- 20 Marks
Question
CLife is a large manufacturing firm dealing in several product lines. Currently, there are plans to explore other foreign markets for its products. Forty staff are tasked with matching goods received notes with orders and then with invoices.
It has been observed that an appreciable length of time is spent trying to find out why some of the sets of three documents do not agree.
While some managers recommend the computerisation of the existing process to facilitate matching, others propose the use of Business Process Re-engineering.
a) Explain Business Process Re-engineering.
(3 marks)
b) State FIVE characteristics of a re-engineered business process. (5 marks)
c) Explain SIX examples of how technology can change the way business activities are conducted, with reference to the CLife scenario where appropriate. (12 marks)
Answer
a) Business process re-engineering (BPR) is the fundamental re-thinking and radical design of business processes to achieve dramatic improvements in critical contemporary measures of performance such as cost, quality, service, and speed. BPR asks “why do we do what we do?” without making any assumptions or looking back at what has always been done in the past. It should also achieve very high performance and not just marginal incremental improvement. (3 Marks)
b) Characteristics of re-engineered business processes include:
- Several jobs are often combined into one.
- Workers are able to make decisions.
- The steps in the process are performed in a logical order.
- Work is performed where it makes most sense.
- Checks and controls may be reduced, and quality ‘built-in’. (5 Marks)
c) Technology has changed the way business activities are conducted in a number of ways, including:
- Shared databases make it possible for information to appear simultaneously in as many places as required. For example, orders entered into a database at CLife will facilitate matching with goods received notes and invoices.
- The use of expert systems means that a generalist can do the work of an expert.
- Telecommunication networks enable businesses to reap the rewards of centralisation and decentralisation simultaneously. CLife could easily engage in electronic data interchange (EDI) with its business partners.
- Decision support tools mean that decision-making is part of everyone’s job. These tools will help CLife management in inventory decisions.
- Wireless data communication and portable computers mean that field staff can send and receive information wherever they are, thus taking advantage of telecommuting.
- Automatic identification and tracking technology will make it possible to locate certain assets wherever they are, and CLife can use this to track orders.
- Through the use of the internet, CLife can apply electronic commerce to help in the more efficient handling of ordering and payment for goods. (12 Marks)
Total: 20 Marks
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