12/4/2017

Business Transformation
PGDM/PGDM IB
Term 5

Class 1: Agenda
Introduction
Team Formation
Course Outline and Readings
Course Distribution (10 Sessions)
Assessment and Housekeeping
Discussion (Specific Qs) on Michael Hammer classic
Summary
Concept/Meaning/Definition
What it is What it is Not

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Course Distribution
Session Content
1 Introduction; Course Plan; BPR Overview
2 Business Process and BPM; Design Thinking and MVP
3 Necessity for Transformation & Transformation Framework
4 and 5 BPR and Information Technology
Part 1 Over the Years
Part 2 Digital Transformation
6 and 7 BPR Implementation
Part 1 Methodology & Tools
Part 2 Success Factors
8, 9 and 10 Multiasistencia Case Study
Setting the Stage
Group Presentations (Group 1 4)
Group Presentations (Group 5 8)

Assessment
Component Weight Topics
Quiz/Project 30 Consulting, Swimlanes
Class Participation 10 BPR (10 Sessions)
Case Submission and 20 Multiasistencia
Presentation
End Term Exam 40 Part A: Prior to Mid-Term
Part B: After Mid-Term

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Reengineering Work: Dont Automate, Obliterate

Michael Hammer (1990)

Introduction
Companies tend to use technology to mechanize old ways of doing business
Scope: Job design, workflows, control mechanisms, organization structures
Objective: Innovation and speed; service and quality
Reengineer: use the power of IT to radically redesign business processes
All or nothing proposition with an uncertain result
Ford
Invoice-less processing
From We pay when we receive the invoice To We pay when we receive the
goods
IT System: On-line Database (ERP equivalent)

Reengineering Work: Dont Automate, Obliterate

Michael Hammer (1990)

Mutual Benefit Life (MBL)

Case Manager instead of sequential clerical work
IT System: Shared Database and Expert System for decision making
Essence of Reengineering
Discontinuous Thinking
Take cognizance of changes in Technology (New); People (Skilled); and
Organization Goals (quality, service, innovation, speed)
Look at fundamental processes of business from a cross-functional
perspective
Use IT not to automate an existing process but to enable a new one

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Reengineering Work: Dont Automate, Obliterate

Michael Hammer (1990)

Principles of Reengineering
Organize around Outcomes, not Tasks
Case Manager at MBL
Logical end points with outcomes not the whole process
Have those who use the output of the process perform the process
Self Service Purchase, Knowledge Base for customers
Decentralize the decisions and tasks
Subsume information-processing work into the real work that produces the
information
Data at source, decentralization, self service
Treat geographically dispersed resources as though they were centralized
Shared services with IT Systems

Reengineering Work: Dont Automate, Obliterate

Michael Hammer (1990)

Principles of Reengineering
Link parallel activities instead of integrating their results
Coordinate while the activities are in process and not integrate at the end
Put the decision point where the work is performed, and build control into the
process
Flat Organization (Vertical Compression)
Expert Systems and BI
Capture information once and at source
MDM and IoT
Think Big
Change job designs, Organization Structures and Management Systems
Executive leadership with Real Vision
Imaginations must guide our decisions about technology, not the other way around

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Reengineering the Corporation

A Manifesto for Business Revolution
Michael Hammer and James Champy (1993)

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.

Excerpts on BPR from Strategy

Early Beginnings
Toyota Production System; Quality Circles; Just in Time
Late 1980s, US emulated
First was TQM
Then BPR
IT was presented as the way for fundamental rethink, by flattening
hierarchies and developing networks
Main driver was potential impact of new technologies
Critique (Thomas Davenport) Iron Triangle of vested interests; Layoffs
1994 State of Reengineering Report 67% were judged as producing
mediocre, marginal, or failed results

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Class 2: Agenda
Quiz on BPR (Definition, Overview, Michael Hammer Article)
Business Process Definition
Group Presentations on chosen Business Process
Overview of BPMN
Example of Business Process and Modelling
BPM Steps & Actors, BPM Tools/Software, BPM Evolution etc.
Concept of EA, Design Thinking and MVP
Class 3 Assignment Business Process Models for your Group

Business Process - Definition

Adam Smith Pin example and division of labour
Fredrick Taylor Industrial Process, Scientific Management
Peter Drucker simplification, decentralization and outsourcing
Davenport (1993)
structured, measured set of activities designed to produce a specific output for a particular
customer or market
specific ordering of work activities across time and space, with a beginning and an end, and
clearly defined inputs and outputs
process approach implies adopting the customers point of view
Michael Hammer and James Champy
a collection of activities that takes one or more kinds of input and creates an output that is of
value to the customer

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BPMN
BPMI (2004) and then OMG (2006)
BPMN 2.0 (2011); BPMN 2.0.2 (2014)
Shapes & Notations
Task Description
Flow Description
Marker Description
Data Object Description
Event Description
Gateway Description
BPMN Diagrams
Processes (Orchestration) Private and Public
Choreographies
Collaborations (can include processes and/or choreographies)

BPM Example
Loan Application Assessment Process

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BPM Steps, Actors and Tools

History of BPM

Source: BPM by John Jeston and Johan Nelis

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BPM 7FE Framework

Source: BPM by John Jeston and Johan Nelis

iBPMS Magic Quadrant

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Move over from just design to design

thinking

Learn from People

Find Patterns
Design Principles
Make Tangible
Iterate Relentlessly

Inspiration, Ideation and Implementation

Design Thinking
Not just Design

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Design Thinking
For a good idea there should be many ideas first

Class 3: Agenda
What compels Business Transformation?
Class Discussion and Categorization
A three-part Business Transformation Framework
Always On Transformation
Types of Transformation
Class Discussion and Categorization
Carry forward from Class 2 (Likely move to Class 4)
BPM Model Presentations by Groups
Discussion on EA, Design Thinking and MVP

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Disruptions that make Transformation Inevitable

Increased Volatility
Digital Disruption
Increasing Regulation
Geopolitics
Public Spending Pressure
Manufacturing Economics
Energy Dynamics
Variable Rates of Growth

Three-Part Transformation Framework

Funding the Journey
Raise Revenue
Simplify the Organization
Use Capital more efficiently
Reduce Costs
Winning in the Medium Term
Rethink the operating & business model
Organizing for Sustained Performance
Focus on team and organization
Culture
Change Management

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Types of Business Transformation

Enterprise-wide or Business Unit focused
Turnaround/Restructuring; Rapid Financial Boost; Growth; Business Model;
Digital; Global; Organization

Function Specific Transformation

Innovation and R&D; Commercial; Operational; IT; Support Functions

Class 4: Agenda
Group Presentations
Business Process and BPMN Models
The idea of EA, Design Thinking and MVP
Business Process and IT Part 1 Over the Years
Concept of Lean Manufacturing and MRP/MRP II
ERP and other Business Functions (SCM, HCM, CRM)
Self Service, Collaboration and SaaS & Extensions
Build vs BPM vs Buy
Concept of Pace Layered Application Strategy and Bimodal IT
Layers, Connectivity, Governance, Organization
Prep for Class 5 Business Process and IT Part 2 Digital Transformation
Advent of Cloud
SMACI use cases and examples and their relevance to BPR
Understanding New Technologies Blockchain, AI/ML; BOTS, AR/VR

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Citation for Pace-Layered Application Strategy

Genovese, Y. (2012). Accelerating innovation by adopting a pace-
layered application strategy. Gartner Inc.

Pace-Layered Application Strategy (Gartner)

Readings
https://blogs.gartner.com/dennis-gaughan/2012/02/03/introducing-the-
pace-layered-application-strategy-special-report/
https://www.gartner.com/newsroom/id/1923014
http://imagesrv.gartner.com/products/local-briefing/pdf/analyst-day-
march2014/introduction_to_pace-layered_application_strategy.pdf
http://www.afsug.com/library/documents/saphila2014_presentations/Day
1/Lynx/Workshop%20Accelerating%20Innovation%20by%20Adopting%20a
%20Pace%20-%20Layered%20Application%20Strategy%20-
%20George%20Ambler.pdf
https://www.gartner.com/binaries/content/assets/events/keywords/applic
ations/apn30/pace-layered-applications-research-report.pdf

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Pace Layered Application Strategy Gartner Jan 2012

Yvonne Genovese

Source: Gartner (January 2012)

Connective Technologies for Pace-Layered

Application Strategy

Source: Gartner (January 2012)

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Governance of Pace-Layered Application

Strategy

Class 5: Agenda
Group Presentations
Business Process and BPMN Models
Business Process and IT Part 2 Digital Transformation
Advent of Cloud
SMACI use cases and examples and their relevance to BPR (moved to Class 6)
Understanding New Technologies Blockchain, AI/ML; BOTS, AR/VR (moved
to Class 6)

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Cloud Quiz
When did the first NIST definition on Cloud come in?
What is NIST definition of Cloud?
What are the 3 well known service models of Cloud?
Which is the 4th one?
What are the well known deployment models of Cloud?
Who are some of the most prominent providers of Cloud?
Name a few IaaS Services?
Name a few PaaS Services?
Name a few SaaS Services?
What are the key benefits of Cloud?
What are the key concerns of Cloud?

NIST definition on Cloud

1st draft in 2009; now 16th version
Cloud computing is a model for enabling ubiquitous, convenient, on-
demand network access to a shared pool of configurable computing
resources (e.g., networks, servers, storage, applications and services) that
can be rapidly provisioned and released with minimal management effort or
service provider interaction.
5 essential characteristics
on-demand self-service, broad network access, resource pooling, rapid elasticity or
expansion, and measured service
3 service models
Software, platform and infrastructure
4 deployment models
Private, community, public and hybrid

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Cloud and BPR

The Cloud is in many ways a reengineering platform. Technology
reengineering in the form of trading proprietary data centers and help
desks for those remote. Financial reengineering in trading IT capex for
opex
The theory of green BPR
Moving business processes to the cloud
The relevance of cloud for Systems of Innovation

Class 6: Agenda
Group Presentations
Business Process and BPMN Models
Business Process and IT Part 2 Digital Transformation
Advent of Cloud (completed in Class 5)
SMACI use cases and examples and their relevance to BPR
Understanding New Technologies Blockchain, AI/ML; BOTS, AR/VR
BPR Methodology
BPR Project Planning

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Key Enablers of Digital Transformation

Interplay of SMACI

Source: EY Study, 2015

SMACI and Business Transformation

Examples
Automotive
Social Media for Pre-Purchase and Post-Sales
Connected Vehicles and Diagnostics
Technology and Telecom Partnerships
CPG and Retail
Data driven segmentation and consumer engagement
E-Commerce and Virtual & Smart Stores
Supply Chain Command & Control

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SMACI and Business Transformation

Examples
Public Sector
Citizen Identity and Public Services
Smart Cities and Utilities
Telemedicine and E-Learning
Financial Services
Mobile Banking and Digital Wallets
Digitizing the Products Deposits, Insurance, Loans etc.
Predictive Analytics and Fraud Detection
Branch optimization and Digital Presence

Artificial Intelligence Embeds in Business Process

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Machine Learning
Techniques focus on:
Regression (Predicting Numbers) eg. customer lifetime value; estimate
optimal pricing
Classification (Membership of a known Class) eg. Customer likely to churn;
Fraud detection
Clustering (Membership of an inferred Class) eg. Customer segmentation;
Credit Risk
Anomaly Detection (Outliers) Employees with high claims
Techniques touch on:
Association Rules (Finding like minded people)
Time Series (Temporal aspect)
Neural Networks (Learn more like a Human)

Main AI Action Areas

Orienting IT and Business Thinking and Practice around the potential,
and the challenges, of AI
Implementing AI through developing strategies, addressing the skills
gap, assessing infrastructure requirements and more
Identifying broad areas where AI impacts organizational behaviors
(horizontal and replicable eg. Conversational platforms)
Developing AI initiatives for specific vertical market segments

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Blockchain Frameworks

Blockchain Outcomes
Immutable and Resilience > Distributed Ledger
Trust among parties > Consensus Mechanism
Tamperproof Data > Cryptography and Digital Signatures
Execution of Business Conditions > Smart Contracts
Transparency and Visibility -> Peer to Peer Network
Scalability and Ecosystem > Cloud

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Class 7: Agenda
Group Presentations
Business Process and BPMN Models
A quick discussion on Blockchain (part of Business Process and IT)
BPR Methodology
BPR Project Planning
Factors for BPR Success and Failure
Distribution of Multiasistencia Case Study

BPR Methodology - Reference

Kettinger, W., Teng, J. and Guha, S. (1997)
Business process change: a study of methodologies,
techniques, and tools
MIS Quarterly, March, pp. 55-80.

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BPR Methodology
Hierarchy of Methodology-Techniques-Tools (MTT)
Study of 25 Methodologies; 72 Techniques; 102 Tools
Business Process Change Model
Management Sub-Systems
Analytic Lens of Business Process
Stage-Activity (S-A) Framework of BPR
6 Stages Envision, Initiate, Diagnose, Redesign, Reconstruct, Evaluate
21 Activities
The key activities of S-A Framework correspond closely to sub-systems of
Business Process Change Model implying coordinated effort to impact/change
the sub-systems

Business Process Change Model Adapted from Kettinger & Grover, 1995

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A Stage-Activity (S-A) Framework for BPR

BPR Project Planning

Devising a Contingency Approach

4 Major Project Characteristics

Project Radical-ness
Project Structured-ness
Customer Focus
Potential for IT Enablement
Project Radical-ness Planning Worksheet
Customize the S-A Framework accordingly
Technique Selection - 11 Categories (through Q-Sort)
Prepare the Custom BPR Method in the Final Case Study

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Class 8: Agenda
Group Presentations
Business Process and BPMN Models
Factors for BPR Success and Failure
Course Summary
Multiasistencia Case Study Discussion
Multiasistencia Case Study Assignment Instructions

Dimensions of Success/Failure Factors for BPR

Change Management and Culture
Management Competency and Support
Organizational Structure
BPR Project Planning and Management
IT Infrastructure

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Source: Al-Mashari, M and Zairi, M (1999)

Source: Al-Mashari, M and Zairi, M (1999)

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Source: Al-Mashari, M and Zairi, M (1999)

Multiasistencia Case Assignment

(Every Group does this with every individual taking up at least 1 task and reviewing together as a Group)

1. Prepare a Business Process Model using BPMN for CCMS (Before and After). Overlay
the ICT system wherever applicable.
2. Identify stages/activities of the BPR over the years (with stated timelines) on the S-A
Framework
3. Prepare Radical-ness Planning Worksheet
4. Comment on the following parameters to determine the Custom BPR Method
i. Project Radical-ness
ii. Project Structured-ness
iii. Customer Focus
iv. IT Triggers
5. Recommend Custom BPR Method as per S-A Framework
6. Which representative techniques should be used for the custom S-A Framework
7. What were the factors for BPR Success or Failure? Use the Al-Mashari and Zairi
Framework.

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Class 9 & 10: Agenda

Multiasistencia Case Study Presentations
Class 9 Four Groups (Randomly Selected)
Class 10 Four Groups (Randomly Selected)

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