Analisis Proses Bisnis

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Introduction to Balanced Scorecard

Introduction to BPR
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Introduction to Balanced
Scorecard
 Developed by
 Robert Kaplan (Harvard) and David Norton
 early 90s..
 The balanced scorecard is a strategic
management system (not only a measurement
system)
 Internal assessment, improvement and reporting
system
 Key is the link to the strategic plan
 System to turn strategy into action
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 The balanced scorecard retains traditional

financial measures. But financial measures tell the
story of past events, an adequate story for
industrial age companies for which investments in
long-term capabilities and customer relationships
were not critical for success. These financial
measures are inadequate, however, for guiding
and evaluating the journey that information age
companies must make to create future value
through investment in customers, suppliers,
employees, processes, technology, and
innovation. Kaplan & Norton
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Balanced Scorecard

 Enables organizations to clarify their vision and

strategy and translate them into action
 It provides feedback about both
 the internal business processes and
 external outcomes
 Continuous improvement of strategic
performance and results.
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 The balanced scorecard suggests that we view

the organization from four perspectives:
 The learning growth perspective
 The business process perspective
 The customer perspective
 The financial perspective
 Develop metrics, collect data and analyze
relative to each of these perspectives
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Learning and Growth
Perspective
 Development of the human resources
 This perspective supports the concept that people are a
company's main resource and most valuable asset
 metrics defined for this perspective must measure various
aspects of employee improvement, growth, and satisfaction.
• personnel training and improvement
• cultivation of corporate culture
• organizational development, including the nurturing of corporate
experts, gurus, and mentors
• setting up of fast and efficient knowledge transfer infrastructure
• opening up of communication lines among personnel
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Business Processes
Perspective
 Internal business processes.
 These metrics, which measure various aspects
(efficiency, speed, quality, etc.) of how well the
company's products, services and internal
support systems are produced or delivered
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The customer perspective

 Focus on customer satisfaction.

 Rigorous data analysis to understand the
customer
 Difficult to reflect the true sentiment of the
customer.
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Financial Perspective

 Indicates if the transformation of strategy leads

to economic success
 Define the financial performance that the
strategy is to achieve
 Revenue growth
 Cost reduction
• Cost reduction from energy efficiency
 Measures the effectiveness of the other
perspectives
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Characteristics of good metrics

 reflect the true present status of the company

from many different perspectives
 provide constructive feedback to various
company processes, leading to continuous
improvement
 show trends in company performance over time,
facilitating adjustments to changes
 quantify many things, making analyses more
accurate and solutions more effective.
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Close the loop

 once the metrics have been defined and

implemented
 scorecard data becomes available,
 follow-through becomes imperative
 movements in the metrics must be analyzed to
identify their causes.
 Causes that produce positive (negative)
changes must be sustained or enhanced
(eliminated)
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What is BPR?

 Reengineering is the fundamental rethinking and

redesign of business processes to achieve
dramatic improvements in critical, contemporary
measures of performance, such as cost, quality,
service and speed.
(Hammer & Champy, 1993)
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BPR is Not?

 Automation
 Downsizing
 Outsourcing
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BPR Versus Process
Simplification

Process Simplification Process Reengineering

Incremental Change Radical Transformation

Process-Led Vision-Led
Assume Attitudes & Behaviors Change Attitudes & Behaviors
Management-Led Director-Led
Various Simultaneous Projects Limited Number of Initiatives

(Source Coulson-Thomas, 1992)

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BPR Versus Continuous
Improvement

Continuous Improvement Process Reengineering

Incremental Change Radical Transformation

People Focus People & Technology Focus
Low Investment High Investment
Improve Existing Rebuild
Work Unit Driven Champion Driven
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What is a Process?

 A specific ordering of work activities across time

and space, with a beginning, an end, and clearly
identified inputs and outputs: a structure for
action.
(Davenport, 1993)
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What is a Business Process?

 A group of logically related tasks that use the

firm's resources to provide customer-oriented
results in support of the organization's
objectives
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Why Reengineer?

 Customers
 Demanding
 Sophistication
 Changing Needs

 Competition
 Local
 Global
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Why Reengineer?

 Change
 Technology
 Customer Preferences
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Why Organizations Don’t Reengineer?

 Complacency*
 A feeling of contentment or self-satisfaction,
especially when coupled with an unawareness of
danger, trouble, or controversy.
 An instance of contented self-satisfaction.
*www.dictionary.com

 Political Resistance

 New Developments

 Fear of Unknown and Failure

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Performance

 BPR seeks improvements of

 Cost
 Quality
 Service
 Speed
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Origins

 Scientific Management. FW Taylor (1856-1915).

 Frederick Herzberg - Job Enrichment
 Deming et al - Total Quality Management and
Kaizen
 In Search of Excellence (Peters and Waterman)
 Value-Added Analysis (Porter).
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Key Characteristics

 Systems Philosophy
 Global Perspective on Business Processes
 Radical Improvement
 Integrated Change
 People Centred
 Focus on End-Customers
 Process-Based
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Systems Perspective

Feedback

Inputs Transformation Outputs

Environment
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Process Based

 Added Value
 BPR Initiatives must add-value over and above
the existing process

 Customer-Led
 BPR Initiatives must meet the needs of the
customer
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Radical Improvement

 Sustainable
 Process improvements need to become firmly
rooted within the organization

 Stepped Approach
 Process improvements will not happen over night
they need to be gradually introduced
 Also assists the acceptance by staff of the
change
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Integrated Change

 Viable Solutions
 Process improvements must be viable and
practical

 Balanced Improvements
 Process improvements must be realistic
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People-Centred

 Business Understanding
 Empowerment & Participation
 Organizational Culture
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Focus on End-Customers

 Process improvements must relate to the needs

of the organization and be relevant to the end-
customers to which they are designed to serve