organization and business process

Organization and Business Process

Guest Lecture for Bina Nusantara University, June 26 2013

Goutama Bachtiar

Advisor, Global Innovations and Technology Platform

T: @goudotmobi

INTRODUCTION

Introduction

Presenter Profile 15 years of working experience: 12 years of Training and Education, 8

years of IT Audit, 7 years of strategic partnership, 8 years of writing, 6 years of consulting, software development, project management and network administration

Advisor at Global Innovations and Technology Platform

Head of Information Technology at Roligio Group

Subject Matter Expert at ISACA International Chapter

Program Evaluator at Project Management Institute

Columnist and contributor at Asia Tech Site e27.co, Forbes Indonesia, The Jakarta Post, DetikINET and InfoKomputer among others

Today’s AgendaOrganization Mission and Vision

Organization Strategy and Design

Business Activities

Business Process

Business Process Management

Business Process Reengineering

Today’s ObjectivesCore business

Business strategy and functions

Customers

Suppliers

Partners

Business process and activities

VisionProvides guidance about what core to preserve and what future to stimulate progress toward

Consists of two major componentsCore ideology defines what we stand for and why we exist (values and purposes)

The envisioned future is what we aspire to become, to achieve, to create—something that will require significant change and progress to attain (10-30 years of Big Goal w/ description)

Vision (cont’d)Example of core ideology: Hewlett-Packard

Code of ethics ‘HP Way’ has guided the company since its inception more than 50 years ago

It includes a deep respect for the individual, a dedication to affordable quality and reliability, a commitment to community responsibility

Packard himself bequeathed US$4.3 billion of his stock to a charitable foundation and a view that company exists to make technical contributions for advancement and welfare of humanity

Vision (cont’d)Example of vision: Coca Cola

People: Be a great place to work where people are inspired to be the best they can be

Portfolio: Bring to the world a portfolio of quality beverage brands that anticipate and satisfy people's desires and needs

Partners: Nurture a winning network of customers and suppliers, together we create mutual, enduring value

Vision (cont’d)Planet: Be a responsible citizen that makes a difference by helping build and support sustainable communities

Profit: Maximize long-term return to shareowners while being mindful of our overall responsibilities

Productivity: Be a highly effective, lean and fast-moving organization.

Vision (cont’d)Example of vision:

Walt-Disney company

Be the leader in the delivery of entertainment experiences

Be the premier channel for sports experiences and information

Vision is also dynamic

Example of vision:

Walt-Disney company

Be the leader in the delivery of entertainment experiences

Be the premier channel for sports experiences and information

MissionIt declares organization purpose

A statement why an organization exists

Serves as the standard against which the organization weigh their actions and decisions

Short and very clear

Walt Disney company "Make People Happy” It didn't say make it through animation, or theme parks, or interactive experiences

Mission (cont’d)Example: Coca Cola

To refresh the world...

To inspire moments of optimism and happiness...

To create value and make a difference

ValuesServing as compass for company actions and

describe how they behave in the world

Example: Coca Cola

Leadership: The courage to shape a better future

Collaboration: Leverage collective genius

Integrity: Be real

Values (cont’d)Example: Coca Cola

Accountability: If it is to be, it's up to me

Passion: Committed in heart and mind

Diversity: As inclusive as our brands

Quality: What we do, we do well

Values (cont’d)Example: Hewlett-Packard

Trust and respect for individuals

Achievement and contribution

Results through teamwork

Meaningful innovation

Uncompromising integrity

Company ObjectivesFinancial

Profit and Lost (P&L) StatementBalance SheetGross Profit, EBIT, EAT (Net Profit),

ROI, ROAStock Price in stock exchange market

Non-FinancialCredibilityContributionIP

Company Objectives (cont’d)

Hewlett-Packard as an example

Profit

Growth

Market leadership

Commitment to employees

Leadership capability

Global Citizenship

Core BusinessThe primary area a company was founded on or focuses on in its business operations

Even though leading the growth, market leaders usually opens their doors for new business opportunities

Core Business (cont’d)The primary area a company was founded on or focuses on in its business operations

Even though leading the growth, market leaders usually opens their doors for new business opportunities

Core Business (cont’d)

Key factsOrganization

A US multinational company based in Palo Alto, CaliforniaSegment

Consumer, commercial and enterpriseIndustry

Computer Hardware, Computer Software, Consulting, Information Technology and Services

Type: PublicFounded: 1939Employees: 332,000

Core Business (cont’d)Key factsPresence in 70 countriesGroups: Imaging and Personal Systems, Enterprise Business Divisions: Financing, Hardware, Software, ServicesCore Business: providing IT hardware, software, solution and

servicesTotal Assets: US$109BTotal Equity: US$23BTotal Revenue: US$120BOperating Income: (US$11B)Net Income: (US$12.7B)

Organization StrategyHow an organization needs to evolve over time to meet its objectives along with a detail assessment of what needs to be done

First comparing its present state to its targeted state to define differences and then stating what is required for the desired changes to take place

Organization DesignAligning organizational and position

structures with organization strategic mission and objectives

Review and analyze organization’s mission, functions, strategic objectives, work processes, and workloads

Determine skills mix (occupational types, grade levels, and numbers of positions in each occupational category) required to achieve strategic objectives

Organization Design (cont’d)Identify functional interrelationships

Identify workflow and work process bottlenecks and inefficiencies

Recommend work process and workflow reengineering

Develop organizational structure and staffing models that facilitate efficient and effective achievement of strategic objectives

CustomersIndividual or other organization willing to pay for

our products, either goods or services (differs it with member, user, consumer)

Consumer (for daily activities perusal: student, housekeeping wife, white-collar worker)

Corporate (for professional and Small Medium Business (SMB) perusal: staff, officer, supervisor, manager, director, CxO)

Enterprise (for companies perusal, in particularly big companies)

SuppliersOther type of organization that our organization or company obtain their raw material, work-in-process, finished good, product, or services:

Principal (hundred of OEMs: AOC, Innolux, Samsung)

Vendor

Distributor

Manufacturer (Foxcon)

PartnersOther type of organization that our organization or company deliver finished good, product, or services:

Principal

Vendor

Distributor (Datamation, TechKing, TixPro, Samafitro)

Manufacturer

Partners (cont’d)Reseller (as Business Partners: Asterindo, MDP, Gading Murni)

Systems Integrator (as Service Partner: AGIT, BHP, MII)

Service Provider (as Support Partner: Infokomputra, Harrisma, Cahaya Surya)

Business ProcessA set of logically related tasks performed to

achieve a defined business outcome

Business outcome

Measureable with numbers and figures, usually represented in financial terms

Business objective

Formed by business outcome. Maximizing value to the company stockholders, financially and non-financially

Business Process (cont’d)

1. Market-research process

2. New product offering realization process

3. Customer acquisition process

4. Customer relationship management

5. Order-fulfillment management process

6. …

Business FunctionA process/operation performed routinely to

carry out a part of the mission of an organization

A description of work that is performed to accomplish one or several business unit's responsibility

In concrete, it’s pooled into department such as Marketing, Finance, Human Resources, Logistics

Examples: delivering raw materials, paying bills, receiving of cash and inventories

Business ActivitiesAny activity that is engaged in for the primary purpose of making a profit

Include things like operations, marketing, production and administration

Also known as "business operations”

Business Activities (cont’d)Business process that is a series of activities spanning multiple systems and applications

For example: implementing SAP with Ariba, Oracle Database and other applications (in-house or off-the-shelf)

Business Activities (cont’d)

Needs computerized systems to monitor, manage and provide real time info on status and results of operations, processes, and transactions to middle and upper management:

Business Activities Monitoring (BAM)

Enterprise Architecture (EA)

Business Process Management (BPM) in the later stage

Rehearsing BPMStrategic management approach to align organization business processes aligned with customer needs

Bringing in business effectiveness and efficiency while striving for innovation, flexibility and integration with technology

Continuous process optimization process

Rehearsing BPM (cont’d)

Efficient, effective and more capable of change

Influenced by Total Quality Management (TQM) or Continuous Improvement Process methodologies

Key drivers: People and (supported by) Technology

BPM Business DriversManaging end-to-end, customer-facing processes

Consolidating data and increasing visibility into and access to associated data and information

Increasing the flexibility and functionality of current infrastructure and data

BPM Business DriversIntegrating with existing systems and leveraging emerging Service-Oriented Architecture (SOA)

Establishing a common language for Business-IT alignment

BPM Practice These DaysFocusing on objective to optimize a domain identified as an area for improvement

In financial sector, it is critical to make sure the system delivering quality service while maintaining regulatory compliance

Shared/Dedicated Resource for BP or BPM (governance, Chief Business Process Officer)

BPM Practice These DaysInternational standards limited to IT sector: ISO/IEC 15944 covering operational aspects of the business

Other standards

BPMN

Enterprise Architecture

Business Motivation Model

Commencing Business Process EngineeringKnown as Business Process Redesign,

Business Transformation and Business Process Change Management

Business management strategy focusing analysis and design of workflow and process

Helping organization to rethink their work to improve customer service, operational cost to become world-class corporation

Commencing Business Process Engineering (cont’d)60% Fortune500 companies have done it or plan to do so

Comprehensive focus on business objectives

Radically restructuring their organizations through ground-up design of business processes

Full scale recreation of processes

Commencing Business Process Engineering (cont’d)Reengineering as an pretext to downsize their companies dramatically

Earned a reputation for being synonymous with downsizing and layoffs

Assumed the factor limiting an organization performance is process ineffectiveness

Commencing Business Process Engineering (cont’d)

Offered no means of validating the assumption

Assumed the need to start the process of performance improvement with a clean state

Doesn’t focus on improvement in organization constraint

Q & A

April 12, 2023

THANK YOU!