BUSINESS PROCESS IMPROVEMENTS and METHODS AND MODELS FOR EVALUATING IT PROJECTS

On Business Process Improvements

An organization like a firm is similar to an organism - an animal that has to adapt to its environment like the ocean or the forest. A company has its external environment such as political climate, consumer preferences, technological, and economic conditions. In today's globally and technologically competitive environments, we find many firms restructure in order to thrive. One way to achieve this is trough Business Process Reengineering. Reengineering is the radical redesign of business processes to achieve dramatic improvements in cost, quality, service and speed. Because the focus of reengineering is on process rather than function, reengineering generally leads to a shift away from a strong vertical structure to one emphasizing stronger horizontal coordination and greater flexibility in responding to changes in the environment.
Reengineering changes the way managers think about how work is done in their organizations. Rather than focusing on narrow jobs structured into distinct, functional departments, they emphasize core processes that cut horizontally across the company and involve teams of employees working to provide value directly to customers.
A process is an organized group of related tasks and activities that work together to transform inputs into outputs and create value. Common process involves product development, order fulfillment, and customer service. Total Quality Management (TQM) is a way of reengineering businesses in terms of the quality and services they provide. It is a management system for a customer-focused organization that involves all employees in continual improvement of all aspects of the organization. TQM finds out what customers want and try to meet their needs and expectations. Benchmarking and Continuous Improvement (implementation of small incremental improvements in business at an ongoing basis) are two important aspects of TQM.
Other companies today pursue highly ambitious quality goals to demonstrate their commitment to improving quality. For example six sigma, popularized by Motorolla and General Electric, specifies a goal of no more than 3.4 defects per million parts. ISO is another set of rules for business process. It provides a set of standardized requirements for a quality management system regardless of what the user organization does, its size, or whether it is in the private. To sum up, BPR produces significant cost reduction and improved customer satisfaction.

On Models and Methods for Evaluating IT Projects

IT projects are seriously expensive to implement. Intelligent planning is definitely required but there is still something that must be done during or even before the planning stage which is the project evaluation. There are many ways of evaluating an IT project.

Total Cost of Ownership:
It is a financial estimate. its purpose is to help consumers and enterprise managers
determine direct and indirect costs of a product or system. It is a management accounting concept that can be used to evaluate IT project. Computer and hardware programs, operation expenses and long term expenses are major classifications of its elements. Computer and Hardware programs may include the upfront costs. Operation expenses relates to the testing costs, insurance, and license renewal. Long term expenses include
decommissioning, upgrades and replacement costs.

Return on Investment (ROI):
It is the percent of profit as compared to the total investment.
ROI = Net Profit / Total Investment
A realistic ROI includes intangible benefits. the only problem is that it is not easily measured.

Cost-Benefit Analysis:
A technique designed to test the feasibility of a project by enumerating the costs of a project and subtracting that from the expected benefits throughout the useful life of the undertaking. If the benefits exceeds the costs then the project makes sense.

Feasibility Study:
Is a preliminary study where the information needs of prospective users and the resource requirements costs, benefits and feasibility of a proposed project are determined.
There are two types: operational and economic feasibility. The former asks whether there would be resistance to change. Is the management supportive of the project? Are employees involved in formulation? Are users willing to adopt? The latter is about costs and benefits. It is economically feasible if benefits exceed the costs.

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Business Process Reengineering and IT Project Evaluation can be modified and applied in day to day living. Like businesses (through TQM), individuals can benefit by restructuring their daily tasks and by improving on the quality of their work even in
small amounts through time. By accumulating small improvements on our daily tasks we easily get used to it. And before we know it we have totally changed the way we do things as opposed to sudden changes that ends up unsuccessful. Try to improve things little by little on a continuous basis like getting up 2 minutes earlier each day to avoid being late. In just a week you wake up almost 15 min. earlier.
Successful students also try to weigh the costs and benefits in their undertakings. Cost benefit analysis is indispensable and I think most of us do it on a daily basis. Think about chatting or watching TV late at night. The benefits obtained from that would not cover up for the lost learning that should have been gained in class if the student were not late. Sometime ago I knew I would be 15 min late for an exam if i ride the jeepney so I thought twice if I would rather spend 100 pesos in taxi or ride a 10 Peso jeepney. I knew that 15min of exam time is more precious than the 90 peso gained by riding the jeepney-- not mentioning the mere intangible mental and physical inconvenience inside the jeepney. It can spell the difference between acing the exam or not.