Business process Analysis | Assignment Help
Introduction (Background)
In this case study assessment current business process will be analyzed that what are its inefficiencies and strengths. Furthermore, new business re-engineered process and process flow chart will be suggested in the assessment to make the business process highly competitive and potentially effective with the appliance of an effective IT solution in the business process. As IT solutions can make business processes highly more competitive against rivals and effective. GAAM is an international organization which manufactures primarily metal products building systems as well as hydraulic systems. Concretely, it makes and produce hydraulic equipment such as motors, gear pumps, telescopic cylinders, as well as control valves. Used in heavy-duty vehicles for instance cranes, these products are sold out locally (United States of America) as well as overseas original equipment manufacturers. The organization’s headquarters are situated in the South Australia. Employing approximately 3,800 personnel around the globe, it operates 27 amenities in 7 countries.
Participants, Inputs and Outputs to the current system
Various tooling, supplemental essentials as well as materials such as foundry sand, varieties of ingredients which are used for pouring castings, as well as any other non-production associated products and services.
The department consists of a purchasing manager, two buyers alongside one secretary/clerk
The purchasing department receives requests for MRO supplies from 36 various individuals within the firm. These requests can take the form of either an MRO card or it could be a purchase requisition. Cards are used for items purchased regular basis while purchase requisitions are used for new items purchases.
In addition, many purchases are for old or outdated replacement parts. This research represents a majority of the MRO buyer’s total work time.
Process Flow or Activity Descriptions
The department is comprised of a purchasing manager, two buyers and one secretary/clerk. This is the primary or most common path through the business process.
Activities in the current business process includes, the purchasing department receives requests for MRO supplies from various individuals within the firm. These requests can take the form of either an MRO card or a purchase requisition. Cards are used for items purchased on daily basis while purchase requisitions are used for newly purchased brand-new items. Each of these individuals has limitations, up to which they are authorized to obtain a purchase. The limits usually range from AU$500 to AU$1,000. If this limit is accelerated than the limits, the card/requisition form must be endorsed by the individual who is at higher ranking position in terms of purchase power authority. Therefore, there is a long “chain of command” that must be followed for authorization of all the MRO purchases.
Moreover, once the card/ requisition reaches the purchasing department, it is revised as well as signed by the MRO buyers. A P/O is then created for the item(s) which has been purchased. If the item is requested by using a card, the card is returned back to the particular department which makes request for the purchase after the purchase has been placed. Recently, approximately 8,000 cards are preserved in many departments. If the item was requested using a purchase requisition, the form is filed in the purchasing department. Distribution of these P/Os is the same as for inventory purchases. These P/Os are also kept in the P/O program. In certain instances, individuals other than the MRO buyer will make purchases. If there is a critical situation in which an item is needed as soon as possible, the department will entail a purchase a specific number that is different from the sequentially normal usuals based numbers used on the normal P/Os. Once this number is ready the purchase is ready to take place. The purchasing department will then complete the P/O as well as will be distributing it on normalized basis. The purchasing department will on a daily basis get MRO requisitions for new items. Furthermore, many purchases are for old as well as outdated replacement parts. This requires the MRO buyer to demeanour significant vendor as well as the pricing research. Thus, this research represents a vast majority of the MRO buyer’s total work time processes.
Exceptions
What happens if information on a form is illegible, a required piece of information is not provided, or a special condition is met? In such situation, the department will be officially informed to provide the supporting documents. Meanwhile, the purchasing department will still carry forward their request and sent their cards back once the document has been provided.
Business Process Model
(Senior authorization for the MRO purchase is required when the amount exceeds 1000$)
Process strengths
In certain emergency instances, individuals other than the MRO buyer’s will be leading purchases. If there is an emergency or crucial situation in which an item is needed as soon as possible then the department will immediately require a purchase number that is completely different from the sequentially daily basis-based numbers which are used on the normal P/Os. Once this number is ready, the purchase can easily take place in the critical situation. Therefore, the purchasing department will then be completing the P/O as well as they will be distributing it on the normal basis.
Process inefficiencies
The current business process had complexity to some extent in it, such as the limitations which individuals had in the cost amount of 500$-1000$, If this limit is exceeded then this, the card/requisition form must be endorsed by the individual who is at the next higher ranking in terms of purchase authority. This can be time consuming and it is complicated as if the amounts exceed first it will be signed by a senior then the request would reach the purchasing department. Hence, the chain of command in the current business process seems to be like instead of acting quickly on their own, they will prefer to find out what the person above them in the hierarchy wants. This will make it very hard for the firm to adapt to changing conditions in a timely manner.
Use of Information Technology
Managing Business Process Documentation System (IT solution)
- When a firm begin to document the processes of the company, it becomes an administrative task to keep effective and timely track of them (Bhasin, 2019). As business processes tend to change and upgrade, it is essential to know which processes are the most current (Kissflow, 2018). It is also significant to manage and handle the entire process so that it can be easily updated as soon as possible. Thus, the requirement to manage and change the process documentation has been one of the driving main forces behind the formation of the document management system. A document management system stores and tracks document and supports the entire business process system (Bourgeois, 2018).
Business Process Re-engineering
- Complicated and long chain of command will be eliminated to make the business process smoother and effective. Extra work flow steps will be diminished from the current business process as new re-engineered business process would be having fewer steps in the work flow to avoid the excessive time wastage and business processes would be able to work effectively and quickly with the IT solution called document management system. A document management system stores as well as tracks down document processes alongside it supports these various business process functions (Bourgeois, 2018).
- Versions & the timestamps: The effective document management system will keep and save multiple variants and versions of the important documents. The most current version of a document is laid-back to for identifying as well as it will be served up by default.
- Approvals & the overall workflows: When the process needs to be transformed, the system will be able to manage and have access to the documents to edit as well as the direction-finding of the document for the approvals.
- Effective Communication: When a process has changed, those who do implementation of the process need to be aware of those changes. Thus, a document management system will notify and inform the relevant people when a change to a document has been approved. Due to implementation of this system business process work flow would be effective, clear and smooth and less time consuming and overall highly productive and effective. As individuals from various departments within the organization now would be directly able to launch a request for purchase on the online document management system without the long chain of command complications and hassle compared to pervious business process flow. As the entire business MRO process would be done online, as even when the individuals requests even for purchase requisition or by card, it will be approved by the system instantly on the spot as well as even if the purchase exceeds the amount more than 500$-1000$ it will be automatically approved and signed in online in the system and thus once purchase has been done and the card will be sent back to the departments (Bourgeois, 2018).
Business process reengineering is not simply taking an existing process alongside automating it. BPR is about understanding the main goals of the processes as well as then critically redesigning and maintain it from the core to obtain dramatic advancements in productivity as well as quality. But this is not easier said than done. Most of the organizations think in terms of how to do small as well as local advancements to a process; complete and maintain redesign requires thinking on a broader scale.
Some guidelines for how to go about doing business process reengineering:
- Organize around main outcomes, not just tasks. This means to design and maintain the processes so that, if possible, one person performs all of the required steps. Instead of repetitive one single step in the process again and again, the person stays indulged in the processes from start to its end (Emerald, 2018).
- Have those who use the outcomes of the processes to perform the major process. Using IT, many basic tasks are now automated and advanced, so that the company can empower the person who needs the motive and outcome of the process to effectively perform it (Bourgeois. D, 2018). The best example Hammer gives here is about purchasing: instead of having every department in the firm use a purchasing department to order supplies, have the supplies ordered simply directly by those who need the supplies the most by using an effective information system.
- Information-processing work out into the real task related work which produces and maintain the essential information. When one part of the firm creates and produces information (like sales information or it could be payment information), it should be processed by that same exact department in the firm. There is no necessity for one part of the firm to process information created in another part of the firm.
- Treat geographically dispersed resources and information as though they were mainly centralized. With the effective communications technologies in place today, it becomes easier and smoother than ever to not worry or be concerned about physical location. A multinational firm does not need separate specific support departments (such as IT as well as purchasing) for each location anymore (Bourgeois. D, 2018).
Businesses process reengineering needs appropriate implementation and crucial analysis before it could be applied to the firm’s processes so that the business processes would remain competitive and effective (Emerald, 2018).
Proposed Workflow Diagram
References
Bourgeois D. (2018) ‘Information systems and business processes implementations in the businesses’, Press Books Journals & books, [Online]. Available at : https://bus206.pressbooks.com/chapter/chapter-9-info-systems-strategic-advantage/
(Accessed: 4 July 2019)
Bhasin. (2019) ‘Eight types of business processes in the corporate world’, Marketing articles & business journals, [Online]. Available at : https://www.marketing91.com/8-types-of-business-processes/ (Accessed : 4 July 2019)
Emerald. (2018) ‘Business Process Management Journal’, Association of Business Schools (ABS) Academic Journal Quality Guide, AERES (France), Australian Business Deans Council (ABDC) Quality Journal List, Australian Research Council (ERA Journal List), Emerald Journals, [Online]. Available at : http://www.emeraldgrouppublishing.com/products/collections/olq.htm
(Accessed: 4 July 2019)
Kissflow. (2018) ‘The extensive guide to the business processes and IT systems’, Kisflow , [Online]. Available at : https://kissflow.com/bpm/business-process/ (Accessed : 4 July 2019)
