Introduction to Business Process Re-engineering

Business Process Re-engineering (BPR) is a management strategy aimed at improving organizational performance by re-designing and optimizing business processes. BPR is a systematic and radical approach to change, focused on transforming and streamlining core business processes to achieve dramatic improvements in quality, efficiency, and customer satisfaction.

BPR involves a comprehensive analysis of existing business processes, identifying inefficiencies, bottlenecks, and waste, and then developing new and improved processes that align with the organization’s strategic objectives. The objective is to eliminate unnecessary steps, reduce cycle time, and improve overall efficiency, while maximizing the value delivered to customers.

BPR requires a fundamental shift in the way an organization thinks about its business processes, emphasizing a customer-centric approach to process design and management. It involves a collaborative and cross-functional approach, involving stakeholders from across the organization to ensure that process improvements are aligned with the organization’s strategic objectives.

The benefits of BPR can include reduced costs, increased productivity, improved quality, faster time-to-market, and greater customer satisfaction. However, implementing BPR can also be a complex and challenging process, requiring significant investment in resources, time, and expertise.

Overall, BPR is a powerful tool for organizations seeking to transform their business processes to meet changing market demands and improve performance. It involves a commitment to continuous improvement and a willingness to challenge existing assumptions and ways of doing things, with the goal of achieving significant and sustainable improvements in business performance.

According to Dr. Michael Hammer,

“Business Process Re-engineering is the fundamental rethinking and radical design of business processes to achieve dramatic improvements in critical, contemporary measures of performance such as cost, quality, service and speed.”

Business process re-engineering is not just a change, but actually it is a dramatic change and dramatic improvements. This is only achieved through overhaul the organization structures, job descriptions, performance management, training and the most importantly, the use of IT i.e. Information Technology.

Figure : Business Process Re-engineering

BPR projects have failed sometimes to meet high expectations. Many unsuccessful BPR attempts are due to the confusion surrounding BPR and how it should be performed. It becomes the process of trial and error. Phases of BPR : According to Peter F. Drucker, ” Re-engineering is new, and it has to be done.” There are 7 different phases for BPR. All the projects for BPR begin with the most critical requirement i.e. communication throughout the organization.

1. Begin organizational change.
2. Build the re-engineering organization.
3. Identify BPR opportunities.
4. Understand the existing process.
5. Reengineer the process
6. Blueprint the new business system.
7. Perform the transformation.

Objectives of BPR : Following are the objectives of the BPR :

1. To dramatically reduce cost.
2. To reduce time requirements.
3. To improve customer services dramatically.
4. To reinvent the basic rules of the business e.g. The airline industry.
5. Customer satisfaction.
6. Organizational learning.

Challenges faced by BPR process : All the BPR processes are not as successful as described. The companies that have start the use of BPR projects face many of the following challenges :

1. Resistance
2. Tradition
3. Time requirements
4. Cost
5. Job losses

Advantages of BPR : Following are the advantages of BPR :

1. BPR offers tight integration among different modules.
2. It offers same views for the business i.e. same database, consistent reporting and analysis.
3. It offers process orientation facility i.e. streamline processes.
4. It offers rich functionality like templates and reference models.
5. It is flexible.
6. It is scalable.
7. It is expandable.

Disadvantages of BPR : Following are the Disadvantages of BPR :

1. It depends on various factors like size and availability of resources. So, it will not fit for every business.
2. It is not capable of providing an immediate resolution.
3. While Business Process Re-engineering (BPR) can have many potential benefits, there are also several disadvantages that organizations should consider before embarking on a BPR initiative. Some of the key disadvantages of BPR include:
4. High costs: Implementing BPR can be a costly and time-consuming process, requiring significant investment in resources, including technology, training, and consulting fees. This can be a significant barrier for small or cash-strapped organizations.
5. Resistance to change: Implementing BPR can be a difficult and complex process that requires significant changes to an organization’s culture, processes, and people. Employees may resist the changes, especially if they feel their job security is at risk, leading to decreased morale and increased turnover.
6. Risk of failure: BPR is a high-risk strategy that can fail if not implemented properly. The failure to gain employee support, lack of a clear strategy, or poor planning can all lead to a BPR initiative’s failure.
7. Disruption to operations: Implementing BPR can disrupt the day-to-day operations of the organization, leading to decreased productivity, customer dissatisfaction, and revenue loss.

Focus on short-term goals: BPR initiatives may focus on short-term goals, such as reducing costs, without considering the long-term impact on the organization’s overall strategy and goals.

In summary, BPR can be a powerful tool for organizations seeking to transform their business processes and improve performance. However, the costs, resistance to change, risk of failure, disruption to operations, and focus on short-term goals are all potential disadvantages that organizations should carefully consider before embarking on a BPR initiative.