Business Process Reengineering method (BPR) is described by Hammer and Champy
as 'the fundamental reconsideration and the radical redesign of organizational
processes, in order to achieve drastic improvement of current performance
in cost, services and speed'.
Rather than organizing a firm into functional specialties (like production,
accounting, marketing, etc.) and to look at the tasks that each function performs,
Hammer and Champy recommend that we should look at complete processes. From
materials acquisition, towards production, towards marketing and distribution.
One should rebuild the firm into a series of processes.
Value creation for the customer is the leading factor for BPR and information
technology often plays an important enabling role. Compare:
Michael Hammer and James Champy
The main proponents of re-engineering were Michael Hammer and James Champy.
In a series of books including Reengineering the Corporation, Reengineering
Management, and The Agenda, they argue that far too much time is wasted, passing
on tasks from one department to another. They claim that it is far more efficient
to appoint a team who perform all the tasks in the process.
A five step approach to Business Process Reengineering
Davenport (1992) prescribes a five-step approach to the Business Process
- Develop the business vision and process objectives: The BPR method
is driven by a business vision which implies specific business objectives
such as cost reduction, time reduction, output quality improvement.
- Identify the business processes to be redesigned: most firms
use the 'high-impact' approach which focuses on the most important processes
or those that conflict most with the business vision. A lesser number of
firms use the 'exhaustive approach' that attempts to identify all the processes
within an organization and then prioritize them in order of redesign urgency.
- Understand and measure the existing processes: to avoid the repeating
of old mistakes and to provide a baseline for future improvements.
- Identify IT levers: awareness of IT capabilities can and should
- Design and build a prototype of the new process: the actual design
should not be viewed as the end of the BPR process. Rather, it should be
viewed as a prototype, with successive iterations. The metaphor of prototype
aligns the Business Process Reengineering approach with quick delivery of
results, and the involvement and satisfaction of customers.
As an additional 6th step of the BPR method, sometimes you find: to adapt
the organizational structure, and the governance model, towards the newly
designed primary process.
Generic Circumstances that influence whether BPR is advisable
Although it is difficult to give generic advice about this, some factors
that can be considered are:
- Does the competition clearly outperform the company? Compare:
- Are there many conflicts in the organization?
- Is there an extremely high frequency of meetings?
- Excessive use of non-structured communication? (memos, emails, etc)
- Is it possible to consider a more continuous approach of gradual, incremental
improvements? (see: Kaizen).
Critics of the BPR approach
Reengineering has earned a bad reputation because such projects have often
resulted in massive layoffs. In spite of the hype that surrounded the introduction
of Business Process Reengineering, partially due to the fact that the authors
of Reengineering the Corporation reportedly bought huge numbers of copies
to reach the top of the bestseller lists, the method has not entirely lived
up to its expectations. The main reasons seem to be that:
- BPR assumes that the factor that limits organization's performance is
the ineffectiveness of its processes. This may or may not always be true.
Also BPR offers no means to validate this assumption.
- BPR assumes the need to start the process of performance improvement
with a "clean slate", i.e. totally disregard the status quo.
- BPR does not provide an effective way to focus the improvement efforts
on the organization's constraints. (As done by Goldratt in the
Theory of Constraints).
- Sometimes, or maybe quite often, a gradual and incremental change (such
as Kaizen) may be a better approach.
- BPR is culturally biased towards the US way of thinking. (see:
BPR compared to Kaizen
When Kaizen is compared with the BPR method is it clear the Kaizen philosophy
is more people-oriented, more easy to implement, but requires long-term discipline
and provides only a small pace of change. The Business Process Reengineering
approach on the other hand is harder, technology-oriented, it enables radical
change but it requires considerable change management skills.
Book: Hammer and
Champy - Reengineering the Corporation -
- Process Innovation -
||BPR - Time Reduction versus Cost
"Doing away the manual processes and bringing in technology and tools to make a process time efficient is one way of doing BPR.
However, technology and tools also come at a certain cost. That's why decision makers are often hesitant to invest in automation without evaluating the business gains. Business dynamics are causing automation to change as well, this is inevitable. Time windows are shrinking, customers are very demanding. They are wiser compared to yesterday. They want value additions and higher value for their money.
To retain, sustain and enhance organization's business/revenues customer base you must have processes with:
- Reduced errors; meaning greater reliability
- Enhanced controls; meaning precision
- More delivery in less time; meaning the processes go faster
- Less physical and mental fatigue; meaning safer working environment
A word of caution. Just because something can be automated that doesn't mean they should be. Automating is not always a good thing to do. Some people may fall into the trap of thinking that if something can be automated, it should be. But that is like someone purchasing a robotic lawn mower, while he enjoys mowing the lawn...
And remember boons and banes (pros and cons) don't travel alone. They always come in pairs."
||Deterministic Machines Concept in BPR
"Hi all, could anyone give me a clarification regarding deterministic machines concept in BPR please? How can BPR be viewed in the view of deterministic machine view?"
||Developing a Standard Framework for BPR
"After reviewing literature, I think that there exists no standard process of BPR. Every company redesigns its processes in its own way.
I believe different cultures, strategies and organizational structures are the main reasons of adapting so many different methods to BPR.
However, I do believe there is a need for a standard framework which could be applied to any BPR case. We could measure the performance and through continuous improvement enhance the project.
I'm currently doing an MBA research on how to succeed a BPR. To collect your opinions on my ideas, I create a survey. Could you please help me to fill in it in order to understand whether my ideas are right and feasible?
Please click on this link to take the survey. Thank you in advance for your help."
||Is BPR Helping ERP or is ERP Helping BPR?
"I am a PhD student and my area is BPR. I just want to know your expert opinion (just general) regarding the relationship of BPR and ERP.
It is a fact that BPR uses technology for efficiency however, I have come across that ERP is doing the same.
So my question is how are these two tools interrelated, and which one is helping the other?
Is BPR used to implement ERP or is ERP helping BPR?"
||Cases and Causes of BPR Failure / BPR Disasters
I'm doing research on BPR failure cases. Unfortunately, I can't find any cases to illustrate my research. Could you please tell me where I can find this kind of cases?
Thank you in advance."
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