Summary
Using a systematic approach to analyze current organizational problems is a successful business strategy for early detection and further management. However, few companies recognize the importance of business process management, BPM, to improve organizational efficiency and productivity. In the case study under discussion, the automotive component company, which focuses on both the original machine parts manufacturer and the distributors and post-sales service, had severe problems with managing internal systems so that it could be at risk of financial collapse and complete liquidation.
A close evaluation of GACC’s current problems highlighted five different areas that could be improved. These included fragmented internal processes within GACC that lacked the properties of cohesiveness and integrity (Jeston, 2018). It is worth noting that such separations are extremely risky for a company claiming to be a leader because they create multiple organizational microcultures competing with each other (Alton, 2017).
On the other hand, the company has seen a diversity of operating business models, many of which are hardly compatible. As a consequence of incoherence, this led to a number of system backbones, the formation of separate code databases, and complicated internal and external organizational system interfaces. Each of the problems described individually poses a significant challenge for the company, but together they have the potential to destroy competitiveness and remove GACC from the leadership race.
Indeed, over time, company leaders began to think about the current problems and the prospects for solving them, so it was decided to turn to BPM theory. The integrated ERP system being developed within this framework should significantly increase the automotive company’s global market share in conjunction with the expected improvement in the quality of goods or services. There is no doubt that more reliable and higher quality products will be a clear advantage in the market to attract new customers and retain current ones. Finally, GACC was interested in legitimately reducing the costs and expenses currently available to the company. The IT department of the company, developing a new ERP integration system, was chosen to translate BPM into organizational practice.
It should be recognized that although the management of the company GACC gives much potential to the ERP system to strengthen the indicators of competitiveness and leadership in the global market, it is only a tool, the efficiency of which usage directly depends on the quality of execution and implementation control. In other words, the company already has a large number of disparate processes, so inadequate control of BPM in EPR can only be another problem for management. On the other hand, if successful, the company will actually be able to update its internal organizational relationships, which have excellent potential to achieve its intended goals.
A more specific review of the risks available includes executive, planning, and human resources risks. In particular, in the proposed scenario, the company showed a severe backlog of about six months, with the wasted budget already exceeding the simulated norms. Thus, poor planning can be a significant problem on the road to goal achievement, so success is unlikely (Boiser, 2019). On the other hand, even if the system itself is sound, poor leadership, lack of a cohesive leadership style, and variance in edicts can also disrupt the execution of change. Finally, human risks were associated with a lack of effective communication among hired employees. Additionally, it is worth recognizing that there are functional, investment, market, and institutional risks to BPM that are virtually independent of the company but can become a problem if insufficiently responsive.
There is no doubt that GACC needs to take immediate and effective steps to return to its original competitiveness and global leadership levels. If nothing is changed, likely, GACC will not withstand the pressure of competitors and be liquidated. That is why implementing the BPM theory is the critical answer for the GACC. However, it is worth recognizing that this is a multiphase process, each of whose individual phases requires careful quality control of execution.
One of the main phases chosen for analysis is the development of the system concept. This choice was driven by the idea that if the company cannot create a reliable and comprehensive plan that takes into account possible risks in the initial phases of the project, then the rest of the execution will be meaningless. So, developing an ERP concept should start with the step of accepting the need for change. This can be accomplished by the appropriate department demonstrating to management the financial failure, collapse, and loss of liquidity of the company. Once the importance of the dynamics has been accepted, the GACC needs to begin a detailed analysis using known techniques that assess the strengths and weaknesses of the project: SWOT, PEST, or SNW (Shtal et al., 2018).
Only the certainty that the weaknesses can be controlled and even in the case of loss of control will not cause the company’s collapse, is the incentive to move on to the next phase. In the third phase, the company’s financial department conducts a cost-benefit analysis of the new system, assesses monetary risks, and determines the potential timing of execution in terms of effective budget wastage. If properly managed, this plan should be sufficient to match all costs clearly. Finally, target audience research is an important step that will allow the company to modify the system even before development begins to satisfy GACC and customer requests for improved service speed, shorter delivery times, or a more positive interaction experience.
References
Alton, L. (2017). Why corporate culture is becoming even more important. Forbes. Web.
Boiser, L. (2019). How poor planning can lead to project failure? Kanban Zone. Web.
Jeston, J. (2018). Business process management: Practical guidelines to successful implementations 4th edition. Routledge.
Shtal, T., Buriak, M., Ukubassova, G., Amirbekuly, Y., Toiboldinova, Z., & Tlegen, T. (2018). Methods of analysis of the external environment of business activities. Web.