BPR - Benchmarking, Process Analysis, Incentives, Motivation, Quality & Trends

1. BPR: BUSINESS PROCESS
REENGINEERING
BENCHMARKING, PROCESS ANALYSIS, QUALITY,
INCENTIVES, MOTIVATION, TECHNIQUES & TRENDS
- Rajesh Timane, PhD

2. PART-1
BPR: BENCHMARKING

3. WHAT IS BPR? – COMMON ANSWERS
 Streamlining
 Improvement
 Efficiency
 “As Is” and “To Be”
 Better
 Faster
 More effective

4. DEFINITIONS
 “Fundamental rethinking and radical redesign of business
processes to achieve dramatic improvements in critical
measures of performance such as quality, service and price”
– (M. Hammer & J. Champy)
 “Revolution not Evolution”
– (catch phrase)
 “Don’t Automate – Obliterate”
– (M. Hammer)

5. FEATURES
 Presents Vision and Aims for future service provision
 Process Mapping and Analysis of existing processes,
organisation and systems
 Benchmarking throughout the process analysis work
 Identifies opportunities for radical service
improvement processes
 Development and Implementation Plans
 On-going reviews ensuring targeted benefits are
achieved

6. BENCHMARKING

7. WHAT IS (PERFORMANCE) BENCHMARKING?
 Industry practice: Business process approaches taken
by companies within and across industries to address
similar challenges
 Benchmarking: The search for industry best practice
that lead to superior performance (Robert Camp)

8. WHY DO BENCHMARKING?
 To identify quantifiable measures of relative performance
 To develop an understanding of what works well in
other/related industries
 Establish what is achievable from an improvement
perspective
 Understand how other companies have designed their
processes
 Determine what not to do, ie. learn from their mistakes
 Find out where the process is (on a scale of 1–10)

9. TYPES
 Internal: comparisons among similar operations within the same
organisation - different site/countries.
 External – Competitive: comparison to the ‘best in class’, ‘best in
industry’, or direct competitors.
 External – Functional: comparison of practices of companies
with similar processes in the same function but in different
industry sectors.
 Generic process: comparison of similar processes, eg. order
fulfillment, with those in organisations who are known to have
innovative work processes.

10. SOURCES OF INFORMATION
 Reports and studies by industry experts
 Site visits to companies
 Conference/symposiums
 Professional associations
 New employees from competitors
 Public research on companies
 Third party research firms

11. WHERE CAN IT BE USED?
 Products
 Services
 Costs
 Labour utilisation
 technology utilisation
 workflow time to do a job
 Revenue/Profit/Profit margin
 Customers
 Suppliers

12. PART-2
BPR: PROCESS ANALYSIS

13. PROCESS
 "a logical series of related transactions that
converts input to results or output“
 A chain of logical connected, repetitive activities
that utilize the organization's resources in
achieving specified and measurable results for
internal or external customers.

14. PROCESS ANALYSIS
Process analysis is an approach that helps managers
improve the performance of their business activities.
It can be a milestone in continuous improvement.
The analysis approach consists of the following steps:
(1) definition of the scope and the objectives of the
study,
(2) documentation of the status quo and definition of
performance measures,
(3) assessment and performance evaluation, and
(4) development of recommendations.

15. PROCESS ANALYSIS TOOLS
 When you want to understand a work process or
some part of a process, these tools can help:
 Flowchart
 Failure Mode Effects Analysis (FMEA)
 Mistake-proofing

16. FLOWCHART
 A picture of the separate steps of a process in
sequential order, including materials or services
entering or leaving the process (inputs and outputs),
decisions that must be made, people who become
involved, time involved at each step and/or process
measurements.
 Order-Filling Process

17. FAILURE MODE EFFECTS ANALYSIS
 A step-by-step approach for identifying all possible
failures in a design, a manufacturing or assembly
process, or a product or service; studying the
consequences, or effects, of those failures; and
eliminating or reducing failures, starting with the
highest-priority ones.

18. S – Severity Rating(1-10 - where 1 is insignificant and 10 is catastrophic), O - Occurrence Rating (1 to 10, where 1 is
extremely unlikely and 10 is inevitable), D - Detection Rating (1 to 10, where 1 means the control is absolutely certain to
detect the problem and 10 means the control is certain not to detect the problem (or no control exists), RPN - Risk
Priority Number = S × O × D, CRIT – Criticality = S x O

19. FMEA
 A bank performed a process FMEA on their ATM system. Figure 1 shows
part of it—the function “dispense cash” and a few of the failure modes
for that function. The optional “Classification” column was not used.
Only the headings are shown for the rightmost (action) columns.
 Notice that RPN and criticality prioritize causes differently. According to
the RPN, “machine jams” and “heavy computer network traffic” are the
first and second highest risks.
 One high value for severity or occurrence times a detection rating of 10
generates a high RPN. Criticality does not include the detection rating,
so it rates highest the only cause with medium to high values for both
severity and occurrence: “out of cash.” The team should use their
experience and judgment to determine appropriate priorities for action.

20. MISTAKE-PROOFING
 The use of any automatic device or method that
either makes it impossible for an error to occur or
makes the error immediately obvious once it has
occurred.
 The mistake-proofing device is an electronic sensor
on the entrance door. The sensor sends a signal to a
vibrating pager on the maitre’s belt to ensure that
the maitre d’ always knows when someone enters
or leaves the restaurant. Other mistake-proofing
methods replaced the process steps requiring the
maitre d’ to leave the front door to seat customers.

21. PART-3
BPR: MANAGING QUALITY

22. MANAGING QUALITY
 Establishing the Quality Policy
 Setting up Quality Objectives
 Creating Quality Management System (QMS)
 Communicating with parties responsible for Product
and Service Quality
 Providing adequate Resources for the Operation of the
QMS
 Reviewing the Operation of the QMS.

23. QUALITY POLICY
 The quality policy identifies the main goals of the
QMS.

24. THE QUALITY POLICY MUST BE:
 Appropriate to the organization’s purpose,
 Include a commitment to meet customer, legal and
regulatory requirements,
 Create a background for establishing quality
objectives,
 Communicated throughout the organization,
 Reviewed for ongoing suitability to the needs of
the organization and its customers

25. QUALITY OBJECTIVES
 Establish Measurable Quality Objectives that support
the quality policy and communicate them throughout
the organization.

26. MANAGERIAL RESPONSIBILITIES
 Effective work depends on a clear understanding of
each persons responsibility and authority.
 Therefore responsibility and authority must be
defined and communicated.

27. MANAGERIAL RESPONSIBILITIES
 Top management must appoint a manager to have
ongoing operational responsibility for the QMS.
 This person is referred to as the Management
Representative.

28. THE DUTIES OF THE MANAGEMENT REPRESENTATIVE INCLUDE:
 Ensuring that processes needed for the QMS are
established, implemented, and maintained,
 Reporting on the performance of the QMS and any
improvements needed,
 Promoting awareness of customer requirements
throughout the organization

29. MANAGERIAL RESPONSIBILITIES
 Top management is required to regularly review
certain aspects of the QMS to make sure that the
goals are being achieved and to look for ways to
improve the QMS.
 The review must cover suitability, adequacy, and
effectiveness of the QMS.
 The review also includes assessing opportunities for
improvement and needed changes to the
QMS, quality policy, and quality objectives.
 Records of these review must be kept.

30. REVIEW INPUT
These meetings must address the following areas:
 Internal audit results,
 Customer feedback,
 How well processes have been working,
 How well products have been meeting requirements,
 Status of previously identified problems,
 Items identified for follow-up in previous management reviews,
 Planned process or product changes that could affect quality,
 Recommendations for improvement generated through the
operation of the QMS

31. REVIEW OUTPUT
 These reviews result in decisions and actions related
to:
 Improving the QMS
 Improving the Product
 The need for additional resources, including Human
Resources.

32. MANAGING FOR QUALITY

34. HOSHIN
 The hoshin process is, first of all, a systematic planning
methodology for defining long-range key entity
objectives.
 These are breakthrough objectives that typically
extend two to five years with little change.
 Second, the hoshin process does not lose sight of the
day-to-day "business fundamental" measures required
to run the business successfully.
 This two-pronged approach provides an extended
period of time for the organization to focus its
breakthrough effort while continuously improving key
business processes day to day

35. PART-4
BPR: INCENTIVES & MOTIVATION

36. BPR &
Motivation
Willingness to
Change
Management
Support for
the Change
Leader as
Motivation
Team based
Effort
Clear &
Measurable
Goals
Business
Process vs.
Business
Function
Adopting
Technology
for Change
BPR & MOTIVATION

37. BPR and
Incentives
Sales
Incentives
Performance
Linked
Incentive
Schemes
Points
Program
Employee
Incentive
Programs
Consumer
Incentive
Programs
Dealer
Incentives
INCENTIVE SCHEME

38.  Change management is a structured approach to
shifting/transitioning individuals, teams, and organizations from a
current state to a desired future state.
 Kotler defines change management as the utilization of basic
structures and tools to control any organizational change effort.
CHANGE MANAGEMENT

39.  It makes use of performance metrics, such as
 financial results,
 operational efficiency,
 leadership commitment,
 training needs,
 counselling,
 communication effectiveness,
 monitor and implementation &
 the perceived need for change to design appropriate strategies,
in order to avoid change failures or solve troubled change
projects.
CHANGE MANAGEMENT

40. Fullan (1993) lists eight "basic lessons" that can be
learned about the process of change and
improvement:
 Lesson One: You Can't Mandate What Matters (The more
complex the change, the less you can force it.)
 Lesson Two: Change is a Journey, not a Blueprint (Change is non-
linear, loaded with uncertainty and excitement and sometimes
perverse.)
 Lesson Three: Problems are Our Friends (Problems are inevitable
and you can't learn without them.)
 Lesson Four: Vision and Strategic Planning Come Later
(Premature visions and planning blind)

41.  Lesson Five: Individualism and Collectivism Must Have Equal
Power (There are no one-sided solutions to isolation and
group think.)
 Lesson Six: Neither Centralization Nor Decentralization
Works (Both top-down and bottom-up strategies are
necessary.)
 Lesson Seven: Connection with the Wider Environment is
Critical for Success (The best organizations learn externally
as well as internally.)
 Lesson Eight: Every Person is a Change Agent (Change is too
important to leave to the experts, personal mind set and
mastery is the ultimate protection.)

42.  Change management is a structured approach to
shifting/transitioning individuals, teams, and organizations from a
current state to a desired future state.
 Kotler defines change management as the utilization of basic
structures and tools to control any organizational change effort.
DYNAMICS OF CHANGE

43.  It makes use of performance metrics, such as
 financial results,
 operational efficiency,
 leadership commitment,
 training needs,
 counselling,
 communication effectiveness,
 monitor and implementation &
 the perceived need for change to design appropriate
strategies, in order to avoid change failures or solve
troubled change projects.
DYNAMICS OF CHANGE

44. CHANGING ATTITUDES AND BEHAVIOURS
 Theories
 Social Cognitive Theory
 Theory of Planned Behaviour
 Trans-theoretical Model

45. SOCIAL COGNITIVE THEORY

46. THEORY OF PLANNED BEHAVIOUR

47. TRANS-THEORETICAL MODEL

48. PART-5
BPR: TRENDS & TECHNIQUES

49. FMS – FLEXIBLE MANUFACTURING SYSTEMS
 Definition
A flexible manufacturing system is a group of numerically-
controlled machine tools, interconnected by a central
control system. The various machining cells are
interconnected, via loading and unloading stations, by an
automated transport system.
It is an automated production system that produces one or
more families of parts in a flexible manner

50. FMS

51. FMS
 Objectives
 to approach the efficiencies and economies of scale
normally associated with mass production
 to maintain the flexibility required for small- and medium-
lot-size production of a variety of parts

52. FMS
 Benefits
 less waste
 fewer workstations
 quicker changes of tools, dies, and stamping machinery
 reduced downtime
 better control over quality
 reduced labour
 more efficient use of machinery
 work-in-process inventory reduced
 increased capacity
 increased production flexibility

53. FMS
 Limitations
 Handles a relatively-narrow range of part varieties
 Increases complexity and cost
 Requires a longer planning and development period
 Reduces equipment utilization
 Requires skilled staff and competent management

54. CAD/CAM
 Computer Aided Design (CAD)
 It is the use of computer technology for the process of
design and design-documentation.
 Computer Aided Manufacturing (CAM)
 It CAM is the use of computer software to control machine
tools and related machinery in the manufacturing of work-
pieces.

55. CAD

56. CAD
 Features of CAD
 It is used to design curves and figures in 2D space; or curves,
surfaces, and solids in 3D space
 Applications include industries such as:
 Automotive, Shipbuilding, Aerospace Industries, Industrial And
Architectural Design, Movie Animations etc
 Types
 2D Drafting, 3D Wireframe, 3D Dumb Solids, 3D Parametric Solid Models

57. CAM
 Features of CAM
 High Speed Machining, including streamlining of tool paths
 Multi-function Machining
 5 Axis Machining
 Feature recognition and machining
 Automation of Machining processes
 Ease of Use

58. CAM

59. ROBOTICS AND ROBOTS
 Robot is a piece of equipment with the capability to be
programmed to perform quick and accurate operations multiple
times.
 An industrial robot is defined by ISO as an automatically
controlled, reprogrammable, multipurpose manipulator
programmable in three or more axes.
 The field of robotics may be more practically defined as the
study, design and use of robot systems for manufacturing.
 Typical applications of robots include welding, painting,
assembly, pick and place, product inspection, and testing; all
accomplished with high endurance, speed, and precision.

60. INDUSTRIAL ROBOT

61. ROBOTICS

62. GROUP TECHNOLOGY
 Group technology was introduced by Frederick Taylor
in 1919 as a way to improve productivity.
 One of long term benefits of group technology is it
helps implement a manufacturing strategy aimed at
greater automation.
 Group technology (GT) is a manufacturing philosophy
that seeks to improve productivity by grouping parts
and products with similar characteristics into families
and forming production cells with a group of dissimilar
machines and processes

63. GT

64. GT
Group technology has the following actions on the
manufacturing process:
 Part Simplification
 Process Standardization
 Production Control
The changes group technologies can have on the
production process.
 Tighter Parts Control
 Close physical layout of machine groups
 Orderings tied to production

65. Results of GT at the organizational level
 Systematic design and redesign
 High-quality level
 Less process planning time and setup time
Impacts of GT on production process
 Reduced purchasing cost
 Less redundant purchases.
 Accurate cost estimation
 A more efficient process
 Quicker design changes
 Standardized Parts
 Improved customer service
 Classification builds customer relationships

66. TREND IN SERVICE AUTOMATION
 Service industries, which are essential to the
economy, continue to grow at a fast pace.
 The addition of automation to the service industry has
led to improved performance and quality of service
delivery to the nation’s consumers.

67. Services
Wholesaling
Trading
Retail
Social
Transport
Financial
Hospitality
Food

68. THE SERVICE WHEEL

69. SERVICE AUTOMATION
 Advantages
 Makes business expansion possible
 Competitive businesses
 Lowers costs
 Relatively low set-up and equipment cost
 Reduces Staff and hence Work-Hours
 E.g.: ATMs
 Limitations
 Initial Investment
 Requires more technical job skills
 Leads to unemployment