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Please use this identifier to cite or link to this item: http://hdl.handle.net/123456789/219

Title: The reengineering program among private central commercial banks
Authors: Delizo, Leonardo I.
Keywords: Re-engineering program
Private central commercial banks
Fundamental
Radical
Modification
Simplification
Process
Redesign
Automation
Issue Date: Dec-1997
Abstract: THESIS ABSTRACT 1. Title: THE RE-ENGINEERING PROGRAM AMONG PRIVATE CENTRAL COMMERCIAL BANKS Total number of pages: 205 Text number of pages: 156 2. Author: LEONARDO I. DELIZO 3. Type of Document: Thesis 4. Type of Publication: Unpublished 5. Host/ Accrediting Institution: Saint Louis University (Private) Bonifacio Street, Baguio City CHED, Baguio 6. Sponsor: None 7. Keywords: RE-ENGINEERING PROGRAM, PRIVATE CENTRAL COMMERCIAL BANKS, FUNDAMENTAL, RADICAL, MODIFICATION, SIMPLIFICATION, PROCESS REDESIGN, AUTOMATION 8. Abstract: 8.1. Summary: The research was a study on the Reengineering Program Among Private Central Commercial Banks in the City of Makati, Metro Manila. The respondents were re-engineering specialists from the departments of cash, credit, loans, trust, accounting and auditing department of the seven private central commercial banks. The primary tool used in data gathering was the questionnaire supplemented by follow-up interviews. Statistical inferences were derived by using F-test for independent samples; for test of difference which were Kruskal Wallis H-test Analysis of Variance by Ranks, and One-way Classification Analysis of Variance. Kruskal Wallis H-test was used to test the significant difference as to the type of re-engineering program implemented in the different departments of private central commercial banks. On the other hand, one-way Classification Analysis of Variance was used to test the significant difference as to the effectiveness of the re-engineering program and the constraints faced by the management in implementing the program in their department such as cash, credit, loans, and trust; accounting and auditing department. The Kuder Richardson Formula was used to test the reliability of the questionnaire which was computed to r = 0.785363 moderate reliability. The 0.05 level of significance was used as a reference in rejecting or accepting the hypothesis. Determination of weighed means and ranking are already used. 8.2. Findings: The study revealed that the private central commercial banks adapted similar types of re-engineering program in their different departments. These were automation and process design. The automations commonly implemented by the said departments were response system automation, accounting automation, and word processing automation. On the other hand, the redesigned process commonly implemented were combining several jobs, making a simple point or centralizing contract, performing work were it make sense, and empowering employees. Moreover, private commercial bank departments did not differ in terms of automation devices installed. The devices commonly found in the department were copiers, personal computers, fax machines, telecommunications and e-mail. As to the technologies used in re-engineering program, the electronic data interchange (EDI); business and process modeling tools; and distributed system and client server architecture were commonly implemented in the different departments. Private central commercial banks significantly differ as to the effectiveness of re-engineering program implemented and constraints faced by management in implementing the program in terms of people’s resistance and cost of modernization of facilities relative to the benefits derived. 8.3. Conclusions: The initiative to Business Process Re-engineering of private central commercial banks is seen as externally driven - customers, competitors, cost, technology shift, shareholders - the greatest challenge to its implementation is identified as organizational. Majority of them re-engineered accounting, loans, and credit department first because these departments have ability to produce increase revenues, minimize cost and maximize profit in the financial statements. Developing an active customer information system to better segment customer market, identifying and pro-actively serve their needs was the top reason for the re-engineering of theses private central commercial banks. Majority implemented level 2 of re-engineering which concerns the redesigning of business process in an entire department. Thus, redesigning process and automations, as value added constituents, are seen as creating more value for less cost. Thus, automation and redesign processes were both implemented in the departments of the commercial banks. Different private central commercial bank departments experience different output of the re-engineered business as to the degree of effectiveness. It is critical to look at a bank as a whole top re-engineers it effectively, and to capitalize on the cross-bank synergies from redesign of individual process. Banks significantly experience degrees of problem, which regards to the constraints, faced in implementing re-engineering program in their different departments. Problems occur in different degrees if top management have no effective way of communicating to the employees especially the rank and files on how to tackle the need for change. It clearly indicates to employees that the restructuring is a onetime process, mot the first of successive “dips” into cost reduction following management’s “knee-jerk” reaction to short-terms earnings fluctuations. The factors such as the financial support from the head office, top management’s moral support, flexibility of personnel, and the knowledge in re-engineering, all have equal weight of importance in conducting re-engineering program whatever departments to be re-engineered. In summary, re-engineering program often involves abandoning traditional hierarchical best practice and replacing them with more self-managed people who not only perform their own functions well but also connect effectively with other functions. 8.4. Recommendations: It has been recommended that the private central commercial bank desperately need to adapt types of re-engineering program at the same time such as redesigning processes and automating manual processes. It is recommended that using information technologies are necessary to support reengineering program. The following technologies recommended to be adapted are namely: knowledge-based system; document image processing, workflow, and groupware; electronic data interchange; distributes system and client-server architecture. These central commercial banks and other business establishments should used knowledge-based system as the major tool program. In addition they must continue to face strong pressure update their cash management service technology in the years ahead by updating their cash - management service delivery methods to minimize cost and to provide services at a price that beats the growing competition in this field. Banks and other business establishments should continue to scrutinize the process carefully to be redesigned and study what departments could gain the benefits throughout the system without producing a manual function or any human intervention. In redesigning processes it may combine several jobs, empower employees, make steps in natural order, make processes in multiple forms, perform work where it make sense, reduce checks and controls, make a simple point or centralize contact, simplify products, centralize customer service. Other business firms are advised likewise. The different technologies designed adapted and implemented can be combined and configured to form systems products that are useful to customers, employees and consumers. It is also advised that there are things to consider in automating systems. These are compatibility - i.e. compatibility with the variety of systems operating the business, compatibility with the systems of other companies and compatibility over time; cost - i.e. initial cost, cost of installation, cost of maintenance; flexibility and capacity of the machines and equipment; and trade-in allowances. To make the re-engineering program truly effective, it is advised that the top management must strictly follow the four levels of re-engineering program. To minimize constraints encountered, the following are advised: develop a good strategic stakeholders management communication system starting from the top management, stockholders/shareholders, employee and to customers to facilitate easy implementation and allowing employees from all levels to participate in this program to commit each employee to change, thereby significantly increasing the success rate of the effort.
Description: Thesis (M.S.B.A.)--Saint Louis University, Baguio City, 1997.
URI: http://hdl.handle.net/123456789/219
Appears in Collections:School of Accountancy and Business Management

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