IT is enabler, the crux is BUSINESS PROCESS

By Damodar Mantri, Director IT and BPE, Dr. Reddy's Laboratories

Business process is al­ways considered as next to Information technology in most of the companies. But truly speaking we can­not leverage IT if business process is not well defined. Further, Business process once defined is not the end of the game, it has to be revisited periodically because once defined it may be engineered keeping the cur­rent business dynamics and custom­ers in mind.

Any business process which is not adding figures to organisation’s bottom line or top line, consider it to be a redundant. Business Pro­cess engineering, defining or re-engineering all make the same sense if the business is into delivering service or manufacturing. Business Process Management is viewed as a systematic approach to improve an organization's business processes, be it on manufacturing floor, in supply chain or in the product development area. Business Process Management also enable employees closest to the business -- the plant floor manager or procurement specialist.

Small and medium industry fol­low manual process which are dis­jointed. By eliminating manual pro­cesses, business organizations not only reduce costs but also optimize their product development depart­ments for more successful product introductions, more closely link supply to demand, and improve on-time delivery and quality of products or services.

Generally, we find two types of IT projects

1 Business users initiate the IT solu­tion – The risk in this type of project is the users come with a predefined solution in mind and wants exactly what is being done in the legacy. The legacy system may be right but may not be the best, as time keep chang­ing everything! If we try to map the current system on to an IT platform, it is like automating what is being done manually. With this approach, we do not get any value addition.

2 IT initiating the IT solution – The risk in such projects is the solution may not be close to ground re­ality. Unless process engineers apply their mind and map the process, the IT solution defined will not be of any use and the IT application/solu­tion will be redundant and moved to corner.

What is important in such scenario is, to treat IT only as a leveraging tool. The process that is being defined to run the business is important. The process will give the measurable points on benefit realization. Now the question is how to balance the above two approaches?

Involve the users’ community right from the initiation by conduct­ing workshop and note down the expectations and suggestions.

Define the TO BE process and publish the derived results.

Again, conduct the workshop, take feedback/suggestions and fi­nalize the process.

Set the business benefit realiza­tions points and target as a goal of the project.

Once design and realization phase is complete, training and hand-holding is very important to increase the comfort level of users. Handle the change management in terms of changes with process, peo­ple, and system.

Do not start measuring the business benefits imme­diate after go live as stabili­zation need its own time.

Once the new sys­tem is stabilized, measure the ben­efits with intended results and continually follow: Plan, Deploy, Check, improve, measure.

What are different types of process exist?

If we see any industry, the generic process followed is……

1)Procure to Pay 2) Order to Cash 3) Order generation to cus­tomer retention 4) Hire to Retire 5) Record to report 6) Financial closure to Balance sheet generation and for any manufacturing industry (continues process or discrete) 7) Production plan to Inventory man­agement is applicable.

How do you measure the process efficiency?

While there is every room for im­provement, applying a quality tools like “Six Sigma” or Value Stream Mapping (VSM) would give the insights on the process efficiency. Lean Manufacturing or Lean think­ing is another way of improving the process thus removing the non-value addition steps in a process.

Where are the areas of process im­provements which can add value to the business figures?

Portfolio Management - Product selection and first to launch or how to present a differentiated product is the leading process to improve on the business figures to add top line.

Customer relationship and reten­tion is another area which will help to boost your sales. In this process understand the need of the customer and improve the velocity in meeting the requirement. Any value added service will improve your customer base like, banks coming to your door step to open an account or conduct­ing learning session on trading for DEMAT account holders.

If it is a manufacturing industry, reducing the WIP and product cycle time or improving the operational efficiency would be beneficial to a great extent. Similarly for a service industry, solving the customer is­sues, addressing the root cause of the issue to avoid the similar issue in future is what a process to be set.

Why a process has to be rede­fined or re-engineered.

Any process which has been set up has a life cycle for not more than a year especially when the custom­er needs and technology trends are changing regularly.

Does a process speak about automation?

Automation is one buzz word that usually misguide the management. In a process where there is no deci­sion-making process and routine in nature can be automated. If a pro­cess requires a decision making, a decision-making tree would support to specify the algorithm. Automa­tion also significantly improve the velocity, productivity and eliminate the paper resulting in improving the compliance for a regulated industry.

“The more flexible process you have, the closer you are to your customer needs”

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