Business Process Re Engineering
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Explain the role of Business Process Reengineering (BPR) within the organization
Understand the origins and key characteristics of BPR
Identify and be able to use core BPR Symbols
Understand and be able to implement a BPR Strategy
Understand the main challenges in implementing a BPR Strategy
Reengineering is the 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 & Champy, 1993)
Automation Downsizing Outsourcing
Process Simplification
Process Reengineering
Incremental Change Process-Led Assume Attitudes & Behaviors Management-Led Various Simultaneous Projects
Radical Transformation Vision-Led Change Attitudes & Behaviors Director-Led Limited Number of Initiatives
(Source Coulson-Thomas, 1992)
Continuous Improvement Process Reengineering
Incremental Change People Focus Low Investment Improve Existing Work Unit Driven
Radical Transformation People & Technology Focus High Investment Rebuild Champion Driven
A specific ordering of work activities across time and space, with a beginning, an end, and clearly identified inputs and outputs: a structure for action. (Davenport, 1993)
A group of logically related tasks that use the firm's resources to provide customeroriented results in support of the organization's objectives
Customers ◦ Demanding ◦ Sophistication ◦ Changing Needs
Competition ◦ Local ◦ Global
Change ◦ Technology ◦ Customer Preferences
Complacency
Political Resistance
New Developments
Fear of Unknown and Failure
BPR seeks improvements of ◦ ◦ ◦ ◦
Cost Quality Service Speed
Scientific Management. FW Taylor (18561915). Frederick Herzberg - Job Enrichment Deming et al - Total Quality Management and Kaizen In Search of Excellence (Peters and Waterman) Value-Added Analysis (Porter).
Systems Philosophy Global Perspective on Business Processes Radical Improvement Integrated Change People Centred Focus on End-Customers Process-Based
Added Value ◦ BPR Initiatives must add-value over and above the existing process
Customer-Led ◦ BPR Initiatives must meet the needs of the customer
Sustainable ◦ Process improvements need to become firmly rooted within the organization
Stepped Approach ◦ Process improvements will not happen over night they need to be gradually introduced ◦ Also assists the acceptance by staff of the change
Viable Solutions ◦ Process improvements must be viable and practical
Balanced Improvements ◦ Process improvements must be realistic
Business Understanding Empowerment & Participation Organizational Culture
Process improvements must relate to the needs of the organization and be relevant to the end-customers to which they are designed to serve
For different versions of a business process or data flow some mandatory information must be on the flowchart. ◦ ◦ ◦ ◦ ◦ ◦
Name of the business process Unique number of the business process Revision number Date of last change Author Page number with total pages
General Principles Simplicity Empowerment Process Design Think horizontally
Organizational Structure Remove barriers Support business processes Customer Interfaces Work from the customer perspective Automation Automate to advantage
Avoid Over-engineering Work hard to simplify Eliminate multiple points of contact with & for the customer Eliminate errors resulting from multiple contacts Eliminate need to reconcile differing information Reduce delays resulting from reconciliation REMEMBER: Simple Processes Less Costly More Flexible
Vertical Compression Process decision-making is not strictly a management task Workers are empowered Decision-making becomes part of work Advantages Fewer Communication Delays Lower Management Overhead Better Customer Response
Accessibility ◦ Be available when the customer wants to interact
Information ◦ Require only the data which cannot be captured elsewhere
Wants and Needs ◦ What are the customers goals, objectives - wants and needs? ◦ Are we meeting these? ◦ Are there unknown wants?
Single solution process ◦ One-size-fits-all ◦ Too complex for standard/simple cases
Processes require flexibility for: ◦ Different markets ◦ Different situations ◦ Resource variations ◦ Special customer requests
Reengineered process contains: ◦ Simple, standard path (80% - 90%) ◦ Exception handling path (8% - 18%) ◦ Large complex path (2%)
Feedback
Inputs
Transformation
Environment
Outputs
Select The Process & Appoint Process Team Understand The Current Process Develop & Communicate Vision Of Improved Process Identify Action Plan Execute Plan
Two Crucial Tasks ◦ Select The Process to be Reengineered ◦ Appoint the Process Team to Lead the Reengineering Initiative
Review Business Strategy and Customer Requirements
Select Core Processes
Understand Customer Needs
Don’t Assume Anything
Select Correct Path for Change
Remember Assumptions can Hide Failures
Competition and Choice to Go Elsewhere
Ask - Questionnaires, Meetings, Focus Groups
Appoint BPR Champion
Identify Process Owners
Establish Executive Improvement Team
Provide Training to Executive Team
Capacity to view the organization as a whole
Ability to focus on end-customers
Ability to challenge fundamental assumptions
Courage to deliver and venture into unknown areas
Ability to assume individual and collective responsibility
Employ ‘Bridge Builders’
Used to generate internal capacity Appropriate when a implementation is needed quickly Ensure that adequate consultation is sought from staff so that the initiative is organization-led and not consultant-driven Control should never be handed over to the consultant
Develop
a Process Overview Clearly define the process ◦ Mission ◦ Scope ◦ Boundaries
Set
business and customer measurements Understand customers expectations from the process (staff including process team)
Clearly
Identify Improvement Opportunities ◦ Quality ◦ Rework
Document
◦ Cost ◦ Time ◦ Value Data
the Process
Carefully
resolve any inconsistencies ◦ Existing -- New Process ◦ Ideal -- Realistic Process
Communicate with all employees so that they are aware of the vision of the future
Always provide information on the progress of the BPR initiative - good and bad.
Demonstrate assurance that the BPR initiative is both necessary and properly managed
Promote individual development by indicating options that are available
Indicate actions required and those responsible
Tackle any actions that need resolution
Direct communication to reinforce new patterns of desired behavior
Develop an Improvement Plan
Appoint Process Owners
Simplify the Process to Reduce Process Time
Remove any Bureaucracy that may hinder implementation
Remove no-value-added activities
Standardize Process and Automate Where Possible
Up-grade Equipment
Plan/schedule the changes
Construct in-house metrics and targets
Introduce and firmly establish a feedback system
Audit, Audit, Audit
Qualify/certify the process Perform periodic qualification reviews Define and eliminate process problems Evaluate the change impact on the business and on customers Benchmark the process Provide advanced team training
Assists the Implementation of Business Processes ◦ Enables Product & Service Innovations ◦ Improve Operational Efficiency ◦ Coordinate Vendors & Customers in the Process Chain
Focus ◦ Business Processes ◦ Process Redesign ◦ Process Implementation
Process Simplification is Common - True BPR is Not Desire to Change Not Strong Enough Start Point the Existing Process Not a Blank Slate Commitment to Existing Processes Too Strong
◦ REMEMBER - “If it ain’t broke …”
Quick Fix Approach
Process under review too big or too small Reliance on existing process too strong The Costs of the Change Seem Too Large BPR Isolated Activity not Aligned to the Business Objectives Allocation of Resources Poor Timing and Planning Keeping the Team and Organization on Target
Reengineering is a fundamental rethinking and redesign of business processes to achieve dramatic improvements
BPR has emerged from key management traditions such as scientific management and systems thinking
Rules and symbols play an integral part of all BPR initiatives
Don’t assume anything - remember BPR is fundamental rethinking of business processes
Explain the role of Business Process Reengineering (BPR) within the organization
Understand the origins and key characteristics of BPR
Identify and be able to use core BPR Symbols
Understand and be able to implement a BPR Strategy
Understand the main challenges in implementing a BPR Strategy
Reengineering is the 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 & Champy, 1993)
Automation Downsizing Outsourcing
Process Simplification
Process Reengineering
Incremental Change Process-Led Assume Attitudes & Behaviors Management-Led Various Simultaneous Projects
Radical Transformation Vision-Led Change Attitudes & Behaviors Director-Led Limited Number of Initiatives
(Source Coulson-Thomas, 1992)
Continuous Improvement Process Reengineering
Incremental Change People Focus Low Investment Improve Existing Work Unit Driven
Radical Transformation People & Technology Focus High Investment Rebuild Champion Driven
A specific ordering of work activities across time and space, with a beginning, an end, and clearly identified inputs and outputs: a structure for action. (Davenport, 1993)
A group of logically related tasks that use the firm's resources to provide customeroriented results in support of the organization's objectives
Customers ◦ Demanding ◦ Sophistication ◦ Changing Needs
Competition ◦ Local ◦ Global
Change ◦ Technology ◦ Customer Preferences
Complacency
Political Resistance
New Developments
Fear of Unknown and Failure
BPR seeks improvements of ◦ ◦ ◦ ◦
Cost Quality Service Speed
Scientific Management. FW Taylor (18561915). Frederick Herzberg - Job Enrichment Deming et al - Total Quality Management and Kaizen In Search of Excellence (Peters and Waterman) Value-Added Analysis (Porter).
Systems Philosophy Global Perspective on Business Processes Radical Improvement Integrated Change People Centred Focus on End-Customers Process-Based
Added Value ◦ BPR Initiatives must add-value over and above the existing process
Customer-Led ◦ BPR Initiatives must meet the needs of the customer
Sustainable ◦ Process improvements need to become firmly rooted within the organization
Stepped Approach ◦ Process improvements will not happen over night they need to be gradually introduced ◦ Also assists the acceptance by staff of the change
Viable Solutions ◦ Process improvements must be viable and practical
Balanced Improvements ◦ Process improvements must be realistic
Business Understanding Empowerment & Participation Organizational Culture
Process improvements must relate to the needs of the organization and be relevant to the end-customers to which they are designed to serve
For different versions of a business process or data flow some mandatory information must be on the flowchart. ◦ ◦ ◦ ◦ ◦ ◦
Name of the business process Unique number of the business process Revision number Date of last change Author Page number with total pages
General Principles Simplicity Empowerment Process Design Think horizontally
Organizational Structure Remove barriers Support business processes Customer Interfaces Work from the customer perspective Automation Automate to advantage
Avoid Over-engineering Work hard to simplify Eliminate multiple points of contact with & for the customer Eliminate errors resulting from multiple contacts Eliminate need to reconcile differing information Reduce delays resulting from reconciliation REMEMBER: Simple Processes Less Costly More Flexible
Vertical Compression Process decision-making is not strictly a management task Workers are empowered Decision-making becomes part of work Advantages Fewer Communication Delays Lower Management Overhead Better Customer Response
Accessibility ◦ Be available when the customer wants to interact
Information ◦ Require only the data which cannot be captured elsewhere
Wants and Needs ◦ What are the customers goals, objectives - wants and needs? ◦ Are we meeting these? ◦ Are there unknown wants?
Single solution process ◦ One-size-fits-all ◦ Too complex for standard/simple cases
Processes require flexibility for: ◦ Different markets ◦ Different situations ◦ Resource variations ◦ Special customer requests
Reengineered process contains: ◦ Simple, standard path (80% - 90%) ◦ Exception handling path (8% - 18%) ◦ Large complex path (2%)
Feedback
Inputs
Transformation
Environment
Outputs
Select The Process & Appoint Process Team Understand The Current Process Develop & Communicate Vision Of Improved Process Identify Action Plan Execute Plan
Two Crucial Tasks ◦ Select The Process to be Reengineered ◦ Appoint the Process Team to Lead the Reengineering Initiative
Review Business Strategy and Customer Requirements
Select Core Processes
Understand Customer Needs
Don’t Assume Anything
Select Correct Path for Change
Remember Assumptions can Hide Failures
Competition and Choice to Go Elsewhere
Ask - Questionnaires, Meetings, Focus Groups
Appoint BPR Champion
Identify Process Owners
Establish Executive Improvement Team
Provide Training to Executive Team
Capacity to view the organization as a whole
Ability to focus on end-customers
Ability to challenge fundamental assumptions
Courage to deliver and venture into unknown areas
Ability to assume individual and collective responsibility
Employ ‘Bridge Builders’
Used to generate internal capacity Appropriate when a implementation is needed quickly Ensure that adequate consultation is sought from staff so that the initiative is organization-led and not consultant-driven Control should never be handed over to the consultant
Develop
a Process Overview Clearly define the process ◦ Mission ◦ Scope ◦ Boundaries
Set
business and customer measurements Understand customers expectations from the process (staff including process team)
Clearly
Identify Improvement Opportunities ◦ Quality ◦ Rework
Document
◦ Cost ◦ Time ◦ Value Data
the Process
Carefully
resolve any inconsistencies ◦ Existing -- New Process ◦ Ideal -- Realistic Process
Communicate with all employees so that they are aware of the vision of the future
Always provide information on the progress of the BPR initiative - good and bad.
Demonstrate assurance that the BPR initiative is both necessary and properly managed
Promote individual development by indicating options that are available
Indicate actions required and those responsible
Tackle any actions that need resolution
Direct communication to reinforce new patterns of desired behavior
Develop an Improvement Plan
Appoint Process Owners
Simplify the Process to Reduce Process Time
Remove any Bureaucracy that may hinder implementation
Remove no-value-added activities
Standardize Process and Automate Where Possible
Up-grade Equipment
Plan/schedule the changes
Construct in-house metrics and targets
Introduce and firmly establish a feedback system
Audit, Audit, Audit
Qualify/certify the process Perform periodic qualification reviews Define and eliminate process problems Evaluate the change impact on the business and on customers Benchmark the process Provide advanced team training
Assists the Implementation of Business Processes ◦ Enables Product & Service Innovations ◦ Improve Operational Efficiency ◦ Coordinate Vendors & Customers in the Process Chain
Focus ◦ Business Processes ◦ Process Redesign ◦ Process Implementation
Process Simplification is Common - True BPR is Not Desire to Change Not Strong Enough Start Point the Existing Process Not a Blank Slate Commitment to Existing Processes Too Strong
◦ REMEMBER - “If it ain’t broke …”
Quick Fix Approach
Process under review too big or too small Reliance on existing process too strong The Costs of the Change Seem Too Large BPR Isolated Activity not Aligned to the Business Objectives Allocation of Resources Poor Timing and Planning Keeping the Team and Organization on Target
Reengineering is a fundamental rethinking and redesign of business processes to achieve dramatic improvements
BPR has emerged from key management traditions such as scientific management and systems thinking
Rules and symbols play an integral part of all BPR initiatives
Don’t assume anything - remember BPR is fundamental rethinking of business processes
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