South-Western - Management  
Improving All Processes
Topic Planning
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Key Words Re-engineering, metrics, eliminating redundancy
News Story

In the home care business, 53% of the expenses incurred are directly related to tasks that employees perform. Because of declining reimbursement rates, it is imperative that businesses find ways to reduce the time it takes to perform each business process and optimize this part of the business.

It is common for home care companies to have 10 to 15 processes that must be performed, like intake, billing and collecting, purchasing, etc.

The first step toward optimizing processes is to have a written policy and procedures manual. A detailed description of how procedures are performed is the first step in improving them.

The act of improving processes is often called “business process reengineering.” BPR is artful management. In order to practice BPR, an organization must have a detailed knowledge of the process, a collaborative effort for identifying problems, creative solutions for eliminating problems and a system of accountability for change.

The best people to collaborate with on process changes are those that are on the front lines, actually doing the work. These are the people that can tell you what will make their job more efficient.

There are two types of metrics that should be used to measure each business process: throughput and quality. “Throughput” describes output per time: for example orders filled per day. Quality describes the portion of the work that meets the internal or external customer’s expectations.

Eliminating redundancy is one important way to improve processes. Reducing footsteps can save time. For example, desktop fax solutions eliminate the need to get up and walk to a fax machine.

There are few industry norms related to processes such as these but the performance of a person or team can be benchmarked to previous throughput and quality. Benchmarking outside the industry can also provide some good ideas.

Questions
1.

What steps are typically involved in the reengineering process? Why does the process of reengineering so often fail?

2.

Define “throughput” and “quality.” What are some other possible measures that can be used to improve, or reengineer the way that work is done in an organization?

3.

Why is the home care business particularly suitable for a reengineering effort? What are some other businesses that could lend themselves to the process of reengineering? Bring your ideas to class.

Source “Improving All Processes,” Home Care Magazine, June 1, 2007, v30 i6 pNA.
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