The business process re-engineering (BPR) (Coursework Sample)

Table of Contents TOC \o "1-3" \h \z \u QUESTION 1 PAGEREF _Toc42529105 \h 2a)Use of Business Process Re-engineering (BPR) as a tool of improvement for HOP Bank PAGEREF _Toc42529106 \h 2b)Identify challenges that HOP Bank might face in implementing BPR. PAGEREF _Toc42529107 \h 4Wrong Direction and Irregularity in Implementation PAGEREF _Toc42529108 \h 4QUESTION 2 PAGEREF _Toc42529109 \h 5a)Determine profit of each division and overall profit of TF Group. PAGEREF _Toc42529110 \h 5b)Analyse the results above and the problems arising from the current transfer pricing method used by the company. PAGEREF _Toc42529111 \h 7QUESTION 3 PAGEREF _Toc42529112 \h 9a)For each perspective of the balanced scorecard (BSC), identify the objectives with a corresponding performance measure for each objective. PAGEREF _Toc42529113 \h 9b)Justify the performance measures that you choose which are able to assess whether the changes have been successful. PAGEREF _Toc42529114 \h 11QUESTION 4 PAGEREF _Toc42529115 \h 12a)Using Porter’s Five Forces model, identify the impact of the external business environment on the performance management of Ralph. PAGEREF _Toc42529116 \h 12b)Justify your recommendation of one new performance measure for each of the elements in the FIVE forces areas at Ralph PAGEREF _Toc42529117 \h 17References PAGEREF _Toc42529118 \h 20Appendices PAGEREF _Toc42529119 \h 20
QUESTION 1
* Use of Business Process Re-engineering (BPR) as a tool of improvement for HOP Bank
The business process re-engineering (BPR) involves the ultimate rethinking and major organization process redesigning with the aim of improving the performance measures like the service, quality, speed and cost (Ballé, 2017). It is used where there is need to achieve performance improvement dramatically but not gradual and frequent improvement hence it’s a tool used to radically cause change to the organization improving largely on productivity and profitability.
Whereas there are other methods which can be used for process improvement in HOP bank, BPR stands alone because of its ability to bring out radical change, paradigm shift, cross functionality and technology innovation improvement.
Through application of BPR, HOP bank expects to improve its service delivery like the introduction of online banking system, improved internal and external communication systems; introducing automated banking services to help in efficiency and improved customer service and this will provide a competitive hedge against its competitors
The BPR process
There are five steps involved in business reengineering:
Step 1: Definition of the objectives and frameworks
This involves definition of the objective of the reengineering process. These objectives are what are expected at the end of the process (Broadbent, Weill and St. Clair, 2016). When they are defined, they are fully communicated to the employees of the institution. This is because for the business reengineering process to be successful, all the employees must be ready and accept change.
For HOP bank, the objective of the reengineering process will be to improve the current service provision in the bank This will be done through having a framework what will give the bank a competitive hedge against its competitors hence being able to to regain all the customers it has lost as well as increase the pool of new customers and this is expected to generate more revenues for the bank. All the banks employees will be informed of the planned changes so that they can be ready and accept them.
Step 2: identification of customer needs:
This involves considering the needs of the customer while redesigning the process.it ensures that the redesigned process has clear provisions of value to the customers. Some of the issues to be considered include the targeted customers and groups, their expectations, their habits and the challenges.
For HOP bank, main reason for the declining number of customers is because the customers were getting better services by the competitors. For instance, they needed to have access to electronic banking as well as automated banking process and a more detailed website. Additionally, they required more efficient loan processing mechanisms with less inconveniences like an electronic bank processing method instead of using trail of papers and face to face interviews with the managers. Further, the customer’s needed an improved customer service to address their concerns.
Step 3: Study of the Existing Process
This step involves an analysis of the existing process before making a decision on the changes to be made. This is done to provide a foundation for the identified new process by answering the why and what questions of the new process being designed through studying the wrongs and the rights of the existing plan (Crawford, 2019).
With the HOP bank, the existing process of banking is old model and has not yet incorporated the existing technology, there is no online banking services offered, the existing website is not updated to incorporate services apart from indicating the services it offers. All the transaction in the bank like the cheque and cash deposits as well as cash withdrawals are done over the counter and none is automated leading to a lot of time wastage clients as they queue for services. Further, the existing bank loan application process is very complex because series of documents needs to be reviewed accompanied by interviews with some officials before an approval is done. The customer service at the bank is also very slow due to lack of evaluations.
Step 4: Formulation of a redesign plan
This step involves noting down all the recommended changes from the study of old design .these recommended changes are usually written down on a piece of paper or anywhere then transformed into a perfect process.al the recommended processes are analyzed and the best selected from the alternatives (Crawford, 2019).
With the HOP bank, the changes recommended are:
* Introduction of online banking
* Updated website to contain more information
* Automated cheque , cash deposit and cash withdrawals
* An automated bank loan application with a simple process
* Customer service evaluation to increase efficiency.
Step 5: Implementation of the redesigned plan
This involves the implementation of the identified changes (Ballé, 2017). The HOP bank will implement all the five changes and the management will put mechanisms in place to ensure that the plan is operational.
* Identify challenges that HOP Bank might face in implementing BPR.
Inadequate Knowledge
Implementing BPR needs a clear understanding of the reason of the implementation with full knowledge of the process by all key stakeholders. HOP employees have worked in the business forever and have no knowledge of the process which poses a challenge to the process.
Wrong Direction and Irregularity in Implementation
The BPR needs constant monitoring to ensure that it takes effect and in some instances might not work for all companies and HOP bank is of no exception. This can be because the proper mechanisms are not used while implementing. For instance, HOP deciding to use a system that is of lesser technology than its competitors
Insufficient resources
For HOP to successfully implement BPR massive resources will be needed and if those resources are not readily available it becomes challenge to the whole process and might lead to a failed implementation plan.
Improper analysis
If an improper analysis is done on the existing systems high chances are there will be wrong items recommended for change and this would make the plan unsuccessful hence a repeat of the whole process.
QUESTION 2
* Determine profit of each division and overall profit of TF Group.
the overall profit of TF Group per unit

 

 

selling price

 

$32

cost

gamma division

$20

 

alpha division

$10

profit

 

$2

Table 1: Total profit (Source: Excel)
calculation of transfer price

 

transfer price (as per cost-plus method)

cost+20% of cost

 

20+20% of 20

 

$ 24

Table 2: Transfer price (Source: Excel)
profit of each division per unit

 

 

 

Gamma

Alpha

selling price

-

$ 32.00

transfer price

$ 24.00

$ 24.00

own cost

$ 20.00

$ 10.00

profit and loss of each division

$ 4.00

$ -2.00

Table 1: Profit of each division (Source: Excel)
Transfer pricing is the method used in costing techniques for adjustments of the cost of services and goods in between le...