Bài giảng enterprise resource planning chương 2

Enterprise Resource Planning, 1st
Edition by Mary Sumner
Chapter 2:
Re-engineering and Enterprise
Resource Planning Systems

© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-1/17


Objectives
•

Recognize factors associated with the
evolution of ERP systems
– BPR
– Client-server networking
Integrated databases

ã

Examine role of process modeling in
redesigning business models

â Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-2/17


Re-engineering

•

Fundamental rethinking and radical redesign of
business processes
Goal is to achieve major improvements in
performance
Efficient redesign of value chain

•
•
–

Primary activities
•

–

Secondary activities
•

•

Inbound logistics, operations, outbound logistics, marketing
and sales, service
Organizational activities, human resources, technology,
purchasing

Motivations
–

Deregulation, consolidation, customer sophistication,
increased competition
© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-3/17


© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-4/17


Business Process Re-engineering
(BPR)
•
•
•
•
•

Technology used to mechanize work
Create new business rules
Remove outdated rules
Improve responsiveness
Reduce costs

© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-5/17

Business Process Re-engineering
(BPR), continued
•

Decentralize decision making
– Become responsive to customer’s needs
– Flatten organization

•
•

Facilitated by information technology
Redesign of jobs
– New levels of judgment
New types of leaders
ã

Adaptable

â Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-6/17


© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-7/17

Process Modeling
•

Business process
–

•

Data store
–

•

Data transferred between processes or from a
process to data store

Organizational unit
–

•

Data needed by business process

Data flow
–

•

Business activities

Units where processes take place

Event
–

Includes triggers and outcomes

© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-8/17


Neighborhood Food Cooperative
•
•
•
•
•
•
•
•

Weekly cycle
Members submit list
Lists merged
Orders placed for
product by phone
Suppliers confirm in
writing with invoice
Shipments made to

cooperative
Members collect
product
Cooperative pays net
10 days
© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-9/17


Basis for Best Practices
Supported by ERP Modules
•

Re-engineered process models
– Improved process change depictions

•

Data integration
– Among multiple processes

•

Structural changes
– Streamline business functions
– Maximized productivity

© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-10/17


Reliable Finance Company
•
•
•
•
•

Expansion required redesign of existing
system
Needs enhanced information system
Increase number of branches exponentially
Achieve a competitive advantage
Analysis of loan application system
–
–

Reduce approval from 10-13 days to 2-3 days
Improve access to databases for approval
decisions

© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-11/17


Failure in Re-engineering
Rosenthal:

– Apply “clean slate” approach
•
•
•
•

Continuous training for new roles
Measure performance
Jobs must be redesigned
Use rewards as incentives to change

– Move away from status quo
– Too narrowly focused
– Project too general
© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-12/17


Information Technology
Facilitates ERP
•
•

Client-server computing allows for increase
power and control
Integrated databases
–

Reduces redundancy

•

–
–
–

Increases data consistency

Supports multiple functional units
Data maintained separately from application
modules
Database management systems
ã
ã
ã

Central data administration
Improved data integrity
Improved control

â Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-13/17


Process Enterprises
Changed management structures
– Process responsibility given to “process
owners”
•

Has process design authority

– Stresses teamwork
– Leans toward standardization of
processes
– Focuses on achieving goals

© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-14/17


Case: Re-engineering the
Payment Process System at RFC
Current payment processing system
–

Customers:
•

Make payments at branch
–

•

Mail payments to branch
–
–
–

•

Manually processed
Batched for deposit in afternoon
Home Office mailed an Advice of Payment Received

Payment made to Home Office
–
–
–

–

Cash, check, money order

Manually processed
Batched for deposit in afternoon
Branch mailed an Advice of Payment Received

Each night, batch payment processing runs to
update accounts

© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-15/17


Case: Re-engineering the Payment
Process System at RFC, continued

•
•

Weekly delinquency analysis run
Payment reminders sent out at 15, 30,
45, and 60 days
– Computer generated

•

Settlement figures processed upon
request
– Urgent requests take overnight

•

Major expansion planned
© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-16/17


Summary
•
•
•
•

BPR allows the organization to rethink
and radically redesign their business

processes
Process modeling of business
activities change organizational
management structures
ERP systems are facilitated by IT
Processes are standardized and
teamwork enhanced
© Prentice Hall, 2005: Enterprise Resource Planning, 1 st Edition by Mary Sumner

2-17/17