Introduction Buisness Process Re engineering.

Business :

It is a legally recognized organization designed to provide goods or services, or both, to consumers,

businesses and governmental entities.Businesses are predominant in capitalist economies. Most
businesses are privately owned. A business is typically formed to earn profit that will increase the
wealth of its owners and grow the business itself. The owners and operators of a business have as
one of their main objectives the receipt or generation of a financial return in exchange for work and
acceptance of risk. Notable exceptions include cooperative enterprises and state-owned enterprises.
Businesses can also be formed not-for-profit or be state-owned There are many types of businesses,
and because of this, businesses are classified in many ways. One of the most common focuses on the
primary profit-generating activities of a business:

Classification of Buisness :

 Agriculture and mining businesses are concerned with the production of raw material, such
as plants or minerals.
 Financial businesses include banks and other companies that generate profit through
investment and management of capital.
 Information businesses generate profits primarily from the resale of intellectual property
and include movie studios, publishers and packaged software companies.
 Manufacturers produce products, from raw materials or component parts, which they then
sell at a profit. Companies that make physical goods, such as cars or pipes, are considered
manufacturers.
 Real estate businesses generate profit from the selling, renting, and development of
properties, homes, and buildings.
 Retailers and Distributors act as middle-men in getting goods produced by manufacturers to
the intended consumer, generating a profit as a result of providing sales or distribution
services. Most consumer-oriented stores and catalogue companies are distributors or
retailers. See also: Franchising
 Service businesses offer intangible goods or services and typically generate a profit by
charging for labor or other services provided to government, other businesses, or
consumers. Organizations ranging from house decorators to consulting firms, restaurants,
and even entertainers are types of service businesses.
 Transportation businesses deliver goods and individuals from location to location,
generating a profit on the transportation costs
 Utilities produce public services, such as heat, electricity, or sewage treatment, and are
usually government chartered.

Process : It typically describes the act of taking something through an established and usually
routine set of procedures to convert it from one form to another, as a manufacturing or
administrative procedure, such as processing milk into cheese, or processing paperwork to grant a
mortgage loan, or converting computer data from one form to another.

Buisness Process

A business process or business method is a collection of related, structured activities or tasks that
produce a specific service or product (serve a particular goal) for a particular customer or customers.
It often can be visualized with a flowchart as a sequence of activities
Types of business processes:

1. Management processes, the processes that govern the operation of a system. Typical
management processes include "Corporate Governance" and "Strategic Management".
2. Operational processes, processes that constitute the core business and create the primary
value stream. Typical operational processes are Purchasing, Manufacturing, Marketing and
Sales.
3. Supporting processes, which support the core processes. Examples include Accounting,
Recruitment, Technical support.

Re engineering

It is the fundamental rethinking and radical redesign of processes to improve substancial

effectiveness and efficiency.

A business process begins with a customer’s need and ends with a customer’s need fulfillment
Business Processes are designed to add value for the customer and should not include unnecessary
activities. The outcome of a well designed business process is increased effectiveness (value for the
customer) and increased efficiency (less costs for the company).

Buisness Process Reengineering

Reengineering is the fundamental rethinking and radical redesign of business processes to achieve
dramatic improvements in critical, contemporary measures of performance such as cost, quality,
service and speed.
BPR advocates that enterprises go back to the basics and reexamine their very roots. It doesn’t
believe insmall improvements. Rather it aims at total reinvention. As for results: BPR is clearly not
for companies who want a10% improvement. It is for the ones that need a ten-fold increase.
According to Hammer and Champy , the lastbut the most important of the four key words is the
word-‘process.’ BPR focuses on processes and not on tasks, jobsor people. It endeavors to redesign
the strategic and value added processes that transcend organizational boundaries.

Reengineering recognizes that an organization's business processes are usually fragmented into
subprocesses and tasks that are carried out by several specialized functional areas within the
organization. Often, no one is responsible for the overall performance of the entire process.
Reengineering maintains that optimizing the performance of subprocesses can result in some
benefits, but cannot yield dramatic improvements if the process itself is fundamentally inefficient
and outmoded. For that reason, reengineering focuses on redesigning the process as a whole in
order to achieve the greatest possible benefits to the organization and their customers. This drive
for realizing dramatic improvements by fundamentally rethinking how the organization's work
should be done distinguishes reengineering from process improvement efforts that focus on
functional or incremental improvement.

Some of the recent headlines in the popular press read,

 Wal-Mart reduces restocking time from six weeksto thirty-six hours.””

 Hewlett Packard’s assembly time for server computers touches new low- four minutes.”

The reason behind these success stories: Business Process Reengineering

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D SHAH- 27/07/2010