Describe two models for change. Include appropriate examples in your answer. The two models for to be considered and discussed in this section are the Business Process Re-engineering and Kaizen models. Business Process Re-engineering
The world today is ever changing, moving from one phase to the other and the only thing that does not change is ‘change’ itself. As the modern business environment is propelled by the three Cs namely Customer, Competition and Change, organisations are always looking for new business innovations to salvage their ailing enterprise. (Hammer and Champy, 1993) One of such solutions that have been identified and used by many companies is the Business Process Re-engineering or shortened as BPR. There is no one definition of BPR. Many writers have attempted to describe what a BPR is and some of these would be considered. The main proponents of BPR, Hammer and Champy (1993) defined it as “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." Davenport (1992), in describing BPR says it “encompasses the envisioning of new work strategies, the actual process design activity, and the implementation of the change in all its complex technological, human, and organizational dimensions”. In other words, BPR involves the reorganisation of the main processes in a business enterprise to remove those elements that do not contribute to the company’s main objectives.(Senior, 2002:109) Its aim is “to achieve a radical rethinking and redesign of organisational processes in order to significantly improve key performance measures, such as quality, cost and delivery.”(Burnes, 2004:596) BPR has been acclaimed as “the biggest business innovation of the 1990s” (Mill, 1994:26) as it is about the improvement of productivity by considering the whole process as opposed to just specific activities or functions. (RDI Managing Change in Organization study material, 2007:3.2). The usefulness of BPR can be seen in the fact that its process takes into consideration all the work and non work activities, like wastage, delay, storage, etc, associated with the order of tasks involved. It is also customer-focused as the business process is expected to come up with an output that meets customers’ needs. (RDI Managing Change in Organization study material, 2007:3.2)
Case study: Star Vault, Inc.
Star Vault Inc. (Berman, 1994) is a company that illustrates the BPR model of change. This is an average sized entertainment enterprise that was making losses and needed a drastic change for improved profitability. The top management of the company came to the realization that their library was overexposed and the competition for the acquisition of the most attractive product in the market was fiercer. As a result, Star Vault Inc. had to reconsider its strategic direction and so elected to have their focus on niche markets. This was where the application of the BPR process came in as in the words of Berman (1994:18), “Instead of simply improving the processes, the company eliminated non-value-added expenses, and evaluated which organizational elements were relevant to the strategy… As a result, the company now has the opportunity to sustain and increase its market share.” Here, all the necessary five-step process for the implementation of the BPR model recommended by Davenport (1992) were followed. The company went back to the drawing table and came up with a new business vision and process objectives. They identified the business process to be redesigned but in doing this, they had to first understand and measure the existing processes against the redesigned one. Further, they designed and built a prototype of the new process to be adopted with the knowledge of IT and then adapted the newly designed process to the structure of the organisation. In essence, at the end of the BPR, Star Vault...
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