PRODUCT DEVELOPMENT PROCESS

1. BUSINESS PROCESS REENGINEERING

What is business process re engineering?

Business Process Reengineering involves the radical redesign of core business processes to achieve dramatic
improvements in productivity, cycle times and quality. In Business Process Reengineering, companies start with a blank
sheet of paper and rethink existing processes to deliver more value to the customer. They typically adopt a new value
system that places increased emphasis on customer needs.
It’s the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in
critical contemporary measures of performance such as costs, quality and speed”.(Hammer and Champ)

Why is it important?

Companies use Business Process Reengineering to improve performance substantially on key processes that impact
customers. Business Process Reengineering can:
 Reduce costs and cycle time: Business Process Reengineering reduces costs and cycle times by eliminating
unproductive activities and the employees who perform them. Reorganization by teams decreases the need for
management layers, accelerates information flows, and eliminates the errors and rework caused by multiple
handoffs.
 Improve quality: Business Process Reengineering improves quality by reducing the fragmentation of work
and establishing clear ownership of processes. Workers gain responsibility for their output and can measure
their performance based on prompt feedback.

How is it conducted?
Business Process Reengineering is a dramatic change initiative that contains following major steps. Managers should:
 Refocus company values on customer needs.
 Redesign core processes, often using information technology to enable improvements.
 Reorganize a business into cross-functional teams with end-to-end responsibility for a process.
 Rethink basic organizational and people issues.
 Improve business processes across the organization.
 Increase the speed at which document intensive processes are conducted and reduce associated costs and
administrative burdens.
 Add flexibility to organizational processes, allowing your business to scale up or down as required by customer
or internal demand.
 Help reducecapital expenditure by reducing the need to invest in the assets required to perform a service
internally.
 Organize information and documents with electronic document management systems and processes, for
example transition to electronic invoicing.
 Minimize document loss and information leakage.
 Utilize electronic document formats more often in internal and customer transactions.
 Improve operational efficiency and customer service levels.
 Mitigate risk by improving compliance to legal standards across the globe.

Where is it applied?
Process reengineering is redesigning or reinventing how we perform our daily work, and it is a concept that is applicable
to all industries regardless of size, type, and location. Many public and private sector organizations and Word-wide had
undergone major reengineering efforts. The technique was applied first to multinational cooperation, such as IBM,
AT&T, SONY, and GENERAL ELECTRIC having as a result major downsizing in their organizational structures.
Later, the banking sector began to reengineer with a great degree of success such as CITIBANK and others
When is it done?
In any organization that fundamental rethinking and radical redesign of business processes to achieve dramatic
improvements in critical, contemporary measures of performance, such as cost, quality, service and speed.
 2. BENCHMARKING

What is Benchmarking?
Benchmarking; Is the process of measuring an organization's internal processes then identifying, understanding, and
adapting outstanding practices from other organizations considered to be best-in-class. Most business processes are
common throughout industries. These processes, albeit from different industries, are all common and can be
benchmarked very effectively. It's called "getting out of the box"
One of the biggest mistakes organizations make when first benchmarking is that they limit their benchmarking activity
to their own industry. Benchmarking within your industry is essential. However, you already have a pretty good idea
how your industry performs so it's imperative that you reach outside and above your own industry into other industries
that perform a similar process but may have to perform this process extremely well in order to succeed. Here are a
couple examples of how one industry can leapfrog their competitor by learning and adapting a similar process from a
totally different industry. For, example
Problem Solution
Benchmarked admittance process with hospital
emergency room departments resulting in dramatically
Customer surveys indicate long wait times for
reduced check-in times. Also netted less employees
hotel rooms, especially for repeat Customers.
needed, automation for frequent hotel guests, and many
more process improvements.
Initial benchmarking research indicated we are already
Routine maintenance on aircraft between flights #1. Brainstormed and discovered Indy 500 racing team
such as refueling, cleaning, tire checks taking too pit crews have a similar maintenance process and a
long. Plane on the ground means more planes and similar requirement to get their vehicle back on the track
personnel are required to maintain high level of as quickly and safely as possible. After benchmarking
service and schedules. Need to reduce ground pit crews maintenance turn-around-times for aircraft
time required in between flights without between flights were reduced by more than half
sacrificing quality or safety of passengers. saving/making the airline millions of dollars within the
first few years.

Why Do Companies Benchmark?

Companies use benchmarking as a way to help become more competitive. By looking at how other companies are
doing, they can identify areas where they are underperforming. Companies are also able to identify ways that can
improve their own operations without having to recreate the wheel. They are able to accelerate the process of change
because they have models from other companies in their industry to help guide their changes. Benchmarking is also
important in order to know:

 Who performs the business process very well and has process practices that are adaptable to your own
organization
 Who is the most compatible for you to benchmark with
 If you need to conduct a comprehensive benchmark study or if you can obtain 80-90% of what you
need from just using the telephone, email, or an electronic survey to communicate your needs with
other members on The Benchmarking Exchange
 3. PRODUCT DEVELOPMENT PROCESS

What is product development process?

It is a system of defined steps and tasks such as strategy, organization, and concept, generation, marketing plan creation,
evaluation and commercialization of a new product. It’s a circle by means of which an innovative firm routinely
converts ideas into commercially viable goods or services.

Why doing product development process?

The development process is the building of the human capacity. Institutions and infrastructure are important but a
skilled, educated workforce is required to carry out basic functions such as policing, security, regulation, and core
service delivery. Developing this capacity is a difficult task and is not likely to be achieved in a short amount of time.

How is it done?
The new product development takes place thru a business process, PDP, starting with the identification of a market
need, which is later turned into a new product.
To allow that, it is necessary to identify and translate the market needs, the technological possibilities and limitations,
into product project specifications and launch planning are two important activities to take place.

Where is it done?

Product development process (PDP) is applied in business and engineering sectors. PDP is the complete process of
bringing new product to the market.

When is it done?
Product development process is done when a company, firm, business unit want to introduce new product to the market
available for sale, a product can be tangible (something physically you can touch or intangible (like a service or belief).
A good understanding of customer needs and wants, the competitive environment and the nature of the market represent
the top required factors for success of new products. Cost, time and quality are the main variables that drive the
customer needs.

Who is involved?
Is usually carried out by a project team with members from both outside and inside the company . This unit presents
procedures for managing and process of product design and development
REFERENCES

 http://www.isixsigma.com/methodology/benchmarking/understanding-purpose-and-use benchmarking

 http://www.bain.com/publications/articles/management-tools-business-process-reengineering.aspx

 www.isixsigma.com/methodology/total-quality-management-tqm/introduction-and-implementation-total-
quality-management-tqm/

 http://searchcio.techtarget.com/definition/Total-Quality-Management