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SM Chapter 7 Definitions

This document defines key terms related to IT and strategic management, including business processes, core business processes, business process reengineering, benchmarking, total quality management, six sigma, and enterprise resource planning. Business processes are sets of tasks that transform inputs into outputs and cross functional boundaries. Core business processes are critical for an organization's success, competitiveness, and customer evaluation. Various methods like business process reengineering aim to considerably improve processes in terms of time, cost, quality and customer responsiveness.

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Selva Ganesh
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49 views

SM Chapter 7 Definitions

This document defines key terms related to IT and strategic management, including business processes, core business processes, business process reengineering, benchmarking, total quality management, six sigma, and enterprise resource planning. Business processes are sets of tasks that transform inputs into outputs and cross functional boundaries. Core business processes are critical for an organization's success, competitiveness, and customer evaluation. Various methods like business process reengineering aim to considerably improve processes in terms of time, cost, quality and customer responsiveness.

Uploaded by

Selva Ganesh
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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IT & SM Important Definitions

SM - Reaching Strategic Edge


Business Process (BP)
Meaning: A Business Process:
1. Is a set of logically related tasks or activities oriented towards achieving a specified outcome
2. Is a set of activities which creates some value to the customer
3. It usually surpasses departmental or functional boundaries.
4. Is a set of activities that transforms a set of inputs into set of outputs for another process or person
Example:
Examples of Business Processes areas:
1. Development of a new product or service,
2. Launching a new product in the market,

Core or Generic Business Processes


Meaning:
1. Core or Generic BPs are those which are highly critical for the success & survival of the entity.
2. They are critical
a. In an entity’s evaluation by its customers.
b. For success in the industry sector within which the entity is positioned.
c. For generating competitive advantages for an entity in the marketplace.
Some Examples of Core Business Processes are —
Nature of Activity Core Business Processes
News Distribution by TV/Newspaper Collection & Broadcasting of news in a timely manner.
Banking Mobilising Deposits and generating fund for providing advances to
customers
Insurance Balance between competitive premium and profits after claims for the
company

Business Process Re-Engineering (BPR)


1. BPR refers to the analysis and re-design of business processes both within and between business entities.
2. It is a total deconstruction and re—thinking of a business process in its entirety, unconstrained by its existing
structure and pattern.
3. Its objective is to considerable gain in the performance of the process in terms of time, cost, quality, &
responsiveness to customers.
4. It implies giving up old practices and adopting the improved ones.
Benchmarking
1. Dictionary defines a benchmark as a standard or a point of reference against which things ma compared and
by which something can be measured and judged
2. Benchmarking is the process of identifying and learning from the best industry practices and the processes
by which they are achieved. It developed out of the need to have information against which performances
can be measured. Ex. a customer support engineer of a television manufacturer attends a call within forty-
eight hours. If the Industry norm Is that all calls are attended within twenty-four hours, then the twenty-four
hours can be a benchmark.
3. Bench marking is not a solution to all the problems. Rather, it studies the circumstances and processes that
help in superior performance. Better processes are not merely copied. Efforts are made to learn, improve
and evolve them to suit the organizational circumstances.
4. It is an approach of setting goals and measuring the productivity based on best industry practices. It is a
process of continuous improvement in search of competitive advantage.
5. Benchmarking involves:
a. Comparing different aspects of the firm's products, services, activities, processes and other aspects
of performance with that of competitors or other leaders in the field and the best prevailing
practices.
b. Identifying gaps and deficiencies in the firm's own performance,
c. Finding out novel methods to reduce the gaps and also to improve the situations, and
d. Ensuring that these improved methods are implemented.

Total Quality Management (TQM)


1. TQM is a people focused management system that aims at continual increase in customer satisfaction at
continually lower real cost.
2. It is a sustained management commitment to quality and everyone in the organisation is responsible for
preventing rather than detecting defects.
3. TQM is a total system approach (not a separate area or program) and an integral part of high- level strategy.
It works horizontally across functions and departments, involves all employees, top to bottom, and extends
backward and forward to include the supply chain and the customer chain.
4. TQM stresses learning and adaptation to continual change as keys to organizational success.

Six Sigma
1. It is a philosophical benchmark or standard of excellence which aims at maintenance of desired quality in end
products and processes by taking systematic and integrated efforts towards improving quality and reducing
cost.
2. It is also called zero defects program

Enterprise Resource Planning


1. ERP stand for Enterprise Resource Planning which is an IT based system linking isolated information centres
across the organisation into an integrated enterprise wide structured functional and activity bases.
2. ERP is successor to MRP systems (Material requirements and Manufacturing Resource Planning Systems).
3. ERP is used for strengthening the procurement and management of input factors.

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