Business process reengineering
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Business Process Reengineering. Example Division of Work. 1776 Adam Smith: The Wealth of Nations Example: producing needles. without division of work: 1 worker all performings result: 20 needles/day 20 needles/worker. with division of work: 10 workers 2 to 3 performings each

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Business Process Reengineering

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Business process reengineering

Business Process Reengineering


Example division of work

Example Division of Work

  • 1776 Adam Smith: The Wealth of Nations

  • Example: producing needles

  • without division of work:

    • 1 worker

    • all performings

  • result:

  • 20 needles/day

  • 20 needles/worker

  • with division of work:

    • 10 workers

    • 2 to 3 performings each

  • result:

  • 48000 needles/day

  • 4800 needles/worker

Comparison in productivity:

With division of work increasing by factor 240


Hypothesis of division of work

Hypothesis of Division of Work

  • Productivity rises with increasing division of work

Productivity

Division of Work

  • Results of Division of Work:

  • increasing dependencies

  • increasing complexity


Limits in division of work

Productivity

Division of Work

Limits in Division of Work

  • Co-ordination

  • Technology

  • People


How to start organising

Useful Division of Work

How to Start Organising

  • Why does a company have to organise?

General task

Multipersonal completion of the general task

Different tasks

Division of Work

  • Which Division of Work (organisational structure) does

  • a company have to choose?


Business process reengineering

Yesterday:

Structure Follows Strategy

Today:

Structure Follows Process Follows Strategy


What we have inherited

What We Have Inherited

Themes: specialisation of labour, hierarchical management,

task efficiency, control

Consequence: fragmentation


The old process

The Old Process


The improved process

The „Improved“ Process


The reengineered process

The Reengineered Process


Core processes and value chain

Core Processes And Value Chain


Example process organisation

Example: Process Organisation


Success of business process reengineering projects

44%

38%

29%

27%

24%

23%

15%

15%

Cut costs

Increased

revenue

Cut cycle

times

Increased

productivity

American companies

European companies

Success of “Business Process Reengineering”-Projects


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