Business Process Reengineering method (BPR) is described by Hammer and Champy
as 'the fundamental reconsideration and the radical redesign of organizational
processes, in order to achieve drastic improvement of current performance
in cost, services and speed'.
Rather than organizing a firm into functional specialties (like production,
accounting, marketing, etc.) and to look at the tasks that each function performs,
Hammer and Champy recommend that we should look at complete processes. From
materials acquisition, towards production, towards marketing and distribution.
One should rebuild the firm into a series of processes.
Value creation for the customer is the leading factor for BPR and information
technology often plays an important enabling role. Compare:
Michael Hammer and James Champy
The main proponents of re-engineering were Michael Hammer and James Champy.
In a series of books including Reengineering the Corporation, Reengineering
Management, and The Agenda, they argue that far too much time is wasted, passing
on tasks from one department to another. They claim that it is far more efficient
to appoint a team who perform all the tasks in the process.
A five step approach to Business Process Reengineering
Davenport (1992) prescribes a five-step approach to the Business Process
Develop the business vision and process objectives: The BPR method
is driven by a business vision which implies specific business objectives
such as cost reduction, time reduction, output quality improvement.
Identify the business processes to be redesigned: most firms
use the 'high-impact' approach which focuses on the most important processes
or those that conflict most with the business vision. A lesser number of
firms use the 'exhaustive approach' that attempts to identify all the processes
within an organization and then prioritize them in order of redesign urgency.
Understand and measure the existing processes: to avoid the repeating
of old mistakes and to provide a baseline for future improvements.
Identify IT levers: awareness of IT capabilities can and should
Design and build a prototype of the new process: the actual design
should not be viewed as the end of the BPR process. Rather, it should be
viewed as a prototype, with successive iterations. The metaphor of prototype
aligns the Business Process Reengineering approach with quick delivery of
results, and the involvement and satisfaction of customers.
As an additional 6th step of the BPR method, sometimes you find: to adapt
the organizational structure, and the governance model, towards the newly
designed primary process.
Generic Circumstances that influence whether BPR is advisable
Although it is difficult to give generic advice about this, some factors
that can be considered are:
Excessive use of non-structured communication? (memos, emails, etc)
Is it possible to consider a more continuous approach of gradual, incremental
improvements? (see: Kaizen).
Critics of the BPR approach
Reengineering has earned a bad reputation because such projects have often
resulted in massive layoffs. In spite of the hype that surrounded the introduction
of Business Process Reengineering, partially due to the fact that the authors
of Reengineering the Corporation reportedly bought huge numbers of copies
to reach the top of the bestseller lists, the method has not entirely lived
up to its expectations. The main reasons seem to be that:
BPR assumes that the factor that limits organization's performance is
the ineffectiveness of its processes. This may or may not always be true.
Also BPR offers no means to validate this assumption.
BPR assumes the need to start the process of performance improvement
with a "clean slate", i.e. totally disregard the status quo.
BPR does not provide an effective way to focus the improvement efforts
on the organization's constraints. (As done by Goldratt in the
Theory of Constraints).
Sometimes, or maybe quite often, a gradual and incremental change (such
as Kaizen) may be a better approach.
When Kaizen is compared with the BPR method is it clear the Kaizen philosophy
is more people-oriented, more easy to implement, but requires long-term discipline
and provides only a small pace of change. The Business Process Reengineering
approach on the other hand is harder, technology-oriented, it enables radical
change but it requires considerable change management skills.
Book: Hammer and
Champy - Reengineering the Corporation
- Process Innovation
Special Interest Group
Business Process Reengineering Special Interest Group.
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