Business Process Re-engineering (BPR) – A Theoretical Perspective
Asif Arif (24.01.2016)
Business Process Reengineering (BPR) is Radical process of re-thinking and re-designing the process of business by focusing to improve the performance measures including quality, service, cost and speed. Business process re-engineering is used by companies to improve their processes, solve any program, launch a new product, and replace the old technology with new one, use of internet & Digital Technologies. Michael Hammer and James Champy describe it as “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 quickness in business operations.”
1. Concept of Business Process Re-engineering (BPR):
The concept of Business Process Reengineering has been presented by James Champy and Michael Hammer in early 1990 into its book, published with the name of “Re-engineering the corporation”. According to their approach of BPR, “Business Process reengineering (BPR) is defined as the analyzing and redesigning of processes within the organization”.
According to the definition of BPR, we can come to know that it is such a process, in which a business or corporation changes its business processes from its existing position to new position. Because some times, organizational procedures needs to redesign for the sake of improving the quality and lowering cost or advancement of information technology. After (1990s) the BPR was known as downsizing, but after that it has changed due to its unrealistic scope and lack of leadership, and now it’s being known as Enterprise Resource Planning (ERP). The other important thing is BRP is to answer three questions, Why Companies Conduct BPR, What process to Do Re-Engineer and how it will be conducted. And the other important thing is, BPR is entirely difference from Process Improvement (Namchul Shin, Donal F. Jemella 2002).
2. Need of Business Process Re-engineering:
Mostly it is considered that BPR is natural process, and all most every organization needs to re-think and redesign its process. The major effect of globalization has stimulated many organizations to redesign its process to improve the quality, speed and reduce operating cost of their operations (Randle 1995). Here are some major reasons for this change.
According to Michael Hammer & James Champy (1990s), mostly large corporations and old businesses have been established on assumption bases and there was not any logical model applied behind their And whole structure about People, Technology, and Vision & Goals has been designed by assuming ideal situations or at the time situations. So in the modern world, they cannot survive without having their goals and vision as per customer oriented and technology oriented.
As discussed above, The BPR is conducted for lowering cost of improving quality of services, meet the technological requirement, so organizations conduct BPR into re-thinking and re-designing the work according to update it.
BPR is conducted when company want to enter into new market, which requires latest technology or better quality, then company needs to re-engineer their process to make them up-to
The Industrialization and Globalization has been considered major key drivers for stimulating organizations to move towards And IT is considered the major enabler of BPR. According to Morton (1998) the shortest payoff in BPR can be obtained processes which come from help of IT & Advancement of Technology. And IT is seemed the important key driver for organizational change (Vishanth Weerakkody and Wendy Currie, 2003).
The Above major reasons are considered yet for reasons for conducting Business Process Re-engineering for updating processes for running its org. activities. And according to (Goll & Cordovano, 1993) has clearly stated that the BPR is such a management approach which can provide road map to achieve radical improvements in cost, speed, quality and services.
3. Key Principles of Business Process Re-engineering:
An effect business process re-engineering involves the criteria meeting and expected outcomes meeting. If the BPR is being conducted within an organization, so it’s important to follow these key principles, so that the expected results and effectiveness of BPR can be achieved.
- Organize around the results, not around
- Identify All Possible Processes & Set Priority
- Integration of Information Processing Work in Reality
- Treat the resources, dispersed, as those were
- Collect once information in particulate
- Put the decision, where work is already
- Linking the activities at
The above key principles for conducting the BPR analysis, which are important to increase the effectiveness of BPR, as they are practical into all situations and provides the required results to organization.
4. Implementation of Business Process Re-engineering:
Once the strategy of BPR has been established, which includes the identification of processes to be re-engineer. Then the next step is to implement the BPR Strategy. Here are some steps, which are important to take for conducting the business process re-engineering for the companies.
- Defining the Company’s Mission Statement & Vision
- Go with the Company’s Objectives and Values
- Highlight the BPR Strategy with Clear
- Translate the Strategy into Goals &
- Clearly State the Behaviors of Organization to achieve aims and
- Develop the Implementation Approach; Top to Down Approach is Suitable to Conduct
- Develop Performance Measures to Monitor
- Develop Contingency
- Develop Measures to Improve Organizational Culture
- Deploy the Strategies into Action Across the
The Above Steps includes the Successful Implementation of BPR Strategy for the Organization. The major thing to keep in mind is to make the communication effective at all level of organization during whole process.
5. Performance Measurement in Business Process Re-engineering:
The performance of Business Process Re-engineering is considered on the basis of performance measures, which are used to assess the performance, either the desired objectives has been achieved or not. As the James Champy and Michael Hammer has defined that the process of Radical change and re-designing the process are used to improve the performance measures which includes the process cost, quality, speed and services. So, for checking the performance of its organization, the performance measures are evaluated to check the overall performance of an organization. Here is the discussion about the performance measures,
Cost—Identifies the all direct and indirect expenses which are occurred to execute and perform any The favorable condition is when, cost is low than previous.
Quality—Ensures the level of performance of a product, which meets or exceeds the expectation is called quality of product, and improvement is quality refers to increase the quality than previous
Speed—Refers to level of quickness and responsiveness in performing any task customer related or company
Services—Refers to intangible efforts, performed by company’s employees towards performing company’s operations or serving the customers.
The above factors are known as the performance measure, which helps in identifying the level of performance achieved. These performance factors also affect the effectiveness of business process re-engineering. The performance measure includes the cost, quality, speed and services, which also have significant effects on effectiveness of Business Process Re-engineering. So companies must identify what are the factors and how those factors affect the BPR process.
Cost—The effect of Cost in result of rethinking and radical change is significant, as in favorable way, It must go The re-designing of business processes must be in shape of decrease in cost. If the cost of process was high and after conducting BPR, it rises more than previous, then the effectiveness of BPR will be considered negative. For example, if a company was using the privately hired vehicles for transporting is products from one place to another and now company wants to use the Railway Train from moving its products, which also less expensive from previous. So this can increase the overall performance of organization, but if cost rises, then it can negatively affect the performance of organization.
Speed—The secondly important factors is Speed, quickness or responsiveness of organization towards serving or delivering its services to their The elements of speed are very crucial for some organization, which are time bound, like pizza hut or rescue services. If the company using slow transportation services, then there must be conducted the BPR, so that to replace the slow modes of transportation with new and fast mode of transportation, so that consumers can find the element of quickness or responsiveness. But if the result of BPR is not improved, then it can negatively affect the organization.
Quality—If company has conducted the Business Process Re-engineering and the results of BPR has improved the quality of products and services, then it would be positive But if quality of products and services has declined more, then it can annoy the customer, which also damage the repute of organization and financials of organization. The main example is implementation strategies of Total Quality Management (TQM), which has re-designed the business process in qualitative manner, so that now the quality matters are also getting reduced.
Services—If the range services has been improved in result of BRP, then it will be positive effective of BPR for any organization. But if the services and service level did not increased, then that BPR was ineffective or not properly implemented, so that to increase the services and service level, as effect BPR must be conducted.
Business Process Re-engineering is compulsory for organization, which operates into diverse economies. As the Information technologies are major enabler for the need of conducting business process reengineering into the organizations. Further, the advancement of internet technologies, change in demographics, and change of market needs and level of competition stimulates organizations for consider the need of radical re-think and redesign its current process towards updated processes. The other important thing is to focus on the performance measures, which include the cost, speed, quality and services, which shows the organizational performance in terms of its quality services, and responsiveness towards providing services to customers. But these performance measures also affect the performance of BPR according to its effectiveness and efficiency. In short, BPR is good for organization to remain dynamic, and improve its processes continuously and by following key performance principles.
Note: This literature can be used only for academic help, guidance or other academic purposes. The copy and publishing of data is not permitted. The website, on the behalf of authors, reserves the all rights. For more information about results and references, contact via Email: firstname.lastname@example.org.
Download The Full File or Request via Email: