TM/U5 Topic 4 Business Process Re-Engineering
The Business Process Re-engineering or BPR is the analysis and redesign of core business processes to achieve the substantial improvements in its performance, productivity, and quality. The business process refers to the set of interlinked tasks or activities performed to achieve a specified outcome.
Simply, the business process reengineering means to change the way an individual performs the work such that better results are accomplished. The purpose of business process reengineering is to redesign the workflows in order to dramatically improve the customer service, achieve higher levels of efficiency, cut operational costs and become a world-class competitor.
The business process re-engineering involves a series of steps. These are:
Step 1: Define Objectives and Framework
Step 2: Identify Customer Needs
Step 3: Study the existing business process
Step 4: Formulate a redesign business plan
Step 5: Implement the Redesign Plan
The business process is required to be re-engineered because of the following reasons:
- The processes the company is using might have become outdated or holds no relevance in the current market scenario.
- Often, the sub-divisions in the organization aims at improving their respective division performance and overlook the resultant effects on the other departments. This might lead to the underperformance of the firm as a whole.
- Due to the departmentalization, each employee focuses on the performance of his respective department and may overlook the critical issues emerging in other areas of the firm, and therefore, the need for re-engineering arises so that the role of the employees could be broadened and shall be made more responsible towards the firm.
- The existing business process could be lengthy, time-consuming, costly, obsolete, therefore, is required to be redesigned to match it with the current business requirements.
- The technology keeps on updating and in order to catch up with it, reengineering is a must.
Thus, the business process re-engineering focuses on obtaining the quantum gains in terms of cost, time, output, quality and responsiveness towards customers. Also, it emphasizes on simplifying and streamlining the business process by eliminating the unnecessary or time-consuming business activities and speeding up the workflow by making the use of high-tech systems.
The Business process re-engineering comprises of following steps:
- Define Objectives and Framework: First of all, the objective of re-engineering must be defined in the quantitative and qualitative terms. The objectives are the end results that the management desires after the reengineering. Once the objectives are defined, the need for change should be well communicated to the employees because, the success of BPR depends on the readiness of the employees to accept the change.
- Identify Customer Needs: While, redesigning the business process the needs of the customers must be taken into prior consideration. The process shall be redesigned in such a way that it clearly provides the added value to the customer. One must take the following parameters into the consideration:
- Type of Customer and customer groups.
- Customer’s expected utilities in product and services
- Customer requirements, buying habits and consuming tendencies.
- Customer problems and expectations about the product or service.
- Study the Existing Process: Before deciding on the changes to be made in the existing business process, one must analyze it carefully. The existing process provides a base for the new process and hence “what” and “why” of the new process can be well designed by studying the right and wrongs of the existing business plan.
- Formulate a Redesign Business Plan: Once the existing business process is studied thoroughly, the required changes are written down on a piece of paper and is converted into an ideal re-design process. Here, all the changes are chalked down, and the best among all the alternatives is selected.
- Implement the Redesign: Finally, the changes are implemented into the redesign plan to achieve the dramatic improvements. It is the responsibility of both the management and the designer to operationalize the new process and gain the support of all.
Thus, the business process re-engineering is collection of interrelated tasks or activities designed to accomplish the specified outcome.