26-12-2012, 06:02 PM
Business Process Reengineering
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BPR
Business process reengineering is the concentration on the improvement of key business processes to ensure that outputs are delivered with speed, service and quality.
BPR - Definition
Reengineering is all about reinventing the entire organisation - including its people, structures - rather than just processes.BPR is the fundamental rethinking & radical redesign of business processes to achieve dramatic improvement in critical, contemporary measures of performance such as cost,quality,service and speed.
Explanation of key terms in the definition of BPR
Fundamental – Ask questions as – Why do we do what we do? / Why do it the way we do?
Radical – means getting to the root of things & disregarding all existing procedures / processes and inventing completely new ways of accomplishing work
Dramatic – involves replacing the old with something new
Processes – it converts inputs to outputs – ask questions as how to do in a better way at a lower cost?
Why Reengineer ?
People are limited and simple. The organisations had to design very simple tasks and jobs for them to do . This in turn led to complex organisational systems , because when the work that is being done is simple and fragmented we need a lot of overhead to tie it all together. Result - high cost , poor quality and bad service. BPR is the only solution to change the organisation.
Requirements for effective implementation of BPR
Continuous updation of strategy
Top management commitment with clear goals
Promotion of cross-functional activities
Decentralisation of decision making to a point as close to the customer as possible
Value adding processes for long term success of an organisation
Radical bottom-up redesign input and effective unwavering top-down leadership
BPR - Key Business Processes
Starting afresh enables an organisation to identify the Key Business Processes and ordinary business processes. KBP’s offer maximum value propositions to the customer .Ordinary business processes offer little or no value propositions to customers. BPR involves a change in organisation structure, roles / responsibilities/ rewards & recognitions etc.,
Features of BPR
Several jobs are combined into one by improving skills.
Work to be performed where it is directly needed. Eg – If central purchase delays activities, go for decentralised purchase.
Non-value adding activities are reduced ( reduce checks & controls).
Processes have multiple versions- select the one that suits you.
BPR combines merits of centralised / decentralised systems.
Business Process
A business process is a set of logically related tasks carried out using a firm’s resources to provide customer oriented results in support of the organisation’s objectives.
Examples of business process include order processing, billing, purchasing, shipping, receiving, auditing, performance appraisal,vendor certification etc.
Dimensions of Business Process
Entitities – Processes take place between entities – could be inter- organisational(e.g. EDI) or inter-functional or inter-personal
Objects – Processes result in manipulation of objects – could be either physical or informational
Activities – Processes could involve two types of activities – managerial ( e.g.. To develop a budget) or operational – ( e.g.. To attend a customer order)