1. Chapter 9 Management Innovation for Modern Businesses:
4/25/2017
Chapter 9
Management Innovation for Modern Businesses:
Business Process Reengineering (BPR)
MINCH9e1

2. Objectives After studying the chapter, students should be able to..
Explain definition of Business Process Re-engineering(BPR)
Describe Framework of BPR
Identify characteristics of BPR
Identify potential benefits of BPR for businesses
Identify things to prepare for BPR implementation
Explain why BPR one of management innovation.

3. Content Introduction BPR BPR Methodology
BPR Successful and Failure Factors
BPR Implementation
BPR Evaluation Framework
BPR : Significant Management Innovation
BPR: Successful Case
Summary

4. Content Introduction BPR BPR Methodology
BPR Successful and Failure Factors
BPR Implementation
BPR Evaluation Framework
BPR : Significant Management Innovation
BPR: Successful Case
Summary

5. When is BPR in need: Customer Competition Change
Introduction
When is BPR in need:
Customer
Competition
Change

6. Introduction Success stories:
“Wal-Mart reduces restocking time from six weeks to thirty-six hours.”
” Hewlett Packard’s assembly time for server computers touches new low- four minutes.”
“Taco Bell’s sales soars from $500 million to $3 billion.”

7. Content Introduction BPR BPR Methodology
BPR Successful and Failure Factors
BPR Implementation
BPR Evaluation Framework
BPR : Significant Management Innovation
BPR: Successful Case
Summary

8. BPR Definition: BP + R Business Process
A set of logically related tasks or activities performed to achieve a defined business outcome (Bozarth & Handfield: 92)
Re-engineering
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.

9. BPR Definitions of BPR:
“the fundamental rethinking and radical redesign of the business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service and speed". (Hammer and Champy,1993)

10. BPR framework (Grant and Mergen) source: Park Win Ying (2012)

11. Purpose of BPR: make all business processes best-in-class.

12. BPR Characteristics of BPR: Several jobs are combined into one.
Employee empowerment.
Steps in the processes are performed in natural order, and several jobs get done simultaneously.
Processes have multiple versions.
Work is performed where it makes the most sense.
Controls and checks and other non-value-added work are minimized.

13. BPR: Roles of Information Technology:
a major enabler for new forms of working and collaborating within an organization and across organizational borders

14. BPR Benefits of BPR: Increase Effectiveness. Reduces cost.
Meaningful job for employees.
Improvement in organizational approach.
Growth of business

15. BPR in Action: Claim Resolution Process
Before BPR
After BPR

16. Content Introduction BPR BPR Methodology
BPR Successful and Failure Factors
BPR Implementation
BPR Evaluation Framework
BPR : Significant Management Innovation
BPR: Successful Case
Summary

17. BPR Methodology
BPR Methodology a structured set of guidelines that enable an analyst to derive ways for problem solving called IDEF0 model. (Hammer, 2000)
Prepare for Re-engineering
Map and Analyze As-Is Process
Design To-Be process
Implement Reengineered Process
Improve Process Continuously

18. IDEF0 Model: BRP Methodology (Hammer, 2000)
BPR Methodology
IDEF0 Model: BRP Methodology (Hammer, 2000)

19. Content Introduction BPR BPR Methodology
BPR Successful and Failure Factors
BPR Implementation
BPR Evaluation Framework
BPR : Significant Management Innovation
BPR: Successful Case
Summary

20. BPR Successful & Failure Factors
Successful Factors
Organization wide commitment.
BPR team composition.
Business needs analysis.
Adequate IT infrastructure.
Effective change management.
Ongoing continuous improvement

21. BPR Successful and Failure Factors
One department may be optimized at the expense of another
Lack of time to focus on improving business process
Lack of recognition of the extent of the problem
Lack of training
Inadequate infrastructure
Overly bureaucratic processes
Lack of motivation

22. Content Introduction BPR BPR Methodology
BPR Successful and Failure Factors
BPR Implementation
BPR Evaluation Framework
BPR : Significant Management Innovation
BPR: Successful Case
Summary

23. BPR Implementation Where the technique has being applied
Types of firms / organizations that BPR can be applied

24. BPR Implementation Where the technique has being applied 1.1 Purposes:
public and private sector organizations
SMEs
multinational cooperations
1.1 Purposes:
downsizing in organizational structures
improve service process
organizational upgrade with innovated IT tools i.e. SAP, BAAN, ERP

25. BPR Implementation
Types of firms / organizations that BPR can be applied
Minimum Number of employees: 20
Strong management commitment to new ways of working and innovation.
Well formed IT infrastructure
2.1 Applied to Company’s Problem
High operational costs
Low quality offered to customers
High level of ''bottleneck" processes at pick seasons
Poor performance of middle level managers
Inappropriate distribution of resources and jobs

26. BPR Implementation 2.2 Duration and implementation cost of BPR
The duration of each BPR project varies from 6 -to 10 months.

27. BPR Implementation
2.3 Conditions for implementation (infrastructures required)
An operating transactional and accounting computerized system inclosing the commercial part of the transactions.
A network that connects all key personnel.
Workstations with Windows
An exchange server (MS outlook, or MS back office)
2.4 Organizations Supporting the Implementation of BPR

28. Content Introduction BPR BPR Methodology
BPR Successful and Failure Factors
BPR Implementation
BPR Evaluation Framework
BPR : Significant Management Innovation
BPR: Successful Case
Summary

29. BPR Evaluation framework
To signify the difficult trade-offs that sometimes have to be made they refer to their model as the devil’s quadrangle.
(H.A. Reijers, S. Liman Mansar / Omega 33 (2005))

30. Content Introduction BPR BPR Methodology
BPR Successful and Failure Factors
BPR Implementation
BPR Evaluation Framework
BPR : Significant Management Innovation
BPR: Successful Case
Summary

31. BPR: Significant Management Innovation
Criteria of Management Innovation
Radical, new at the time
Marked departure from previous management practices
Conferred a competitive advantage on the pioneering company
Lasting, being found in some form in organizations today

32. Content Introduction BPR BPR Methodology
BPR Successful and Failure Factors
BPR Implementation
BPR Evaluation Framework
BPR : Significant Management Innovation
BPR: Successful Case
Summary

33. BPR: Successful Case
After BPR implementation, Ford Motors (India) can induce significance increase of effectiveness and efficiency of business process.

34. BPR: Successful Case

35. BPR : Successful Case

36. Content Introduction BPR BPR Methodology
BPR Successful and Failure Factors
BPR Implementation
BPR Evaluation Framework
BPR : Significant Management Innovation
BPR: Successful Case
Summary

37. Summary