Jawahery also highlighted the key projects being implemented by the company. He said the ERP system was introduced within a record period of seven months only from the start of implementation.
A new SAP system was used in the overall maintenance operations during this year and for the purchasing, financial affairs and other activities related to the Company's operations.
"The management formed a working team to prepare an enterprise risk management system covering all the company's operations. The company is considered as one of the leading companies that applied this vital project in the Gulf region.
He also expressed his thanks and appreciation to Nasser bin Ahmed Al Sayyari, former deputy chairman for his outstanding efforts during his term on the board for more than 21 years during which he said the company made significant achievements.
Talking about expansion plans, he said: "GPIC still awaits acquiring sufficient natural gas quantities to go ahead with its expansion projects by implementing the ammonia II and urea 11 projects."
He thanked Dr Mohamed bin Abdul Rahman Al Terkait, former managing director for his commendable efforts during his membership of the board for more than 12 years.
He also appreciated Abdul Aziz bin Mohammed Al Rawaf, former board member for his support during his three year on the board.
He praised the efforts made by all the board members and their team spirit that made it possible to win major awards and realise significant achievements during the previous years.
Later, Anwar Saeed bin Salama, deputy chairman, Yousuf bin Abdul Rahman Al Zamil, managing director and Jawahery presented commemorative plaques to Nasser bin Ahmed Al Sayyari Dr Mohamed bin Abdul Rahman Al Tarkeet, and Abdul Aziz Al Rawaf, former board member in recognition of their services during their term on the board.
The employees who rendered 25, 20, 15, 10, and 5 years of services were also honoured during the ceremony.
Sunday, December 30, 2007
SAP itself has acquired several companies, most recently Business Objects
Will there be more mergers and acquisitions in the software industry? Most likely, according to the local chief enterprise software firm SAP.
“So far, since there is no major negative impact in terms of how the companies are doing after these mergers, I personally see this activity going for the next couple of years,” said Krishnendu Datta, managing director for SAP Philippines, issuing his forecasts in an interview with INQUIRER.net.
In particular, he foresees more software companies, which are smaller and targeting niche markets, to get acquired by larger companies with big cash reserves.
In the long-run, however, he noted that too much consolidation would be detrimental to the end-user because it would result in less room for innovation.
“The biggest of companies are normally not the biggest innovators,” he said. “So I would say the trend would continue for the next couple of years but at some point in time, the trend would reverse, in maybe between two to four years.”
SAP itself has acquired several companies, most recently Business Objects, which makes business intelligence software, in a deal valued at around $6.8 billion. The move is seen as the German software maker’s reply to rival Oracle’s earlier acquisition of Hyperion, a competitor of Business Objects.
Datta, though, stressed that SAP remains focused on organic growth while acquiring several smaller companies to cope with changing trends in enterprise software. He noted smaller acquisitions like Triversity, which makes point-of-sale software and was acquired by SAP several years back.
“SAP realizes that there are packets of solution gaps that would be difficult for us to fill in such a short time. Even though Business Objects is a big acquisition for us, it still falls under that direction,” he said.
Satyam Computer Services Ltd. (NYSE: SAY: 27.19, +0.61, +2.29%), a leading business and information technology services provider,
Satyam Computer Services Ltd. (NYSE: SAY: 27.19, +0.61, +2.29%), a leading business and information technology services provider, today announced that Forrester Research has named the company a leader in SAP implementation capabilities. "The Forrester Wave(TM: 106.60, -0.92, -0.85%): SAP Implementation Providers, Q4, 2007 (December 2007)" places Satyam in the same category as companies heading "an extremely well qualified pack."
The report states "Satyam has a strong overall value proposition in addition to a long track record with SAP. Its client satisfaction scores are high, its pricing is reasonable, and a large number of clients were willing to attest to its value."
"It is certainly true that our customers have been our greatest assets and references," Mehta said. "Our achievements are a direct result of our commitment to deliver excellence and the demonstrated value of our SAP implementations. We always try to exceed our customers' expectations, and our recognition in the report reflects these efforts."
The report is especially relevant because demand for SAP services continues to grow globally, as organizations increasingly leverage the ERP provider's expanding portfolio of offerings. In addition, many existing customers need to upgrade to newer versions of SAP.
"We are pleased to be recognized as a leader by Forrester Research and rated as no.1 in current offering amongst Indian organization," said Manish Mehta, Business Head, Satyam SAP Practice. "We are proud of our exceptional SAP expertise, and of our ability to help our customers in a broad range of industries gain the maximum benefit from their ERP investments. As the report noted, we continue to invest in our SAP Practice, and this is evidenced by our increasing number of end-to-end implementations. Companies all over the globe benefit from those efforts, as well as the skills of our SAP consultants."
The report is the result of information compiled by Forrester by researching the world's leading SAP implementation organizations on 108 evaluation criteria. It noted that Satyam is an especially good fit for companies that "need experienced SAP technical skills," and those that "require vertical knowledge in the manufacturing, high-tech, or semiconductor industries."
Moreover, the report praises Satyam's implementation capabilities. "Not surprisingly, given its strong SAP methodology as well as internally developed engagement aids and implementation experience, Satyam scores strongly in the implementation portion of this survey," the report said. Satyam's skills in strategy, post-implementation, remote delivery, overall vision, and overall value were also noted.
The report states "Satyam has a strong overall value proposition in addition to a long track record with SAP. Its client satisfaction scores are high, its pricing is reasonable, and a large number of clients were willing to attest to its value."
"It is certainly true that our customers have been our greatest assets and references," Mehta said. "Our achievements are a direct result of our commitment to deliver excellence and the demonstrated value of our SAP implementations. We always try to exceed our customers' expectations, and our recognition in the report reflects these efforts."
The report is especially relevant because demand for SAP services continues to grow globally, as organizations increasingly leverage the ERP provider's expanding portfolio of offerings. In addition, many existing customers need to upgrade to newer versions of SAP.
"We are pleased to be recognized as a leader by Forrester Research and rated as no.1 in current offering amongst Indian organization," said Manish Mehta, Business Head, Satyam SAP Practice. "We are proud of our exceptional SAP expertise, and of our ability to help our customers in a broad range of industries gain the maximum benefit from their ERP investments. As the report noted, we continue to invest in our SAP Practice, and this is evidenced by our increasing number of end-to-end implementations. Companies all over the globe benefit from those efforts, as well as the skills of our SAP consultants."
The report is the result of information compiled by Forrester by researching the world's leading SAP implementation organizations on 108 evaluation criteria. It noted that Satyam is an especially good fit for companies that "need experienced SAP technical skills," and those that "require vertical knowledge in the manufacturing, high-tech, or semiconductor industries."
Moreover, the report praises Satyam's implementation capabilities. "Not surprisingly, given its strong SAP methodology as well as internally developed engagement aids and implementation experience, Satyam scores strongly in the implementation portion of this survey," the report said. Satyam's skills in strategy, post-implementation, remote delivery, overall vision, and overall value were also noted.
Naval Air Systems Command (NAVAIR) went “live” on the Navy ERP system
When compared to the private sector, the Navy may appear to be a Johnny-come-lately when it comes to implementing and utilizing enterprise resource planning (ERP) software systems.
In comparison with the other services, however, the Navy has been a pioneer in bringing comprehensive software solutions to a wide range of functions. The Navy’s effort took a major step forward this fall, as the Naval Air Systems Command (NAVAIR) went “live” on the Navy ERP system. Further expansions are planned, beginning next spring with the Space and Naval Warfare System Command (SPAWAR).
The Navy didn’t consider ERP until the late 1990s, when an initiative from the chairman of the Joint Chiefs of Staff called for management and technological innovation designed to achieve improved levels of effectiveness in joint war fighting. The Navy formed four pilot ERP programs to investigate whether commercial off-the-shelf ERP products were feasible for the Navy and to report the findings to senior naval leadership.
By then, it was common for private business to integrate and abridge data and processes into unified ERP systems.
“We looked at what industry had done and reviewed their best practices,” said Susan Keen, Navy ERP technical director. “It became very clear that we looked very much like a very large global corporation.”
Consequently, the decision was made to replace legacy supply, maintenance and financial management systems with a single integrated, responsive, accurate and integrated system. The software chosen was that developed and offered by SAP, the Germany-based business software company that has been a major force in spreading the ERP concept in recent decades.
An ERP Project Manager is required for my client based in Cambridge due to expansion.
* Location: Cambridgeshire
* Sector: IT Consultancy
* Job Hours: Full-Time
* Job Position: Permanent
* Job Role: MIS / IT Manager
* Company: Nigel Frank International
* Salary: £40000 - £55000 per annum + car, benefits etc
* Posted Date: 30 December 2007 22:36:44
ERP Project Manager Cambridge £40 - 55k + car & a wide range of excellent benefits
An ERP Project Manager is required for my client based in Cambridge due to expansion.
My client is an award winning & well established, reputable software & IT consultancy organisation & a Microsoft Gold Partner. My client has an enviable reputation in the market place and is one of the most respected Microsoft partners in the World. This is a genuinely exciting opportunity to enhance your skills, and assist in shaping the future of the organisation.
This ERP project manager role is a once in a lifetime oppurtunity to join a firm who gives thier employee's the freedeom to express thier skills.
The ideal candidate will have solid project management experience of at least 10 years in the ERP industry e.g. SAP, Microsoft Dynamics, Oracle, Baan, JD Edwards, Peoplesoft, Sage etc.
This ERP project management role will be created for the right person - a wonderful oppurtunity to build & mould a team around your abilities.
My superb client is offering a highly competitive remuneration package including share options as well as excellent future career prospects. The position on offer is full time & permanent with my client interviewing soon.
To discuss this fantastic opportunity in more detail please send your CV with a brief covering note to guv@nigelfrank.com or call me on 0191 230 8034.
Nigel Frank International Ltd is acting as an Employment Agency in relation to this vacancy.
* Sector: IT Consultancy
* Job Hours: Full-Time
* Job Position: Permanent
* Job Role: MIS / IT Manager
* Company: Nigel Frank International
* Salary: £40000 - £55000 per annum + car, benefits etc
* Posted Date: 30 December 2007 22:36:44
ERP Project Manager Cambridge £40 - 55k + car & a wide range of excellent benefits
An ERP Project Manager is required for my client based in Cambridge due to expansion.
My client is an award winning & well established, reputable software & IT consultancy organisation & a Microsoft Gold Partner. My client has an enviable reputation in the market place and is one of the most respected Microsoft partners in the World. This is a genuinely exciting opportunity to enhance your skills, and assist in shaping the future of the organisation.
This ERP project manager role is a once in a lifetime oppurtunity to join a firm who gives thier employee's the freedeom to express thier skills.
The ideal candidate will have solid project management experience of at least 10 years in the ERP industry e.g. SAP, Microsoft Dynamics, Oracle, Baan, JD Edwards, Peoplesoft, Sage etc.
This ERP project management role will be created for the right person - a wonderful oppurtunity to build & mould a team around your abilities.
My superb client is offering a highly competitive remuneration package including share options as well as excellent future career prospects. The position on offer is full time & permanent with my client interviewing soon.
To discuss this fantastic opportunity in more detail please send your CV with a brief covering note to guv@nigelfrank.com or call me on 0191 230 8034.
Nigel Frank International Ltd is acting as an Employment Agency in relation to this vacancy.
Wednesday, December 26, 2007
'Public Company' or a 'Private Company'
its profit, if any, or other income in promoting its objects, and to prohibit the payment of any dividend to its members. While granting the licence, the Central Governtnent may impose such conditions and regulation's as it' thinks fit and may direct the company to incorporate the same in its memorandum or articles.(iii) Unlimited Companies. An unlimited company is one in which tle liability of the members is unlimited i.e. the members are also personally liable for the payment of companies' liabilities. Thus, if in the event of winding up of a company the assets of the company are not sufficient to pay The majority of companies in India belong to this category. Registered companies can further be classified in two ways: 1. On the basis of Liability of
members and 2. On the basis of number of members.Registered Companies on the basis of Liabilities. On the basis of liability of members, the Companies Act makes provision for registration of three types of companies, namely:(i) Companies Limited by shares, or
(ii) Companies Limited by guarantee, or
(iji) Unlimited Companies, Each of these types may be a 'Public Company' or a 'PrivateCompany'.
(i) Companies limited by sh\res. A company in which the liability of each member is limited to the nominal or face value of the shares held by him, is known as a company limited by shares. If a member has paid the full amount of shares, then his liability shall be nil. In case the shares are partly paid up, then the company can call up the remaining amount at 3liy time. But a shareholder cannot be called upon to pay more than the amount remaining unpaid
on his shares at any time and during: the lifetime and during the winding up of the company. His personal assets cannot be called upon for the paymenf of liabilities of the company. Most of the companies in India are of this type and we, in this text, are concerned with this type of cnies.Companies limited by guarantee. Where the liability of the members of a company is limited to such an amount as the members undertake to contribute to the assets of the
company in the event of its winding up. Such companies are generally formed for the promotion of art; science, culture, sports etc. Such a company mayor may not have share capital and, if it is registered with a share capital, it may be a public company or a private Generally, a company limited by guarantee must use the word 'Limited' or the words 'Private Limited' , as the case may be, as the last word or words of its name. However, the Central Government may by a licence exempt such a company from using the word 'Limited' or the words 'Private Limited' in its namc, provided it is proved to the satisfaction of the Central Government that the company is formed for promoting commerce, art, science, religion. charity or any other useful object that it intends to apply its liabilities,private property of the members can also be utilised for the payment of company's liabilities. It may, however, be noted that due to separate legal entity of the company, its creditors cannot file a suit against the members directly. Such companies are rarely formed now-adays. They are not popular as they are lacking in one ofthe characteristic features of joint stock companies, viz, limited liability.
members and 2. On the basis of number of members.Registered Companies on the basis of Liabilities. On the basis of liability of members, the Companies Act makes provision for registration of three types of companies, namely:(i) Companies Limited by shares, or
(ii) Companies Limited by guarantee, or
(iji) Unlimited Companies, Each of these types may be a 'Public Company' or a 'PrivateCompany'.
(i) Companies limited by sh\res. A company in which the liability of each member is limited to the nominal or face value of the shares held by him, is known as a company limited by shares. If a member has paid the full amount of shares, then his liability shall be nil. In case the shares are partly paid up, then the company can call up the remaining amount at 3liy time. But a shareholder cannot be called upon to pay more than the amount remaining unpaid
on his shares at any time and during: the lifetime and during the winding up of the company. His personal assets cannot be called upon for the paymenf of liabilities of the company. Most of the companies in India are of this type and we, in this text, are concerned with this type of cnies.Companies limited by guarantee. Where the liability of the members of a company is limited to such an amount as the members undertake to contribute to the assets of the
company in the event of its winding up. Such companies are generally formed for the promotion of art; science, culture, sports etc. Such a company mayor may not have share capital and, if it is registered with a share capital, it may be a public company or a private Generally, a company limited by guarantee must use the word 'Limited' or the words 'Private Limited' , as the case may be, as the last word or words of its name. However, the Central Government may by a licence exempt such a company from using the word 'Limited' or the words 'Private Limited' in its namc, provided it is proved to the satisfaction of the Central Government that the company is formed for promoting commerce, art, science, religion. charity or any other useful object that it intends to apply its liabilities,private property of the members can also be utilised for the payment of company's liabilities. It may, however, be noted that due to separate legal entity of the company, its creditors cannot file a suit against the members directly. Such companies are rarely formed now-adays. They are not popular as they are lacking in one ofthe characteristic features of joint stock companies, viz, limited liability.
Thursday, December 20, 2007
Types of Conflict
Types of Conflict
Type of Conflict Meaning Explanation / Example
1 Intra individual conflict Intra personal conflict Need base conflicts
A Goal Conflict
‘a Approach – Approach Conflict 2 positive situations
Has to select one
2 Lucrative jobs
‘b Approach – Avoidance conflict Both Positive and negative aspect Get something & loose something
‘c Avoidance – Avoidance conflict 2 negative situations Dislike present job – No any alternative
B Role Conflict Expectations people have about the behavior of a person in a position.
‘a Person role conflict Expected behavior is incompatible
With person’s own basic values
Politician Ask to play dirty tricks
Supporter Refuses on moral ground
‘b Inter role conflict Facing multiple roles Professor works as trainer, developer or teacher
‘c Inter sender role Against work rule / code /
specifications
Builder – Architect – Developer – different work from
code / rules / municipal corp.’ rules
Reasons for interpersonal conflict
1 Personality differences Psychological problem
2 Perceptions Difference in perceptions
3 Clashes of values and interests Engineers – Quality Products
Manufacturer – Cost of the product
4 Power and Status differences Waitress – Low Status
Cook – High Status
5 Scare resources Limited vacancies / nos of attendants
Inter Group Conflicts
Conflicts over authority, jurisdiction & resources
Reasons for Inter Group Conflict
1 Incompatible Goals Differences between group Goals
2 Task interdependence Dependence of one unit on another
3 Resource allocation More fixed resources – More intense conflict
4 Competitive incentive & Reward
system
Students performance as per individual – Case Study / Example
5 Line & Staff conflicts Dalton’s Study
6 Differences in Values or perceptions Young Bank Clark / Engineering people v/s Manufacturing people
7 Other Reasons
7a Heterogeneity of Members Personality differences
7b Communication Distortions Lack of knowledge / miscommunication
7c Participative Decision Making Joint decision making – disagreement more than facilitate co-ordination & cooperation
7d Low formalization Jurisdictional disputes
J Thompson’s three types of interdependences
1 Pooled Departments have little interaction with each other but are
affected by each other’s action.
Delhi Branch has nothing to do with Merut branch.
2 Sequential Output of once – Another’s input Performance of B depends of performance of A
3 Reciprocal Frequent interactions Relationship between nursing staff, surgeons,
anesthesiology staff, etc.
Inter Organizational Conflicts
Two organizations responsible decision making.
Types of Inter Organizational Conflicts (Stanger & Roses)
1 Management - Government Political Contribution – Bribery – Anti trust activity – Fair trade – Consumer protection
2 Inter Management Disputes over patents – Fulfillment of contracts
3 Inter Union Internal competition
4 Union Government Criminal activities discrimination / illegal Strikes
5 Union Management Conflict is essential to survival the union.
Strikes – peaceful bargains – grievances – debates – loyalties – sabotage & absenteeism.
Intra Organizational Conflicts
Types of Intra Organizational Conflicts
1 Horizontal Conflict Between employees / Departments at the same level
2 Vertical Conflict Between users in an organization.
Reasons of Vertical Conflict
Inadequate communication
Differences of interests between position holders occupying different status in the organizational hierarchy.
Lack of shared perceptions and attitudes among members in various levels.
Type of Conflict Meaning Explanation / Example
1 Intra individual conflict Intra personal conflict Need base conflicts
A Goal Conflict
‘a Approach – Approach Conflict 2 positive situations
Has to select one
2 Lucrative jobs
‘b Approach – Avoidance conflict Both Positive and negative aspect Get something & loose something
‘c Avoidance – Avoidance conflict 2 negative situations Dislike present job – No any alternative
B Role Conflict Expectations people have about the behavior of a person in a position.
‘a Person role conflict Expected behavior is incompatible
With person’s own basic values
Politician Ask to play dirty tricks
Supporter Refuses on moral ground
‘b Inter role conflict Facing multiple roles Professor works as trainer, developer or teacher
‘c Inter sender role Against work rule / code /
specifications
Builder – Architect – Developer – different work from
code / rules / municipal corp.’ rules
Reasons for interpersonal conflict
1 Personality differences Psychological problem
2 Perceptions Difference in perceptions
3 Clashes of values and interests Engineers – Quality Products
Manufacturer – Cost of the product
4 Power and Status differences Waitress – Low Status
Cook – High Status
5 Scare resources Limited vacancies / nos of attendants
Inter Group Conflicts
Conflicts over authority, jurisdiction & resources
Reasons for Inter Group Conflict
1 Incompatible Goals Differences between group Goals
2 Task interdependence Dependence of one unit on another
3 Resource allocation More fixed resources – More intense conflict
4 Competitive incentive & Reward
system
Students performance as per individual – Case Study / Example
5 Line & Staff conflicts Dalton’s Study
6 Differences in Values or perceptions Young Bank Clark / Engineering people v/s Manufacturing people
7 Other Reasons
7a Heterogeneity of Members Personality differences
7b Communication Distortions Lack of knowledge / miscommunication
7c Participative Decision Making Joint decision making – disagreement more than facilitate co-ordination & cooperation
7d Low formalization Jurisdictional disputes
J Thompson’s three types of interdependences
1 Pooled Departments have little interaction with each other but are
affected by each other’s action.
Delhi Branch has nothing to do with Merut branch.
2 Sequential Output of once – Another’s input Performance of B depends of performance of A
3 Reciprocal Frequent interactions Relationship between nursing staff, surgeons,
anesthesiology staff, etc.
Inter Organizational Conflicts
Two organizations responsible decision making.
Types of Inter Organizational Conflicts (Stanger & Roses)
1 Management - Government Political Contribution – Bribery – Anti trust activity – Fair trade – Consumer protection
2 Inter Management Disputes over patents – Fulfillment of contracts
3 Inter Union Internal competition
4 Union Government Criminal activities discrimination / illegal Strikes
5 Union Management Conflict is essential to survival the union.
Strikes – peaceful bargains – grievances – debates – loyalties – sabotage & absenteeism.
Intra Organizational Conflicts
Types of Intra Organizational Conflicts
1 Horizontal Conflict Between employees / Departments at the same level
2 Vertical Conflict Between users in an organization.
Reasons of Vertical Conflict
Inadequate communication
Differences of interests between position holders occupying different status in the organizational hierarchy.
Lack of shared perceptions and attitudes among members in various levels.
Handling anger in negotiation
Handling anger in negotiation
Uncontrolled Anger
Get angry – blood pressure rises – heart rate increases
Can not thing logically
Makes obstinate
Controlled Anger
Frown
Speak in a tight
Stem voice
Commanding gesture
Negotiating fears
Fear of loss
Fear of the unknown
Fear of failure
To prevent from fear of unknown, try to do…
Prepare thoroughly
Find alternate solutions
Be prepare to walk out
Several ways to deal with the fear…
Acknowledge your fear
Prepare thoroughly & examine the negotiation
Mentally rehearse your negotiation
Dress for negotiation in clothes that make you feel good
Make sure about your files & notes
Act confident.
Five things you should never mention when you negotiate
Appearance - Personal hygiene – Clothing
Race – Gender – Ethnic background – Religion
Profession – Company – Business
Competence – Experience
Age
Five things you should never do when you negotiate
Exasperated eye rolling
Disdainful sneering a la Elvis
Finger – pining or fist shaking
Book – Paper – Furniture throwing
Any gesture your opponent can construe as physically
threatening
Neutralizing Personality Conflict
Tips how to handle a personality conflict
Stays Low Key – Moderate your tone of voice & your attitude.
Be Frank
Use the magic words "fair & reasonable"
Everyday Negotiating Situations
The players in the real Estate Game
Broker – Licensed to sell real estate – Agents
- Charge the seller a commission
Sales People / Sales Associates
– Licensed to sell real estate
- Can’t open their own real estate office
- Must work for a broker
- Agents of the seller
Agents can help with…
Financing
Finding a home
Preparing your home
Negotiating
The offer form should include the following information …
The address & legal description of the property
Price – Down Payment
A time limit
Conditions & contingencies
Property taxes
The closing shall take place if the counteroffer is accepted
Uncontrolled Anger
Get angry – blood pressure rises – heart rate increases
Can not thing logically
Makes obstinate
Controlled Anger
Frown
Speak in a tight
Stem voice
Commanding gesture
Negotiating fears
Fear of loss
Fear of the unknown
Fear of failure
To prevent from fear of unknown, try to do…
Prepare thoroughly
Find alternate solutions
Be prepare to walk out
Several ways to deal with the fear…
Acknowledge your fear
Prepare thoroughly & examine the negotiation
Mentally rehearse your negotiation
Dress for negotiation in clothes that make you feel good
Make sure about your files & notes
Act confident.
Five things you should never mention when you negotiate
Appearance - Personal hygiene – Clothing
Race – Gender – Ethnic background – Religion
Profession – Company – Business
Competence – Experience
Age
Five things you should never do when you negotiate
Exasperated eye rolling
Disdainful sneering a la Elvis
Finger – pining or fist shaking
Book – Paper – Furniture throwing
Any gesture your opponent can construe as physically
threatening
Neutralizing Personality Conflict
Tips how to handle a personality conflict
Stays Low Key – Moderate your tone of voice & your attitude.
Be Frank
Use the magic words "fair & reasonable"
Everyday Negotiating Situations
The players in the real Estate Game
Broker – Licensed to sell real estate – Agents
- Charge the seller a commission
Sales People / Sales Associates
– Licensed to sell real estate
- Can’t open their own real estate office
- Must work for a broker
- Agents of the seller
Agents can help with…
Financing
Finding a home
Preparing your home
Negotiating
The offer form should include the following information …
The address & legal description of the property
Price – Down Payment
A time limit
Conditions & contingencies
Property taxes
The closing shall take place if the counteroffer is accepted
Appealing to your opponent’s Emotions
Appealing to your opponent’s Emotions
Wealth
Recognition
Self preservation
Recognize opponents with a strong craving for wealth
Show off their possessions – expensive car – house – clothes
Talk related money
Expressions dealing with money
they talk about other people’s money
Recognize opponents with a strong craving for recognition
Show off across media – local newspaper – magazine – television –
work of mouth
Well groomed – may wear flashy clothes
Favorable work – I / Me
Work in public eye – actors – politicians – athletes – executives –
celebrities
W
Recognize opponents with a strong craving for Self prevention
They are not aggressive.
Good listeners
Don’t get exited or angry easily
Dress plainly.ork in uniform – military officers – airline pilots - police
Necessity to build Goodwill
Goodwill means doing your opponent a favor.
Four specific reasons why one should build goodwill…
Serves as a bridge of trust
Ensures the opponent will like you
Goodwill makes easy time whenever negotiation occurs.
Managing the negotiation process & crossword
1 Collaboration An approach n conflict handling where the effort is to help
both the parties achieve their personal goals.
2 Preparation A stage in which negotiators identify the issue & range of
objectiveness for each issue
3 Avoider A person who views conflict on something to be stunned
at all costs.
4 Omasaa He identified the particular situations in which each style
works the best.
5 Abjuration An approach to conflict resolution by aiming at
maintaining the interpersonal relationship at all costs.
6 bargaining A stage in which parties try to get concessions.
Negotiation’s Phases / Stages / Consequences
1 Preparation Negotiators identify the issues & range of objectives for
each issues
2 Developing a
strategy
Each parties decides what strategy & stages to adopt
3 Getting
started
Each side presents their initial demand / case
4 Building
understanding
Negotiators justify their position & try to weigh up the
other’s position.
5 Bargaining Each party tries to get concessions
6 Closing Final agreement – negotiations are terminated short of an
agreement
1) Stage 1 : Preparing for negotiation
Three basic elements in any preparation…
Setting bargaining objectives
Assessing the other side’s case
Assessing relative strengths & weakness
Setting bargaining objectives
A top line objective – the best achievable outcome
A bottom line objective – the lowest, still acceptable outcome.
A target objective – what you realistically expect to settle for.
2) Stage 2 : Developing a strategy
Five distinct categories of different approaches…
1 Collaborating Win – win stances – Cooperative approach
2 Compromising Win – lose stances
3 Accommodating Lose – win stances – maintaining the interpersonal
relationship at all cost
4 Controlling Power oriented approach - Attempt to win
5 Avoiding Withdrawing from a threatening situation
Personal goals are usually not met
Interpersonal relationship not maintained
3) Stage 3 : Getting Stated
Opening the negotiation
Setting the agenda
4) Stage 4 : Building understanding
Three basic components …
Getting information
Testing arguments & positions
Using timing & adjournments
Getting Information
The quality of the information provided by the other party
depends largely on the type of questions asked.
Testing Arguments & positions
We should look for the following flaws or distortions in the
arguments of the other negotiator
• Factual errors or omissions
• Faulty logic
• Selective use of statistics
• Hidden agenda
• Misrepresentation or priorities
Using timing & adjournments
One individual session should rarely exceed 2 hours
Formal presentation 15 to 20 minutes
An informal contribution 2 to 3 minutes
5) Stage 5 : Bargaining
Three basic components …
Getting & marking concessions
Breaking deadlocks
Moving towards an agreement
Braking deadlocks
o Reasons why deadlocks / stalemate arise…
Both parties have widely divergent objectives.
One party mistakes firmness for rigidity & will not make
concessions even to keep the negotiation alive.
As a deliberate tactic during a negotiation is to force the
other party to reconsider its position & make concession.
6) Stage 6 : Closing
3 stages of closing…
Formulating an agreement
Ensuring implementation
Renewing your negotiating experience
Wealth
Recognition
Self preservation
Recognize opponents with a strong craving for wealth
Show off their possessions – expensive car – house – clothes
Talk related money
Expressions dealing with money
they talk about other people’s money
Recognize opponents with a strong craving for recognition
Show off across media – local newspaper – magazine – television –
work of mouth
Well groomed – may wear flashy clothes
Favorable work – I / Me
Work in public eye – actors – politicians – athletes – executives –
celebrities
W
Recognize opponents with a strong craving for Self prevention
They are not aggressive.
Good listeners
Don’t get exited or angry easily
Dress plainly.ork in uniform – military officers – airline pilots - police
Necessity to build Goodwill
Goodwill means doing your opponent a favor.
Four specific reasons why one should build goodwill…
Serves as a bridge of trust
Ensures the opponent will like you
Goodwill makes easy time whenever negotiation occurs.
Managing the negotiation process & crossword
1 Collaboration An approach n conflict handling where the effort is to help
both the parties achieve their personal goals.
2 Preparation A stage in which negotiators identify the issue & range of
objectiveness for each issue
3 Avoider A person who views conflict on something to be stunned
at all costs.
4 Omasaa He identified the particular situations in which each style
works the best.
5 Abjuration An approach to conflict resolution by aiming at
maintaining the interpersonal relationship at all costs.
6 bargaining A stage in which parties try to get concessions.
Negotiation’s Phases / Stages / Consequences
1 Preparation Negotiators identify the issues & range of objectives for
each issues
2 Developing a
strategy
Each parties decides what strategy & stages to adopt
3 Getting
started
Each side presents their initial demand / case
4 Building
understanding
Negotiators justify their position & try to weigh up the
other’s position.
5 Bargaining Each party tries to get concessions
6 Closing Final agreement – negotiations are terminated short of an
agreement
1) Stage 1 : Preparing for negotiation
Three basic elements in any preparation…
Setting bargaining objectives
Assessing the other side’s case
Assessing relative strengths & weakness
Setting bargaining objectives
A top line objective – the best achievable outcome
A bottom line objective – the lowest, still acceptable outcome.
A target objective – what you realistically expect to settle for.
2) Stage 2 : Developing a strategy
Five distinct categories of different approaches…
1 Collaborating Win – win stances – Cooperative approach
2 Compromising Win – lose stances
3 Accommodating Lose – win stances – maintaining the interpersonal
relationship at all cost
4 Controlling Power oriented approach - Attempt to win
5 Avoiding Withdrawing from a threatening situation
Personal goals are usually not met
Interpersonal relationship not maintained
3) Stage 3 : Getting Stated
Opening the negotiation
Setting the agenda
4) Stage 4 : Building understanding
Three basic components …
Getting information
Testing arguments & positions
Using timing & adjournments
Getting Information
The quality of the information provided by the other party
depends largely on the type of questions asked.
Testing Arguments & positions
We should look for the following flaws or distortions in the
arguments of the other negotiator
• Factual errors or omissions
• Faulty logic
• Selective use of statistics
• Hidden agenda
• Misrepresentation or priorities
Using timing & adjournments
One individual session should rarely exceed 2 hours
Formal presentation 15 to 20 minutes
An informal contribution 2 to 3 minutes
5) Stage 5 : Bargaining
Three basic components …
Getting & marking concessions
Breaking deadlocks
Moving towards an agreement
Braking deadlocks
o Reasons why deadlocks / stalemate arise…
Both parties have widely divergent objectives.
One party mistakes firmness for rigidity & will not make
concessions even to keep the negotiation alive.
As a deliberate tactic during a negotiation is to force the
other party to reconsider its position & make concession.
6) Stage 6 : Closing
3 stages of closing…
Formulating an agreement
Ensuring implementation
Renewing your negotiating experience
Conflict Management Strategies
Conflict Management Strategies
1 Physical Separation This may work when two groups are not
required to interact while achieving targets.
2 Withdrawal Withdrawal from conflict.
3 Dominance Little to prevent reoccurrence of conflict in a
more violent form later on.
4 Appeal procedures Conventional method of resolving disputes
5 Compromise Traditional method - No clean winner / loser
6 Liaison groups /
Intermediaries / Integrators
7 Member rotation
8 Reduce interdependence
9 Procedural & Structural
changes
10 Super ordinate goals Common goals that appeals to all the parties
involved
Can not be completed separately
Demand interdependence / co-operation
11 Identifying a common enemy Sherif & Sherif - Boys Camp
Creation of super ordinate goals
Present a common treat as enemy
12 Integrated problem solving Incorporates that require of both parties
Mutually satisfactory solution
Level of trust between parties.
The basics of Successful Negotiation / The Concept of Bargaining
/ The Concept of Joint Problem -solving
Fixed Price – No Negotiation
Variable Price – No Negotiation
Example : Supermarket – Fixed Price – No negotiation
Your own item to sell - Negotiation
Negotiation involves 2 or more parties
Government – Union Management Negotiation To avert a strike
A number of countries Negotiation Multilateral treaty
Example :
Bargain – The purchase of a carpe
Negotiation – For long term housing / education loan
- Selling a used auto
Bargaining – One party win / one party loss
Seller want – highest price
Buyer want – lowest price
Win – lose situation
Cooperation – 50 – 50 – win-win situation – common interest
5 external factors of Negotiation
The Nature of the issues at stake
The relationship between the parties
The type of parties involved
The time available for the negotiation
The balance of power
You & your Opponent
The people can be categorized in 3 broad types…
1 Analytical Most profoundly influenced by all the things financial,
statistical & factual.
2 Aesthetic Capable of making decisions.
3 Intuitive Has intuitions regarding life, wants – quick decision makers
1) The Analytic Type
They are most profoundly influenced by all things financial, statically &
factual.
Capable of making decisions.
Accountants – Financial Analysist – Business managers
Chief financial officer – Tax consultants
2) The Aesthetic Type
Focuses on how things look & feel and what kind of visceral impact
they have.
More artistic considerations.
Artists – Writers – Actors – Designers
People who are in creative occupations.
3) The intuitive Type
Feeling based people.
Tend to make quick decision.
Jobs that require rapid analysis diagnostic.
Doctors – lawyers – Sales people
How your Opponent Makes Decisions
The strong (Not-so-silent) Type & Negotiation with the strong type
Strong types make decisions quickly & confidently.
They analyze complicated information rapidly, but as they give
quick decision sometime it may be wrong.
Commanding & authorities
Easy to deal with
Respond best to clear
Lead to stick to their view / judgment even they are wrong
Get angry very quickly
The fence straddling type & Negotiation with fence straddling type
Needs more time & likes to reach a consensus before taking any
action.
Often comes back to the bargaining table with all kinds of changes
& variations.
The weak type & Negotiation with weak type
Unfortunate negotiations
Reluctant to make negotiations
Pass the responsibility on to family member / Business Associates /
Friends.
Try to postpone decisions.
Subjects are to be avoided so you don’t attack your opponent’s
self
Negative opinions / gossips about your opponent’s company,
product or colleagues.
Negative opinions on hobbies, movies, books, or interests - unless
you know for sure your opponent agrees.
Jokes (Unless you know your opponents’ sense of humor well)
Anything to do with religion or politics
1 Physical Separation This may work when two groups are not
required to interact while achieving targets.
2 Withdrawal Withdrawal from conflict.
3 Dominance Little to prevent reoccurrence of conflict in a
more violent form later on.
4 Appeal procedures Conventional method of resolving disputes
5 Compromise Traditional method - No clean winner / loser
6 Liaison groups /
Intermediaries / Integrators
7 Member rotation
8 Reduce interdependence
9 Procedural & Structural
changes
10 Super ordinate goals Common goals that appeals to all the parties
involved
Can not be completed separately
Demand interdependence / co-operation
11 Identifying a common enemy Sherif & Sherif - Boys Camp
Creation of super ordinate goals
Present a common treat as enemy
12 Integrated problem solving Incorporates that require of both parties
Mutually satisfactory solution
Level of trust between parties.
The basics of Successful Negotiation / The Concept of Bargaining
/ The Concept of Joint Problem -solving
Fixed Price – No Negotiation
Variable Price – No Negotiation
Example : Supermarket – Fixed Price – No negotiation
Your own item to sell - Negotiation
Negotiation involves 2 or more parties
Government – Union Management Negotiation To avert a strike
A number of countries Negotiation Multilateral treaty
Example :
Bargain – The purchase of a carpe
Negotiation – For long term housing / education loan
- Selling a used auto
Bargaining – One party win / one party loss
Seller want – highest price
Buyer want – lowest price
Win – lose situation
Cooperation – 50 – 50 – win-win situation – common interest
5 external factors of Negotiation
The Nature of the issues at stake
The relationship between the parties
The type of parties involved
The time available for the negotiation
The balance of power
You & your Opponent
The people can be categorized in 3 broad types…
1 Analytical Most profoundly influenced by all the things financial,
statistical & factual.
2 Aesthetic Capable of making decisions.
3 Intuitive Has intuitions regarding life, wants – quick decision makers
1) The Analytic Type
They are most profoundly influenced by all things financial, statically &
factual.
Capable of making decisions.
Accountants – Financial Analysist – Business managers
Chief financial officer – Tax consultants
2) The Aesthetic Type
Focuses on how things look & feel and what kind of visceral impact
they have.
More artistic considerations.
Artists – Writers – Actors – Designers
People who are in creative occupations.
3) The intuitive Type
Feeling based people.
Tend to make quick decision.
Jobs that require rapid analysis diagnostic.
Doctors – lawyers – Sales people
How your Opponent Makes Decisions
The strong (Not-so-silent) Type & Negotiation with the strong type
Strong types make decisions quickly & confidently.
They analyze complicated information rapidly, but as they give
quick decision sometime it may be wrong.
Commanding & authorities
Easy to deal with
Respond best to clear
Lead to stick to their view / judgment even they are wrong
Get angry very quickly
The fence straddling type & Negotiation with fence straddling type
Needs more time & likes to reach a consensus before taking any
action.
Often comes back to the bargaining table with all kinds of changes
& variations.
The weak type & Negotiation with weak type
Unfortunate negotiations
Reluctant to make negotiations
Pass the responsibility on to family member / Business Associates /
Friends.
Try to postpone decisions.
Subjects are to be avoided so you don’t attack your opponent’s
self
Negative opinions / gossips about your opponent’s company,
product or colleagues.
Negative opinions on hobbies, movies, books, or interests - unless
you know for sure your opponent agrees.
Jokes (Unless you know your opponents’ sense of humor well)
Anything to do with religion or politics
Studies of Conflict
Studies of Conflict
Prisoner’s Dilemma Game [PDG]
Tracking Game
1 Two research methods
The Robbers CAVE experiment
A two by two pay matrix
Zero sum conflict
A Prisoner’s Dilemma Game [PDG]
One group gains – another group
losses
B Tracking Game 2 Trucks – one route – time / money
C The Robbers CAVE experiment 1954 – Oklahoma
Children Camp – games –
evaluations
Effect of the Winning group
Retains it cohesion
Release tension, looses its fighting spirit, celebrate the success.
High inter group and co-operation.
Positive stereotype.
Has little sympathy to losers.
Effect of the Losers group
Psychological escapes.
Find the causes of loss.
Ready to work harder.
Low inter group competition.
Little sympathy to winning group.
Stimulation Strategies
1 Communication Manipulation of messages.
Ambiguous / Threatening messages
Intelligently planted rumors
2 Bringing in outsiders
3 Restructure the organization Changing the structure of the organization
4 Encouraging competition Bonus, incentive pay & rewards
Conflict works as productive
Conflict resolution Styles
Thompson’s five styles – Competitive - Avoiding –Accommodating
• – Compromising - Collaboration
1 Competition
[Dominance]
High assertiveness
Low co-operations
Direct physical aggression
Aggravate the struggle
Discover innovations.
2 Avoiding
[Withdrawal]
Behavior such as …
Withdrawal, indifference, evasion,
apathy, flight reliance, etc.
3 Accommodating [Smoothing] Low assertiveness
High co-operative ness
Temporary solution is needed in short
run.
4 Compromising style
[lose – lose]
Traditional method
No winner / No loser
Give & Take process / Negotiation
Sacrifices
5 Problem solving / Confrontation
/ Collaboration / Win – win Style
Opposite of conflict
Attempt to listen & develop empathy.
Problem solving is characterized by ……
Non Zero Game.
Mutual problem solver.
Joint outcomes.
Open, Honest sharing of information.
Flexibility.
Try to solve conflict in a way that will benefit both the parties.
Prisoner’s Dilemma Game [PDG]
Tracking Game
1 Two research methods
The Robbers CAVE experiment
A two by two pay matrix
Zero sum conflict
A Prisoner’s Dilemma Game [PDG]
One group gains – another group
losses
B Tracking Game 2 Trucks – one route – time / money
C The Robbers CAVE experiment 1954 – Oklahoma
Children Camp – games –
evaluations
Effect of the Winning group
Retains it cohesion
Release tension, looses its fighting spirit, celebrate the success.
High inter group and co-operation.
Positive stereotype.
Has little sympathy to losers.
Effect of the Losers group
Psychological escapes.
Find the causes of loss.
Ready to work harder.
Low inter group competition.
Little sympathy to winning group.
Stimulation Strategies
1 Communication Manipulation of messages.
Ambiguous / Threatening messages
Intelligently planted rumors
2 Bringing in outsiders
3 Restructure the organization Changing the structure of the organization
4 Encouraging competition Bonus, incentive pay & rewards
Conflict works as productive
Conflict resolution Styles
Thompson’s five styles – Competitive - Avoiding –Accommodating
• – Compromising - Collaboration
1 Competition
[Dominance]
High assertiveness
Low co-operations
Direct physical aggression
Aggravate the struggle
Discover innovations.
2 Avoiding
[Withdrawal]
Behavior such as …
Withdrawal, indifference, evasion,
apathy, flight reliance, etc.
3 Accommodating [Smoothing] Low assertiveness
High co-operative ness
Temporary solution is needed in short
run.
4 Compromising style
[lose – lose]
Traditional method
No winner / No loser
Give & Take process / Negotiation
Sacrifices
5 Problem solving / Confrontation
/ Collaboration / Win – win Style
Opposite of conflict
Attempt to listen & develop empathy.
Problem solving is characterized by ……
Non Zero Game.
Mutual problem solver.
Joint outcomes.
Open, Honest sharing of information.
Flexibility.
Try to solve conflict in a way that will benefit both the parties.
Conflict Management & Negotiation Skills
Conflict Management & Negotiation Skills
Reasons why conflict Occurs
1 Incompatibility Mutually Exclusively goals, Values or Events
2 Perception 2 Different Perceptions (Visions)
3 Blocking Deliberate Blocking behavior
4 Latent / Overt Limited overt acts
5 Verbal / Non verbal Shake of Hand
Indecent gesture
Writing scathing memo
Scratching the paint of a new car with a nail
6 Active / Passive Withholding information
3 Types of Competition
1 Inter group Competition Against each other
2 Inter group Competition Against another group
3 Individual Competition Individuals work independently against external
standard
Functions of Competition and Collaborations
1 Sense of identity Mutuality
2 Sense of responsibility Alternative ideas and solutions
3 Internal standards Mutual support and reinforcement
4 Excellence Synergy
5 Individual creativity Collective action
6 Individual autonomy
Positive Conflict & Negative Conflict
Mutual respect for ideas – things
Effective working relations
1 Positive Conflict
Supportive to all
Views as adversaries
Not at all bothered about Basic human
rights
Try to win at any cost
2 Negative Conflict
Criticism occurs and hurts and fail to elicit
the true thoughts and feelings of others
Positive Consequences of Conflicts
1 Major stimulant for change
Spotlights the problems that demand attention, forces clarification
2 Group think is avoided
3 Conflict fosters creativity and innovations
4 Cohesion and satisfaction
5 A minimum level of conflict is optimal
Negative Consequences of Conflicts
Physical & mental health of the
combatants
Feeling of anxiety
1 Conflict creates stress in people
Guilt - Frustration - Hostility
2 Diversion of energy
Instability & chaos Tension between groups 3
The moral fabric of the group torn apart
The Process of Conflict
Sequence of interlocking conflict episodes
1 The aftermath Based on the past experience
2 Latent conflict Scarcity of the resources
3 Perceived conflict Disagreement over an issue
Anxiety - frustration - Feeling of
hostility
4 Manifest conflict Based on behavior
Apathy Dramatic
Over hostility Aggressive
5 The Conflict a
The Changing Scenario of Conflict [CBI]
Organizational abnormality
A Potentially dangerous process
Negative outcome
Anger Confusion
Resentment Lake of co-operation
Harmful
1 The Classical Approach
Avoided and suppressed
Harmful and bad for organization 2 Behaviouralists
Natural occurrence
Interactionist view
Helpful – functional
3 Emerging view of Conflicts
Facilitative and functional
The interactionist views summarized as……
1 Normal aspect
2 Inevitable / inherent structural component
3 Neither bad / nor good for organization
4 Not always caused by trouble makers
5 Integral to the nature of change
6 Desirableftermath
Reasons why conflict Occurs
1 Incompatibility Mutually Exclusively goals, Values or Events
2 Perception 2 Different Perceptions (Visions)
3 Blocking Deliberate Blocking behavior
4 Latent / Overt Limited overt acts
5 Verbal / Non verbal Shake of Hand
Indecent gesture
Writing scathing memo
Scratching the paint of a new car with a nail
6 Active / Passive Withholding information
3 Types of Competition
1 Inter group Competition Against each other
2 Inter group Competition Against another group
3 Individual Competition Individuals work independently against external
standard
Functions of Competition and Collaborations
1 Sense of identity Mutuality
2 Sense of responsibility Alternative ideas and solutions
3 Internal standards Mutual support and reinforcement
4 Excellence Synergy
5 Individual creativity Collective action
6 Individual autonomy
Positive Conflict & Negative Conflict
Mutual respect for ideas – things
Effective working relations
1 Positive Conflict
Supportive to all
Views as adversaries
Not at all bothered about Basic human
rights
Try to win at any cost
2 Negative Conflict
Criticism occurs and hurts and fail to elicit
the true thoughts and feelings of others
Positive Consequences of Conflicts
1 Major stimulant for change
Spotlights the problems that demand attention, forces clarification
2 Group think is avoided
3 Conflict fosters creativity and innovations
4 Cohesion and satisfaction
5 A minimum level of conflict is optimal
Negative Consequences of Conflicts
Physical & mental health of the
combatants
Feeling of anxiety
1 Conflict creates stress in people
Guilt - Frustration - Hostility
2 Diversion of energy
Instability & chaos Tension between groups 3
The moral fabric of the group torn apart
The Process of Conflict
Sequence of interlocking conflict episodes
1 The aftermath Based on the past experience
2 Latent conflict Scarcity of the resources
3 Perceived conflict Disagreement over an issue
Anxiety - frustration - Feeling of
hostility
4 Manifest conflict Based on behavior
Apathy Dramatic
Over hostility Aggressive
5 The Conflict a
The Changing Scenario of Conflict [CBI]
Organizational abnormality
A Potentially dangerous process
Negative outcome
Anger Confusion
Resentment Lake of co-operation
Harmful
1 The Classical Approach
Avoided and suppressed
Harmful and bad for organization 2 Behaviouralists
Natural occurrence
Interactionist view
Helpful – functional
3 Emerging view of Conflicts
Facilitative and functional
The interactionist views summarized as……
1 Normal aspect
2 Inevitable / inherent structural component
3 Neither bad / nor good for organization
4 Not always caused by trouble makers
5 Integral to the nature of change
6 Desirableftermath
Succeeding at Re-engineering
Succeeding at Re-engineering
1) Trying to fix a process instead of changing it
2) Inadequate focus on business processes
3) Ignoring everything except process redesign
4) Neglecting people’s values and beliefs
5) Not aiming for radical results
6) Abandoning the project prematurely
7) Placing prior constraints on the definition of the problem & the scope
of the re-engineering effort
8) Barriers to re-engineering due to existing culture & attitude
9) Initiating & implementing re-engineering bottom-up
10) Assigning an incompetent re-engineering leader
11) Granting inadequate resources to re-engineering
12) Bury re-engineering is the middle of the corporate agencies
13) Embarking on many re-engineering projects at once
14) Attempting to re-engineer without an assured commitment
15) Failure to distinguish re-engineering from improvement programs
16) Exclusive focus on design
17) Aiming for a smooth transition & change
18) Withdrawal from the project in the face of resistance
19) Excessive pressure for efforts and results
1) Trying to fix a process instead of changing it
2) Inadequate focus on business processes
3) Ignoring everything except process redesign
4) Neglecting people’s values and beliefs
5) Not aiming for radical results
6) Abandoning the project prematurely
7) Placing prior constraints on the definition of the problem & the scope
of the re-engineering effort
8) Barriers to re-engineering due to existing culture & attitude
9) Initiating & implementing re-engineering bottom-up
10) Assigning an incompetent re-engineering leader
11) Granting inadequate resources to re-engineering
12) Bury re-engineering is the middle of the corporate agencies
13) Embarking on many re-engineering projects at once
14) Attempting to re-engineer without an assured commitment
15) Failure to distinguish re-engineering from improvement programs
16) Exclusive focus on design
17) Aiming for a smooth transition & change
18) Withdrawal from the project in the face of resistance
19) Excessive pressure for efforts and results
Mapping the Process
Mapping the Process
Allows the team to see all parts of the process & how these parts fit
together & the weakness & unnecessary complexities of the process.
Enables the team to design different attendants.
Following are the different components….
1) Process Analysis
2) Process Environment Diagrams
3) Data flow diagrams
4) Data flow leveling
5) Flow charts
1. Process Analysis
o Process – Sub process – Main Activities – Special tasks
o Data flow diagram – shows the flow of inputs & outputs
2. Process Environment diagrams
o Represents the process
o Shows the main customers & Suppliers
o Flow inputs & outputs
o Supplying is the key
3. Data Flow Diagram
o Sub Process – Represented by Circle
o Flow of inputs / Outputs – represented by arrow & lines
o Second level data flow – Each circle & exploding with main
element.
4. Data flow leveling
5. flow Chart
Circle Start
Rectangle End
Big Rectangle Process Step [Activity]
Decision
Input or output
D shape Delay
Arrow Flow
Process Improvement Techniques
1) Five Question Analysis
2) Value Added Analysis
3) Bureaucracy Elimination
4) Cycle time Analysis
Five Question Analysis
What is the purpose?
Where is it performed?
When is it performed?
Who performs it?
How is it performed?
Value Added Analysis
Flow
Classification…
o Adds Real Value – actually makes a difference to the final
output.
o Add Business Value – That are required by the organization,
but that add no value to the customer point of view.
Bureaucracy Elimination
o Bureaucratic Steps…
Checking Recording
Authorizing Producing multiple copies
Storing Approving
Re-engineering Implementation Framework
Raymond Manganelli – New York Based Gateway Information Services
Inc.
Definition
The rapid & radical redesign of strategic, value-added business
processes & the systems, policies & organizational structures
that support them to optimize the work flows & productivity in an
organization.
Reengineering methodology must focus on two strategic guidelines
Empowering People
Enabling technology
Five steps to Reengineering Approvals.
o Preparation
o Identification
o Vision
o Solution
o Process Design
1. Preparation
Recognize the need to re-engineer & develop consequences.
Identify existing barriers – Cost & Time
Change plan document / Contract
2. Identification
Identify important processes for the organization
7 main characteristics that influence customers decisions
Q Quality Product that suit their needs & are durable & reliable
V Volume Should be in certain Quantity / Volume
A Administrative
procedures
Procedures that buyers must go through to pay for the
product
L Location Ease to access & attractively arranged premises
I Image &
interrelations
The supplier’s image & interrelationship with customers.
T Time Factor Products should received at time
Y Yield The value per unit of money spent
3. Vision
Understanding the process structure & how it flows within the
organization.
4. Solution
Divided into 2 areas
Process Design
Social Design
5. Transformation
After completing the business system design, performing the process
design, & developing test & rollout plans, personnel must be evaluated
before the new system is constructed.
Continuous improvement follows but Manganelli cautions against
thinking of re-engineering in terms of continuous improvement.
Allows the team to see all parts of the process & how these parts fit
together & the weakness & unnecessary complexities of the process.
Enables the team to design different attendants.
Following are the different components….
1) Process Analysis
2) Process Environment Diagrams
3) Data flow diagrams
4) Data flow leveling
5) Flow charts
1. Process Analysis
o Process – Sub process – Main Activities – Special tasks
o Data flow diagram – shows the flow of inputs & outputs
2. Process Environment diagrams
o Represents the process
o Shows the main customers & Suppliers
o Flow inputs & outputs
o Supplying is the key
3. Data Flow Diagram
o Sub Process – Represented by Circle
o Flow of inputs / Outputs – represented by arrow & lines
o Second level data flow – Each circle & exploding with main
element.
4. Data flow leveling
5. flow Chart
Circle Start
Rectangle End
Big Rectangle Process Step [Activity]
Decision
Input or output
D shape Delay
Arrow Flow
Process Improvement Techniques
1) Five Question Analysis
2) Value Added Analysis
3) Bureaucracy Elimination
4) Cycle time Analysis
Five Question Analysis
What is the purpose?
Where is it performed?
When is it performed?
Who performs it?
How is it performed?
Value Added Analysis
Flow
Classification…
o Adds Real Value – actually makes a difference to the final
output.
o Add Business Value – That are required by the organization,
but that add no value to the customer point of view.
Bureaucracy Elimination
o Bureaucratic Steps…
Checking Recording
Authorizing Producing multiple copies
Storing Approving
Re-engineering Implementation Framework
Raymond Manganelli – New York Based Gateway Information Services
Inc.
Definition
The rapid & radical redesign of strategic, value-added business
processes & the systems, policies & organizational structures
that support them to optimize the work flows & productivity in an
organization.
Reengineering methodology must focus on two strategic guidelines
Empowering People
Enabling technology
Five steps to Reengineering Approvals.
o Preparation
o Identification
o Vision
o Solution
o Process Design
1. Preparation
Recognize the need to re-engineer & develop consequences.
Identify existing barriers – Cost & Time
Change plan document / Contract
2. Identification
Identify important processes for the organization
7 main characteristics that influence customers decisions
Q Quality Product that suit their needs & are durable & reliable
V Volume Should be in certain Quantity / Volume
A Administrative
procedures
Procedures that buyers must go through to pay for the
product
L Location Ease to access & attractively arranged premises
I Image &
interrelations
The supplier’s image & interrelationship with customers.
T Time Factor Products should received at time
Y Yield The value per unit of money spent
3. Vision
Understanding the process structure & how it flows within the
organization.
4. Solution
Divided into 2 areas
Process Design
Social Design
5. Transformation
After completing the business system design, performing the process
design, & developing test & rollout plans, personnel must be evaluated
before the new system is constructed.
Continuous improvement follows but Manganelli cautions against
thinking of re-engineering in terms of continuous improvement.
Re-engineering team
Re-engineering team
Strength of 5 to 10 people came from various functions involved in the
process.
Must have thorough knowledge of the process / at least one part.
No team can re-engineer more than one process a time.
Requires good mix of insiders – team members – people external to
the process.
Outsiders
o Do not work in the process
o Need to be good listeners & communicators
o Located at…
Inmates of engineering
Information system
Marketing departments
Process owners is the client of re-engineering, not the poss.
Team must feel comfortable with ambiguity.
Team members must expect to make mistake & learn.
Steering committee
It is Optional aspect of re-engineering structure, chaired by the leader.
A collection of senior managers & process owners.
Re-engineering Expert
Process owners & team – focuses on their re-engineering project.
Leader – Look at right perspective.
The expert serves as the leader is chief of staff for re-engineering.
2 main functions…
Enabling & supporting each individual process owner & reengineering
team
Coordinating all ongoing re-engineering activities.
Concerned with developing the infrastructure.
Business Processes
Invisible & unnamed
A set of activities performed across the organization creating an output
of value to the customer.
Every process has a customers – external / internal
Process execution – Data is Gathered – Processed – Stored
The process execution…
Receive input
Measure / Analyses documents
Perform, Process, Record, Access Data
Produce result & Communicate
Choosing the Processes to Re-engineer
Criteria to make the choices to re-engineer
Based on dysfunction Which processes are in
grave trouble?
Based on Importance Greatest impact on the
company’s customer
Impact on External
customers
Price / Cost
Quality / Product Value
Based on feasibility Most sophisticated to
successful redesign
Scope – Greater payoff
– success may be driver
Cost
Commitment – the
strength of the
reengineering team &
the commitment of the
process owner.
Strength of 5 to 10 people came from various functions involved in the
process.
Must have thorough knowledge of the process / at least one part.
No team can re-engineer more than one process a time.
Requires good mix of insiders – team members – people external to
the process.
Outsiders
o Do not work in the process
o Need to be good listeners & communicators
o Located at…
Inmates of engineering
Information system
Marketing departments
Process owners is the client of re-engineering, not the poss.
Team must feel comfortable with ambiguity.
Team members must expect to make mistake & learn.
Steering committee
It is Optional aspect of re-engineering structure, chaired by the leader.
A collection of senior managers & process owners.
Re-engineering Expert
Process owners & team – focuses on their re-engineering project.
Leader – Look at right perspective.
The expert serves as the leader is chief of staff for re-engineering.
2 main functions…
Enabling & supporting each individual process owner & reengineering
team
Coordinating all ongoing re-engineering activities.
Concerned with developing the infrastructure.
Business Processes
Invisible & unnamed
A set of activities performed across the organization creating an output
of value to the customer.
Every process has a customers – external / internal
Process execution – Data is Gathered – Processed – Stored
The process execution…
Receive input
Measure / Analyses documents
Perform, Process, Record, Access Data
Produce result & Communicate
Choosing the Processes to Re-engineer
Criteria to make the choices to re-engineer
Based on dysfunction Which processes are in
grave trouble?
Based on Importance Greatest impact on the
company’s customer
Impact on External
customers
Price / Cost
Quality / Product Value
Based on feasibility Most sophisticated to
successful redesign
Scope – Greater payoff
– success may be driver
Cost
Commitment – the
strength of the
reengineering team &
the commitment of the
process owner.
Human Resources Enablers
Human Resources Enablers
Fredrick Taylor
People were viewed as little much than machines, to be directed
& controlled at the whim of management.
Elton Mayo at Hawthrone plant of the Western Electric Company
The feelings & motivations of workers affected the productivity
and performance.
The Japanese management techniques & practices
Lifetime employment, seniority systems based on job rotation &
participative management are now seen as necessary to the
success of business.
Following are the components of Human Resources Enablers
Autonomous work teams
Career planning
All round appraisals
Autonomous Work Teams
Highly reutilized / repetitive work
Job dissatisfaction
Alienation from the work
Poor mental health
The team may be responsible for …..
Allocating jobs among themselves
Setting & achieving production targets
Recording & responding to production data
Solving quality problems
Ordering supplies
Delivering finished goods to customers
The result has several Advantages over the previous design
Time reduces drastically to perform the process
Reduces the time spent in checking on the progress
Enhance the nature of work performed b individuals
Career Planning
All round Appraisals
Provides performance feedback to an individual from 3 directional
sources.
1 Downwards From the person’s boss
2 Lateral From the peers
3 Upward From the subordinates
o Two distinct advantages
Lateral appraisal – encompasses more than the usual
concern of a person’s manager
Peers – with the team
Organizing for Re-engineering
Companies do not re engineer processes, people do.
Roles emerge, either distinctly or in various combinations.
Leader
A senior executive who authorizes and motivates the
overall re-engineering effort.
Process Owner
A manager with responsibility for a specific process & the
re-engineering effort focused on it.
Re-engineering team
A group of individuals dedicated to the re-engineering of
a particular process, who diagnose the existing process &
the re-engineering effort focused on it.
Steering committee
A policy making body of senior managers who develop
the organization’s overall re-engineering strategy &
monitor its progress.
Re-engineering expert
An individual responsible for developing re-engineering
techniques & tools within the company & for achieving
synergy across the company’s separate re-engineering
projects.
The leader appoints the process owner, who convenes a reengineering
team to re-engineer the process, with the assistance
from the expert & under the auspices of the steering committee.
Leader
The re-engineering leader makes re-engineering happen.
He / she – Senior Executive.
Nobody is assigned as a leader – it is self nominated, self
appointed.
Primary role – To act as visionary & motivator.
Appoints senior manager as owners of the processes & charges
them with achieving breakthroughs in performance.
He creates – new vision & sets the new standards
Comes forward to take any responsibility on behalf of the reengineering
team
Face any kind of obstacle in the path of re-engineering.
CEO as a leader – Focuses extremely towards customers
o Focuses internally towards the operations
Hallmarks of the reengineering leaders
o Ambition – restlessness – leadership through
Signals – Expert messages
Symbols – Action that the leader performs
Systems – Reinforce the re-engineering message
- Measure & reward employee’s succession
re-engineering.
Process Owner
Process owner is responsible for Re-engineering specific process at
the individual process level.
He shall be a senior level manager with a line responsibility.
Usually individuals who manage one of the functions involve in the
process that will under go re-engineering.
Important characteristics
Respect for peers
Knowledge about the process to be re-engineered
Re-engineering technologies
Should be comfortable with… Shall be able to …
Change Motivate
Tolerant of ambiguity Inspire
Re-engineering techniques Advice
Fredrick Taylor
People were viewed as little much than machines, to be directed
& controlled at the whim of management.
Elton Mayo at Hawthrone plant of the Western Electric Company
The feelings & motivations of workers affected the productivity
and performance.
The Japanese management techniques & practices
Lifetime employment, seniority systems based on job rotation &
participative management are now seen as necessary to the
success of business.
Following are the components of Human Resources Enablers
Autonomous work teams
Career planning
All round appraisals
Autonomous Work Teams
Highly reutilized / repetitive work
Job dissatisfaction
Alienation from the work
Poor mental health
The team may be responsible for …..
Allocating jobs among themselves
Setting & achieving production targets
Recording & responding to production data
Solving quality problems
Ordering supplies
Delivering finished goods to customers
The result has several Advantages over the previous design
Time reduces drastically to perform the process
Reduces the time spent in checking on the progress
Enhance the nature of work performed b individuals
Career Planning
All round Appraisals
Provides performance feedback to an individual from 3 directional
sources.
1 Downwards From the person’s boss
2 Lateral From the peers
3 Upward From the subordinates
o Two distinct advantages
Lateral appraisal – encompasses more than the usual
concern of a person’s manager
Peers – with the team
Organizing for Re-engineering
Companies do not re engineer processes, people do.
Roles emerge, either distinctly or in various combinations.
Leader
A senior executive who authorizes and motivates the
overall re-engineering effort.
Process Owner
A manager with responsibility for a specific process & the
re-engineering effort focused on it.
Re-engineering team
A group of individuals dedicated to the re-engineering of
a particular process, who diagnose the existing process &
the re-engineering effort focused on it.
Steering committee
A policy making body of senior managers who develop
the organization’s overall re-engineering strategy &
monitor its progress.
Re-engineering expert
An individual responsible for developing re-engineering
techniques & tools within the company & for achieving
synergy across the company’s separate re-engineering
projects.
The leader appoints the process owner, who convenes a reengineering
team to re-engineer the process, with the assistance
from the expert & under the auspices of the steering committee.
Leader
The re-engineering leader makes re-engineering happen.
He / she – Senior Executive.
Nobody is assigned as a leader – it is self nominated, self
appointed.
Primary role – To act as visionary & motivator.
Appoints senior manager as owners of the processes & charges
them with achieving breakthroughs in performance.
He creates – new vision & sets the new standards
Comes forward to take any responsibility on behalf of the reengineering
team
Face any kind of obstacle in the path of re-engineering.
CEO as a leader – Focuses extremely towards customers
o Focuses internally towards the operations
Hallmarks of the reengineering leaders
o Ambition – restlessness – leadership through
Signals – Expert messages
Symbols – Action that the leader performs
Systems – Reinforce the re-engineering message
- Measure & reward employee’s succession
re-engineering.
Process Owner
Process owner is responsible for Re-engineering specific process at
the individual process level.
He shall be a senior level manager with a line responsibility.
Usually individuals who manage one of the functions involve in the
process that will under go re-engineering.
Important characteristics
Respect for peers
Knowledge about the process to be re-engineered
Re-engineering technologies
Should be comfortable with… Shall be able to …
Change Motivate
Tolerant of ambiguity Inspire
Re-engineering techniques Advice
Inductive thinking & deductive thinking
Inductive thinking & deductive thinking
Inductive thinking
Define a problem/problems then seeking & evaluation of different
situation
Deductive thinking
The ability to recognize first powerful solution then seed the
problems it might solve
Information management principles in Business process Re
engineering
Principle 1 Eliminating the problem eliminates information about the problem
Principle 2 Simplify the process & simplify the information embedded in the
process
Principle 3 Focus on the appropriate use of information technology
Principle 4 Making information available does not make it useful : one should
concentrate on targeted information use
Principle 5 Se lead –time reduction in process re-engineering efforts to drive
out insignificant information & drive in value added information
Principle 6 Use re-engineering to closely link work processes information
management responsibilities
Principle 7 Flexible business practices require flexible information systems
Principle 8 Manageable works groups make information needs more
manageable
Principle 9 Use business process re-engineering & information management
to balance information & material flows
Role of information Technology as an enabler in Re engineering
Breaking rules is how people learn to think inductively about
technology during the re-engineering process.
Teleconferencing
EDI – electronic data interchange
1) Shared Documents
Information in paper – one person can use
Distributed copes – many person can use
Shared documents means one document exists in several
places at once
Database technology – free process form the artificial limitations
of sequencing.
2) Expert System
By eliminating the hands-off, delays, & errors inherent in a
traditional sequential process, the re-engineered process can
achieve order of magnitude improvements in cycle time,
accuracy, and cost.
3) Telecommunications Networks
Manufacturing Plants, service facilities & sales offices located
far from the headquarters must be treated as separate,
decentralized, autonomous organizations if they are to function
effectively & efficiently.
4) Decision Support System
Modern database technology allows information previously
available only to management to be made widely accessible.
When accessible data is combined with easy to use analysis
and modeling tools, frontline works with proper training become
capable of making fast, effective & sophisticated decisions.
5) Wireless data communication & portable computers
Mobile Phones – Laptops – Palmtops – Personal computers
People can connect to information sources wherever they are.
6) Interactive videodisk
Used to augment retail sales force for the customer support
Customer at these stores can select a product from a menu,
watch a video presentation about it, ask questions & if satisfied
can order it.
7) Automatic identification & tracing
Combined with wireless communication technology, automatic
identification technology & tracking can be used to track
anything from trucks to packages.
Some railroads.
8) High performance computing
A computer supplied with real time data from point of sale
terminals could aid better decision making, reduce inventory,
and improve customer satisf
Role of creativity in Business Process Re-engineering
Creativity in terms of four different components
1 Similarity Seeing links between things that others have not
perceived
Benchmarking exercise
2 Alternative functions Ability to see different uses of the same thing
3 Number of instances Perceiving many different instances of a common
theme
4 Naming Generating many different interpretations of the
same thing
action & value.
Inductive thinking
Define a problem/problems then seeking & evaluation of different
situation
Deductive thinking
The ability to recognize first powerful solution then seed the
problems it might solve
Information management principles in Business process Re
engineering
Principle 1 Eliminating the problem eliminates information about the problem
Principle 2 Simplify the process & simplify the information embedded in the
process
Principle 3 Focus on the appropriate use of information technology
Principle 4 Making information available does not make it useful : one should
concentrate on targeted information use
Principle 5 Se lead –time reduction in process re-engineering efforts to drive
out insignificant information & drive in value added information
Principle 6 Use re-engineering to closely link work processes information
management responsibilities
Principle 7 Flexible business practices require flexible information systems
Principle 8 Manageable works groups make information needs more
manageable
Principle 9 Use business process re-engineering & information management
to balance information & material flows
Role of information Technology as an enabler in Re engineering
Breaking rules is how people learn to think inductively about
technology during the re-engineering process.
Teleconferencing
EDI – electronic data interchange
1) Shared Documents
Information in paper – one person can use
Distributed copes – many person can use
Shared documents means one document exists in several
places at once
Database technology – free process form the artificial limitations
of sequencing.
2) Expert System
By eliminating the hands-off, delays, & errors inherent in a
traditional sequential process, the re-engineered process can
achieve order of magnitude improvements in cycle time,
accuracy, and cost.
3) Telecommunications Networks
Manufacturing Plants, service facilities & sales offices located
far from the headquarters must be treated as separate,
decentralized, autonomous organizations if they are to function
effectively & efficiently.
4) Decision Support System
Modern database technology allows information previously
available only to management to be made widely accessible.
When accessible data is combined with easy to use analysis
and modeling tools, frontline works with proper training become
capable of making fast, effective & sophisticated decisions.
5) Wireless data communication & portable computers
Mobile Phones – Laptops – Palmtops – Personal computers
People can connect to information sources wherever they are.
6) Interactive videodisk
Used to augment retail sales force for the customer support
Customer at these stores can select a product from a menu,
watch a video presentation about it, ask questions & if satisfied
can order it.
7) Automatic identification & tracing
Combined with wireless communication technology, automatic
identification technology & tracking can be used to track
anything from trucks to packages.
Some railroads.
8) High performance computing
A computer supplied with real time data from point of sale
terminals could aid better decision making, reduce inventory,
and improve customer satisf
Role of creativity in Business Process Re-engineering
Creativity in terms of four different components
1 Similarity Seeing links between things that others have not
perceived
Benchmarking exercise
2 Alternative functions Ability to see different uses of the same thing
3 Number of instances Perceiving many different instances of a common
theme
4 Naming Generating many different interpretations of the
same thing
action & value.
Change accompanying Business Process Re-engineering
Change accompanying Business Process Re-engineering
1) Change in work units
Replacement of old structure / team / group
Virtual team – shorter life span
2) Change in Jobs
Job changes from simple task to multi dimensional tasks
Eliminates non value adding work
Eliminates unproductive work
3) Change in people’s role
People’s role changes from controlled to empowered
Considered additional criteria in their hiring
4) Change in Job preparation
Job preparation changes from training to education
5) Change in focus of performance measure & compensation
The primary focus of performance measures &
compensation shifts from actively to results.
6) Change in advancement criteria
Advancement criteria, changes from performance to ability
Appropriate reward – BONUS
A company should pay for performance & promote for ability
7) Change in values
Entails a great shift in the within organization
Demands that employee deeply believe that they work for
their consumers out for their bosses
In a company that has re engineered, employees must hold
beliefs such as...
1 Customers not bosses pay all
our salaries
I must do what it takes to please the
customers.
2 Every job in this company is
essential and important
I do make a difference.
3 Showing up is no
accomplishment
I get paid for the value I create
4 Responsibility I must accept ownership of problem and
get them solved
5 Team belongingness We fail or we succeed together
6 Adaptability Constant learning is part of my job
8) Change in manager’s role
Role changes from supervisor to hat of a coaches
Complex process becomes simple & simple process
becomes complex
9) Change in organization structure
Organizational structures change from hierarchical to flat
10) Change in the role of Executives
The role of executives would change from storekeepers to
leaders.
Flatter organizations move senior executives closer to
customers and to the people performing the company’s value
adding work.
1) Change in work units
Replacement of old structure / team / group
Virtual team – shorter life span
2) Change in Jobs
Job changes from simple task to multi dimensional tasks
Eliminates non value adding work
Eliminates unproductive work
3) Change in people’s role
People’s role changes from controlled to empowered
Considered additional criteria in their hiring
4) Change in Job preparation
Job preparation changes from training to education
5) Change in focus of performance measure & compensation
The primary focus of performance measures &
compensation shifts from actively to results.
6) Change in advancement criteria
Advancement criteria, changes from performance to ability
Appropriate reward – BONUS
A company should pay for performance & promote for ability
7) Change in values
Entails a great shift in the within organization
Demands that employee deeply believe that they work for
their consumers out for their bosses
In a company that has re engineered, employees must hold
beliefs such as...
1 Customers not bosses pay all
our salaries
I must do what it takes to please the
customers.
2 Every job in this company is
essential and important
I do make a difference.
3 Showing up is no
accomplishment
I get paid for the value I create
4 Responsibility I must accept ownership of problem and
get them solved
5 Team belongingness We fail or we succeed together
6 Adaptability Constant learning is part of my job
8) Change in manager’s role
Role changes from supervisor to hat of a coaches
Complex process becomes simple & simple process
becomes complex
9) Change in organization structure
Organizational structures change from hierarchical to flat
10) Change in the role of Executives
The role of executives would change from storekeepers to
leaders.
Flatter organizations move senior executives closer to
customers and to the people performing the company’s value
adding work.
Reengineering Defined
Reengineering Defined
Valfredo Pareto
Early 20th century Italian economist
80 / 20 role
80 % of the effective expanded in an process is caused by
20 % of the input
Ford’s concepts
We pay when we receive the invoice
We pay when we receive the goods
We pay when we use the goods
Key learning themes from the Re-engineering Experience
1 Process Orientation
2 Ambition
3 Role breaking Brake old traditional rules
4 Creative use of
information
Technology
Create new process model as per another
information technology.
IT acts as an enabler that allows
organization to do work in radically ways.
The truth of Re-engineering
Reengineering is not restructuring or downsizing.
Downsizing or restructuring means doing less with less whereas re
engineering means doing more with less.
Business reengineering is synonymous with innovation.
MB 010 – Business Process, Re Engineering
Reengineering is the 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.
In reengineering, in order to meet contemporary demand of quality,
service, flexibility & low cost, the process must be kept simple.
Characteristics of Re-engineering Process
Several jobs are combined into one
Several jobs combine into one may firmly distinct jobs as tasks we
integrated & compressed into one
Customer service representative
Performs the entire process & also serve as the single
point of contact for the customer
Case team / Case team members
Worker make decisions
Vertical Compression
Workers had to go to managerial hierarchy for an answer
Workers themselves now do that portion of a job that firmly
managers performed
The steps in the processes are performed in a natural orders
Freed form the tyranny of straight line sequences
Decline arising
Many jobs get done simultaneously
Reducing the amount of time that is elapsed between the
early and late steps of a process
Processes have Multiple versions
End of standardization
Traditional processors – Mass Production & Mass Market
Need of multiple versions of the same process
Work is performed where IT makes the most senses
Shifting of work across organizational boundaries
Checks and controls are reduced
Non value adding work
Checking of non value [-] adding work
No tightly checking
Reconciliation is minimized
Low inventory
Chain management
Negative inventory carrying costs
Infinite return on capital
Continuous replenishment
A case manager provided at single point of conflict
The steps of a process either are so complex or are
dispersed
Has to answer the customer’s question & solve
customer’s problems
CSR – Customer service representative
Hybrid centralized operations are prevalent
Ability to combine the advantage of centralization &
decentralization
Eliminate the bureaucratic machinery
Valfredo Pareto
Early 20th century Italian economist
80 / 20 role
80 % of the effective expanded in an process is caused by
20 % of the input
Ford’s concepts
We pay when we receive the invoice
We pay when we receive the goods
We pay when we use the goods
Key learning themes from the Re-engineering Experience
1 Process Orientation
2 Ambition
3 Role breaking Brake old traditional rules
4 Creative use of
information
Technology
Create new process model as per another
information technology.
IT acts as an enabler that allows
organization to do work in radically ways.
The truth of Re-engineering
Reengineering is not restructuring or downsizing.
Downsizing or restructuring means doing less with less whereas re
engineering means doing more with less.
Business reengineering is synonymous with innovation.
MB 010 – Business Process, Re Engineering
Reengineering is the 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.
In reengineering, in order to meet contemporary demand of quality,
service, flexibility & low cost, the process must be kept simple.
Characteristics of Re-engineering Process
Several jobs are combined into one
Several jobs combine into one may firmly distinct jobs as tasks we
integrated & compressed into one
Customer service representative
Performs the entire process & also serve as the single
point of contact for the customer
Case team / Case team members
Worker make decisions
Vertical Compression
Workers had to go to managerial hierarchy for an answer
Workers themselves now do that portion of a job that firmly
managers performed
The steps in the processes are performed in a natural orders
Freed form the tyranny of straight line sequences
Decline arising
Many jobs get done simultaneously
Reducing the amount of time that is elapsed between the
early and late steps of a process
Processes have Multiple versions
End of standardization
Traditional processors – Mass Production & Mass Market
Need of multiple versions of the same process
Work is performed where IT makes the most senses
Shifting of work across organizational boundaries
Checks and controls are reduced
Non value adding work
Checking of non value [-] adding work
No tightly checking
Reconciliation is minimized
Low inventory
Chain management
Negative inventory carrying costs
Infinite return on capital
Continuous replenishment
A case manager provided at single point of conflict
The steps of a process either are so complex or are
dispersed
Has to answer the customer’s question & solve
customer’s problems
CSR – Customer service representative
Hybrid centralized operations are prevalent
Ability to combine the advantage of centralization &
decentralization
Eliminate the bureaucratic machinery
Business Process, Re - Engineering
Business Process, Re - Engineering
Evolution of Organization and Management Concepts
Adam Smith
A Philosopher & economist
Concept – Division of Labor
Henry Ford
Concept – Dividing work into tiny, repeatable task
Alfred Sloan
Management process be divided into different functions
Henry Feyol
Management would be effective if business is planned
The Realities of the New Economy
Nothing is constant / Predictable including …
Market Growth Product life cycle
Customer Demand The rate and direction of technological change
The nature of competition
Evolution of Organization Structure
Various Organization Structure
Functional – Product – Matrix
Common characteristics
Structured on the basis of hierarchy
One Section – One function
Restricted decision making
Principle of span of control
Core communication channels
Decision making authority rests at the top
Each functional head fulfills the portion of operation allocated,
accomplishing the business operation
Advantages of Adam Smith’s decision of labor principle & Alfred
Sloan’s principle of management control & accountability.
Companies don’t have to bare people
Everyone in the process is accountable through the bureaucratic
chain of the command
The twenty first century organization
Would be difficult in structure, style & character
Structure would be flexible & responsive to customer need
Needs would be fulfilled about a higher speed
Would endeavor to meet the customer’s basic needs & psychological
expectations
Goal would be to maximize the value offered to the customer about the
least cost & a greatest speed
The organization will provide proper education, training, support &
reward, incorporating them in terms to produce value added
deliverables to the customer.
The business strategy for achieving customer delight therefore calls
for:
Careful choice of the market segment
Ascertaining the value system or profile of the customer in the
chosen segment
Designing the product or service to exceed all the value
expectations
Designing the related processes in such a way that new changes
are made quickly, in product or service and processes, so that
customer loyalty will be maintained, and business leadership
remains challenged.
Reengineering Defined
Re engineering is the fundamental rethinking and radical redesign of
business processes to achieve dramatic improvements in critical,
contemporary measures of performance, such as cost, quality, service
& speed.
The definition contains four key words.
Key Work 1 : Fundamental
Key Work 2 : Radical
Key Work 3 : Dramatic
Key Work 4 : Processes
Key Work 1 : Fundamental
People must ask the basic questions
Re engineering ignores – what is and concentrates on what should
be
Key Work 2 : Radical
Derived from Latin word – Radix means root
Radical redesigning – getting to the root of the things
Re engineering is business re invention and not …
Business improvement / enhancement / modification
Key Work 3 : Dramatic
Company falls 10 % short
If cost is come in 10 % too high
If the quality is 10 % too low
If the customer performance needs a 10 % boost,
Three kinds of companies that undertake re-engineering.
The companies that find themselves in deep trouble
o No choice
o The companies yet not in trouble but also the
management has the foresight to see trouble
coming
o These companies have the vision to begin reengineering
in advance of running into adversity.
Companies are in peak position
o No discernible difficulties
o Sees re engineering as an opportunity
No re engineering
required
o These companies have the vision to begin
Re engineering ignores – what is and concentrates on
Key Work 4 : Processes
Most important / frequent difficulty
Process : A series of activities that delivers value to a customer
Evolution of Organization and Management Concepts
Adam Smith
A Philosopher & economist
Concept – Division of Labor
Henry Ford
Concept – Dividing work into tiny, repeatable task
Alfred Sloan
Management process be divided into different functions
Henry Feyol
Management would be effective if business is planned
The Realities of the New Economy
Nothing is constant / Predictable including …
Market Growth Product life cycle
Customer Demand The rate and direction of technological change
The nature of competition
Evolution of Organization Structure
Various Organization Structure
Functional – Product – Matrix
Common characteristics
Structured on the basis of hierarchy
One Section – One function
Restricted decision making
Principle of span of control
Core communication channels
Decision making authority rests at the top
Each functional head fulfills the portion of operation allocated,
accomplishing the business operation
Advantages of Adam Smith’s decision of labor principle & Alfred
Sloan’s principle of management control & accountability.
Companies don’t have to bare people
Everyone in the process is accountable through the bureaucratic
chain of the command
The twenty first century organization
Would be difficult in structure, style & character
Structure would be flexible & responsive to customer need
Needs would be fulfilled about a higher speed
Would endeavor to meet the customer’s basic needs & psychological
expectations
Goal would be to maximize the value offered to the customer about the
least cost & a greatest speed
The organization will provide proper education, training, support &
reward, incorporating them in terms to produce value added
deliverables to the customer.
The business strategy for achieving customer delight therefore calls
for:
Careful choice of the market segment
Ascertaining the value system or profile of the customer in the
chosen segment
Designing the product or service to exceed all the value
expectations
Designing the related processes in such a way that new changes
are made quickly, in product or service and processes, so that
customer loyalty will be maintained, and business leadership
remains challenged.
Reengineering Defined
Re engineering is the fundamental rethinking and radical redesign of
business processes to achieve dramatic improvements in critical,
contemporary measures of performance, such as cost, quality, service
& speed.
The definition contains four key words.
Key Work 1 : Fundamental
Key Work 2 : Radical
Key Work 3 : Dramatic
Key Work 4 : Processes
Key Work 1 : Fundamental
People must ask the basic questions
Re engineering ignores – what is and concentrates on what should
be
Key Work 2 : Radical
Derived from Latin word – Radix means root
Radical redesigning – getting to the root of the things
Re engineering is business re invention and not …
Business improvement / enhancement / modification
Key Work 3 : Dramatic
Company falls 10 % short
If cost is come in 10 % too high
If the quality is 10 % too low
If the customer performance needs a 10 % boost,
Three kinds of companies that undertake re-engineering.
The companies that find themselves in deep trouble
o No choice
o The companies yet not in trouble but also the
management has the foresight to see trouble
coming
o These companies have the vision to begin reengineering
in advance of running into adversity.
Companies are in peak position
o No discernible difficulties
o Sees re engineering as an opportunity
No re engineering
required
o These companies have the vision to begin
Re engineering ignores – what is and concentrates on
Key Work 4 : Processes
Most important / frequent difficulty
Process : A series of activities that delivers value to a customer
Technology import policy in india
Technology import policy in india
Industrial Policy – July 1991
Commitment to development & utilization of indigenous
capabilities
Foreign investment – welcome
o Obtain higher technology
o Increase exports
o Expand the production base
Relationship – dynamic
Foreign investment – industrial development
Indian companies – free to negotiate
Procedure for – Foreign investment – foreign technology
agreements – services of foreign technicians – made easier
Constituents of IPR
IPR – Intellectual property rights
IP includes rights relating to
Types of IP are
1) Patent
Legal protection for an invention
Criteria – must be new & involve invention step
Granted for specific term – generally 20 yrs
If not renewed periodically – becomes a public property
2) Industrial design registration
When industrial designs are registered – called is IP
Features…
Shape Ornamentation
Configuration Composition of lines of colors
Pattern Applied to any article
Granted for specific term – generally 10 yrs
3) Copyright
Artistic creations
Poems – novels – documentary works
Called as – Author’s right
Protection available at east 50 years
4) Trade Mark
Trade mark is a symbol – intended to indicate
Distinctive marks such as – Words – Signs – Combination of
both
Valid for not less than 7 years
Trading with IPR
NDA Non disclosure agreements
MOU Memorandum of unit
TIFAC Technology information forecasting and assessment council
BTG British technology Group
KIPO Korean patent attorneys office
GATT General agreement trade and tariffs
WTO World Trade Organization
TRIPS Trade related intellectual property rights
WIPO World intellectual property organizations
The Paris convention for the protection of industrial property 1883
General agreement trade and tariffs 5th April 1994
World Trade Organization 1st January 1995
Transfer of industrial technology to India some issues
Industries have been looking for in their efforts towards technological
developments are …
o Capital for investment
o Latest technology & continuous access to it
o Avenues for specialized training
o Enhanced export capabilities through new markets
o Prospects of joint – ventures in third countries
Terms & conditions of know – how transfer
The industrial development & regulation act 1950
The Indian companies act 1956
The Indian trade & merchandise act 1961
The Indian income tax act 1958
The monopolies and restrictive trade practices act 1969
The Indian patents and designs act 1970
The foreign exchange regulation act 1973
The industrial policy resolution 1948
The industrial policy resolution - modified 1956
The science policy resolution 1958
Guidelines for foreign investment & collaboration 1969
FERA guidelines 1974
FERA guidelines amplified 1976
Annual guidelines for industries 1973 -74
Industrial Policy – July 1991
Commitment to development & utilization of indigenous
capabilities
Foreign investment – welcome
o Obtain higher technology
o Increase exports
o Expand the production base
Relationship – dynamic
Foreign investment – industrial development
Indian companies – free to negotiate
Procedure for – Foreign investment – foreign technology
agreements – services of foreign technicians – made easier
Constituents of IPR
IPR – Intellectual property rights
IP includes rights relating to
Types of IP are
1) Patent
Legal protection for an invention
Criteria – must be new & involve invention step
Granted for specific term – generally 20 yrs
If not renewed periodically – becomes a public property
2) Industrial design registration
When industrial designs are registered – called is IP
Features…
Shape Ornamentation
Configuration Composition of lines of colors
Pattern Applied to any article
Granted for specific term – generally 10 yrs
3) Copyright
Artistic creations
Poems – novels – documentary works
Called as – Author’s right
Protection available at east 50 years
4) Trade Mark
Trade mark is a symbol – intended to indicate
Distinctive marks such as – Words – Signs – Combination of
both
Valid for not less than 7 years
Trading with IPR
NDA Non disclosure agreements
MOU Memorandum of unit
TIFAC Technology information forecasting and assessment council
BTG British technology Group
KIPO Korean patent attorneys office
GATT General agreement trade and tariffs
WTO World Trade Organization
TRIPS Trade related intellectual property rights
WIPO World intellectual property organizations
The Paris convention for the protection of industrial property 1883
General agreement trade and tariffs 5th April 1994
World Trade Organization 1st January 1995
Transfer of industrial technology to India some issues
Industries have been looking for in their efforts towards technological
developments are …
o Capital for investment
o Latest technology & continuous access to it
o Avenues for specialized training
o Enhanced export capabilities through new markets
o Prospects of joint – ventures in third countries
Terms & conditions of know – how transfer
The industrial development & regulation act 1950
The Indian companies act 1956
The Indian trade & merchandise act 1961
The Indian income tax act 1958
The monopolies and restrictive trade practices act 1969
The Indian patents and designs act 1970
The foreign exchange regulation act 1973
The industrial policy resolution 1948
The industrial policy resolution - modified 1956
The science policy resolution 1958
Guidelines for foreign investment & collaboration 1969
FERA guidelines 1974
FERA guidelines amplified 1976
Annual guidelines for industries 1973 -74
Complexity in Technology Acquisition
Complexity in Technology Acquisition
Steps in Technology Acquisition
9 steps involved in a technology acquisition process are…
1 Identification 6 Negotiation
2 Need & justification for technology acquisition 7 Acquisition
3 Mode of technology acquisition 8 Implementation
4 Sources of technology 9 commercialization
5 Technology evaluation
Key elements involved in the processes …
o Identification of the mode of technology acquisition
o Identification of the potential technology supplier
o Sort listing of the possible suppliers
o Asserting the standing of the suppliers
o Consideration of offers from the more suitable sources
o Negotiations
o Analytical hierarchy process
Strategy for Technology Acquisition
1 Identification 5 Check offers
2 Short listing 6 Arrange magnitude
3 Acquiring information 7 Obtain commitments
4 Obtain TT offers 8
Implications for policy making
Studies have shown tat, in a majority of cases the distribution of
costs across the chain varies….
Research, Advanced Development & Basic invention 5 – 10 %
Engineering & Designing the product 10 – 20 %
Tooling manufacturing engineering, getting ready for
manufacture
40 – 60 %
Manufacturing start up expenses 5 – 15 %
Marketing start up expenses 10 – 25 %
4 interfaces…
Technical interfaces
Economic interfaces
Institutional interfaces
Behavioral interfaces
3 resource threshold…
Men
Equipment
MaterialFees / royalties
In house R & D in industry and National R & D infrastructure
In house R & D units recognized by DSIR More than 1230
National laboratories Around 325
Co operative research associations 13
SIROs 450
State funded research institutions 200
Universities and IITS 200
Human resources employed in R & D establishments 3 lakhs
Chemical & allied sector 35 %
Electrical & electronics 25 %
General Commercialization factor – CF 1:25
CF for public sector companies 1:17
CF for private sector 1:33
CF for small scales 1:18
Scientific & industrial research organizations
Medical – Agricultural – Natural – Applied sciences
450
Universities Around 200
Co operative research associations
Automobiles – textiles – rubber - other
13
Technology Acquit ion agreement
Definition
o The technology, the process, technical services etc.
being transferred should be clearly defined & specified.
Technology package
o Services provided by supplier
o Process parameters
o Designs & drawings
o Quality assurance technique
o Specifications of raw materials
o Training
Payments
o Agreement about – manner – modes – currency –
schedules
Duration
o Duration of the validity of the agreement
Access to improvements in technology
Guarantees by the supplier
o Guaranttee the performance of the technology
o Suitable intermediate measures on failure
Rectification – Compensation
Rights & Obligations
o Rights & obligations of the buyers should be clearly
specified
Identification
o Third party’s rights protected by a patent
Exclusivity or non exclusivity
o Right for the se of technology
Exclusive – conditional – Exclusive for a region –
Non exclusinve
Arbitration
o Mechanism for dispute settlement
Government low
o Specification of Law that would be applicable in case of
disputes
Role of DSIR in TT
DSIR Department of scientific & industrial research
Wide range of activities for the promotion – development –
utilization – transfer of technology
NRIDC National research development corporation
CEL Central electronics limited
PETSER Program aimed at technological self reliance
SEETOT Scheme to enhance the effective transfer of technology
NISSAT National information system for science and technology
CLRI Centre for lather research information
CFTRI Centre for food technology research information
CMTI Centre for machine tools information
CDRI Centre for drug research information
ATIRA Swedish pharmaceutical company
DSIRs annual support to R & D…
In year 1992 - 93 Rs 2 Crores
In year 1994 – 95 Rs 6 Crores
In year 1995 – 96 Rs 14 Crores
Steps in Technology Acquisition
9 steps involved in a technology acquisition process are…
1 Identification 6 Negotiation
2 Need & justification for technology acquisition 7 Acquisition
3 Mode of technology acquisition 8 Implementation
4 Sources of technology 9 commercialization
5 Technology evaluation
Key elements involved in the processes …
o Identification of the mode of technology acquisition
o Identification of the potential technology supplier
o Sort listing of the possible suppliers
o Asserting the standing of the suppliers
o Consideration of offers from the more suitable sources
o Negotiations
o Analytical hierarchy process
Strategy for Technology Acquisition
1 Identification 5 Check offers
2 Short listing 6 Arrange magnitude
3 Acquiring information 7 Obtain commitments
4 Obtain TT offers 8
Implications for policy making
Studies have shown tat, in a majority of cases the distribution of
costs across the chain varies….
Research, Advanced Development & Basic invention 5 – 10 %
Engineering & Designing the product 10 – 20 %
Tooling manufacturing engineering, getting ready for
manufacture
40 – 60 %
Manufacturing start up expenses 5 – 15 %
Marketing start up expenses 10 – 25 %
4 interfaces…
Technical interfaces
Economic interfaces
Institutional interfaces
Behavioral interfaces
3 resource threshold…
Men
Equipment
MaterialFees / royalties
In house R & D in industry and National R & D infrastructure
In house R & D units recognized by DSIR More than 1230
National laboratories Around 325
Co operative research associations 13
SIROs 450
State funded research institutions 200
Universities and IITS 200
Human resources employed in R & D establishments 3 lakhs
Chemical & allied sector 35 %
Electrical & electronics 25 %
General Commercialization factor – CF 1:25
CF for public sector companies 1:17
CF for private sector 1:33
CF for small scales 1:18
Scientific & industrial research organizations
Medical – Agricultural – Natural – Applied sciences
450
Universities Around 200
Co operative research associations
Automobiles – textiles – rubber - other
13
Technology Acquit ion agreement
Definition
o The technology, the process, technical services etc.
being transferred should be clearly defined & specified.
Technology package
o Services provided by supplier
o Process parameters
o Designs & drawings
o Quality assurance technique
o Specifications of raw materials
o Training
Payments
o Agreement about – manner – modes – currency –
schedules
Duration
o Duration of the validity of the agreement
Access to improvements in technology
Guarantees by the supplier
o Guaranttee the performance of the technology
o Suitable intermediate measures on failure
Rectification – Compensation
Rights & Obligations
o Rights & obligations of the buyers should be clearly
specified
Identification
o Third party’s rights protected by a patent
Exclusivity or non exclusivity
o Right for the se of technology
Exclusive – conditional – Exclusive for a region –
Non exclusinve
Arbitration
o Mechanism for dispute settlement
Government low
o Specification of Law that would be applicable in case of
disputes
Role of DSIR in TT
DSIR Department of scientific & industrial research
Wide range of activities for the promotion – development –
utilization – transfer of technology
NRIDC National research development corporation
CEL Central electronics limited
PETSER Program aimed at technological self reliance
SEETOT Scheme to enhance the effective transfer of technology
NISSAT National information system for science and technology
CLRI Centre for lather research information
CFTRI Centre for food technology research information
CMTI Centre for machine tools information
CDRI Centre for drug research information
ATIRA Swedish pharmaceutical company
DSIRs annual support to R & D…
In year 1992 - 93 Rs 2 Crores
In year 1994 – 95 Rs 6 Crores
In year 1995 – 96 Rs 14 Crores
Technological Benchmarking
Technological Benchmarking
Technological benchmarking is the process by which an
enterprise performs a direct comparison of its technological
performance & other entities with similar operations.
The benchmarking process consists of ten steps
Barrier of Benchmarking
o Time
o The
Cooper & Kleinschmidt - 1995 – Study of 135 enterprises
Best practices are related to new product performance, used the
following factors…
Scales objective success Meeting sales
Profit objective success Meeting profits
Success rate % of new innovations / commercial success
Sale impact Impact of new product
Relative profitability New product program compares to similar program
Overall success Overall basis comparison to its competitors or
industry leaders
Measures are gauged via one to five Likert-type scales with
anchor phasesTechnological Audit
Internal audit function
The types of audits…
o Financial
o Operational
o Organizational
o Functional
o Management
Goodman & Lawless – two stage innovation audit
Technological audit
o Familiarization with the technological objectives
o Examination of technology delivery system
o Appraisal & evaluation of the adequacy
o Reporting
Mechanisms of TT
Chief Technology Officer
CTO - Chief technology officer
CTDM - Chief technology decision maker
a modified set of Colmen’s factions for a CTO consists of …
o Developing the technological strategic plan
o Developing & operating the technology environmental
monitoring systemof findings & constructive recommendations
Barriers of TT
Internal barriers
o Production manager don’t know the
o Ineffective communication system
o R & D don’t know the needs & capability of production
o Various levels of skills & expertise in R & D and
production
o Vasconcellous’ study – lack of effective communications
o Testing of new processes & products
CTO - Chief technology officer
CTDM - Chief technology decision maker
a modified set of Colmen’s factions for a CTO consists of …
o Developing the technological strategic plan
o Developing & operating the technology environmental
monitoring system
Technology Acquisition & Technology Development
The great ascent – India – China – Indonesia – Egypt
The Technology Market
Problems with technology market
o No standard price for knowledge package
o Information of all types
o Numerous restrictive conditions in the agreement
governing technology transactions
o Buyers
Technology
Constituent elements of TP
o DK – documents knowledge – Know How
o S – Skill
o H – Hardware / machinery
o 1 / i – Imported
o d – Desi / Local
Adoptive transfer – Absorption, adaptation & improvement
Domestic scientific & technological capacity
Technological benchmarking is the process by which an
enterprise performs a direct comparison of its technological
performance & other entities with similar operations.
The benchmarking process consists of ten steps
Barrier of Benchmarking
o Time
o The
Cooper & Kleinschmidt - 1995 – Study of 135 enterprises
Best practices are related to new product performance, used the
following factors…
Scales objective success Meeting sales
Profit objective success Meeting profits
Success rate % of new innovations / commercial success
Sale impact Impact of new product
Relative profitability New product program compares to similar program
Overall success Overall basis comparison to its competitors or
industry leaders
Measures are gauged via one to five Likert-type scales with
anchor phasesTechnological Audit
Internal audit function
The types of audits…
o Financial
o Operational
o Organizational
o Functional
o Management
Goodman & Lawless – two stage innovation audit
Technological audit
o Familiarization with the technological objectives
o Examination of technology delivery system
o Appraisal & evaluation of the adequacy
o Reporting
Mechanisms of TT
Chief Technology Officer
CTO - Chief technology officer
CTDM - Chief technology decision maker
a modified set of Colmen’s factions for a CTO consists of …
o Developing the technological strategic plan
o Developing & operating the technology environmental
monitoring systemof findings & constructive recommendations
Barriers of TT
Internal barriers
o Production manager don’t know the
o Ineffective communication system
o R & D don’t know the needs & capability of production
o Various levels of skills & expertise in R & D and
production
o Vasconcellous’ study – lack of effective communications
o Testing of new processes & products
CTO - Chief technology officer
CTDM - Chief technology decision maker
a modified set of Colmen’s factions for a CTO consists of …
o Developing the technological strategic plan
o Developing & operating the technology environmental
monitoring system
Technology Acquisition & Technology Development
The great ascent – India – China – Indonesia – Egypt
The Technology Market
Problems with technology market
o No standard price for knowledge package
o Information of all types
o Numerous restrictive conditions in the agreement
governing technology transactions
o Buyers
Technology
Constituent elements of TP
o DK – documents knowledge – Know How
o S – Skill
o H – Hardware / machinery
o 1 / i – Imported
o d – Desi / Local
Adoptive transfer – Absorption, adaptation & improvement
Domestic scientific & technological capacity
Technological Metrics
Technological Metrics
Measure of technological performance
View points of US congress….
1. Societal
2. Political or Governmental
3. Enterprise
4. System or Project
Example…
o Low price for a drug – Human Immune Deficiency Virus
(HIV)
1) Societal Metrics
Relationship between technological change to social change
A complex dynamical system
2) Political or Governmental Metrics
Spann et al – 1995 – developed for studying TT metrics
Technology Pull Strategies – demand driven
Need motivated
Technology Push Strategies – Counting metrics -
Such as the number of licenses issued and papers published
Technology Pull relies on…
o Level of effort expanded
o Level of resources committed to TT activities
The technology-push metrics used by the sponsor included…
o Requests for Help
o Licenses Granted
o Number of site visits
The technology-pull metrics used by the sponsors of R & D
included…
The number of jobs created Degree of user satisfaction
Royalties collected
Technical problems solved
number of new commercial customers obtained
Number of new products developed
The metrics used as measures of TT included …
o Technical briefs / Papers requested
o Technical presentations
o Success stories published
o Site visits
o Requests for help
The metrics for measuring commercial success included…
o Commercial customers
o Commercial sales
o Licenses granted
o New business started
The measures of adopter benefits were founded by Spann et
al to be related to the number of…
o Technical problem solved
o Cost savings
o Productivity gains
o User satisfaction
3) Enterprise Metrics
An enterprise is usually concerned with how a new technology
product, process or service can achieve market success.
4) System or Project Metrics
Related to technical performance measure & are quantities
design related factors
Blanchard & Fabrycky – a cost effective model approach
Measure of technological performance
View points of US congress….
1. Societal
2. Political or Governmental
3. Enterprise
4. System or Project
Example…
o Low price for a drug – Human Immune Deficiency Virus
(HIV)
1) Societal Metrics
Relationship between technological change to social change
A complex dynamical system
2) Political or Governmental Metrics
Spann et al – 1995 – developed for studying TT metrics
Technology Pull Strategies – demand driven
Need motivated
Technology Push Strategies – Counting metrics -
Such as the number of licenses issued and papers published
Technology Pull relies on…
o Level of effort expanded
o Level of resources committed to TT activities
The technology-push metrics used by the sponsor included…
o Requests for Help
o Licenses Granted
o Number of site visits
The technology-pull metrics used by the sponsors of R & D
included…
The number of jobs created Degree of user satisfaction
Royalties collected
Technical problems solved
number of new commercial customers obtained
Number of new products developed
The metrics used as measures of TT included …
o Technical briefs / Papers requested
o Technical presentations
o Success stories published
o Site visits
o Requests for help
The metrics for measuring commercial success included…
o Commercial customers
o Commercial sales
o Licenses granted
o New business started
The measures of adopter benefits were founded by Spann et
al to be related to the number of…
o Technical problem solved
o Cost savings
o Productivity gains
o User satisfaction
3) Enterprise Metrics
An enterprise is usually concerned with how a new technology
product, process or service can achieve market success.
4) System or Project Metrics
Related to technical performance measure & are quantities
design related factors
Blanchard & Fabrycky – a cost effective model approach
The TT & innovation system & pathways
The TT & innovation system & pathways
A framework for analysis
There are a large numbers of pathways through which the various
stakeholders can interact to transfer technologies. The most common
include…
Direct Purchasing Cooperative research arrangements & co-production
agreements
Licensing Export of products & capital goods
Franchising Exchange of scientific & technical personnel
Foreign Direct Investment Science & technology conferences, trade shows & exhibits
Sale of Turnkey Plants Education & training
Joint Venture Open literature – Journals, magazines, books & articles
Subcontracting Government assistance programs
Commercial visits
The present framework classifies pathways into three primary types…
1 Government driven TT initiated by government to full fill specific policy
objectives
2 Private sector driven TT between commercially oriented private sector entities
3 Community driven TT involving community organizations with a high degree
Five stages of assessment
1 Agreement 4 Adjustment
2 Implementation 5 Replication – repetition
3 Evaluation
International joint ventures have been growing in number since 1980.
Kogut – 1988- Joint ventures in terms of transaction costs, strategic
behavior & transfer of organizational knowledge & learning.
Technology Assessment
During early stage – this assessment is performed to determine which
technology offers the best opportunity to achieve the enterprise
objectives, which have been predetermined by the eldership team.
During last stage – the objective of the assessment is to determine if
the technology offers the best opportunity to achieve the enterprise
objectives, which have been predetermined by the leadership team.
Individual Technology Assessment
A technology has to pass through 3 gateways
o Market
o Systems – Management
o Technology
Scoping includes…
o The potential actuation process
o Associated technology issues
o System management issues
o Goals of the new technology
This requires…
o Documentation of technologies
o Economic needs
o Societal needs
o Technological feasibility
1) Market Gateway
The market gateway assessment uses – Market Uncertainty
Analysis Approach – Which Covers…
New users Competitive technologies
User skepticism
behavior adjustment
Unpredictable technological developments
New users & legal barriers
2) Management Gateway
The enterprises modes of development…
o Entrepreneur
o Small high technology enterprise
o Large enterprise with multiple markets and products
o Multiple enterprises such as consortia & conglomerates
which operate in multiple sectors.
Each mode incorporates…
Risk avoidance – exploitation flexibility – marketing skills
Legal skills – core competencies – enterprise information
communication structure & culture
3) Technology Gateway
Higher the degree of innovativeness – larger the uncertainty
US enterprises use a breakthrough approach with the
commensurate uncertainty.
Example….
o Star War projects of US department of Defense
Assessment of Innovation
Technological Breakthrough
o Technology of uncertainty
o Enterprise technological experience and knowledge
o Enterprise business experience & knowledge
o Fiscal resources associated with the particular technological
development
A framework for analysis
There are a large numbers of pathways through which the various
stakeholders can interact to transfer technologies. The most common
include…
Direct Purchasing Cooperative research arrangements & co-production
agreements
Licensing Export of products & capital goods
Franchising Exchange of scientific & technical personnel
Foreign Direct Investment Science & technology conferences, trade shows & exhibits
Sale of Turnkey Plants Education & training
Joint Venture Open literature – Journals, magazines, books & articles
Subcontracting Government assistance programs
Commercial visits
The present framework classifies pathways into three primary types…
1 Government driven TT initiated by government to full fill specific policy
objectives
2 Private sector driven TT between commercially oriented private sector entities
3 Community driven TT involving community organizations with a high degree
Five stages of assessment
1 Agreement 4 Adjustment
2 Implementation 5 Replication – repetition
3 Evaluation
International joint ventures have been growing in number since 1980.
Kogut – 1988- Joint ventures in terms of transaction costs, strategic
behavior & transfer of organizational knowledge & learning.
Technology Assessment
During early stage – this assessment is performed to determine which
technology offers the best opportunity to achieve the enterprise
objectives, which have been predetermined by the eldership team.
During last stage – the objective of the assessment is to determine if
the technology offers the best opportunity to achieve the enterprise
objectives, which have been predetermined by the leadership team.
Individual Technology Assessment
A technology has to pass through 3 gateways
o Market
o Systems – Management
o Technology
Scoping includes…
o The potential actuation process
o Associated technology issues
o System management issues
o Goals of the new technology
This requires…
o Documentation of technologies
o Economic needs
o Societal needs
o Technological feasibility
1) Market Gateway
The market gateway assessment uses – Market Uncertainty
Analysis Approach – Which Covers…
New users Competitive technologies
User skepticism
behavior adjustment
Unpredictable technological developments
New users & legal barriers
2) Management Gateway
The enterprises modes of development…
o Entrepreneur
o Small high technology enterprise
o Large enterprise with multiple markets and products
o Multiple enterprises such as consortia & conglomerates
which operate in multiple sectors.
Each mode incorporates…
Risk avoidance – exploitation flexibility – marketing skills
Legal skills – core competencies – enterprise information
communication structure & culture
3) Technology Gateway
Higher the degree of innovativeness – larger the uncertainty
US enterprises use a breakthrough approach with the
commensurate uncertainty.
Example….
o Star War projects of US department of Defense
Assessment of Innovation
Technological Breakthrough
o Technology of uncertainty
o Enterprise technological experience and knowledge
o Enterprise business experience & knowledge
o Fiscal resources associated with the particular technological
development
Inventions & Patents
Strategic alliances for TT can be ….Technical exchanges Marketing agreement
Cross licensing Joint product development programs
Co-production Joint ventures with equity ownership
Intellectual Property
Bought or sold
Leased or rented
Transferred between parties
Consists of …
Patents Designs
Trade Secrets Know how
Copy rights Trademarks
Leased or rented
Transferred between parties
Consists of …
Patents Designs
Trade Secrets Know how
Copy rights Trademarks
Inventions & Patents
Invention is the act or process of discovering something new,physical or conceptual.
A US patent is an agreement between the US government &
inventor.
Patents gives the patentee the right to exclude others from its
use, but does not give the patentee the right to use the patent if
such use infringes on patents of others.
Trade Secrets & Know How
Must be maintained by avoiding public disclosure.
A trade secret is any commercial formula, device, pattern,
process, or information hat affords an enterprise an advantage
over other who dos not know it. Know – how: Knowledge as a result of trial / errors if the
information moves into the public domain & loses protection
under trade secretes law.
Copy Right
Exclusive right granted by any giant to …
Authors – Composers – Artists or their assignees
Exists when a work is created
Trade Mark…
Word Latter
Symbol Numerical
Device Picture
Individual identifiable & distinguishable
Assume as authenticity
Can be registered
Licensing
Permit the third party to use property
Small – exclusive / non exclusive
Enterprise / Company
US government Technology Transfer
Conference & symposia Informal TT
Consulting firm Advice / information
Collegial interchange Information – free exchange
Exchange of trade secrete
Contract Acquisition instrument
Contractor Provides supply / service
Against fees
Patents Mutual benefit
Non government entities proved…
Educational grants / awards
WFO – Work for Other
Stakeholders, Decisions & Policies in TT
TT influenced by government aid / financing program /
Multilateral bank landing
Major source of technology
o Transnational Corporations
o Multinational Corporations
Motivations of the various stakeholders can differ markedly
They seek…
International sales
Market share
FDI – foreign direct investment
Primary concerned with…
Profit
Acceptable risks
Protecting of intellectual property
Motivator to the recipient country firms are…
Technical capabilities, quality, or cost reductions
The higher perceived status of international level
technologies
Access to managerial and marketing expertise and sources
of capital
Access to export markets
Access to new distribution network
Multilateral agencies
Word Bank Regional development banks
UNDP Regional organizations
TT is transferred as knowledge – money (Investment) & goods
(trade).
World bank
UNDP
Methods of Technology Transfer
Methods of Technology Transfer
Informal Transfer – With / Without the transferee’s knowledge
Formal Transfer- Legal arrangement between the participants
Informal Process
Transfer of technical information exchange through…
o Published matter – Printed / Electronic media
o Meetings – symposia – individual exchange
Technical information available through…
o Professional meetings – Journals – Articles – Electronic
Exchange – Informal Meetings
Acquisition of critical technical personnel is informal method of
TT.
Formal Process
Process/ Person – embodied transfer outright procurement
Sale / License / Acquisition of the enterprise
Formal agreement between…
o Government – Enterprises – Individuals –
Research entities = Laboratories / Academic
Institutes
o Meetings – symposia – individual exchange
Technical information available through…
o Professional meetings – Journals – Articles – Electronic
Exchange – Informal Meetings
Acquisition of critical technical personnel is informal method of
TT.
Internal Technology Transfer
Important factors in Internal TT
Timing
Development of Specifications
Operating parameters
Location
MB 009 – Management of Technology Transfer, Absorption & IPR
Relationship between technician – customer – supplier
Availability – technical / Marketing skills
Existing technology
Process required
Organization learning – Need to increase the technical capacity
Staff
Efficiency of communication method
External Technology Transfer
Important factors in Internal TT
Type Relationships
Complexity Core Competencies
Transfer mechanism Organizational Culture
Hakansson & Snehota – no enterprise is an island
Gemunden et al – Studies of 490 enterprises – relevance of technology
oriented relationships to an enterprise’s innovation capabilities.
Methods of External Technology Transfer
1) Co operative & collaborative ventures
2) Licensing
3) Contracting
4) Enterprise acquisition
1) Co operative & Collaborative ventures
Ventures are structures between two or more enterprises
General partnership
o Competitors – Suppliers - Customers
Consortia Constitute includes…
o Universities – Industry – federal laboratories
Strategic alliance
o 2 / more entities – formal agreement
Collaboration
o Research / exchange joint development marketing &
research
o Collaboration of members of US – Semi conductors
o Industry – SEMATECH
o Cooperation of R & D – the euro peon air bus project
o Bidault & Cumings – cross industry alliance proved more
innovative
Informal Transfer – With / Without the transferee’s knowledge
Formal Transfer- Legal arrangement between the participants
Informal Process
Transfer of technical information exchange through…
o Published matter – Printed / Electronic media
o Meetings – symposia – individual exchange
Technical information available through…
o Professional meetings – Journals – Articles – Electronic
Exchange – Informal Meetings
Acquisition of critical technical personnel is informal method of
TT.
Formal Process
Process/ Person – embodied transfer outright procurement
Sale / License / Acquisition of the enterprise
Formal agreement between…
o Government – Enterprises – Individuals –
Research entities = Laboratories / Academic
Institutes
o Meetings – symposia – individual exchange
Technical information available through…
o Professional meetings – Journals – Articles – Electronic
Exchange – Informal Meetings
Acquisition of critical technical personnel is informal method of
TT.
Internal Technology Transfer
Important factors in Internal TT
Timing
Development of Specifications
Operating parameters
Location
MB 009 – Management of Technology Transfer, Absorption & IPR
Relationship between technician – customer – supplier
Availability – technical / Marketing skills
Existing technology
Process required
Organization learning – Need to increase the technical capacity
Staff
Efficiency of communication method
External Technology Transfer
Important factors in Internal TT
Type Relationships
Complexity Core Competencies
Transfer mechanism Organizational Culture
Hakansson & Snehota – no enterprise is an island
Gemunden et al – Studies of 490 enterprises – relevance of technology
oriented relationships to an enterprise’s innovation capabilities.
Methods of External Technology Transfer
1) Co operative & collaborative ventures
2) Licensing
3) Contracting
4) Enterprise acquisition
1) Co operative & Collaborative ventures
Ventures are structures between two or more enterprises
General partnership
o Competitors – Suppliers - Customers
Consortia Constitute includes…
o Universities – Industry – federal laboratories
Strategic alliance
o 2 / more entities – formal agreement
Collaboration
o Research / exchange joint development marketing &
research
o Collaboration of members of US – Semi conductors
o Industry – SEMATECH
o Cooperation of R & D – the euro peon air bus project
o Bidault & Cumings – cross industry alliance proved more
innovative
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