Book of Change

Business process re-engineering (BPR) is a business management strategy, originally pioneered in the early 1990s, focusing on the analysis and design of workflows and business processes within an organization. BPR aimed to help organizations fundamentally rethink how they do their work in order to dramatically improve customer service, cut operational costs, and become world-class competitors. BPR seeks to help companies radically restructure their organizations by focusing on the ground-up design of their business processes. According to early BPR proponent Thomas Davenport (1990), a business process is a set of logically related tasks performed to achieve a defined business outcome. Re-engineering emphasized a holistic focus on business objectives and how processes related to them, encouraging full-scale recreation of processes rather than iterative optimization of sub-processes. Business process reengineering is also known as business process redesign, business transformation, or business process change management. (Wikipedia)

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What is Business Process Reengineering? (Smartsheet)

Business Process Reengineering (BPR) is the structured, process-driven approach to improving the performance of a company in areas such as cost, service, quality, and speed. This radical change methodology starts at the highest level of companies, and works down to the most minute details to overhaul the system in a short time. This complete redesign distinguishes BPR from other methodologies where incremental improvements are made through regular process improvements. Companies performing BPR must reassess their fundamentals and reform their processes to standardize and simplify them. Ambitious companies that start BPR do so with the intent of doing whatever it takes to improve performance in all aspects of the business. Some examples of company-specific goals through BPR include:

• Taking a decentralized process and making one person responsible for it

• Redeveloping the company’s goals so improvement plans are consistent

• Taking a department-specific process and assigning it to coordinate and integrate cross-functionally

• Going from a product perspective to a process perspective

       The term “reengineering” suggests that something has already been developed and is being re-developed. In most businesses, change to a pre-existing process happens relatively slowly and incrementally. Within the context of BPR however, the most modern tools are put to use in a way that uses them from the ground up. The fundamentals of already existing processes, ideas, and designs are rethought. 

      The term process focuses on how things are done, not on the specific people, their job descriptions, or the specific tasks that they perform. BPR is more interested in the series of steps that produce the product or service, from its conceptual stage through the final creation.  

      Business Process Reengineering (BPR) is also known as business process redesign, business transformation, or business process change management.   

 

Business Process Reengineering Overview

Michael Hammer, an original promoter of BPR in the 1990s preached, “reengineering work:  don’t automate, obliterate.”  At the time, investments in technology were expected to return dramatic results to improve process performance. However, because new technologies are often applied after a process had been in place for many years, they are incapable of doing more than moderately speeding it up.  Hammer recommended challenging the ingrained assumptions and rules, so that real improvements could be made.
Some of the recommendations that the field of BPR discovered early on include:

• Organize around the outcome, not the specific task. One person owns a whole process, performing or coordinating all of the steps.  

• Those closest to the process should perform the process. Instead of fielding out different types of easily managed work, ownership is given to the people who need the quick outcomes from simple tasks.

• Have the people who produce the information process it as well. This streamlines the outcome of the information gathered into useable data.

• Centralize resources. Databases and other technology systems can consolidate resources to cut down on redundancies and increase flexibility.

• Integrate corresponding activities, not just their results. This keeps the content cohesive, without the gaps and miscommunication that could cause delays.

• Have the decision points controlled and where the work is done. Built-in controls enable the employees who perform the work to self-manage, so that managers can become supportive rather than directive. 

• Information should be collected once and at the source. Data redundancies are erased when processes are connected in a central database.

 

BPR Framework

There is no one universal framework for BPR that guides companies step-by-step. This is due to the unique nature of every company, as each company has its own distinctive challenges. BPR should be adapted to not only the company, but to its customers and stakeholders. Consultants in Business Process Management have tried to make easy guidelines for BPR. They often use proprietary frameworks based upon the experience and philosophy, and then tailor the methodology to the specific company they are working with. For example, Bhudeb Chakravarti developed the INSPIRE framework, which stands for Initiate, Negotiate, Select, Plan, Investigate, Redesign, and Ensure. M’hammed Abdous and Wu He also developed a framework specifically for Higher Education with four steps: Initiation, analysis, reengineering, and implementation and evaluation. Guha, et. al. developed the Process Reengineering Life Cycle (PRLC) Methodology, which will be detailed more below.  
      All of the suggested frameworks take into account certain basic guiding principles for every BPR. These can make the process more advantageous, and increase the chances for successful outcomes. They often differ in how emphatic they are in designing new processes versus redesigning old processes and the sequence of steps. Michael Glykas and George Valiris most strongly recommend a multidisciplinary approach that encompasses both process improvement and innovation. However, regardless of how an organization undertakes BPR, they must ensure that they have a deep understanding of their business culture, a clear vision, and that they use the most suitable, relevant information technology (IT). Common guiding principles for BPR are as follows:

1. Set the Vision
BPR starts with the reasons why. Companies must be clear on why they want or need to reengineer their processes; why where they are now is not where they need to be. A business needs analysis could be a way to start the process and convince stakeholders with clearly defined and measurable objectives. The organization must understand that their current processes must change, and be given a vision for the future. Understanding the reasons are critical because they ensure employee buy-in to the BPR.  Without buy-in, the employees may feel that their work life is threatened. They may obstruct the change, especially the necessary radical alterations that come with BPR. Since absolute support is critical, a clear vision of the intended consequences can give the employees a goal to rally.

2. Assemble the Team
Next, a team (which can consist of internal employees, consultants, or mix of both) is gathered within the company to conduct the reengineering. Depending on the project scope, the factors to consider when choosing a team are as follows:

• Should there be an initial team to consider the reengineering?

• Should the team be responsible for the BPR in its entirety?

• What experience and background should team members have with respect to the company or the field?

• Should the team be a smaller “core” group, or a larger “contributor” group?

• How autonomous with decisions should the team be?

• Should there be team members that are external to the company?

Hammer and Champy discuss five specific roles that should comprise the BPR team. These include the Leader, the Process Owner, the Reengineering Team, the Steering Committee, and the Reengineering Czar. They cite that the core reengineering team is ideally five to ten people.

3. Determine the Processes
This portion of BPR requires a comprehensive study of the company itself, looking at its mission, goals, the needs of its customers, and how the company is meeting those needs. Through this lens, the processes are reviewed and analyzed for how they are currently performed. Weaknesses and non-value add tasks are rooted out. Companies must ask what each process is trying to accomplish. It is imperative at this step to choose which process(es) to initially evaluate, starting out with only a small amount of processes so as not to overwhelm the company. Hammer and Champy discourage using benchmarking - measuring your company’s performance against similar but best in class companies - because it can  restrict innovative thinking.  

4. Redesign
There are no specific rules that govern how a process is redesigned. This is the portion of BPR where the team gets to flex their creative muscle and design the main principles that reengineering will be applied though. These include figuring out what biases and assumptions that the team is under for the process at hand, and looking for opportunities to apply technology. Team members should remember that they are not just making the old processes better, but completely redesigning how they are performed.

5. Include the Whole Company
Companies should remember that BPR does not work well if it is done in a bubble. Not only should companies get employee feedback, but also they should review the other portions of the company that will necessarily evolve because of the change in processes. This may include organizational and management structures, in keeping with the vision. Further, continued communication with employees about the reengineering process itself, the results, and their part in it is essential. Reinforcing the reengineering method through performance incentives keeps them positive and engaged.