Processes and Business Process Reengineering

Transcription

1 Processes and Business Process Reengineering Lecture 4 Week commencing 13 th February, 2012

2 BPR: Outcomes Explain the importance of process design; Apply the tools of mapping processes and identifying improvements; Apply Little s Law for calculating throughput time and cycle time; Explain the significance of.

3 Design example Environmentally sensitive product and process

4 Design of products/services and processes design Products and services should be designed in such a way that they can be created effectively. Product/service design has an impact on the process design and vice versa. Processes should be designed so they can create all products and services which the operation is likely to introduce.

5 Process mapping symbols design Process mapping symbols derived from Scientific Management Operation (an activity that directly adds value) Process mapping symbols derived from Systems Analysis Beginning or end of process Inspection (a check of some sort) Transport (a movement of something) Delay (a wait, e.g. for materials) Storage (deliberate storage, as opposed to a delay) Activity Input or Output from the process Direction of flow Decision (exercising discretion)

6 Re-engineering Processes Raw materials design Standardised sandwich old process Assembly Stored sandwiches Move to outlets Stored sandwiches Sell Take payment Standard sandwich process Raw materials Assembly Take payment Customer request Customised sandwich old process Customer request

7 Higher level process map design The operation of making and selling customised sandwiches Use standard base? Sandwich materials and customers Bread and base filling No Prepare Assemble whole sandwich Assemble as required Take payment Customers assembled to sandwiches The outline process of making and selling customized sandwiches Customer request Yes Stored bases Fillings Assemble from standard base The detailed process of assembling customized sandwiches

8 Customised Sandwich New Process design Assemble whole sandwich Assembly of sandwich bases Use standard base? No Take payment Fillings Bread and base filling Customer request Yes Stored bases Assemble from standard base

9 Flow process charts for processing expense Description of activity Report arrives Wait for processing Check expenses report Stamp and date report Send cash to receipt desk Wait for processing 7 Check advance payment 8 9 Send to accounts receivable Wait for processing 10 Check employee record 11 Send to account payable 12 Attach payment voucher 13 Log report 14 Check against rules 15 Wait for batching 16 Collect retorts into batch 17 Batch to audit desk 18 Wait for processing 19 Batch of reports logged 20 Check payment voucher Reports to batch control Batch control number 23 Copy of reports to filing 24 Reports filed 25 Payment voucher to keying 26 Confirm payment Description of activity Report arrives Stamp and date report Check expenses report Attach payment voucher Wait for batching Collect retorts into batch Batch to audit desk Wait for processing Check reports and vouchers Reports to batch control Batch control number Copy of reports to filing Reports filed Payment voucher to keying Confirm payment Before After Totals Totals

10 Flow process charts for processing expense reports at Intel Flow process chart Description of activity Report arrives Wait for processing Check expenses report Stamp and date report Send cash to receipt desk Wait for processing 7 Check advance payment 8 9 Send to accounts receivable Wait for processing 10 Check employee record 11 Send to account payable 12 Attach payment voucher 13 Log report 14 Check against rules 15 Wait for batching 16 Collect retorts into batch 17 Batch to audit desk 18 Wait for processing 19 Batch of reports logged 20 Check payment voucher Reports to batch control Batch control number 23 Copy of reports to filing 24 Reports filed 25 Payment voucher to keying 26 Confirm payment Totals Intel got this process down to 15 steps. Look for ways to improve the process/ reduce the steps: What is wasteful in the process? Can some tasks be done simultaneously? Before

11 Throughput (TH) = Work In Process (WIP) x Cycle Time (CT) law Cycle time = 2 mins WIP = 10 Throughput time =? Throughput time = 10 2 mins Throughput time = 20 mins

12 - example law Throughput (TH) = Work In Process (WIP) x Cycle Time (CT) No of people required = work content / cycle time TH = the time for a unit to move through the process WIP = Materials or partly finished products CT = The actual time it takes to complete a process from start to finish to produce a unit. Work content = the total amount of work required to produce a unit of output

13 Need to process 500 applications in 5 days (working 7 hours a day). Takes 1 hour to process each application. What is the throughput time? What is the cycle time? How many people are needed?

14 Pareto s Law (80/20 rule) law A general law found to operate in many situations that indicates that 20% of something causes 80% of something else Used in Process Improvement, e.g. 20% of types of problems produce 80% of disruption Used in Inventory Management, e.g. 20% of products produce 80% of sales value

15 ABC classification law Cumulative % of total value Class A items: 20% of high-usage value items which account for around 80% of total usage value Class B items: next 30% or so of medium usage values count for 10% of total usage value Class C items: next 50% of low-usage value, account for 10% of total usage value % of total number of items

16 learning learning Slack et al 2011 (white cover) Chapter 5: Slack et al 2010 (black cover): Read Chapter 4. Process Design Complete the workshop task (if not complete in the class) Continue working on your assignment

17 Questions