What is reengineering?
“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[4].” The key words in the preceding definition are the italicized ones.
BPR advocates that enterprises go back to the basics and reexamine their very roots. It doesn’t believe in small improvements. Rather it aims at total reinvention. As for results: BPR is clearly not for companies who want a 10% improvement. It is for the ones that need a ten-fold increase. According to Hammer and Champy [4], the last but the most important of the four key words is the word-‘process.’ BPR focuses on processes and not on tasks, jobs or people. It endeavors to redesign the strategic and value added processes that transcend organizational boundaries.
Business process reengineering (often referred to by the acronym BPR) is the main way in which organizations become more efficient and modernize. Business process reengineering transforms an organization in ways that directly affect performance.
The Impact Of BPR On Organizational Performance
The two cornerstones of any organization are the people and the processes. If individuals are motivated and working hard, yet the business processes are cumbersome and non-essential activities remain, organizational performance will be poor. Business Process Reengineering is the key to transforming how people work. What appear to be minor changes in processes can have dramatic effects on cash flow, service delivery and customer satisfaction. Even the act of documenting business processes alone will typically improve organizational efficiency by 10%.How To Implement A BPR Project
The best way to map and improve the organization's procedures is to take a top down approach, and not undertake a project in isolation. That means:- Starting with mission statements that define the purpose of the organization and describe what sets it apart from others in its sector or industry.
- Producing vision statements which define where the organization is going, to provide a clear picture of the desired future position.
- Build these into a clear business strategy thereby deriving the project objectives.
- Defining behaviours that will enable the organization to achieve its' aims.
- Producing key performance measures to track progress.
- Relating efficiency improvements to the culture of the organization
- Identifying initiatives that will improve performance.
Consolidated Methodology:
A consolidated methodology has been developed from the five methodologies previously presented and an
IDEF0 model was developed to provide a structured approach and to facilitate understanding. But for the sake of
brevity, we have shown only the major activities in the IDEF0 model in Figure 1. In the ensuing section, we deal
with the details of our methodology.
Activity #1: Prepare for Reengineering:
“If you fail to plan, you plan to fail”. Planning and Preparation are vital factors for any activity or event to
be successful, and reengineering is no exception. Before attempting reengineering, the question ‘Is BPR necessary?’
should be asked? There should be a significant need for the process to be reengineered. The justification of this need
marks the beginning of the Preparation activity[9].
This activity begins with the development of executive consensus on the importance of reengineering and
the link between breakthrough business goals and reengineering projects. A mandate for change is produced and a
cross-functional team is established with a game plan for the process of reengineering. While forming the crossfunctional team, steps should be taken to ensure that the organization continues to function in the absence of several
key players[5]. As typical BPR projects involve cross-functional cooperation and significant changes to the status
quo, the planning for organizational changes is difficult to conduct without strategic direction from the top. The
impact of the environmental changes that serve as the impetus for the reengineering effort must also be considered
in establishing guidelines for the reengineering project. Another important factor to be considered while establishing
the strategic goals for the reengineering effort, is to make it your first priority to understand the expectations of your
customers and where your existing process falls short of meeting those requirements. Having identified the customer
driven objectives, the mission or vision statement is formulated. The vision is what a company believes it wants to
achieve when it is done, and a well-defined vision will sustain a company’s resolve through the stress of the
reengineering process. It can act as the flag around which to rally the troops when the morale begins to sag and it
provides the yard stick for measuring the company’s progress[4, 9].
Activity #2: Map and Analyze As-Is Process:
Before the reengineering team can proceed to redesign the process, they should understand the existing
process. Although some BPR proponents (in particular Hammer and Champy) argue against analyzing the current
enterprise, saying that it inhibits the creative process, that might not always hold true[1]. It varies from case to case.
While some organizations which are in dire straits might go the Hammer and Champy way (attempt a new process
design while totally ignoring the existing processes) most organizations need to map the existing processes first,
analyze and improve on it to design new processes. The important aspect of BPR (what makes BPR, BPR) is that the
improvement should provide dramatic results. Many people do not understand the value of an As-Is analysis and
rather prefer to spend a larger chunk of their valuable time on designing the To-Be model directly. What follows is
an illustration that illustrates this fallacy.
A large manufacturer spent six million dollars over a period of one year in a bid to develop a parts-tracking
system and was all set to go online. Only then did he realize that he had totally overlooked a small piece of
information – ‘the mode of transmission of information between the scheduling staff and the shop floor was through
naught and the whole system that he had so painstakingly developed had to be scrapped. Alas! He had recognized
the need for an As-Is analysis, way too late[1].
The main objective of this phase is to identify disconnects (anything that prevents the process from
achieving desired results and in particular information transfer between organizations or people) and value adding
processes[9]. This is initiated by first creation and documentation of Activity and Process models making use of the
various modeling methods available. Then, the amount of time that each activity takes and the cost that each activity
requires in terms of resources is calculated through simulation and activity based costing(ABC). All the groundwork
required having been completed, the processes that need to be reengineered are identified.
Activity #3: Design To-Be process:
The objective of this phase is to produce one or more alternatives to the current situation, which satisfy the
strategic goals of the enterprise. The first step in this phase is benchmarking. “Benchmarking is the comparing of
both the performance of the organization’s processes and the way those processes are conducted with those relevant
peer organizations to obtain ideas for improvement[7].” The peer organizations need not be competitors or even
from the same industry. Innovative practices can be adopted from anywhere, no matter what their source.
Having identified the potential improvements to the existing processes, the development of the To-Be
models is done using the various modeling methods available, bearing in mind the principles of process design.
Then, similar to the As-Is model, we perform simulation and ABC to analyze factors like the time and cost involved.
It should be noted that this activity is an iterative process and cannot be done overnight. The several To-Be models
that are finally arrived at are validated. By performing Trade off Analysis the best possible To-Be scenarios are
selected for implementation.
The implementation stage is where reengineering efforts meet the most resistance and hence it is by far the most difficult one[2]. If we expect that the environment would be conducive to the reengineering effort we are sadly mistaken. The question that confronts us would be,’ If BPR promises such breath taking results then why wasn’t it adopted much earlier?’ We could expect to face all kinds of opposition - from blatantly hostile antagonists to passive adversaries: all of them determined to kill the effort. When so much time and effort is spent on analyzing the current processes, redesigning them and planning the migration, it would indeed be prudent to run a culture change program simultaneously with all the planning and preparation. This would enable the organization to undergo a much more facile transition. But whatever may be the juncture in time that the culture change program may be initiated, it
should be rooted in our minds that ‘winning the hearts and minds of everyone involved in the BPR effort is most vital for the success of the effort[10]. Once this has been done, the next step is to develop a transition plan from the As-Is to the redesigned process. This plan must align the organizational structure, information systems, and the business policies and procedures with the redesigned processes. “Rapid implementation of the information system that is required to support a reengineered business process is critical to the success of the BPR project. The IDEF models that were created in the As-Is can be mapped to those created during the To-Be and an initial list of change requirements generated. Additional requirements for the construction of the To-Be components can be added and the
result organized into a Work Breakdown Structure (WBS). Recent developments in BPR software technologies enable automatic migration of these WBS activity/relationships into a process modeling environment. The benefit here is that we can now define the causal and time sequential relationships between the activities planned[9].” Using prototyping and simulation techniques, the transition plan is validated and it’s pilot versions are designed and demonstrated. Training programs for the workers are initiated and the plan is executed in full scale.
Activity #5: Improve Process Continuously:
A process cannot be reengineered overnight. A very vital part in the success of every reengineering effort lies in improving the reengineered process continuously. The first step in this activity is monitoring. Two things have to be monitored – the progress of action and the results. The progress of action is measured by seeing how
much more informed the people feel, how much more commitment the management shows and how well the change
ensured through a performance tracking system and application of problem solving skills. Continuous improvement
(TQM) and BPR have always been considered mutually exclusive to each other. But on the contrary, if performed
simultaneously they would complement each other wonderfully well. In fact TQM can be used as a tool to handle
the various problems encountered during the BPR effort and to continuously improve the process. In corporations
that have not adopted the TQM culture as yet, application of TQM to the newly designed processes should be
undertaken as a part of the reengineering effort[8].
teams are accepted in the broader perspective of the organization. This can be achieved by conducting attitude
surveys and discrete ‘fireside chats’ with those initially not directly involved with the change. As for monitoring the
results, the monitoring should include such measures as employee attitudes, customer perceptions, supplier
responsiveness etc[12]. Communication is strengthened throughout the organization, ongoing measurement is
initiated, team reviewing of performance against clearly defined targets is done and a feedback loop is set up
