In a rapidly changing world, companies are immersed in a competitive and globalized environment and markets that require a great ability to respond to constant changes and are in constant search to stand out every day.
That is why most of them are aware of the needs demanded by the customer and the environmental variables to establish advantages over their competitors through the development and implementation of strategies that can be commercial, technological, and operational. It is because of the ability to be flexible and changeable that companies choose business process re-engineering. In this article, we will talk about this concept in detail and consider all its key provisions.
- BPR enables companies to achieve profound changes for efficiency and improvement.
- BPR involves complete project overhauls, unlike BPI’s incremental workflow improvements.
- BPR integrates processes, empowers decision-makers, and follows systematic re-engineering steps.
Business Process Re-engineering: Essential Knowledge
Let’s start by finding out in detail what business process re-engineering is. With the help of BPR, companies strive to improve their processes effectively to achieve their goals. The goal of this concept is to radically improve business efficiency with a complete redesign of its core processes and work dynamics, always striving for continuous improvement.
Business process re-engineering involves the analysis of each of the processes and tasks performed in the company, their redefinition, and improvement, striving for simplification and efficiency. To carry out this redefinition or improvement, it is necessary to perform the steps that we will talk about next.
BPR and BPI: What is the main difference?
If we do not go into details, it may seem that these concepts are similar to each other. But the field of application lies precisely in the differences. If we describe the differences in general, then BPI is a point change that does not lead to drastic changes but only improves the already existing workflow. But business process re-engineering is an opportunity for global changes and a complete rethinking of an entire project or product.
That is, changes that can be made according to the BPI concept can affect micro-processes in the middle of the company but will not provide new solutions but only improve existing ones. This is a kind of optimization of what you already have. If your company uses business process re-engineering, it can bring drastic changes in all areas, from micro-processes to higher-level processes.
In the process of re-engineering, don’t just think outside the box, build a new box altogether.
Tom Peters
Business Process Re-engineering: Basic Principles
The main principles of business process re-engineering are as follows:
- Several processes are combined into one
Integration of several processes is carried out to reduce interfaces between different jobs and reduce waiting time and other inefficient procedures.
- Performers make their own decisions
Instead of turning to a higher boss and, accordingly, slowing down the process, as well as taking time from the manager, the employee himself is delegated (and accordingly prepares for it) to make individual decisions.
- Work from the process is performed in their natural order
Business process re-engineering seeks not to impose additional requirements on the process, for example, related to the organizational structure or linear technology.
- Work is done where it is most appropriate
The best business process re-engineering examples prove that an enterprise’s organizational structure should not impose rigid restrictions on the process. The distribution of functions should come from the process and the need for its effective implementation and not from once-fixed responsibilities. One of such simple business process re-engineering examples is if it is more convenient for employees of the marketing department to purchase their own office or equipment, why should other departments do it?
- Processes have different execution options
Instead of rigid and non-adaptive processes, processes focused on the maximum number of possible cases of their implementation are introduced. Each of the process options is performed depending on the situation.
- The responsible manager is the only contact person for the process
He interacts with the customer on all issues related to the process. For this, he needs to have access to all information systems used in this process and all executors.
- Combination of centralized and decentralized operations
Modern information technologies make it possible to regulate the activities of divisions, simultaneously centralizing and decentralizing individual operations. Centralization can be carried out by aggregating information and delimiting access rights. Decentralization can be supported administratively.
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Contact Us5 Steps of Business Process Re-engineering
Step 1. Map the current state of your business processes
Today, examples of business process re-engineering show us the importance of defining the way forward and the actual situation. You have to find the strengths of the company to promote them and the weaknesses to strengthen them.
Step 2. Analyze them and find any process gaps or disconnects
To start the implementation of business process re-engineering, it is necessary to conduct an in-depth analysis of the company, while it is important to know how all areas of the company’s activities work.
Step 3. Look for improvement opportunities and validate them
Your company must not only understand the importance of business process re-engineering but also define the goals to be achieved through process modification (quality, costs, competitiveness, etc.). Define different processes or tasks using best practices to simplify and eliminate anything that doesn’t add value. Business process re-engineering involves searching for different work options that provide optimal results.
Step 4. Design a cutting-edge future-state process map
At this stage, various changes and process improvements will be implemented in practice. This will require investment in new technologies, staff training, and the involvement of all people involved in the company.
Step 5. Implement future state changes and be mindful of dependencies
Finally, a monitoring and control system should be implemented that has appropriate indicators (metrics and KPIs) that allow analyzing processes, identifying deviations (applying appropriate corrective measures), and knowing whether the set goals are being achieved.
Business Process Re-engineering: How it works
For a visual demonstration of how the company improved its position with the help of business process re-engineering, we will give you well-known business process re-engineering examples of processes on the Credit company.
IBM Credit Corporation is an affiliate of IBM and provides credit to customers to whom IBM sells computers, software, and services. IBM Credit’s problem was that, under the existing technological cycle, it took an average of a week to resolve a client’s credit issue and, in complex cases, up to two weeks. Excessive decision-making time led to the loss of the client because, during this time, he could not find another source of financing.
The duration of decision-making on the client’s request was caused because the processing of the request was carried out in five stages, performed sequentially by five different divisions of the company. The transfer of the request from one unit to another was carried out on a paper medium. The company instructed two senior managers to go through all five stages themselves with several customer requests. They asked the executors to process requests without delay. The experiment showed that only 90 minutes are spent on processing the request, and the rest of the time is spent on transferring the request from one department to another. Thus, it turned out that the problem is not in the efficiency with which specialists work but in the structure of the processing process. Therefore, to solve the problem, it is necessary to change the process and not its individual steps.
The method of processing was based on the assumption that each request is a complex task that requires the participation of experts of various specialties to solve it. The analysis showed that this assumption is wrong because most of the queries are simple, and their processing is reduced to working with the database, which can be done by an ordinary clerk. In the new process, all processing is performed by one specialist, with an information expert system that provides decision-making and access to all necessary data and tools.
As a result of the re-engineering, IBM Credit radically redesigned the processing process and achieved a leap-like improvement in the company’s main performance indicators: the request processing time was reduced from 7 days to 4 hours, and the number of processed requests increased 100 times while reducing the number of employees.
Business Process Re-engineering steps to success
Educate employees about long-term changes
One of the key steps to the re-engineering of the company’s business process is the continuous development of its employees. Create boot camps and interest, and motivate your employees to learn and improve their skills. It will help your company in the process of business process re-engineering to have motivated specialists who thoroughly know all fundamental processes.
Leave no department behind
All of the above should apply to absolutely every department in your company. It is impossible to develop a company relying only on a few elements of business process re-engineering. The key to a powerful company is the harmonious development and coherence of all its departments.
Build a BPR team
The business process re-engineering team should have from 5 to 10 members; one part should have a deep knowledge of not only the process but also the importance of business process re-engineering, and the other part should be formed by personnel outside the process in order to question it and suggest alternatives.
Get inspiration from competitors
Often, competitors who have already implemented business process re-engineering, these elements of business process re-engineering can serve as a reference point. In addition, you should always analyze your competitors to stay competitive.
Conclusion
As you can already see, when a company wants to radically change its organization in search of greater efficiency, speed, and continuous improvement, it resorts to business process re-engineering. BPR will make profound changes both in the company’s usual processes and its corporate culture, offering a significant increase in the production and quality of products and services. Ficus Technologies can assist companies in navigating the challenges of a rapidly evolving business landscape by offering expertise in Business Process Re-engineering (BPR).
The duration of business process re-engineering depends on many factors, including the complexity of the components. On average, business process re-engineering can last from several months to a year.
Most business process re-engineering examples show tremendous improvements in customer satisfaction. As a rule, the main components of business process re-engineering are aimed at improving the user experience.
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