Case Study: Led Bpr Efforts Business Process

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SAMPLE EXCERPT:

[. . .] Therefore, the IT-led BPR project implemented by ManuCo was considered to only be a partial success.

A significant project risk that arose with the BPR project executed by ManuCo was conflict between plant managers with regard to misunderstandings concerning the effects that sharing resources had on plant-level measures, resulting in a decrease in inter-plant cooperation. This could have been remedied through the use of internal integration tools. These tools could have taken the form of in-depth information dispersed by knowledgeable project leaders with regard to the protocol and details involved in the measures that were to be implemented by the plant managers.

HealthCo

HealthCo is a prominent leader in the healthcare industry, and is the number one provider of health services in several parts of the U.S. Hospitals are working more than ever before to reduce costs and improve efficiency due to the decrease in reimbursements for healthcare services provided to patients. This pressure to reduce costs motivated HealthCo to implement IT-led BPR at both the patient care and administrative levels. The outcome focus of the BPR was based on the reduction of costs, since an increase in revenue in the health services industry is considered to be impossible. HealthCo therefore sought to reduce operating costs through the improvement of administrative efficiency in patient care. In other words, the improvement of administrative productivity was seen by HealthCo as the only method to maintain, or maybe even possibly increase, profitability.

There are significant competitive forces within the healthcare services industry, so it was important that HealthCo devised an effective plan for an IT-led BPR. The IT system strategy employed by HealthCo in order to deal with these competitive forces was to establish themselves as low-cost leaders through cost reduction. This reduction in costs occurred as a result of consolidation of the functions performed by subsidiary organizations, as well as the centralizing of IT and administrative services to one location. This was facilitated through the implementation of an upgraded centralized information system, known as the Enterprise Resource Planning system.

An analysis of business processes involved in the aim of cost reduction by HealthCo could take the form of the value chain model applied to the other two firms already discussed. The value chain model basically indicates activities within the organization where competitive strategies for improvement can most effectively be applied. A primary activity most directly related to the services provided by HealthCo would be the direct service involved in patient care. A secondary activity related to service delivery in patient care would be the administrative operations necessary to support the provision of patient care. The IT-enabled BPR conducted by HealthCo was directed at secondary administrative activities, in that the changes and technology implemented was focused on improving the efficiency and streamlining of administrative functions within the organization. It was determined that the IT-led BPR conducted by HealthCo was successful based on effectiveness measures (Kohli & Hoadley, 2006).

Conducting an IT-enabled BPR presents risks for organizations, especially with regard to the costs involved (Kohli & Hoadley, 2006). Due to this risk and the difficulty in management of immense, widespread organizational change, most BPR projects do not result in performance gains that could be considered as overwhelmingly successful. A study conducted by Elmuti & Kathawala (2000) indicated that about half of the organizations with BPR programs under observation stated they had not achieved the objective of increased organizational effectiveness. Measuring effectiveness depends on different factors that are industry-specific. This was evident in the case studies presented by Kolhi & Hoadley (2006), and the different outcomes produced by the BPR projects in the three different firms. Nonetheless, the core focuses of the three organizations were the same. They all involved improvements in customer value and productivity, and furthermore, profitability. The extent to which each firm achieved these improvements varied, and it was concluded by the researchers that HealthCo was the most successful due to their clarity in focus, and high process and performance orientation. FinCo and ManuCo, on the other hand, were assessed as less effective due to ambiguity in focus variables in the BPR projects, as well as a lack of appropriate outcome measures (Kohli & Hoadley, 2006).

References

Elmuti, D.; Yunus K.. "Business reengineering: revolutionary management tool, or fading fad?." Business Forum. California State University, Los Angeles. 2000. HighBeam Research. 11 Dec. 2010 .

Kohli, R.; Hoadley, E. "Towards Developing a Framework for Measuring Organizational Impact of IT-Enabled BPR: Case Studies of Three Firms." Database for Advances in Information Systems. 2006. 37(1), pp. 40-58.

Lee, Y.C.; Chu, P.Y.; Tseng, H.L. "Exploring the relationships between information technology adoption and business process reengineering." Journal of Management and Organization. Australian and New Zealand Academy of Management (ANZAM). 2009. HighBeam Research. 11 Dec. 2010 .

Lobontiu, G.; Big, R.. "IMPLEMENTING Business PROCESS REENGINEERING." Scientific Bulletin Series C: Fascicle Mechanics, Tribology, Machine Manufacturing Technology. . 2006. HighBeam Research. 11 Dec. 2010 .

Olalla, M.F. "Information Technology in Business Process… [END OF PREVIEW]

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