ENTERPRISE INFORMATION SYSTEM

ASSIGNMENT # 01

Business Process Reengineering

Submitted to:-
PROF. [Link]

submitted By-
Manish kaushal
Sec:- ‘c’
Roll no:- 10202131

Business Process Reengineering Case study

 The goal of the case study is to show the practical implementation of especially
business process management and importance of information sharing. This case
study includes two participating companies – the retailer (e. g. a large grocery
store) and the supplier (that supplies the needed product).
The presented models can easily be extended with the inclusion of additional
companies or processes and analyzed with the same methodology. As can be seen
from figure 2 and 3 the AS-IS model consists of two separate processes – the
procurement process at the retailer's and the order-fulfillment process at the
supplier's. While both processes are certainly interconnected (e.g. the activity No.
12 in the retailer model is a direct consequence of activity No. 15 in the supplier
model) and some exchange of information between those two processes exist, it
is evident from those two models that:
• There are several unnecessary delays in the process (for example the process at
the supplier's can only start after the end of activity No. 4 at the retailer's),
• Relevant information is not readily available and several delays and unnecessary
activities are needed as a consequence. The typical example is that the retailer
has to wait for the supplier to confirm the order. This is a consequence of limited
information (the retailer is unaware of current supply capabilities of its partner)
and leads to severe delays in the process, especially if the supplier cannot fulfill
the order as reconciliation is then needed,
• Quick and flexible responses to changes in end customer’s demand are either
not possible or very costly. This is due to long cycles (from identification to
fulfillment of the need), higher inventory levels and insufficient information about
customer needs and changes in these needs at all levels in the supply chain,
• One company has no possibility to influence the processes of the other one,
although they are mutually dependent on each other,
• It is hard to measure cycle times and costs of the supply chain as a whole, but
only at each single company The usual solution to these problems is obviously the
increase in stock levels that leads to well known problems and additional increase
in costs.

Therefore the current processes have to be renovated in order to achieve greater

efficiency. The renovated systems are then strongly supported with effective use
of information technology as shown in the continuation.
 The TO-BE model (Figure 4) shows the integration of both processes into one
process that spans across various departments of both companies. The main
changes enabling this integration are:
- Long-term contracts and e-business connections are established between the
retailer and the supplier – long-term partnership is definitely a prerequisite for
the necessary investment in business renovation and new solutions, as these
investments can be quite costly and the return period can be considerably longer
than the usual length of short or medium- term commercial contracts, an
integrated Supply chain management (SCM) system is introduced supporting the
entire process and is available to all involved departments at the supplier's and
retailer's side,
- Vendor-managed inventory (VMI) (similar approaches are sometimes described
as co managed inventory (CMI), distribution requirements planning (DRP), and
continuous or efficient replenishment planning (CRP/ERP). The supplier has full
information about the inventory state and future needs of the retailer and is
therefore in charge of timely deliveries,
- Consequently the starting point of the integrated process is different and is in
the supplier's company. The supplier identifies the procurement need and starts
the process of fulfilling it,
-The integration of the processes also enables the supplier to better plan its
processes, avoid bottlenecks in production and reduce safety stocks as the
information of future demand is more readily available. Consequently the supplier
also realizes considerable benefits, - the final solution is an integrated supply-
chain management system that supports the entire process and is available to all
involved departments at the supplier's and the retailer's side.
Those changes lead to the radically improved process with considerable
benefits for all involved companies and improve the added value for the final
customer and consequently also the competitiveness of the supply chain as the
whole. They also considerably reduce the lack of information and enable much
better coordination.
 Other possible improvements on a more tactical/operational level can be (these
are the changes that are more technologically than process-oriented and can also
bring some benefits to all companies involved):
- Automatic performance of some activities (such as preparing invoice, delivery
note or booking), that can also reduce costs, times and number of mistakes,
- Providing electronic delivery tracking that further enhances available
information to all companies in the supply chain – information is available more
timely and in a cheaper way, quicker response to changes or unforeseen
problems are possible, - introduction of e-payment system that considerably
reduces the time and effort needed for billing.
While the TO-BE process enables shorter cycle-time and lower costs of
transactions, it also means the reduction in inventory levels (safety stock) for both
(all) companies in the supply chain without increasing the danger of stock-outs.
Because many activities were eliminated from the process and others were
considerably shortened, the amount of employees´ work is considerably reduced,
allowing them to focus on other more strategic or value-adding activities. Beside
these advantages on the operational/tactical level, some strategic advantages can
also be realized. Quicker identification and response to long-term changes in
demand patterns, improved customer service, better and quicker response to
unexpected events and also introduction of new products or services are much
easier in the new model. Once again it has to be emphasized that the main cause
for those improvements is not the implementation of e-business itself, but rather
renovation and integration of business processes that can be enabled by e-
business solutions. Information Transfer in Supply Chain Management