BUSINESS

PROCESS
REENGINEERING

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Group Members

Chanky Jain 33
Tapesh Joshi 35
Aditi Kadam 36
Gaurang Kamat 40

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 What is a Process?
A specific ordering of work activities
across time and space, with a beginning,
an end, and clearly identified inputs and
outputs.

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 What is Business Process?
A group of logically related tasks that use
the firm's resources to provide customer-
oriented results in support of the
organization's objectives

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 What is Reengineering?
 The reengineering of software was described as
"The examination and alteration of a system to
reconstitute it in a new form". Less formally,
reengineering is the modification of a software system
that takes place after it has been reverse engineered,
generally to add new functionality, or to correct
errors.
 This entire process is often erroneously referred to as
reverse engineering; however, it is more accurate to
say that reverse engineering is the initial examination
of the system, and reengineering is the subsequent
modification.
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 DEFINITION – BPR

BPR is 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.

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 BPR - OVERVIEW
 BPR began as a private sector technique to help
organizations fundamentally rethink how they do
their work in order to dramatically improve customer
service, cut operational costs, and become world-
class competitors.
 A key stimulus for reengineering has been the
continuing development and deployment of
sophisticated information systems and networks.
 BPR is the main way in which organizations become
more efficient and modernize. BRP transforms an
organization in ways that directly affect performance.

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 WHY RE-ENGINEERING?

Reengineering recognizes that an organization's business processes

are usually fragmented into sub processes and tasks that are carried
out by several specialized functional areas within the organization.

Reengineering maintains that optimizing the performance of sub

processes can result in some benefits, but cannot yield dramatic
improvements if the process itself is fundamentally inefficient and
outmoded.

For that reason, reengineering focuses on redesigning the process as

a whole in order to achieve the greatest possible benefits to the
organization and their customers.

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WHY RE-ENGINEERING?

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Contd…
Business process re-engineering (BPR) is
being attempted by many firms that are
looking for radical gains from the
successful redesign of their processes.
BPR is a high risk, time consuming
activity, with no guarantee of success, and
yet many businesses claim to be re-
engineering their processes.

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Contd…
The companies in their study with the
largest improvement were found to be
redesigning critical processes of their
business. Process improvement was found
to be minimal where narrow processes
that only changed the surface of the
business were defined.

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Contd…
In small firms, organizational structure is
typically informal, but highly centralized,
which provides strength in decision-making
and rapid implementation of decisions.
This also enables more rapid implementation
of change in the organization.
Further, it has been empirically confirmed that
small businesses differ from large
organizations in other matters such as
maturity and environmental uncertainty.
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 Organization Structure
Classical IE Based BPR Based

Hierarchical management Flattened & shortened chain of command

control

Vertical division of labor, centralization of Decentralization of responsibilities & of

decisions decision making

Separation of categories by status Blurring of status differences & trend towards

more status equity
Technical division of labor & atomistic & Enlargement of task toward more professional
service strict task assignment division of work
Specialization & compartmentalization of Multidisciplinary team working
knowledge

Loose ties with supplier Connectivity with suppliers & subcontractors

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Loose ties with consumer Great sensitivity to market demand, to buyers
& consumers & all stock holders

Standardized products & production processes. Structural, technological & organizational

flexibility.

Overall routines & rigidities Continuous search for innovation & value
additions.

Production management is central Human resource department becomes central

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 Objectives
Lower the cost
Increase quality &
Increase the quantity of service

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 EFFECTS OF BPR
1. Less Cost

2. Better Service

3. Shorter Lead Times

4. Greater Competitiveness

5. Opportunity to gain market share

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 Features of bpr

 Workers make decisions.

 Several jobs are combined into one.
 Steps in the process are performed in natural order.
 Process has multiple versions.
 Work is performed where it makes the most sense.
 Checks & controls are reduced.
 Reconciliation is minimized.
 A case manager provides a single point of contact.
 Work unit changes: functional to process.
 Structure changes: hierarchical to flat.
 Managers change: Supervisor to coaches

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 Process of BPR
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I. Select the Process & Appoint Team
Two Important Tasks

◦ Select the process to be reengineered

◦ Appoint a process team

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 Core Skills Required
Capacity to view the organization as a
whole

Ability to focus on end-customers

Ability to challenge fundamental

assumptions

Courage to deliver into unknown areas

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II. Understand the Current Process
Develop a process overview
Clearly define the process
◦ Mission
◦ Scope
◦ Boundaries
Quantify customer measurements
Understand customers expectations from
the process

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 Understand the Current Process
Identify Improvement Opportunities
◦ Quality
◦ Rework
Document the Process
◦ Cost
◦ Time
◦ Value Data

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III. Develop & Communicate Vision of
Improved Process
Communicate with all employees so that
they are aware of the vision of the future

Always provide information on the progress

of the BPR initiative - good and bad.

Demonstrate assurance that the BPR

initiative is both necessary and properly
managed

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 Develop & Communicate Vision of
Improved Process
Promote individual development by
indicating options that are available

Indicate actions required and those

responsible

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 IV. Identify Action Plan
Develop an improvement plan
Appoint process owners
Simplify the process to reduce process
time
Remove no-value-added activities
Standardize process and automate
wherever possible
Up-grade equipment
Plan/schedule the changes

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 V. Execute Plan
Qualify/certifythe process
Perform periodic qualification reviews
Define and eliminate process problems
Evaluate the change impact on the
business and on customers
Benchmark the process
Provide advanced team training

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 Key areas
Emphasize customer satisfaction
Use performance improvement programs and
problem solving techniques
Focus on business processes
Use teams and teamwork
Bring about changes in values and beliefs
Work to drive decision making down to lower
levels in the organization
Require senior level commitment and change
management for success
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 Characteristics
1. Process-based
Replace traditional management
philosophy
Look at business from outside in
Concentrate on end-to-end management
of processes

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2. Fundamental Rethink
A zero-based approach to the redesign of key
processes
Three key issues
◦ The extent current structure detracts from
creation and delivery of value
◦ The retarding effect that structure can have
◦ The unresolved cross-functional conflicts and
tensions
 
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3. Radical improvement
Avoid scaling down ambitions
Emphasis on achieving dramatic and
sustainable leaps in performance
Re-engineering not appropriate if
alternative approach will achieve same
gains

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4. Integrated Change
Major change adds pressure
Personal ambition and competing
initiatives - divert attention and resources
The approach should deliver a balanced
and holistic solution
People and training put in place

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5. People Centred
Understanding of business goals
Knowledge of processes
Ability to make decisions and take risks
on behalf of organisation
Coaching of staff

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6. Mindset Change
Discard prior conditioning
Build and communicate a shared
understanding of the organisation’s future
Create an environment and infrastructure
that promotes learning and imagination to
guide decisions

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 TQM, JIT & BPR

TQM seeks to create an atmosphere

where ‘Doing right thing on right time in
right quality’ becomes the goal.
JIT is a mfg. philosophy that calls for
total reorganization of operations.
BPR is a mean by which an organization
can bring radical change in level of cost,
cycle time, service & quality.

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 BPR differs from TQM & JIT in following ways:

BPR provides a new definition of

operational excellence which helps to
destroy all the old tenets.
BPR pushes TQM & JIT approaches both
upstream & downstream to customer &
supplier.
BPR requires corporate leaders
Traditional TQM & JIT often fail to break
functional barriers.
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BPR examines & analyses work flow
structure of a process.
BPR is TPQM i.e. Total productivity &
quality management which is in line with
our concepts

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 Role of Information technology

Shared databases
Expert systems, allowing generalists
Telecommunication networks
Decision-support tools
Wireless data communication and portable
computers
Interactive videodisk
Automatic identification and tracking
High performance computing
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 Case Study

Mahindra & Mahindra

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 Circumstances that lead M&M to
implement BPR Factors
Manufacturing Inefficiencies
Poor productivity
Long production cycle
Sub-optimal output.
Unhealthy work culture
Corruption was widespread
(contd.)

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 Decision to focus on enhancing
productivity and delivering world-class
quality at the least possible cost.

 Ambition to become the largest tractor

manufacturer in the world.

 The three C’s (customers, competition,

change)
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 Why M & M faced resistance from
unions while implementing BPR?
 Fear of Downsizing
 Several jobs were combined into one
 Management accepting the Union demands
every time
 Lenient approach of management towards
running the plant
 Inflexibility of the workers
 Idle time available to workers due to
unorganized processes
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 BPR Implementation Events
 Resistance from the unions

 Re-engineering the layout and method of

working

 Cellular Manufacturing
 Multi-tasking through multi-machine manning
 Reduction in non-productive activities

 Implementation of TPM & Kaizen

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 Platform Concept
 Focus on customer requirement

 Concurrent engineering: Formation of cross

functional teams

 Formation of 3 full-time teams

◦ Horizon1: Improvements in existing products
◦ Horizon2: Up-gradation of existing products
◦ Horizon3: Development of new products

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 Benefits of BPR in M&M
Around a 100 officers produced 35 engines a day as compared to the 1200
employees producing 70 engines in the pre-BPR days.

Igatpuri Plant: Employees declined by 400 but productivity went up by 125

engines per day

Nasik Plant: 125% improvement in productivity

Value added per employee increased from 0.3 million to 0.46 million

Reduction in employee costs

◦ 1994: 12.4%
◦ 1996: 10.1% 12/07/2021 45
 Summary
“Today the atmosphere is so different that
every morning all the workers recite the
company oath, which is a sea change from
the situation 10 years ago when workers
used to play cards on shop floor during
working hours.” - Anand Mahindra

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