Business Process Reengineering INFSY 489 IST 402 Spring
Business Process Reengineering INFSY 489 / IST 402 Spring 2005
Business Process Reengineering n BPR – effort to identify the best way to do each business task supported by the system n Functional Areas? vs. Business Process?
Business Process Reengineering n Example: Forecasting Last month’s demand to predict this month n Use monthly demand from a year ago to predict this month n Spreadsheet algorithm such as exponential smoothing over available monthly data n Seasonality indices in a spreadsheet algorithm n Rely upon managerial judgment n Ouija board n
Business Process Reengineering BPR has resulted in massive reductions in workforce (RIF) n BPR failure rates have been 50% to 70% n Employee resistance to change n Inadequate attention to employee concerns n Inadequate & inappropriate staffing n Inadequate developer & user tools n Mismatch of strategies used & goals n Lack of oversight n Failure in leadership commitment n
Best Practices in ERP n Primary feature of SAP is Best Practices A method that is judged superior to other methods n Efficient way to perform a task n 800 to 1000 best practices included in SAP R/3 n n Benchmarking – compares an organization’s methods with peer groups to identify the best practices
Business Process Reengineering n Researcher Scott and Kaindle found at least 20% of functionality needed by ERP users is missing from vendor packages n BPR designed to consider human values and business purposes n ERP implementation often neglect human considerations
Business Process Reengineering n There are two main methods of business process reengineering. n Clean Slate Reengineering n Technology-Enabled Reengineering
Business Process Reengineering n Clean Slate Reengineering Everything is designed from scratch n The software to support reengineering is selected n More expensive but more responsive to organization needs n Slower and harder to apply n Involves significant changes in the way organization does business n
Business Process Reengineering n Clean Slate Reengineering Pros: n Tasks are custom made to the company and better fit the needs of the business n No constraints, anything can be designed. n Some of the underlying business components can stay the same without having to modify it to a specific software package.
Business Process Reengineering n Clean Slate Reengineering Cons: n Most expensive compared to other methods n Slower to design and harder to implement since everything is in-house with no external support. n Higher risk of failure due to slower implementation.
Business Process Reengineering n Technology-Enabled Reengineering First select a system, then reengineer using ERP best practices n A. K. A. Constrained Reengineering, Concurrent Transformation n Faster and cheaper n Design the organizational system around abilities of vendor software n Involves the most change in organizational practice n Most complicated for training n The most dominant practice today n
Business Process Reengineering n Technology-Enabled Reengineering Pros: n Cheaper then other methods due to the system and software already being available. n More support due to experience of others. n Faster to implement and design.
Business Process Reengineering n Technology-Enabled Reengineering Cons: n Involves the most business change due to having to build your company around the software package. n Possibility of more training involved for employees because there are no guarantees any of your previous business tasks will remain.
Risks of Failure in Business Process Reengineering n Average estimate of BPR project failure is 70% due to initial problems within the implementation, which include: Internal resistance n Lack of a company sponsor n Inability to staff employees to the need of the project n Lack of attention to employees concerns n Inadequate support of software or incorrect software chosen dependant on organization n
BPR Lab n What is the process to register for a class at Penn State Harrisburg? n How could you reengineer this process?
- Slides: 15
