Bench Marketing and Business Process Reengineering - Essay Example

Bench Marking and Business Process reengineering. The competition between the businesshouses has grown rapidly all over the world. In order to optimize the performance of the organizations lot of planning and modification is done by the managers of the companies. In the present era two new concepts have gained much popularity. The introduction of the process of benchmarking and Business Process Reengineering has benefitted the Organizations immensely. In the paper we will study the use of the above two process by organizations. The methodology applied by the organizations in handling the process is also been studied. Benchmarking: The process of benchmarking involves the search for the best practices and then comparing the performance with that followed in the organization and determining the future performance. The three underlying principles of the process are quality, customer satisfaction and improvement in action. (Kozak, 2004, p.5) The application of the process of Benchmarking is done to improve the overall productivity of the business. Through the process of Benchmarking it enables the organization to highlight their individual strength and weakness. The internal knowledge about a business is essential to bring about changes in performance level and through benchmarking the objective is achieved. As the process of Benchmarking involves a finding of the best practices used by organization, it also enables an overall analysis of the competitors. Thus the process of benchmarking enables organizations to stay ahead of the competitors in the same line of business (Moore, 2008, p.181). Four types of benchmarking are generally in use by the organizations. They are named as internal benchmarking, external benchmarking, competitive benchmarking and sector benchmarking. The scopes and objectives of the different heads of benchmarking are different in their nature. (Wober, 2002, p.3) Use of benchmarking process in Intel: Intel has been global leaders in the makers of computer chipsets over a decade. The business aims to improve the performance of the new generation of chipset in every release of their updated product. The popularity of Intel has been so vast that it has almost established a monopoly in the market of PC chipset producers. The company uses the process of benchmarking as one of the tools to improve the overall performance of the organization. Intel uses the help of PC platform performance bench marking process that helps in analyzing and measuring the performance of the PC’s build by them. The analyzing of the performance of their product helped them in Customer satisfaction to a large extent. The platform bench marking used by Intel also increased their overall productivity and resulted in satisfied employees. The use of platform benchmarking was used by Intel as a solution to handle the challenges faced by the business. Intel tried to provide faster Pc’s in their every upgrade. The upgraded PC’s in use had an increased number of applications in use. Due to the increase in application load often users complained for the slowness of the machines. The problem of unrealistic user expectation was also been encountered by Intel. Moreover the build process in use by Intel was immature in nature. A platform performance measuring process was used to address the above problems in dealing with the situation. The benchmarking process helped to analyze the impact of the client performance during new release of the products. The comparison of the different platforms was done using a simplified process which involved the calculation of timing test, productivity test and technical characteristics of the platforms in use. A four part process was conducted in the benchmarking process which involved preparation, technical characterization, productivity test and timing tests. The benchmark test performed by Intel was helpful in analyzing the problems with the performance. The benchmarking data in use was helpful in managing user expectations. The users were also educated in optimizing the performance of the PC’s. Internal decision making also became helpful in using the benchmark methodology. New solutions were benchmarked against each other and the best combination of performance and functionality was implemented. (Tierny&Tenty, 2008, pp.4-10) There were also few limitations of the benchmarking process in use by Intel. No single measurement methodology was used to determine the performance of the microprocessor produced by Intel. But during the purchase of products clients uses only a single benchmark which deals with the overall performance of their product. The benchmark processes used by Intel are done on specific hardware and software requirement which may vary from that of users and come out with varied results. However if these limitations in the use of benchmarking can be overcome by Intel their product performance could rise into a further satisfactory levels (Benchmark Limitations, n. d). The below graph shows the improvement achieved by Intel in various model by them after the implementation of benchmarking Process. The series models are represented as 735, 745, 7300 respectively in the X axis and their performance is measured along the Y axis. The colored bar represents the various types of models under the particular series. (Tierny&Tenty, 2008) The data for the graph was estimated from the source. Use of Bench marking in Dell: Dell Corporation uses benchmark assessment throughout its technology development and the assessment of the servers, workstations and the client system in use. The performance benchmark used by dell helps in providing impartial information which is used in comparing the performance of different products manufactured by the organization. Dell uses its distinctive organizational philosophies in implementing the benchmark process. The benchmarking process is guided by three major principles which are followed by dell. The benchmarking process used in the measurement of the product is done in the identical manner in which organizations use their applications on their product. Dell also uses the benchmarking process incorporated by organizations like SPEC and BAPCo. During the process of benchmarking in Dell various factors are kept in concern which includes maintaining a balance in the overall performance accompanied with cost and quality. Dell supports the procedure of benchmarking guidelines maintained by the industry. Dell maintains a specific standard of their own by maintaining its own set of benchmark for the servers and the applications. An example of the benchmark standards maintained by Dell is given in the table below. It is quite evident from the study that Dell takes the help of comparative benchmarking in its process. Workload type Benchmark Database Online transaction processing (OLTP): TPC- Decision support: TPC-H and TPC-R Java Web services Hypertext Transfer Protocol (HTTP): SPECweb HTTP over SSL (HTTPS): SPECweb99_SSL Storage SPC Benchmark 1™ (SPC-1) Iometer CPU, memory subsystem, And compiler Linpack SPEC CPU2000 2-D graphics • Photoshop • Autodesk, AutoCAD (Hanson, Esteves& Espinoza, 2004, p.90) The general limitation of the benchmarking process used by Dell in the evaluation process is that it does not considers the other necessary factors like price, availability of services and the up gradation of the system. The appropriate use of the benchmark process byDell wil enables the administrators in effective evaluation of their computer systems. The use of regulated benchmark by dell enables them to have a well defined and a documented methodology in use for further reference. The main strength in benchmarking procedure of Dellhas been their proper benchmarking standards and the procedures they opt in comparison of the services against the benchmark set. (Hanson, Esteves& Espinoza, 2004) Business Process Reengineering: The activity of Business process reengineering can be defined as the innovation of a completely new process using a variety of tools with cross functional focus. The change or the reengineering is done at the macro organizational level. The redesigning of the business process is done to improve the overall structure of the business which includes performance, cost, quality and service. (Harrington, 2005, p.218) The key stimulus in the process of reengineering involves the automation process and deploying of information system and networks. There are five major methodologies of achieving Business process reengineering. The initial step of the Business process reengineering involves developing the vision of the business and the objectives are set .The next step involves the identification of the process which are aimed to be re designed. The process to be redesigned is then carefully studied to find out the deficiencies. After the evaluation of the existing process identification of the capabilities of the information technology is done in rebuilding the new process. The final step in the methodology of the BPR comprises of designing and prototype building of the new process. (Radhakrishnan,n .d, p.39) The various activities which are carried out in the Business process reengineering are (i) Prepare for reengineering, (ii) Mapping and analyzing of As- Is process. (ii) Designing of the process to be implemented (iii) implementation of the process (IV) Improvement of the process. (Muthu, Whitman & Cheraghi, 1999, p.3) Use of Business Process reengineering in IBM: IBM a global leader in the field of Information technology resorts to the use of the Business Process Reengineering to optimize the business and in improving the results. The company undertakes the full fledged use of the process and carries the process effectively to suit its business needs. It maintains a wide range of services in each of the steps of the business process reengineering process. In the As –Is assessment of BPR, the company undertakes the critical analysis of the processes and the performance of the overall organization. The organizations business objectives, values and culture are often taken into consideration. The development of roles is analyzed by the help of responsibility matrix. The need analysis involves the resource analysis and analysis of the business processes which are documented. The feasibility study of the need of new process to be implemented is studied over here along with a critical analysis of the cost involved in the project of reengineering. The recommended areas of improvement are studied in a proficient manner. The next step involving the “to be definition” stage of the BPR involves the process definition and the construction of the work and data flow diagram. The resource allocation of the new process to be implemented is done in this phase by the organization. A rough estimation of the expected outcome and the benefits from the business on implementation of the new process is also carried out by IBM. The transition planning involves framing of plans for the successful implementation of the new reengineered business process. The plans which are generally framed are the analysis of the stakeholders and the plans for the change management involving proper training and guidance to the users of the new system. The overall process of system development and implementation is done in the final stage of the project implementation. IBM maintains a detail process in following the business process reengineering. It carries a careful analysis of the whole system before deciding for any reengineering process. The costs associated with reengineering are given a prime importance and the post implementation benefits are also tried to be forecasted. The other alternatives of the business process reengineering are considered before this method is opted for. The use of technology for the reengineering process is also critically chosen.(‘Business Process Reengineering, n. d) Use of Business Process reengineering in Tata Consultancy Services: The concept of Business Process Reengineering developed its popularity towards the middle of 1990’s and it spread across the corporate world in a very rapid pace. Multinational IT companies which manage a wide range of business of consultancy under their belt started reaping benefits from the use of this new concept. Tata consultancy incorporated the use of business process reengineering in their insurance regulatory division along with the assistance from Celent. In incorporation of the reengineering process steps were taken in designing a proper interaction between person and system. As most reengineering methods adapts to sufficient use of technology this step was taken. The reengineered process was careful in recording, and analyzing the process and space was even provided for the improvement of the new process. The area of insurance was properly chosen in implementation of the BPR as insurance is a process driven business. Business Process reengineering added a lot of value to the operation of the business. The new business process was helpful in gathering and analyzing information from both internal and external source. It caused a direct impact on the operation of the business and enabled faster notice of losses. Cancellations and reinstatements occurred at a quick time because of the prompt communication system in use. Auditing and charges on premium and endorsements was also carried out in proper manner. The adherence to the new system added a whole range of benefits both to the clients and the service providers. Proper support was also provided at all level of management by the new service in use. A proper flow of information and communication between different levels of executives was carried out as a result of the reengineered process. (Light, Shanmuganandam & Nayak, n. d, pp.1-6) Recommendations: Though the process of benchmarking and Business Process Reengineering has benefitted the Organizations immensely, the organizations should be careful in their overall implementation. The organizations should particularly look into the cost factors while opting for the Business Process Reengineering. They should carry out the evaluation process carefully before deciding to implement the Business Process Reengineering. In case of the benchmarking process the organizations needs to be careful regarding their choice of the benchmarked process. They should carefully investigate the viability of the benchmarked process and its effectiveness in the market. The benchmarked process should be chosen such that the organization can reach up to the level of the benchmark created by them. The actual need for both the process needs to be investigated before putting them in action. Conclusion: The study conducted in the paper analyzes the effective use of benchmarking and Business process reengineering. The analysis shows the benefits gained by the organizations in using the new strategies. It has been found from the study that the organization uses benchmarking methods for specifically handling particular methods which appeared challenging for the business. Organizations like Intel use performance benchmarking for gaining optimization in the performance of their product and Dell also carries out the same methodology for producing better quality servers and pc. The importance of business process reengineering is often applied by business organizations to gain overall productivity of the business. The application of technology is detrimental in the overall result achieved from the implementation of the new process. Organization like IBM uses the precautionary measures in reengineering techniques because of the cost involvement and unsure results of the new process. On the contrary Tata Consultancy uses the service in the insurance handling and reaps a wide range of benefits from its use. It has been observed that the nature of performance of the process implemented by the organizations differ in respect to the process and methodologies applied by them. Some organizations like IBM use a detailed approach and have achieved different levels of productivity. In case of Business Process Reengineering, the credibility or the appropriateness of the process chosen determines the effort as it was found with Tata Consultancy Services. Various models have been incorporated by the Organizations in adhering to the practice of the different strategies mentioned but the organizations need to be particular regarding their choice of strategies in countering a problem. The abundance in number of strategies available is good for companies in reaching their goals but a clever practice in their approach is suggested. References Benchmark Limitations, (n. d), INTEL, available at: http://www.intel.com/content/www/us/en/benchmarks/resources-benchmark-limitations.html (accessed on November 15, 2011) Business Process Reengineering, (n. d), IBM, available at: http://www-304.ibm.com/easyaccess3/ites2s/contenttemplate/!!/xmlid=105204 (accessed on November 15, 2011) Radhakrishnan, R, (n. d). Business Process Reengineering: Text and Cases, London: PHI Learning Pvt. Ltd. Harrington, (2005), Business Process Improvement, London: Tata McGraw-Hill Education, Hanson,S. 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