ACCA SBL Syllabus H. Innovation, Performance Excellence & Change Management - Business Process Redesign - Notes ^{7 / 11}

Although this syllabus heading is referring to the current situation of a business (from the scenario in the exam) - obviously we can’t comment on that here but the following is needed when the processes aren’t working well currently, and a complete overhaul is needed

Business Process redesign is also called Business process Re-engineering (BPR)

Harmon recommends a 5 stage approach to this:

1. Plan Identify goals, scope, personnel and plan

2. Analysis Document workflow, identify problems

3. Redesign Explore alternatives and choose best

4. Development Redesign of jobs, products, hiring & firing, KPIs

5. Transition Integrate, train, test, modify where needed

In the exam you may be asked to evaluate an existing process and make redesign suggestions - look out for..

1. Are there any steps or gaps missing?

2. Any duplication of work?

3. Any no value added activities?

Process Re-design Patterns

These are simply solutions / approaches that have worked in the past..

• Pattern	What causes it?	Description
  Re-engineering	Major re-organisation	Major redesign from scratch. High risk/return
  Simplification	Duplication and unnecessary activities	Checking each step in the process to check they’re needed. Low risk/return
  Value added analysis	Non value adding activities	Check each activity for what value it adds to the customer. Moderate returns
  Gaps and Disconnects	Information flows not working	Using process diagrams to see what needs to happen. Moderate returns

In the exam you need to decide if you think a complete redesign is needed or just an improvement on existing processes.

In doing so think about the pros and cons in terms of money, culture, effect of change etc

Process redesign and Strategy

As we have seen BPR involves improving the value chain and looks at existing processes to check they are operating according to our current strategy

• This strategy, according to Norton and Kaplan’s Balanced Scorecard, is formulated from four different perspectives.

  1. Financial

  2. Customers

  3. Internal business processes

  4. Innovation and learning

• Each of these 4 categories will have KPIs

  So BPR should be aimed at improving these KPIs and thus ensuring that they are following strategy