BUSINESS PROCESS REENGINEERING

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BUSINESS PROCESS RE-ENGINEERING

• (Talwar, 1996)

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Business Process Re-engineering

• Fashionable and potentially most detested
  management concept of the 90s
• Offers the promise of dramatic performance
  improvements
• Streamlining of end-to-end processes

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• What is re-engineering?
• What are the fundamental breakthroughs required
  to ensure success?
• What are the opportunities being interpreted?
• What are the key steps in the re-engineering
  process

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• What role should technology play in the change
  process?
• What are the factors critical to the success of
  the initiative?
• Is the organisation ready for re-engineering?

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What is re-engineering?

• Fundamental rethinking and redesign of business
  processes to achieve dramatic improvements in
  critical, contemporary measures of performance,
  such as cost, quality, service, and speed.
• (Hammer, Michael)

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• A process is
• a sequence of activities
• performed on one or more inputs
• to deliver an output to the customer of the
  process
• Functions are skill based groupings into which
  activities are organised

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Defining the Challenges

• Customer interested in end-to-end process
• Organisation often inwardly focused
• Vertical chains of command
• Lack of trust
• Limited training

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• Empowerment of staff
• training to perform variety of roles
• areas of responsibility to make decisions
• authority to fulfil those responsibilities
• supportive environment enabling them to learn
  from mistakes

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The Re-engineering Spectrum(Talwar, 1996)
Local Limited
Risk
Threat to Survival
Sustainable Step Change
Paradigm Shift
Mindset Change
Gains
Business Re-engineering
Incremental
None
Scope
Local
Business Wide
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• Process Re-engineering
• True re -engineering - radical streamlining or
  total redesign
• Business Re -engineering
• Step change improvements across all processes

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• Transformation
• Reinventing the business - why do we exist?
• Ongoing renewal
• Continual refocusing and reinvention

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Identifying the Fundamental Breakthroughs

• Six critical areas
• Process based
• Fundamental rethink
• Radical improvement
• Integrated change
• People centred
• Mindset change

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Process-based

• Replace traditional management philosophy
• Look at business from outside in
• Concentrate on end-to-end management of processes

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Fundamental Rethink

• A zero-based approach to the redesign of key
  processes
• Three key issues
• The extent current structure detracts from
  creation and delivery of value
• The retarding effect that structure can have
• The unresolved cross-functional conflicts and
  tensions

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Radical improvement

• Avoid scaling down ambitions
• Emphasis on achieving dramatic and sustainable
  leaps in performance
• Re-engineering not appropriate if alternative
  approach will achieve same gains

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Integrated Change

• Major change adds pressure
• Personal ambition and competing initiatives -
  divert attention and resources
• The approach should deliver a balanced and
  holistic solution
• People and training put in place

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People Centred

• Understanding of business goals
• Knowledge of processes
• Ability to make decisions and take risks on
  behalf of organisation
• Coaching of staff

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Mindset Change

• Discard prior conditioning
• Build and communicate a shared understanding of
  the organisations future
• Create an environment and infrastructure that
  promotes learning and imagination to guide
  decisions

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How are opportunities being interpreted?

• Cost cutting or growth initiative?
• Clarification of strategic direction
• vision
• mission
• goals
• commercial proposition
• stakeholders
• performance measures

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• Creation of the organisational blueprint
• how strategic direction will be achieved
• infrastructure to enable efficient working of
  processes
• Determine gap with current operations
• Engineer the changes
• the best way to close the gap

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• Rethink the organisation
• Revisit business strategy
• Redesign business processes
• Rethink management approaches

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Key Steps in the Re-engineering Process

• No one standard approach
• Three main phases
• initiation
• implementation
• exploitation

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Programme Initiation

• Raising awareness, understanding and interest
• Define strategic scope, scale and direction
• Plan the change programme

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Design and Implementation

• Analysis of current operations
• map, model and analyse current process(es)
• Business redesign
• generate range of options
• Integration and testing
• test options against key measures
• prototype, test and refine
• train users and integrate into business
  environment

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Exploitation of the Re-engineered Business

• Managing the re-engineered business
• provide ongoing support for operations and staff
• monitor performance and initiate ongoing
  refinements
• Review opportunities to exploit enhanced
  capabilities created
• Maintain balance between incremental and
  fundamental changes in process design

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The Role of IT

• IT plays a key role in BPR
• Supporting and enabling role
• Business and process modelling tools
• Document image processing and workflow
• Electronic Data Interchange

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• Common customer databases
• Distributed systems and client server
  architectures
• Knowledge based systems to facilitate end-user
  decision making
• e -commerce

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Critical Success Factors

• Leadership
• Direction
• Motivation
• Integration
• Customers
• Participation
• Ambition

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• Rethink
• Support
• Communication
• Measurement
• Technology
• Passion
• Humanity

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Questions(groups of six )

• Examine the case study (EuroProducts Inc) and
  identify the key features of BPR espoused in
  Talwars article
• What lessons can be learnt on BPR from the case
  study?