design of business processes  to achieve dramatic improvements in performance Start on a clean slate Achieve significant leaps in performance Series of jobs grouped together Principles of BPR  Focus on outcome and not on tasks  Users of output should perform the process tasks  Output in the form of information should be in a processed form  Treat geographically dispersed resources as centralised  Link and not integrate parallel activities  Allocate authority

12. 12 Recap  Appraise business process change initiatives previously adopted by organisations.  Establish an appropriate scope and focus for business process change using Harmon's process-strategy matrix.  Advise on the implications of business process outsourcing.  Recommend a business process redesign methodology for an organisation.  Describe a range of process redesign patterns.  Assess the feasibility of possible redesign options.

13. [training@getthroughguides.com]