Question 8-17 Hammaker Manufacturing Ii (Business Process Reengineering or Outsource)

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1. Identify tools that would help Denise and Rowland map HMC's business processes. Which processes do you think they should work on first? Why those processes?

Hammaker Manufacturing (HMC) has had its AIS in place for the past 15 years, and is interested in reevaluating its business processes to identify any potential areas for improvement. The current system has worked well for the company so far, however with the increasing pace of modern technological advances, HMC is weighing its options between business process reengineering and the potential to outsource. Denise Charbonet, the CEO, is currently working with Lloyd Rowland, a software consultant, to evaluate the feasibility of outsourcing jobs.

Some tools that they could use to map HMC's business processes could be efficiency ratings, process flow charts, and queries within the AIS. One of the best ways to achieve success in any business is to maximize the efficiency of every business process.

HMC should work on the production process first because this is the core component in making specialty Corvette car parts. Charbonet and Rowland should investigate where costs can be reduced and saved. Some questions to consider might be-is it worth it to manufacture all of the products we offer? Do we need all of our employees? Are we working to our full potential?

Another process that should be considered is the sales order process. Due to the nature of its business, HMC often needs to fill customer orders quickly, therefore the warehouse needs to keep inventory on hand in case it is needed. If there are inefficiencies in this process it could greatly increase storage costs which can add up quickly. Also, the tasks of the HR department should be investigated to see if another company could complete them at a lower cost.

The production process is most important to look at first because HMC is considering outsourcing production of some of its parts and this is a big decision to make. If the company can...
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