PROCESS INNOVATION - PowerPoint PPT Presentation

1 / 22
About This Presentation
Title:

PROCESS INNOVATION

Description:

(The American Heritage Dictionary) ... Inner loop: like medical exam; outer loop: like ... Like medical examination? 24. Taxonomy of Redesign Transformations ... – PowerPoint PPT presentation

Number of Views:24
Avg rating:3.0/5.0
Slides: 23
Provided by: markn5
Category:

less

Transcript and Presenter's Notes

Title: PROCESS INNOVATION


1
PROCESS INNOVATION
  • MN3309 Session 18
  • Prof. Mark Nissen

2
Agenda
  • Reengineering Process Innovation
  • Redesigning Reengineering
  • Quickly today
  • Review next session
  • Redesign Example (take 1)
  • Case/homework Assignment
  • Summary

3
Innovation
  • innovate verb
  • To begin or introduce (something new) for or as
    if for the first time.
  • invent verb, transitive
  • To produce or contrive (something previously
    unknown) by the use of ingenuity or imagination.
  • (The American Heritage Dictionary)
  • Innovation effort to create purposeful, focused
    change in enterprises economic or social
    potential (Drucker)

4
Discipline of Innovation
  • Taxonomy of innovation opportunities
  • Purposeful, systematic innovation
  • Analyze all sources of new opportunities
  • Use both sides of brain
  • Simple, focused, single innovation
  • Start small
  • Aim for industry leadership
  • Hard, focused, purposeful work
  • Can innovation be disciplined?

5
Innovation Opportunities - Internal
  • Unexpected occurrences
  • Use computer for payroll
  • Edsel failure gt Mustang success
  • Incongruities
  • Container ships railroad/truck techniques
  • Process Needs
  • Japanese road reflectors
  • Newspaper advertising
  • Industry/market changes
  • Institutional investment
  • Internet markets

6
Innovation Opportunities - External
  • Demographic changes
  • Japanese robotics
  • Club Med vacations
  • Perceptual changes
  • Health product markets
  • Personal computer
  • New knowledge
  • Scientific, technical and social categories
  • Most common notion of innovation (RD)
  • Most difficult to predict, manage and effect in
    timely manner (50 years ave thru history)

7
Reengineering Process Innovation
  • BPR (Hammer Champy)
  • the fundamental rethinking and radical redesign
    of business processes to achieve dramatic
    improvements in critical, contemporary measures
    of performance
  • Innovation (Davenport)
  • revolutionary, process approach to effect
    quantum, multiplicative improvements in business
    performance
  • Compare with Druckers concept?

8
Reengineering Overview
  • Powerful approach to process innovation
    reinvention
  • Focus on enterprise process
  • Dramatic performance improvement
  • Responsible for much economic growth
  • Raises competitive bar
  • BPR vs. TQM/TQL?

9
Reengineering Overview
  • 30B including expenses systems
  • IT as central enabler
  • 50-75 failure rate
  • High risk, high return venture
  • You are likely to experience BPR
  • 50 cycle-time reduction --gt BPR?

10
Reengineering Exemplars
  • Commercial
  • IBM Credit (2 weeks --gt 4 hours)
  • Ford A/P (500 people --gt 125 --gt 5?)
  • Federal Mogul (20 weeks --gt 20 days)
  • NoGru S/W procurement (10 wk --gt 7 day)
  • Government
  • IRS (collections 33, staff - 50)
  • DoD spectrum assignment (6 mo --gt 3 wk)
  • SPEDI, AF ADPE procurement
  • Many others

11
BPR Organization Roles
  • Organization
  • Cross-functional teams (IPTs)
  • Spans org hierarchy
  • Can include customers suppliers
  • Roles (not mutually exclusive)
  • Enterprise Leader
  • BPR Steering Committee
  • Process Owner
  • Reengineering Czar
  • Reengineering Team

12
Reengineering CSFs
  • Critical Success Factors (CSFs)
  • Preconditions for success
  • Top management commitment
  • Realistic expectations (cost/time/results)
  • Right people working full-time
  • Empowered, collaborative BPR team
  • Shared vision
  • Sound management processes
  • Org growth expansion context
  • Sufficient patience budget

13
BPR Life Cycle
  • Future vision
  • Process ID selection
  • Process redesign - KW
  • Redesign implementation
  • Continuous improvement
  • Next process or iteration

14
Process Redesign
  • Central analytical process in BPR
  • Parallels IS analysis design
  • Analytical, upstream activities
  • Match tech with requirements
  • Key to implementation maintenance
  • Two major approaches
  • Greenfield (aka blank sheet of paper)
  • Baseline transformation (as-is --gt to-be)

15
Greenfield To Be Scenario
16
Aircraft System Design Model
Configuration Measurement
Wing Area
System
Thrust
Plastic
FBW
Performance - Speed - Altitude - Maneuverability
Weight
Environment
17
Process Redesign Model
Configuration
Performance
Environment
Transform
Strategy
18
Reengineering Success?
See, a perfect fit
Worked great for our other clients
19
Second Wave of BPR Baseline Transformation
  • Make legacy processes explicit
  • Principal steps (from Davenport)
  • Model current process flow
  • Measure baseline process
  • Diagnose process pathologies
  • Match appropriate transformations
  • Generate redesign alternatives
  • Prototype test redesigns
  • Presently KW done manually

20
Redesigning Reengineering
Select
Implement
Model
Measure
Rqmts/Test
ID select process
Diagnose (taxonomy)
Generate
Match (taxonomy)
Inner loop like medical exam outer loop like
product design?
21
Redesigning Reengineering
Select
Implement
Model
Measure
Test
ID select process
Diagnose
Generate
Match
22
Configuration Dimensions Graph-Based Measures
Configuration
Performance
- Space (statics) length, breadth,
depth - Structure (AI, system dynamics)
feedback, parallelism, size - Dependency
(AI, coordination)
decomposability, producer-consumer, shared -
Organization (STS) job
specialization, centralization, job scope -
Technology (IS) IT-Support,
-Communication, -Automation
23
Taxonomy of Process Pathologies
  • 10 classes of common pathologies
  • Problematic process structure (linear flows)
  • Bureaucratic organization (job specialization)
  • Fragmented process flows (process friction)
  • IT infrastructure (manual, paper-based)
  • Checking approach to quality (many reviews)
  • Centralized authority (long decision chains)
  • Under-utilized human potential (training v ed)
  • Inhibitive leadership (directive supervision)
  • Centralized information (central DB arch)
  • Deficient core competencies (IT expertise)
  • Like medical examination?

24
Taxonomy of Redesign Transformations
  • 7 classes of common transformations
  • Workflow reconfiguration (de-linearization)
  • Information technology (shared DB system)
  • Organizational design (case manager)
  • Human resource (team-based compensation)
  • Information availability (informate agents)
  • Inter-org alliance (supplier-run inventory)
  • Management culture (ESOP)
  • Source of innovation opportunities?

25
Measurement Example
Step 1 Step 2 Step 3
Step 4 Step 5 H
H H
H A AgentA A AgentB A AgentC
A AgentD A AgentE O Org1 O
Org2 O Org3 O Org4 O
Org5 S none S SysA S SysB
S SysC S SysD C phone C
paper C paper C paper C
paper U nil U nil U
nil U nil U nil
Measurements Size 5, Length 5, Feedback
1, Handoffs 4, IT-support 4, IT-Communication
0, IT-Automation 0
KOPeR (NPS site)
26
Diagnostic Example
Password?
27
Diagnostic Example
Redesigns?
28
Redesign Example
Transformations - Delinearization steps 2 3 -
Empowerment step 5 FB - Case manager steps
1-4, H - Workflow system steps 1-4
Step 1 Step 2 Step 3
Step 4 Step 5 H
H H
H A AgentB A AgentB A AgentB
A AgentB A AgentE O Org1 O Org2
O Org3 O Org4 O
Org5 S none S SysA S SysB
S SysC S SysD C WF C
WF C WF C WF C
paper U nil U nil U
nil U nil U nil
X
X
X
X
X
Measurements Size 4, Length 3, Feedback
0, Handoffs 0, IT-support 4, IT-Communication
4, IT-Automation 0
KOPeR (NPS site)
29
Comparative Measurements
30
Redesign Example
31
BPR Example
  • Credit Financing process
  • Big ticket electronic equipment
  • Key part of order fulfillment
  • Customer, sales, credit, delivery VCs
  • Independent, bureaucratic credit org
  • 6-14 days cycle time for credit package
  • No capability for internal tracking
  • Losing customers tired of waiting

32
Credit Financing Process
33
Credit Financing - Level 1
Measurements Size 6, Length 6, Feedback
1, Handoffs 5, IT-support 4, IT-Communication
0, IT-Automation 0
34
Acquisition Redesign Example
  • Procurement processes (3)
  • JA (small, simple)
  • RFP (medium, average)
  • LCP (large, complex)
  • Major military sites (aviation)
  • Approximately 220 contracts personnel
  • Approximately .75B/yr
  • Well-managed organization (TQM etc.)

35
JA Process - Level 1
Basic structure - Attributed Digraph
Customer JA doc CS
Approvals File assist
assign
- Level (1) - Type (A) - Agent(CS) -
Cardinality(1) - Org(Procurement) - Inputs(Stub,
rqmts) - Outputs(JA_draft) - Tools(NIL) -
Communication(Paper)
36
JA Level-2 Approvals
Task List 11 Legal review 10 KO review 8 RACA
review 6 PACA review 3 NAVAIR review
37
JA Process Measurements Diagnostics
indicates theoretical minimum for
measure Redesign alternatives?
38
JA Redesign Alternatives
indicates superiority by process experts
39
JA Redesign Performance
indicates exceeded performance-doubling
threshold
40
JA Process Specification
indicates theoretical minimum for measure
41
Innovation Case Assignment
  • Redesign the Process
  • Represent using A-digraph
  • Include org, agent, tools, other info
  • Measure process
  • Diagnose pathologies
  • Identify transformations
  • Generate at least two redesigns
  • Refer to examples in KOPeR
  • Also in MISQ article

42
Summary
  • Innovation can be disciplined
  • BPR is powerful approach
  • Raises competitive bar
  • High-risk, high-return venture
  • You are likely to experience
  • Process measurement
  • Enables engineering approach to BPR
  • Combine with redesign heuristics
  • KBS support through KOPeR (VPM)
Write a Comment
User Comments (0)
About PowerShow.com