Business Process Re-engineering
Business process re-engineering focus on the analysis and design of workflows and 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 Davenport (1990) a business process is a set of logically related tasks performed to achieve a defined business outcome. It is "a structured, measured set of activities designed to produce a specified output for a particular customer or market." Improving business processes is important for businesses to stay ahead of competition in today's marketplace. Over the last 10 to 15 years, companies have been forced to improve their business processes because customers are demanding better products and services. Many companies begin business process improvement with a continuous improvement model. The BPR methodology comprises of developing the business vision and process objectives, identifying the processes to be redesigned, understanding and measuring the existing processes, identifying IT levers and designing and building a prototype of the new process. In this context it can be mentioned that, some of the biggest obstacles faced by reengineering are lack of sustained management commitment and leadership, unrealistic scope and expectations, and resistance to change. 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 re-engineering is also known as business process redesign, business transformation, or business process change management. Definition
The most notable definition of reengineering by (Hammer and Champy, 1993) is: “The fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical contemporary modern measures of performance, such as cost, quality, service, and speed". The concept of business processes - interrelated activities aiming at creating a value added output to a customer - is the basic underlying idea of BPR. These processes are characterized by a number of attributes: Process ownership, customer focus, value adding, and cross-functionality. Business Process Reengineering (BPR) and Total Quality Management (TQM) Total Quality Management and BPR share a cross-functional relationship. Quality specialists tend to focus on incremental change and gradual improvement of processes, while proponents of reengineering often seek radical redesign and drastic improvement of processes. Quality management often referred to as TQM or continuous improvement, means programs and initiatives, which emphasize incremental improvement in work processes, and outputs over an open-ended period of time. In contrast, reengineering, also known as business process redesign or process innovation, refers to prudent initiatives intended to achieve radically redesigned and improved work processes in a specific time frame. In contrast to continuous improvement, BPR relies on a different school of thought. The extreme difference between continuous process improvement and business process reengineering lies in where you start from and also the magnitude and rate of resulting changes. In course of time, many derivatives of radical, breakthrough improvement and continuous improvement have emerged to address the difficulties of implementing major changes in corporations. Benefits of BPR
Major benefits are as follows:
70 percent decreases in cycle time.
40 percent decreases in costs
40 percent increases in customer satisfaction, quality, and revenue 25 percent growth in market share
During the 1990s, business process reengineering captured the imagination...
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