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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。 Process Measure Data Output Example。 and Michael Hammer?s Perspective ?Allows a diverse group to create a clear, explicit picture of a plex business process –a mon language –easy to understand (visual display) ?Serves as a starting point to redesign the system Process mapping is a critical tool for business reengineering. Building Blocks: Objectives: Basic activity steps – always begin with an action verb Nesting detail Decisions regarding flow Start or end of process or “Go To” another section or page Rework loops Information system Storage Movement / transportation no yes Diagnose PMO 25 SFR Reengineering Example Process Map: AC Slide Design Process Slide Completed Fillout Slide Schedule Graphics Perform Research/ Run Model Walk to Graphics Manager Approval? no minor modification no radical redesign Graphics Produces Slide Questios/ Issues? no yes Walk to Graphics Submit Slide Wizard Crashes? no yes Errors? yes no Consultant Approval? no yes Proof Slide Correct Slide Blank Slide Created Graphics Calls to Clarify Swear Profusely Diagnose PMO 26 SFR Reengineering ActivityBased Costing See Related Topics: Defining Costs to be Assigned。 offline, in sequence ?Lower quality from scratches and dings ?Time lost working around doors ?Difficult to insert big items like seats and instrument panel ?Higher quality ?Less wasted effort ?Parallel work flow ?Assembly workers build inefficiently around doors ?Finished car rolls off line ?Body exits paint shop, remove doors at start of final assembly ?Assembly workers build out car without doors ?Reattach doors in sequence (at end of line) See Additional Example: Taco Bell Example 8 SFR Reengineering Agenda ?Objectives ?Reengineering Introduction –definition –significance –Bain?s reengineering practice ?Reengineering Process ?Example ?Defense Co. ?Exercise 9 SFR Reengineering Significance of Reengineering ?Levi Strauss Co. –$850 million reengineering program halted –additional $14 million allocated for a twoyear ?education? effort to calm unhappy employees Unsuccessful Reengineering Programs (~2/3 of all programs) ?Pacific Telesis / Pacific Bell –$XB saved over Y years ?Federal Express –package delivery shortened from 4 days to 1 day ?General Electric –productivity doubled in order fulfillment ?Texas Instruments –order fulfillment went from 25 weeks down to 4 weeks ?United Airlines –plane turnaround shortened from 40 minutes to 25 minutes Successful Reengineering Programs (~1/3 of all programs) Reengineering efforts have enormous potential, but are very difficult to implement successfully. Our clients hire us to ensure that their reengineering effort is successful Examples from Public Sources: 10 SFR Reengineering Reengineering Success Factors ?Objective, outsider?s perspective ?Creative “out of the box” thinking ?Experience in reengineering and corporate transformation ?Coaching and training ?Dedicated team to ensure that process continues ?Group moderating skills ?Analytical horsepower Bain ValueAdded ?Compelling case for action –factbased analysis –vision for the future ?“Clean slate” options available to redesign teams: challenge the status quo ?Focus on delivering value to customers: Clear and consistent sense of purpose ?Top management leadership mitment ?The right process owners / managers: Bridge anizational boundaries ?Explicit targets for success Critical Success Factors Bain’s valueadded enables our clients to successfully design and implement reengineering programs. 11 SFR Reengineering Agenda ?Objectives ?Reengineering Introduction –definition –significance –Bain?s reengineering practice ?Reengineering Process ?Example ?Defense Co. ?Exercise 12 SFR Reengineering The Bain Approach to Reengineering (1 of 2) Bain goes beyond the traditional definition of reengineering to return maximum value. ? The holistic and radical redesign... ?…of the entire business system / core processes… ?…to achieve full potential… ?...in building strategic petitive advantage Bain Approach ? The radical redesign... ?…of business processes… ?…to achieve dramatic improvements… ?...in critical measures of performance Traditional Reengineering 13 SFR Reengineering The Bain Approach