- Business Process Re-engineering (BPR) refers to the analysis and re-design of workflows and processes both within and between business firms.
- It is a total deconstruction and re-thinking of a business process in its entirety, unconstrained (= at liberty) by its existing structure and pattern.
CONCEPT: The concept of BPR is outlined below
- Operational excellence: The operational excellence of a company is very important for its competitiveness.
- Process orientation: Processes need to be managed effectively but not functions. The firm should look at “what work is being done” and also “how work is being done”.
- No old ideas: For considering new ways of re-designing processes, each and every concept, assumption, purpose and principle should be abandoned (discarded) temporarily. It is necessary to proceed afresh, without being influenced by old ideas.
- Dramatic improvement: Dramatic improvement in performance is a pre-requisite for overcoming competition. Continuous improvement is not sufficient when the company is far below industry standards. In such a case, the company needs to make quantum leaps (jump) in performance.
- Competitive advantage: To survive, grow and tackle competition, “how to compete” is more important than deciding where to compete. Successful implementation of BPR will enable a company to achieve competitive advantage in business.
IMPLEMENTING BPR IN ORGANISATION
Determining objectives and framework
Objectives are the desired end results of the redesign process which the management and organization attempts to achieve.
This will provide the required focus, direction, and motivation for the redesign process.
Identify customers and determine their needs
The designers have to understand their profile, their steps in acquiring, using and Act disposing a product.
The purpose is to redesign business process that clearly provides added value to the customer
Study the existing process
Purpose is to gain an understanding of the ‘what’, and ‘why’ of the targeted process.
However, some companies go through the reengineering process with clean perspective without laying emphasis on the past processes.
Formulate a redesign process plan
The information gained through the earlier steps is translated into an ideal redesign process.
Customer focused redesign concepts are identified and formulated.
In this crucial step alternative processes are considered and the optimum is selected.
Implement the redesign
Implementation of the redesigned process and application of other knowledge gained from the previous steps is key to achieve dramatic improvements.
ROLE OF IT IN BPR
- A re-engineered business process, characterized by IT-assisted speed, accuracy, adaptability and integration of data and service points is focused on meeting the customer needs and expectations quickly and adequately, thereby enhancing the level of customer satisfaction.
- The impact of IT-systems on BPR can be identified with respect to:
- Operational Speed, drastic reduction in time,
- Global Village, i.e. overcoming restrictions of geography and / or distance,
- Restructuring of relationships or organisational restructuring.
- Information systems that provide timely, reliable and accurate information, and
- Business Values – IT initiatives provide business values in the areas of
- Efficiency – by way of increased productivity,
- Effectiveness – by way of better management,
- Innovation – by way of improved products and services.
PROBLEMS IN BPR
- Outdated Processes: Most of the processes that firms follow might have been developed by their functional units over a period of time and are outdated.
- Sub-System view: Individual departments or divisions of a firm try to optimize their own performance, without considering the effect on other areas of operation.
- Time and Cost: Existing business processes may be lengthy, time-consuming, costly, inefficient, obsolete and irrational.
- Fragmentation: Fragmentation of work processes makes it difficult to improve the quality of work performance and also develops a narrow vision among the employees.
- Inefficiency: Emerging critical issues may remain unattended by traditional management systems, due to the narrow definition of tasks or roles of an individual department.