INFS 2005 Accounting information system
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QUESTION 5
Explain the business process reengineering?
Business process reengineering (BPR) is the analysis and redesign of business processes and information systems to achieve significant performance improvements. The concept of BPR was first introduced in the late Michael Hammer's 1990 Harvard Business Review article and received increased attention a few years later, when Hammer and James Champy published their best-selling book, Reengineering the Corporation. The authors promoted the idea that sometimes-radical redesign and reorganization of an enterprise is necessary to lower costs and increase quality of service and that information technology is the key enable for that radical change. We will discuss these topics:Essay on why we use accounting
Hammer and Champy suggested seven reengineering principles to streamline the work process and thereby achieve significant levels of improvement in quality, time management, speed and profitability:
Organize around outcomes, not tasks. If a process is organized as a set of tasks, the primary concern will be the set of task outputs rather than the overall out-come. Task-based organization tends to preserve the old way of doing things. For example, reengineering means that rather than having multiple people each do a small part of the process, one person might do all the steps in a particular process.
Have those who use the output perform the process. Classic organization structure defines departments that provide goods and services for other departments. Changes in information technology can facilitate integration across departmental barriers so that those who use the output can perform the activities necessary to do the process. This principle can also greatly increase the support of those performing the process, which can set the stage for further process improvements.
Subsume information processing work into the real work that produces the information. Rather than generating information from processes through “accountants,” a user (worker) could generate information from the “real” work process. A good example of this is the development of information using scanners on bar codes, which allows the worker on the loading dock to capture information as part of the normal work routine. Organizational design of this type eliminates the scenario of different “accountants” preparing information for other accountants, cascading information through organization.
Treat geographically dispersed resources as though they were centralized. Information technology allows firms to virtually centralize their resources (e.g. departments), aggregating the resources of multiple locations. Economies of scale are then used to decrease costs.
Link parallel activities instead of integrating their results. Parallel processes, typically done by multiple persons, are combined in a single job, rather than trying to assemble multiple disjointed efforts after they are completed. In some situations, some of the activities can be eliminated. In others, assembling the results of the parallel activities becomes less of a task, because activities are assembled as they occur.
Put the decision point where the work is performed. In many organizations and processes, those who do the work are different from those responsible for making decisions about the work. This principle indicates that people who do the work, possibly supported by IT, should be allocated decision-making rights or responsibilities.
Capture information once and at the source. Information that is gathered at the source has fewer chances of having error introduced into it. Rather than having “accountants” generate information from processes, which is then sent to other accountants, this principle focuses on generating the information at the time it is developed. Electronic data interchange (EDI) data developed by the customer in formulating the order information can be used directly by the vendor, eliminating the need for duplicating data.following links are useful:ACC 222EXTERNAL REPORTING II
ACC311 STRATEGIC AND SUSTAINABLE ACCOUNTING
QUESTION 6
What challenges faces by reengineering effort?
BPR is challenging and many efforts fail or do not accomplish all they set out to do. To successfully complete the BPR process, a company must face and overcome the following obstacles:
Tradition : Old ways of doing things do not die easily, especially practices associated with the organization’s culture. Successful reengineering requires changes in employee culture and beliefs. Resistance : Change is always met with a great deal of resistance. Managers must continually reassure, persuade, and provide support to those affected so that the necessary changes will work.
Time and cost requirements : BPR is costly and almost always takes two or more years to complete.
Lack of management support : Many top managers are afraid of the “big hype, few results” syndrome. Without top-management support, reengineering has little chance of succeeding.
Skepticism : Some people view BPR as traditional systems development in a new wrapper with a fancy name.
Retraining : Employees must be retrained, which is time-consuming and expensive.
Controls : Important controls that ensure system reliability and integrity cannot be deleted.
links:Essay on financial accountingExplain the business process reengineering?
Business process reengineering (BPR) is the analysis and redesign of business processes and information systems to achieve significant performance improvements. The concept of BPR was first introduced in the late Michael Hammer's 1990 Harvard Business Review article and received increased attention a few years later, when Hammer and James Champy published their best-selling book, Reengineering the Corporation. The authors promoted the idea that sometimes-radical redesign and reorganization of an enterprise is necessary to lower costs and increase quality of service and that information technology is the key enable for that radical change. We will discuss these topics:Essay on why we use accounting
Hammer and Champy suggested seven reengineering principles to streamline the work process and thereby achieve significant levels of improvement in quality, time management, speed and profitability:
Organize around outcomes, not tasks. If a process is organized as a set of tasks, the primary concern will be the set of task outputs rather than the overall out-come. Task-based organization tends to preserve the old way of doing things. For example, reengineering means that rather than having multiple people each do a small part of the process, one person might do all the steps in a particular process.
Have those who use the output perform the process. Classic organization structure defines departments that provide goods and services for other departments. Changes in information technology can facilitate integration across departmental barriers so that those who use the output can perform the activities necessary to do the process. This principle can also greatly increase the support of those performing the process, which can set the stage for further process improvements.
Subsume information processing work into the real work that produces the information. Rather than generating information from processes through “accountants,” a user (worker) could generate information from the “real” work process. A good example of this is the development of information using scanners on bar codes, which allows the worker on the loading dock to capture information as part of the normal work routine. Organizational design of this type eliminates the scenario of different “accountants” preparing information for other accountants, cascading information through organization.
Treat geographically dispersed resources as though they were centralized. Information technology allows firms to virtually centralize their resources (e.g. departments), aggregating the resources of multiple locations. Economies of scale are then used to decrease costs.
Link parallel activities instead of integrating their results. Parallel processes, typically done by multiple persons, are combined in a single job, rather than trying to assemble multiple disjointed efforts after they are completed. In some situations, some of the activities can be eliminated. In others, assembling the results of the parallel activities becomes less of a task, because activities are assembled as they occur.
Put the decision point where the work is performed. In many organizations and processes, those who do the work are different from those responsible for making decisions about the work. This principle indicates that people who do the work, possibly supported by IT, should be allocated decision-making rights or responsibilities.
Capture information once and at the source. Information that is gathered at the source has fewer chances of having error introduced into it. Rather than having “accountants” generate information from processes, which is then sent to other accountants, this principle focuses on generating the information at the time it is developed. Electronic data interchange (EDI) data developed by the customer in formulating the order information can be used directly by the vendor, eliminating the need for duplicating data.following links are useful:ACC 222EXTERNAL REPORTING II
ACC311 STRATEGIC AND SUSTAINABLE ACCOUNTING
QUESTION 6
What challenges faces by reengineering effort?
BPR is challenging and many efforts fail or do not accomplish all they set out to do. To successfully complete the BPR process, a company must face and overcome the following obstacles:
Tradition : Old ways of doing things do not die easily, especially practices associated with the organization’s culture. Successful reengineering requires changes in employee culture and beliefs. Resistance : Change is always met with a great deal of resistance. Managers must continually reassure, persuade, and provide support to those affected so that the necessary changes will work.
Time and cost requirements : BPR is costly and almost always takes two or more years to complete.
Lack of management support : Many top managers are afraid of the “big hype, few results” syndrome. Without top-management support, reengineering has little chance of succeeding.
Skepticism : Some people view BPR as traditional systems development in a new wrapper with a fancy name.
Retraining : Employees must be retrained, which is time-consuming and expensive.
Controls : Important controls that ensure system reliability and integrity cannot be deleted.
Efficient and effective accounting information system depends on basic principles of accounting information system.
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