03. Business Processes-DESKTOP-FC6L31D.ppt

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1. Business Processes
By
Ashok Kumar

2. Introduction
Business Process
•A set of logically related tasks or activities performed to achieve a defined business
outcome.
•These outcomes can be physical, informational, or even monetary in nature
Physical outcomes: the manufacture and delivery of goods to a customer
Informational outcome: might be registering for college courses
Monetary outcome: payment to a supply chain partner for services rendered

3. Business Processes may be divided into 3 types:
Primary Processes Support Processes Development Processes
Providing a service Evaluating suppliers Developing new products
Educating Customers Recruiting new workers Performing basic research
Manufacturing Developing a sales & operations
plan (SOP)
Training new workers
Primary Process
•A process that addresses the main value-added activities of an organization
Support Process
•A process that performs necessary, albeit non-value-added activities
 

4. Development process
•A process that seeks to improve the performance of
primary and support processes
Improving Business Processes
•Step 1: Map the Process
•Step 2: Analyze the Process
•Step 3: Redesign the Process
•Step 4: Acquire Resources
•Step 5: Implement and Communicate Change
•Step 6: Review the Process
Example: Improvement in Passport application

5. Mapping Business Processes
•The process of developing graphical representations of the organizational
relationships and/or activities that make up a business process is called mapping
Mapping serves several purposes:
1.Creates a common understanding of the content of the process: its activities, its
results, and who performs the various steps
2.Defines the boundaries of the process
3.Provides a baseline against which to measure the impact of improvement efforts

6. Following approach is used to map processes:
1.Relationship Mapping
2.Process Mapping
Family 1
Supplier
Family 2
Supplier
Family 3
Supplier
Family 10
Supplier

Supplier of
“Cockpits”
Assembly
Plant
Tier 1
Tier 2
Automotive
OEM
Physical and
Information
Flows

Relationship Map
•A high-level map that
shows the major
organizational entities
involved in a business
process and how they are
connected to one another
via physical, informational,
and or monetary flows

7. Process Map
•A detailed map that identifies
the specific activities that make
up the informational, physical,
and/or monetary flows of a
process
Basic steps of process mapping
are:
1.Identify the entity that will
serve as your focal point: may be
customer, order, raw material
2.Identify clear boundaries and
starting and ending points
3.Keep it simple
Start or finishing point
Step or activity in the process
Decision point (typically requires a “yes” or “no”)
Input or output (typically data or materials)
Document created
Delay
Inspection
Move activity
Mapping Symbols

10. Measuring Process Performance
•Process performance can be measured for following parameters:
1.Quality
2.Cost
3.Time
4.Flexibility
Specific Measures to evaluate Process Performance
1.Productivity
2.Efficiency
3.Cycle Time
4.Benchmarking

11. Productivity
•A measure of process performance; the
ratio of outputs to inputs
•Always expressed in terms of units of
output per unit of input
Single-factor Productivity
•A productivity score that measures
output levels relative to single input

12. Multifactor Productivity
•A productivity score that measures
output levels relative to more than one
output
Efficiency
•A measure of process performance;
the ratio of actual outputs to standard
outputs
•Usually expressed in percentage terms
Standard Output
•An estimate of what should be
produced, given a certain level of
resources

13. Cycle Time
•The total elapsed time needed to
complete a business process
•Total time required to complete a
process from start to finish; also called
throughput time
•In order to reduce cycle times,
organizations and supply chains typically
must perform well on other dimensions,
such as quality, delivery, productivity, and
efficiency
Percent value-added time
•The percent of cycle time spent on value-
added activities
•It is a measure of process effectiveness

14. Reducing Cycle Times
Cycle Time Drivers
Waiting times
Unneeded process steps
Serial v/s parallel process steps
Repeated steps
Batching
Excessive controls
Outdated technology
Lack of information or training

15. Benchmarking
•The process of identifying, understanding,
and adapting outstanding practices from
within the same organization or from other
businesses to help improve performance
Competitive Benchmarking
•The comparison of an organization's
processes with those of competing
organizations
Process Benchmarking
•The comparison of an organization's
processes with those of non competitors
that have been identified as superior
processes

16. Strategies for Business Process Improvements
•Internal & External Business Processes
•Continuous Improvement
•Business Process Re-engineering (BPR)

17. Thank you