Business process redesign, Salvador Trinxet
Business process redesign (BPR) gurus Hammer and Champy (1993) define BPR as the fundamental reconsideration and radical redesign of organizational processes, in order to achieve drastic improvement of current performance in cost, quality, service and speed. Value creation for the customer is the leading factor for process redesign, in which information technology often plays an important role.
There are generally five important rules to keep in mind with any BPR project:
- Determine strategy before redesigning.
- Use the primary process as a basis.
- Optimize the use of information technology.
- Organizational structure and governance models must be compatible with the primary process.
In addition, there is a general condition for success, namely that management and employees must participate.
Often, the redesign entails a ‘back to square one’ approach. In an effort to allow discussion of any new views on how to design the organization, the existing organizational structure and processes are considered ‘nonexistent’, or irrelevant in the redesign.
When to use it
Before engaging in a BPR project, the organization must come to the realization that there is a need for BPR. Consequently, the very first step is determining the scope of the BPR project, or even more fundamentally, deciding if there is a need for BPR at all. The BPR team should determine this need by assessing indicators such as:
■ numerous conflicts within (parts of) the organization;
■ unusually high frequency of meetings;
■ excessive amount of non-structured communication (memos, e-mails, announcements, etc.).
Successful BPR projects executed by Berenschot consultants have yielded such remarkable results as:
– 70% reduction in order delivery time
– 60% reduction in average inventory level
– 25% increase in revenues
– 50% reduction in indirect labour
– 98% delivery reliability, up from 70%.
One way to determine whether or not there are too many conflicts or whether or not meetings and additional communication are excessive is by benchmarking the organization or department with another.
Having established the need, the next step in the BPR process is the redesigning of (part of) the organization in accordance with strategic requirements. Ask:
– What is the focus of our efforts (think about products, services and target customers)?
-What are the critical success factors?
– How can we achieve maximum efficiency based on the required output levels?
The third step is determining the required management of the newly designed organization. Typical questions here are:
– How can we ensure that processes will function as intended?
– How can we measure performance?
– How can we adjust for improvements, if needed?
– How can we compensate or reward?
The last step comprises the implementation of the new organizational structure, the installation of management and procedures, and the integration of the organization’s work methods into its environment.
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