Process Reengineering in the WestJet Airline - Business Plan Example

Name: Tutor: Course: Date: Introduction Business process reengineering involves steps taken by the organization to implement change in their organizational structure and processes in relation to their business environment[Maj01]. This means organizations change on how they operate and manage their operations. Most organizations have been engaged in BPR due to the changing conditions of their respective business environments as a result of the globalization of the global economy and the liberalization of trade markets. This has led in companies experiencing increased competition. This competition has been characterized by price wars, quality, and selection. Further, activities such as international corporation, innovations and removal of barriers have intensified the level of competition experienced by companies[Asl12]. All these factors have acted as motivational factors for companies to re-invent themselves through usage of BPR in a bid to have a competitive edge over their rivals. This paper will give a case study of WestJet Airlines Business re-engineering and control processes that focus on their IT structure. WestJet Airline Background The WestJet airline was started in 1996 as a regional carrier in Canada that linked several Canadian cities[Mal15]. The company began its operations with three Boeing 737-200. The company has been successful in their operations and by the year 2013, the company had 90 Boeing Next –Generation 737 aircrafts that enabled the company to provide services to 85 destinations in 18 countries[Mal15]. The company has also provided employment opportunities to over nine thousand individuals by the year 2013. This has made the company to be regarded as the second largest airline in Canada and the ninth largest airline in North America. The company recognizes Informational Technology has played a crucial role in its success. The organization has indicated that the IT structure and organization has grown and evolved from the business. However, a comparison of its IT capacity with its peer is relatively small but very competent from a technical point of view. With the company’s intention to grow and achieve higher targets, the capacity their IT infrastructure is the cornerstone of their strategic plan. However, the current status of the infrastructure cannot be able to propel their strategic plan through. One of the strategies was ability to codeshare[Mal15]. This involves several airlines entering into an agreement to share flights. The adoption of this plan provides an opportunity for an airline to access more destination for its passengers and also make it easy for the company to provide connection services. The adoption of this strategy required the company to have a system that could be integrated with the rest of the international airline systems. However, WestJet system due to its standalone features, it was not possible for the Airline to be integrated with other major international reservation systems. This made WestJet not to be able to keep with its peers in the industry in terms of its IT structures. WestJet previously did not have an executive officer who was entirely responsible for the management of all affairs related to IT. In order to improve their IT capabilities, the top leadership of the airline decided on appointing an executive officer. This individual would be regarded as the chief information officer (CIO) responsible in managing the IT systems to be at par with the rest of airlines. As a result Cheryl Smith, was appointed and given a two-year contract with an option of making her the permanent CIO at the executive level. IT Governance Institute focus areas IT Governance is regarded as the responsibility of management for directing and controlling information technology systems with an aim of achieving the business objectives as well as minimizing the risks the business is exposed to. It involves putting in place appropriate leadership structures that ensure the IT structure organization is designed and implemented in order to sustain and make the objectives of an organization achievable. IT, therefore, plays a critical role in ensuring the success of a company[Mir11]. The Leadership of WestJet recognized the role of IT in achieving their objectives resorting in the decision to hire Smith as the Chief Information Officer. She was given the responsibility of ensuring the organization adopted IT systems in line with the company’s strategies. The IT Governance Institute has identified five critical areas that organizations need to focus on their IT governance structures. These areas include: a) Strategic alignment. This area of focus deals with ensuring an organization can link its business unit’s plans and its IT plans. It involves ensuring that the operations of a business are linked to the IT model adopted[Mir10]. When Smith was appointed as an executive vice president of WestJet by being named as the Chief information officer, she initiated an examination of the current IT model adopted by the company. She realized there was a lack of a strong linkage that existed between the business units. Her first action involved overhauling the governance model in order to create more active links within the business units. She did this by breaking the IT function groups that existed and reassigning her staff to focus on specific business units. Half of the employees who were in her portfolio were reassigned to developers, support, resource planning individuals, project managers and business analyst individuals[Mal15]. The remaining staff categorized in one group where they focused on IT infrastructure, operations, security, governance and administration, help desk support and quality assurance. These individuals were not assigned to any particular business unit in the organization since they were tasked with maintaining the organization’s shared infrastructure and ensuring that the practices were in line with the industry’s best practice. This made it possible for groups assigned to specific units to concentrate on the needs of their units need and priorities and to ensure they are in line with the organization shared infrastructure. In order to ensure there was a stronger link, Smith created the position of business unit CIO, who were in charge of the respective business unit IT infrastructure. All these actions were aimed at ensuring that the organization achieved a stronger alignment with its business strategies and IT governance model. b) Value delivery. According to IT governance institute, this area focuses on ensuring that IT delivers the promised benefits through optimization of the resources available[Mir10]. In ensuring that the IT portfolio provided services of value, Smith decided in assigning half of the staff to deal with application-based activities. This meant that any project that a business unit needed would be implemented by their respective Business Unit IT team with the IT operating budget. Further, she proposed an annual budget process that would decide projects to be implemented which required enormous capital. She abolished the monthly planning and budgeting processes. The Executive Management team would discuss the projects available and decide which were to be prioritized. This was to ensure that the IT governance would concentrate on specific projects in order to deliver value to the organization in the most effective and efficient way possible. c) Resource management. This involves the management of the available resources and optimizing them to the needs of the organization to obtain the best possible results. Smith in regard to this decided that the leadership of the organization would be determining the projects to be implemented then focusing on those projects only on an annual basis[Mir11]. This ensured that they created value for the services. Her decision to divide her team into groups was geared to ensuring that the organization achieved a strong linkage between their operations and IT infrastructure. This helped in promoting the efficiency of the organization. d) Risk management. This is the situation whereby and the leadership of the organization understands the risks faced and provides measures that will help in managing the level of risk. Smith felt that the location of the data center adjacent to the runway exposed to the company to high-risk levels[Mir10]. This made her influence the leadership of the organization to relocate the data center to a more secure place. Through this she was able to manage the risks that the company would be exposed to in case a calamity occurred on the runway. e) Performance measurement. Performance measurement includes placement of monitoring strategies within the organization in order to evaluate the performance of an organization with an IT governance model. She developed the position of business unit CIO who would be monitoring the performance of their teams and reporting to her on the progress made[Mir10]. Components of the AS805 model in IT governance The AS805 model of governance usually comprises of five components. These components include definition, design and integration, testing, evaluation and production. These components aid in making IT governance successful in achieving the target results. After Smith had been hired as the executive, chief information officer, she suggested possible changes that were aimed at helping the company operate more efficiently in achieving its goals. The first action after being hired was contracting two IT experts who benchmarked the current organization structure with the industry practices. This was in line with the models first component that involves the definition of the current status and possible problems within the system. After identification of areas that needed redesigning, Smith was involved in redesigning and integration the organization process. This was in line with the second components that requires design and integration. She developed processes that would link all business units together to function as one big unit that was interlinked. The third and four components which involved testing and evaluation. These components requires determination of the effectiveness of the control measure. She was involved in the testing and evaluation of the changes with her staff some of whom indicated that they are likely not to work. The implementation of the plan was in aligned with the final component production. She implemented the changes and continuously monitored to see if the changes were effective as desired. Risks affecting WestJet IT structure The IT governance model that had been adopted by WestJet had significantly contributed to its success since the company was started[Sus13]. However, the level of ambition of the company could not be accommodated by the current IT governance model due to the existence of several risk factors. One of the risk factors was the placement of Data center adjacent to the runaway. Despite the Data center well-constructed, if any calamity occurred then the company could have lost a lot of data that was necessary for helping the company achieve its goals. Further, the occurrence of a disaster would lead to destruction of the data centre resulting to the company suspending its operations to repair the run away and also to set up another data centre which is important in airline operations. The company’s IT structure that was based on the internal procedures and operations of the company provided a risk of the company not being able to integrate with other major international reservation systems. One of the strategies of the company is to be able to codeshare with other international airlines to be able to share flights and connection of flights. Their IT structure limited further growth of the company. The IT governance model adopted by a company should be flexible enough to allow a company grow and also be involved in external activities that will provide the company with value. However, this was not the case with WestJet. Since most of the IT staff of the airline had been involved in the development and maintenance of the current system of the airline acted as risk factors in moving to the new IT structure. They would provide a level of resistance to the company in applying changes to the company’s IT governance structure. They would wish to maintain the WestJet way of doing things. WestJet operated 24 hours a day, seven days in a week. However, the IT staff only worked during day time. They were only available at night on a call basis. This operation plan possessed a risk of overworking the staff due to the constant call for them to work at night. In managing these risk, the company can implement several strategies to lower the level of risk. First the company ought to have a 24 hour working schedule whereby staff would work in shifts. This would provide a chance to them to rest and not be overworked thus leading to quality work from them. The company also ought to educate its staff members on the need to continually re-engineering their operations in accordance with the industry practices. This will enable them to be up to date with the current practices in their operations thereby reducing the cost and time of moving from one strategy to another. The company also needs to move their data center to a more secure place to avoid any risk of destroying it. Steps in managing a BRP In order for Smith and WestJet to manage change successfully and achieve the desired results, and then the following steps should be taken: 1. Step one. Preparation and coordination This is step is critical since it provide a basis for the project. After identification of the necessary changes, then there is a need for Smith to establish support for change both from the management and her staff. Smith needs to explain to all stakeholders of change the need to commit and support change as well as demo[Asl12]nstrating the benefits that will be realised. Secondly Smith needs to assign roles to capable staff who will help in the implementation of the project and their responsibilities. This will assist in coordination efforts along the project[Fit96]. 2. Step two: Business measurement This step will involve identification of the areas that need to be changed. Once these areas have been identified, there is a need for measuring the characteristics of these areas in order to establish the best way possible to implement change[Gro97]. 3. Step three: Selecting processes in need of change Once areas that need have been identified and measured, then Smith needs to identify strategic processes that require a change to address various challenges. This step will involve redesign and model the selected processes. 4. Step Four: Technical designing of solutions This step involves establishing network connections among the process team members. The step will include preparation of the workflow chart that will be implemented during the redesigning processes. It will involve establishing employees who will be responsible for each process and the responsibilities they will perform[Aha04]. 5. Step five: training of personnel This step will involve training of employees to make them skilled and also comfortable in implementing the changes required. It will also provide a chance to introduce them fully to the changes that will be implemented. 6. Step six: management of change This step will involve management of all aspects related to change such as employee attitudes towards change. It will involve managing the resistance that may be witnessed in the implementation of change. 7. Step seven: introduction of new processes This step will involve the implementation of the new processes in the entire organizations and insisting that previous procedures are not acceptable anymore. 8. Step eight: continuous improvement This step will involve continuous improvement of areas that may pose challenges to the new systems. It will involve looking at the ways of improving the implemented changes and also correcting areas that cause challenges to the new system[Aha]. Conclusion BRP is tool that has been used by business to ensure that they are successful in their operations. The decision by leadership of WestJet to hire Smith gave the company an opportunity to re-organize their operations in order to achieve their strategies. Smith under took this process following strategic steps to aid in a successful change. In conclusion, BRP is necessary when a company wants to re-invent its self, however, they should follow certain steps to ensure they are successful. Works Cited Maj01: , (Al-Mashari, Irani and Zairi 438), Asl12: , (Goksoy, Ozsoy and Vayvay 90), Mal15: , (Murno and Khan 1), Mal15: , (Murno and Khan 4), Mir11: , (GHEORGHE 548), Mir10: , (GHEORGHE 33), Mal15: , (Murno and Khan 6), Mir10: , (GHEORGHE 34), Mir11: , (GHEORGHE 549), Mir10: , (GHEORGHE 35), Sus13: , (Pandy 10), Asl12: , (Goksoy, Ozsoy and Vayvay), Fit96: , (Fitzgerald and Murphy 7), Gro97: , (Grover and Malhotra 210), Aha04: , (Ahadi 14), Aha: , (Ahadi), Read More