BUSINESS PROCESS BUSINESS PROCESS REENGINEERINGREENGINEERING

By: Garip Önder ÖzenBy: Garip Önder Özen

DEFINITIONDEFINITION

Hammer and Champy (1993) define BPR Hammer and Champy (1993) define BPR asas "... the fundamental rethinking and "... the fundamental rethinking and radical redesign of business processes to radical redesign of business processes to achieve dramatic improvements in critical achieve dramatic improvements in critical contemporary measures of performance, contemporary measures of performance, such as cost, quality, service, and speed."such as cost, quality, service, and speed."

DEFINITIONDEFINITION

Thomas Davenport Thomas Davenport (1993), another well-(1993), another well-known BPR theorist, uses the term known BPR theorist, uses the term process innovation, which he saysprocess innovation, which he says ”encompasses the envisioning of new ”encompasses the envisioning of new work strategies, the actual process design work strategies, the actual process design activity, and the implementation of the activity, and the implementation of the change in all its complex technological, change in all its complex technological, human, and organizational dimensions”.human, and organizational dimensions”.

DEFINITIONDEFINITION Finally, Johansson Finally, Johansson et al.et al. (1993) provide a description of (1993) provide a description of

BPR relative to other process-oriented views, such as BPR relative to other process-oriented views, such as Total Quality Management Total Quality Management (TQM) and (TQM) and Just-in-timeJust-in-time (JIT), (JIT), and state:and state: "Business Process Reengineering, although a "Business Process Reengineering, although a close relative, seeks radical rather than merely close relative, seeks radical rather than merely continuous improvement. It escalates the efforts of JIT continuous improvement. It escalates the efforts of JIT and TQM to make process orientation a strategic tool and TQM to make process orientation a strategic tool and a core competence of the organization. BPR and a core competence of the organization. BPR concentrates on core business processes, and uses the concentrates on core business processes, and uses the specific techniques within the JIT and TQM ”toolboxes” specific techniques within the JIT and TQM ”toolboxes” as enablers, while broadening the process vision."as enablers, while broadening the process vision."

DEFINITIONDEFINITION

BPR derives its existence from different BPR derives its existence from different disciplines, and four major areas can be disciplines, and four major areas can be identified as being subjected to change in identified as being subjected to change in BPRBPRorganization organization technology technology strategy strategy people people

WHY REENGINEERING?WHY REENGINEERING?

CustomersCustomersDemandingDemandingSophisticationSophisticationChanging NeedsChanging Needs

CompetitionCompetitionLocalLocalGlobalGlobal

WHY REENGINEERING?WHY REENGINEERING?

ChangeChangeTechnologyTechnologyCustomer PreferencesCustomer Preferences

WHY REENGINEERING?WHY REENGINEERING?

ComplacencyComplacency

ResistanceResistance

New DevelopmentsNew Developments

Fear of FailureFear of Failure

WHAT DOES IT SEEK?WHAT DOES IT SEEK?

BPR seeks BPR seeks

CostCostQualityQualityServiceServiceSpeedSpeed, improvements, improvements

The role of information technologyThe role of information technology

Information technology (IT) plays an Information technology (IT) plays an important role in the reengineering important role in the reengineering concept concept

It is considered as a major enabler for new It is considered as a major enabler for new forms of working and collaborating within forms of working and collaborating within an organization and across organizational an organization and across organizational borders. borders.

The role of information technologyThe role of information technology

Shared databases, making information available at many places Shared databases, making information available at many places Expert systems, allowing generalists to perform specialist tasks Expert systems, allowing generalists to perform specialist tasks Telecommunication networks, allowing organizations to be Telecommunication networks, allowing organizations to be

centralized and decentralized at the same time centralized and decentralized at the same time Decision-support tools, allowing decision-making to be a part of Decision-support tools, allowing decision-making to be a part of

everybody's job everybody's job Wirelss data communication Wirelss data communication and and portable computersportable computers, allowing field , allowing field

personnel to work office independent personnel to work office independent Interactive videodisk, to get in immediate contact with potential Interactive videodisk, to get in immediate contact with potential

buyers buyers Automatic identification and tracking, allowing things to tell where Automatic identification and tracking, allowing things to tell where

they are, instead of requiring to be found they are, instead of requiring to be found High performance computing, allowing on-the-fly planning and High performance computing, allowing on-the-fly planning and

revisioning revisioning

Key StepsKey Steps

Select The Process & Appoint Process Team

Understand The Current Process

Develop & Communicate Vision Of Improved Process

Identify Action Plan

Execute Plan

Select the Process & AppointSelect the Process & Appoint TeamTeam

Two Two Important Important TasksTasks

Select Select tthe he pprocess to be rocess to be rreengineeredeengineered

Appoint Appoint aa pprocess rocess tteameam

Select the ProcessSelect the Process

Review Review bbusiness usiness sstrategy and trategy and ccustomer ustomer rrequirementsequirements

Select Select ccore ore pprocessesrocesses

Understand Understand ccustomer ustomer nneedseeds

No assumptionNo assumption

Select the ProcessSelect the Process

Select Select ccorrect orrect ppath for ath for cchangehange

Ask - Ask - qquestionnaires, uestionnaires, mmeetings, eetings, ffocus ocus

Appoint the Process TeamAppoint the Process Team

Identify Identify pprocess rocess oownerswners

DevelopDevelop eexecutive xecutive iimprovement mprovement tteameam

Provide Provide ttraining to raining to eexecutive xecutive tteameam

Core Skills RequiredCore Skills Required

Capacity to view the organization as a wholeCapacity to view the organization as a whole

Ability to focus on end-customersAbility to focus on end-customers

Ability to challenge fundamental assumptionsAbility to challenge fundamental assumptions

Courage to deliver into unknown areasCourage to deliver into unknown areas

Core Skills RequiredCore Skills Required

Ability to assume individual and collective Ability to assume individual and collective responsibilityresponsibility

Understand the Current ProcessUnderstand the Current Process

Develop a Develop a pprocess rocess ooverviewverviewClearly define the process Clearly define the process

MissionMissionScopeScopeBoundariesBoundaries

Set business and customer measurements Set business and customer measurements Understand customers expectations from Understand customers expectations from

the processthe process

Understand the Current ProcessUnderstand the Current Process

Identify Improvement OpportunitiesIdentify Improvement OpportunitiesQualityQualityReworkRework

Document the ProcessDocument the ProcessCostCostTime Time Value DataValue Data

Develop & Communicate Vision of Develop & Communicate Vision of Improved ProcessImproved Process

Communicate with all employees so that they Communicate with all employees so that they are aware of the vision of the futureare aware of the vision of the future

Always provide information on the progress of Always provide information on the progress of the BPR initiative - good and bad.the BPR initiative - good and bad.

Demonstrate assurance that the BPR initiative is Demonstrate assurance that the BPR initiative is both necessary and properly managedboth necessary and properly managed

Develop & Communicate Vision of Develop & Communicate Vision of Improved ProcessImproved Process

Promote individual development by Promote individual development by indicating options that are availableindicating options that are available

Indicate actions required and those Indicate actions required and those responsibleresponsible

Identify Action PlanIdentify Action Plan

Develop an Develop an iimprovement mprovement pplanlan

Appoint Appoint pprocess rocess oownerswners

Simplify the Simplify the pprocess to rocess to rreduce educe pprocess rocess ttimeime

Identify Action PlanIdentify Action Plan

Remove no-value-added activitiesRemove no-value-added activities

Standardize Standardize pprocess and rocess and aautomate utomate wwhere here ppossibleossible

Up-grade Up-grade eequipmentquipment

Plan/schedule the changesPlan/schedule the changes

Execute PlanExecute Plan

Qualify/certify the processQualify/certify the processPerform periodic qualification reviewsPerform periodic qualification reviewsDefine and eliminate process problemsDefine and eliminate process problemsEvaluate the change impact on the Evaluate the change impact on the

business and on customersbusiness and on customersBenchmark the processBenchmark the processProvide advanced team trainingProvide advanced team training

Benefits From ITBenefits From IT

Assists the Implementation of Business Assists the Implementation of Business ProcessesProcessesEnables Product & Service InnovationsEnables Product & Service Innovations Improve Operational EfficiencyImprove Operational EfficiencyCoordinate Vendors & Customers in the Coordinate Vendors & Customers in the

Process ChainProcess Chain

Common ProblemsCommon Problems

Process Process ssimplification is implification is ccommon - ommon - ttrue rue BPR is BPR is nnotot

Desire to Desire to cchange hange nnot ot sstrongtrongCommitment to Commitment to eexisting xisting pprocesses rocesses ttoo oo

sstrongtrong

Common Problems with BPRCommon Problems with BPR

Process under review too big or too smallProcess under review too big or too smallReliance on existing process too strongReliance on existing process too strongThe Costs of the The Costs of the cchange hange sseem eem llargeargeAllocation of Allocation of rresourcesesourcesPoor Poor ttiming and iming and pplanninglanningKeeping the Keeping the tteam and eam and oorganization on rganization on

ttargetarget

THANK YOU...THANK YOU...