Global Strategic Management - Reengineering

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No, BPR is not a fad. Its origins traces back to management theories developed as early as the nineteenth century. The term 'reengineering' was first introduced in 1990 in a Harvard Business Review article: Reengineering Work: Don't Automate - Obliterate. The definition given by the author Michael Hammer and James Champy in a book entitled: Reengineering the Corporation is as follows:

Reengineering is 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 speed.

Companies on the brink of disaster to cut costs and return to profitability often use BPR. To reap lasting benefits, companies must be willing to examine how strategy and reengineering complement each other - by learning to quantify strategy (in terms of costs, milestones, timetables); by accepting ownership of the strategy throughout the organization; by assessing the organizations current capabilities and processes realistically; and by link strategy to the budgeting process.

The four keywords: fundamental, radical, dramatic and processes all are a part of BPR. Understanding the fundamental operations of the business is the first step. Radical redesign means disregarding all existing structures and procedures and inventing new ways of doing business. Dramatic is about achieving dramatic improvements in performance. Processes are separated into the simplest tasks across department. Task-based thinking will need to shift toward process-based thinking in order to become efficient.

DOES IT OFFER SOMETHING OF VALUE

Yes, however, it is not a quick fix. Companies on the brink of disaster often use BPR. Re-engineering has a high failure rate because it is misunderstood and has been equated to downsizing. Reengineering, although it is about familiar concepts, is new in that these familiar concepts are combined into something new. A clean slate is rarely found in practice. Implementation should be down over several phased projects. . Most companies have a portfolio of approaches to organizational change, which include reengineering. These approaches include continuous improvement, incremental approaches and restructuring techniques. Redesigned processes depend upon those who do the work. Therefore, acceptance and ownership at the grass root level is essential for successful BPR.

BPR contributes to organization transformation but it does not mean transformation. Organizational transformation is usually about the emergence of a new belief system and involves broad changes in other dimensions besides the work processes: such as organizational structure, strategy and business capabilities.

Although BRP has roots in IT management, it is primarily a business initiative. As such is has consequences in terms of satisfying the needs of customers and other constituents. IS may need to play a behind-the-scene role. IT departments in may companies should not have a central role due to the historic inability of IT to do anything big quickly. Companies, however, should not exclude the IT group.

WHEN SHOULD BPR NOT BE USED?

The key to discovering when not to use a BPR process is to determine when it should be used.

BPR activities usually occur primarily within the requirements definition and design phase of an ERP or other major implementation effort. BPR should be given ...