mdi-ipm it and bpr

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MANAGEMENT DEVELOPMENT ISNTUTUTE

COLLEGE OF BUSINESS ADMINSTRATIONMISSOURI STATE UNIVERSITY

Mini MBA: Information Technology and

Business Process Reengineering

Presented by:

Waleed El-Naggar, MBA, PMP



Contents

Introduction: The Information Age

Management Information Systems


E-Commerce

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Learning Objectives

Explain the importance of the use of

Information Technology in Business

Explain the role of Business Process

Reengineering (BPR) within the organization

Identify the basic steps of BPR

Explain the use of e-commerce

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THE INFORMATION AGE

“The stone age was marked by man's clever

use of crude tools; the information age, to

date, has been marked by man's crude use of

clever tools.”

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Information Age

Adam Smith in his book “Wealth of Nations”, stated

that the wealth of a nations is dependent on how well

a society organizes its production in national

businesses and factors.

The wealth of nations will be dependent upon how

well a society can organize information & knowledge Knowledge workers are those who use, manipulate,

process and transmit information.

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Computers Personal computer (PC) is a general-purpose computer

whose original price, size, and capabilities make it

useful for individuals, and which is intended to be

operated directly by an end user, with no interveningcomputer operator.

Today a PC may be a desktop computer or a laptop.

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Internet The Internet is a global network of interconnected

computers, enabling users to share information along

multiple channels

The World Wide Web (www) is a very large set of

interlinked hypertext documents accessed via the Internet.

Electronic mail (e-mail) is any method of creating,

transmitting, or storing primarily text-based humancommunications with digital communications systems File

Transfer/Sharing

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Management Information Systems

An 'MIS' is a planned system of the collecting,

processing, storing & disseminating data in the form

of information needed to carry out the functions of management

Academically, the term is commonly used to refer to

the group of information management methods tied to

the automation or support of human decision making

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Microsoft Office

Microsoft Word (Text Editor)

Microsoft Excel (Spreadsheets)

Microsoft Power Point (Presentations).

Microsoft Project (Project Management)

Microsoft Outlook (Email)

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Enterprise Resource Planning

Enterprise resource planning (ERP) is an enterprise-

wide information system designed to coordinate all

the resources, information, and activities needed tocomplete business processes such as order fulfillment

or billing

ERP delivers a single database that contains all data

for the software modules

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Manufacturing

Supply chain

management Financials

Projects

Human resources

Access control

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Customer relationship

management

Sales and marketing,commissions, service,

customer contact and call

center support

Data warehouse




SAP

SAP ERP Financials

SAP ERP Logistics

SAP ERP Human Resource Management

Oracle ERP

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In-class Case Study

A software development company needs to implement an ERPsystem. Discuss what the company needs for successful

implementation.

Systems Analysis (HR, Accounting, HR, project reporting,

Supplier chain, sales, marketing

Required Resources (Machines, software, employees).Training.

Vendors

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Business Information Technology

Business Information Technology (BIT) is concerned with arange of factors that determine the effective and efficient

design, development and integration of information systems

and Information technology to increase the income or profit.

According to an American survey in 1990, over 50% of the

employees in the US are knowledge workers.

On average, over 75% of the national capital investment within

modern information-based economics is on IT and IS.

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Information Technology & Information System

• An information system within business results from the structure of

integrates to handle , store and process data.• There are three components parts to an information system:

The data processing activity

Information represent processed data

• Quality information for decision making is an essential asset for any competitive business.

Inputs Processing Outputs

Data InformationProcessing

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Technology Growth

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Business and Technology

Business organizations are often referred to as beinginformation based retrieval e.g.:

Banking sectors

Financial organization

Airlines companies

Stock keeping

Payroll

Professional Investment Systems (PIS)

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BUSINESS PROCESS REENGINEERING

“An organizational make-over”

“Reengineering is new, and it has to be done.”

Peter F. Drucker

١٨



What is “Process”?

“A specific ordering of work activities across

time and space, with a beginning, an end, and

clearly identified inputs and outputs: a

structure for action”

(Davenport,

1993)

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• The search for, and implementation of, radical

change in business processes to achieve

breakthrough results

• Synonyms: business process redesign, business

transformation, process innovation, business

reinvention, change integration

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• Rather than organizing a firm into functionalspecialties (like production, accounting, marketing,

etc.); complete processes from materials acquisition,

to production, to marketing and distribution should

be considered.

• The firm should be re-engineered into a series of

processes.

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BPR is NOT:

• Automation• Outsourcing

• Downsizing

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BPR vs. Continuous Improvement

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Continuous Improvement

Incremental ChangePeople Focus

Low InvestmentImprove Existing

Work Unit Driven

Process Reengineering

Radical TransformationPeople & Technology Focus

High InvestmentRebuild

Champion Driven



BPR, A System Perspective

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TransformationInputs Outputs

Feedback

Environment



BPR in Action

Start from the future and work backwards BPR is not easy - serious work

BPR is not free - financial & cultural BPR often driven by fear and greed

Change is a “struggle”; BPR is a “war”

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BPR: Strategy

Stakeholder Assessment - shareholders,

customers, employees

Determine which stakeholder expectations should be met to gain competitive advantage

Determine how to redesign to meet expectations

Map out IT solutions to support

Develop & implement new processes, etc.

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٢٧



BPR Key Steps

• Select The Process & Appoint Process Team

• Understand The Current Process

• Develop & Communicate Vision Of ImprovedProcess

• Identify Action Plan

• Execute Plan

٢٧

٢٨



1. Select the Process

Review Business Strategy & Customer Requirements

Select Core Processes

Understand Customer Needs

Don’t Assume Anything

Select Correct Path for Change

Appoint BPR Champion

٢٨

٢٩



1. Select the Process (Contd.)

Identify Process Owners

Establish Executive Improvement Team

Provide Training to Executive Team

٢٩

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2. Understand the Current Process

Develop a Process Overview

Clearly define the process (Scope & Boundaries)

Set business and customer measurements

Understand customers expectations from the process

Clearly Identify Improvement Opportunities

٣٠

٣١



3. Develop & Communicate Vision of

Improved Process

Shared understanding among all stakeholders

Provide information on the progress of the BPR

Assure that the BPR is necessary & properly managed Indicate actions required and those responsible

Tackle any actions that need resolution

Direct communication to reinforce new patterns of

desired behavior

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4. Identify Action Plan

Develop an Improvement Plan & appoint Process

Owners

Simplify the Process to Reduce Process Time

Remove Bureaucracy that may hinder

implementation

Remove non-value-added activities

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4. Identify Action Plan (Contd.)

Standardize Process & Automate Where Possible

Up-grade Equipment

Plan/schedule the changes

Construct in-house metrics and targets

Introduce and firmly establish a feedback system

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5. Execute the Plan

Qualify/certify the process

Perform periodic qualification reviews

Define and eliminate process problems

Evaluate the change impact on the business and oncustomers

Benchmark the process

Provide advanced team training

Evaluate the Results

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٣٥



Reengineering Success Factors

Strong Top Management Sponsorship Alignment with company strategic direction

Measurable objectives

Proven Methodology

Effective Change Management.

Line Ownership (pair ownership with accountability) Reengineering Team Composition (breadth &

knowledge)

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Case: Ford Motors, Reengineering

the Accounts Payable Department

Results of BPR effort

Reduction of paper flow (invoice-less processing)

Up-to-date data

Personnel reduction by 75% Accurate financial information

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Reengineered Process Enabled by IT

Process: Accounts Payable

Account Payable Department: 500 Personnel (400 after

improvement) vs. 15 in Mazda

Enormous paperwork, non-matching data: Purchase

order, Receiving documents, invoices

BPR: Just-in-time Purchasing – Eliminate non-value-adding activities

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Technology Facilitates the ProcessPeople drive the Process

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E-Commerce

Buying and selling of products or services overelectronic systems such as the Internet.

The amount of trade conducted electronically grew

extraordinarily since the spread of the Internet.

Modern electronic commerce typically uses the

World Wide Web at least at some point in thetransaction's lifecycle, although it can encompass a

wider range of technologies such as e-mail as well.

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Online Activities

Buying online (amazon.com, ebay.com, … etc) –

Eliminate distance

On-line auctions.

Virtual Banking. Travel and booking information.

E-library

E-government

E-advertising (free services)

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Case Study – Send Results by Email Search engines are free tools used to search for anything

on the Internets.

Main Revenue: Advertising

Smart engines: which advertisement to show?

▫ User location

▫ User Interests

Engines evolve into portals (Google, Yahoo, … etc)

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