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Business Process Reengineering & Innovation. Jason Chen, Ph.D Professor of MIS School of Business Administration Gonzaga University Spokane, WA 99223 chen@gonzaga.edu. Innovation as a Response to Change in Market and Technology. Technological Opportunities. Advances in Technology.

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business process reengineering innovation

Business Process Reengineering & Innovation

Jason Chen, Ph.D

Professor of MIS

School of Business Administration

Gonzaga University

Spokane, WA 99223

chen@gonzaga.edu

slide2

Innovation as a Response to Change in

Market and Technology

Technological Opportunities

Advances in Technology

EFFICINCY

EFFECTIVENESS

INNOVATION

INNOVATION

New Products and Services

Market Needs

Socio-political

Changes

Market

Time

what is business process and business reengineering
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.

TM -3

Dr. Chen, The Trends of the Information Systems Technology

principles of re engineering by michael hammer
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.
slide5
BPR

Radical Change =

New organization +

IT

Types of

Organizational =

Strategies

Industry

Structure +

Competitive

Strategies +

Cooperative

Strategies

business reengineering steps
BUSINESS REENGINEERING STEPS:

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

TM -6

Dr. Chen, The Trends of the Information Systems Technology

slide7

Figure 3-6 Reengineered Accounts Payable Process (from Hammer[1])

Before

Copy of Purchase Order

Purchasing

Purchase Order

Payment

Accounts

Payable

Vendor

Invoice

Goods

Receiving Document

Receiving

slide8

Figure 3-6 Reengineered Accounts Payable Process (from Hammer[1])

After

Purchasing

Purchase Order

Payment

Accounts

Payable

Database

Vendor

Goods

Receiving

implementing re engineering
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
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

Reorchestrate:Organizational Change
the c s related to organization re engineering projects
The C’s related toOrganization Re-engineering Projects

The 3C’s of organization Re-engineering:

The 4C’s of effective teams:

- Commitment

- Customers

- Cooperation

- Competition

- Communication

- Change

- Contribution

slide13

Information Engineering

PLANNING

ANALYSIS

DESIGN

CONSTRUCTION

what is 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.
slide15

Figure: Relationship and linkage of proposed system projects with strategic factors and the business plan

Objective

Proposal

Business Plan

Strategic Factors

SystemProject

  • Decrease direct labor and overhead by 20%
  • Increase our customer order-filing rate to 95%
  • Produce timely tracking and sales information for inventory managers
  • Increase labor productivity
  • Improve service differentiation
  • Provide managers with better information
  • A standard cost accounting system that provides online labor rate and efficiency variances
  • An inventory management system that provides reorder points, EOQ’s, quantity on hand, and sales by item and salesperson.

Supports

Supports

slide16

The Emergence of a Strategic Role for IT in Organizations

Technology Push

Competitive Pull

  • Innovative IT-enabled applications to obtain differential benefits in the marketplace to stay competitive

IT as a strategic

resource

  • Cost-performance trends
  • Connectivity capabilities
business reengineering steps1
BUSINESS REENGINEERING STEPS:

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

TM -17

Dr. Chen, The Trends of the Information Systems Technology

slide18

Figure 3-6 Reengineered Accounts Payable Process (from Hammer[1])

Before

Copy of Purchase Order

Purchasing

Purchase Order

Payment

Accounts

Payable

Vendor

Invoice

Goods

Receiving Document

Receiving

slide19

Figure 3-6 Reengineered Accounts Payable Process (from Hammer[1])

After

Purchasing

Purchase Order

Payment

Accounts

Payable

Database

Vendor

Goods

Receiving