Week 5: The Principle of BPR

BPR is defined as “the fundamental re-thinking and radical re-design of business processes to achieve dramatic improvements in critical contemporary measures of performance, such as cost, quality, service, and speed”, repeatedly told by Dr. Helen DU during her lectures. In my understanding, the basic idea behind this term is to eliminate some redundant processes and also combine some processes into one. I think, also, the organisation may actively execute the centralised operation in its business processes with the shared database. Its benefits are the reduction of operational cost and cycle time in the process, the increased efficiency of the process, and the increased data consistency on the process. 

A paper (V. Grover and M. K. Malhotra 1997) described and verified those benefits with the two successful examples of BPR, one is Ford’s accounts payable process, and another is Detroit Edison’s work order process. Nevertheless, here my statement is that not all organisations can be easy implement the BPR in achieving dramatic performance gains due to the lack of consensus on the massive and complex BPR methodologies. Therefore, as the authors wrote, we may realise some rationales behind the BPR and myths through the successful instances. 

Reengineering reflects this horizontal view by emphasizing notions of processes, process owners, teams and empowerment, and de-emphasizing hierarchical structures. In fact, the organisations have many processes that usually have the customer involvement such as the ordering process, so the customer focus is necessary in BPR for enhancing the customer responsiveness and increasing the process performance. In addition, junior staffs always start the work on the activities until the top management delegates. It causes the longer lead time and approval delays in the traditional top-down organisational approach. Hence, empowerment is crucial that low level staffs would have the decision making. Moreover, use the example of the ordering process again; it takes lots of staffs in different departments and organisations to handle many sub processes from customer request and order fulfilment to collecting payment, so that it is usually a cross-functional work. Therefore, my opinion is that reengineering to a business should bring a positive impact because its effort not only improves the business process, but produces new products and service and increases the revenue and the operating savings.

Even though the authors indirectly said that these myths might be true and appropriate only in some organisations, my thought is that those are worth to stay on our minds because they are a good guideline for helping the organisation reengineering of the business process. Last but not least, I quoted the part of the contents with my lots of reflection for sharing in the following. 

• ""Reengineering is a radical one-time approach" is changing … some firms are finding that continuous improvement through stewardship of processes may be more beneficial in the long run…, "Reengineering should focus on cross-functional core business processes" is fine, but many piecemeal improvements within functions can also add up to significant change and have proven very successful." – The improvement is not one-time and needs a lot of time which can bring the greatest benefit to and influence on the business included the processes and the reduction of the operational cost and time. I think that it is an incremental effort to the business. 
• ""Reengineering involves breakthrough performance gains" is being challenged as benchmarking and measurement of these gains can prove elusive. In many cases, more moderate gains that are consistent with the organizational culture and orientation define success."  –  This is realism and true that most organisations directly associate the performance gain from the reengineering with their business objectives itself. If reengineering would help organisations to achieve the organisational goals, it can be defined as the success to reengineering. Therefore, it is a harsh measurement of performance. 
• "" Reengineering enables change primarily through IT" … Many of these innovations do not involve or require IT." – Since the technology advances, not ten years ago, many business processes now may be paperless and electronic. Some applications get improved by IT such as eChannel System. It can reduce the processing time. Hence, my opinion is IT now acts as a critical role of reengineering efforts. Business aspect is still important in this time. 
• "" Reengineering enhances individual capacities through empowerment and teams" is all well and good but many process-change projects are being defended based on cost objectives … some bottom-up process change initiatives with strong inputs from line workers have proven successful…" – I just said earlier in this post, top-down processes only lead to longer cycle time and approval delays on the processes. Hence, in terms of speed, I rather accept the bottom-up approach to the business processes in order to improve processes and speed up processes. Organisations need to accept the empowerment in the organisational structure if dramatic improvements. 

Thus it can be concluded that, not only does BPR effort significantly improve the processes in the business, it also increases the profitability. Besides, redesign the process must be a continuous and incremental improvement rather than one-shot, also focuses customer, then organisations can maximize the long-run benefits on BPR projects. 

REFERENCES: 

[1] "Business Process Reengineering: A Tutorial on the Concept, Evolution, Method, Technology, and Application" by V Grover and M K Malhotra 1997, pp. 193-213