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ective ?Utilizes Bain?s plete toolkit ?Implementation support to ensure realization of full potential ?Valuedriven attitude ?Factbased, datadriven analysis ?Focused creativity ?Focus on achieving results 14 SFR Reengineering Bain Experience / Results See Related Topic: Evolution of Bain Reengineering ?15% reduction in total costs。 18% improvement in customer satisfaction Process Industry Results ?Air freight express ?Truck delivery ?5 times improvement in revenue, 11 times improvement in operating earnings, and 10 times increase in share price ?Computers ?Distribution ?Product permutations decreased from 1 billion to 40,000。 order and edit process shortened from 11 to 0 days, scheduling from 26 to 4 days, time vehicle on lot from 71 to 31 days ?Automobiles ?Manufacturing and distribution ?4065% headcount reduction in finance functions ?Aerospace ?Budgeting and forecasting ?70% reduction in lead time ?Consumer products ?Marketing and advertising ?71% reduction in manufacturing cycle time ?Athletic footwear ?Manufacturing ?3day pricing decision reduced to 30 seconds ?Credit cards ?Marketing ?50% reduction in headcount ?Utility ?Engineering Bain has worked in a variety of different industries and has delivered significant results for its clients. 15 SFR Reengineering Notes: Percentages are approximate. Str ateg y / M ar keti ng R ee ng i nee r i ng O the r0%20%40%60%80%10 0%Oth e rT r a n s p o r t a t io n / A u to m o t iv eU ti l i ti esH ealth C ar eIndustr i al P ro ductsH i g h techD ef enseT e le co m m u n i c a ti o n sR eta i l /C onsume rPr oductsReengineering is a significant portion of Bain’s business worldwide. Reengineering represents approximately 20% of Bain case work Importance to Bain 16 SFR Reengineering Agenda ?Objectives ?Reengineering Introduction –definition –significance –Bain?s reengineering practice ?Reengineering Process ?Example ?Defense Co. ?Exercise 17 SFR Reengineering Reengineering Process See Related Topic: Reengineering Roadmap Implement and Track Results Prioritize SubProcesses for Redesign Diagnose PMO FMO Redesign Quantification of Potential Design TMO, Create Initiatives Identify Critical Processes Initial Prioritization Change Management Process Definitions PMO = Present Mode of Operation TMO = Transitional Mode of Operation FMO = Future Mode of Operation 18 SFR Reengineering Reengineering Toolkit See Related Topic: Example Fishbone Diagram Implement and Track Results Diagnose PMO Allocate Costs FMO Redesign Quantification of Potential Design TMO, Create Initiatives Identify Critical Processes Initial Prioritization Change Management Process ?Strategy review ?Performance gaps, petitive benchmarks ?Management interviews ?Client interviews ?Customer interviews ?Business definition ?Process mapping ?Activitybased costing ?RAID analysis ?Cycletime analysis ?Fishbone diagrams ?Prioritization matrix ?Customer needs ?BDP analysis ?Brainstorm ?Root cause analysis ?IT opportunity assessment ?Cost / benefit analysis ?Cycle time impact ?Customer surveys – service, value impact ?Initiative ideas surveys ?Opportunity classification, consolidation ?Quick hits ?Product metrics ?Process metrics ?Financial metrics Reengineering projects utilize a number of different Bain tools. Prioritize SubProcesses for Redesign 19 SFR Reengineering Reengineering Process Implement and Track Results Diagnose PMO FMO Redesign Quantification of Potential Design TMO, Create Initiatives Identify Critical Processes Initial Prioritization Definitions PMO = Present Mode of Operation TMO = Transitional Mode of Operation FMO = Future Mode of Operation Prioritize SubProcesses for Redesign 20 SFR Reengineering What is a Process? See Related Topic: Examples of Recurring Processes See Example Core Processes: Telemunications Services Company。 Defense Company。 and Electric Utility. A process is a set of business activities which cross multiple functional boundaries to create value for a customer. Corporate Staff Finance Research and Development Manufacturing Marketing Order Fulfillment Product Development Customer Acquisition Integrated Logistics Vertical Structure Organizations Core Business Processes Traditional Organizations ProcessOriented, Horizontal View Example Core Processes Identify Critical Processes 21 SFR Reengineering Identifying Process Types There are four primary types of business processes: ?Core Process –activities dedicated to the design, production, delivery, and maintenance of products and/or services ? essential to satisfying customer needs ? . customer acquisition, manufacturing ?SubProcess –an individual process that, when bined, creates a core process ?Support Process –activities that support core business processes but are not direct contributors to the core value creating process for customers ? supports and enables the acplishment of core processes ? . human resources, MIS ?Management Process –activities that guide the strategic direction, manage stakeholder interests, and make key decisions regarding the allocation of human and capital resources ? . budgeting, strategic planning See Example Core Processes: Telemunications Services Company。 Defense Company。 and Electric Utility Begin and end with an external customer Begin and end with an internal customer Begin and end with key deci