Business Process Re-Engineering: What It Is and Isn’t

Business process re-engineering (BPR) is implemented by companies when they want to bring dramatic changes in their operations and improve overall performance. There are many businesses and global companies that have implemented the concept of BPR to detect the problems in their system and rectify them to ensure that the changes have a positive impact on operations. When companies do this they typically are trying to induce updates and refocus. 

Corporations can opt for BPR when they are facing issues in their productivity or when they come across a problem that needs to be addressed for better results. In this article, we will cover what exactly is business process re-engineering and build a comprehensive understanding of how it affects business processes and operations.

In the introduction, we learned the basic idea of business process re-engineering. Still, in layperson's terms, it simply means redesigning business processes so that a corporation can achieve dramatic improvements not just in manufacturing and performance but in all other aspects that contribute to productivity and customer satisfaction. A few examples of such aspects are quality, customer service, and time cycles. 

BPR begins when companies assess the work that needs to be done to increase value. This can include the procedure of process mining that assists in discovering, monitoring, and improving processes.

Let us look at seven major steps that can give a clear idea regarding the implementation of the BPR methodology:

• The first step involves refocusing on company values, removing any form of low-level or suboptimal work.
• Next, the company engages in the simplification of processes and standardization of overly complex work. Moreover, if possible, organizations try automating repetitive tasks that simply improve productivity and minimize the time and effort required.
• This step involves aligning the operations with modern systems, technology, data, models or frameworks to facilitate business process optimization.
• In the next step, work is located in the most effective and efficient environment. 
• The reorganization of the business occurs into cross-functional groups and teams with end-to-end responsibility.
• This step involves rethinking people and basic organizational issues.
• The last step involves determining suitable roles for outsources and third parties based on where they actually add value.

Ford, the American multinational automobile corporation, shines out as the first and one of the most popular examples of a company that successfully executed BPR. In 1995, Ford began an extensive plan called the Ford 2000. This basically meant that the company merged its European, North, American and other international operations into one single global organization.

With the BPR in Ford 2000, the company brought dramatic cost reductions by making the processes and products common worldwide. Ford intended to remove process and organizational redundancies. This reengineering also helped the company in realizing and implementing economies of scale in both manufacturing and purchasing.

The new business process redesign approach made the technology be employed to overcome any forms of production constraints. Ford also discovered that only reengineering the accounts payable department was futile, and they must focus on a new goods acquisition process, which included both selling and receiving the accounts payable. Earlier, Ford worked with the rule that "We pay when we receive the invoice," but post-engineering and radically redesigning the processes moved to the new rule, which was "We pay when we receive the goods."

Business process re-engineering is an ambiguous term for many people, and they tend to confuse it with other aspects of changes done in business operations. To clear this confusion, we will try to understand what it is and what it isn't.

Process Reengineering Is Not Process Improvement

Yes, you read that right: Process reengineering is not the same as process improvement. Of course, organizations carry out redesigning activities to achieve improvement, but it is not process improvement alone. 

BPR, as noted above, involves the introduction of substantial changes in business processes that lead to a significant change in the overall business operations, productivity, and performance.

The whole point of BPR technology is to change the way work is done, which, in turn, results in enormous positive results and helps companies achieve organizational goals. One of the key aspects of it is to reduce or eliminate costs that the company was incurring unnecessarily. 

In contrast, process improvement mainly relates to subprocesses, tweaks here and there and small updates. Simply put, when compared to it, process reengineering is transformational and helps in realizing totally different outcomes.

BPR relies on keeping the processes current going forward with the new objectives and bringing in changes that offer favorable results in cost reduction, quality and productivity. Keeping processes current refers to tracking the growth and monitoring how all the processes align with each other. The purpose of this is to ensure that the assessment of employees’ productivity and work performance occurs from time to time so that there is an effective ongoing process with improved results.

Having said that, there are dozens of examples of how many small and international businesses have implemented BPR to bring dramatic alterations and positive growth in their operations, including multiple aspects of their business.

At last, we must all inform you of the drawbacks of the process. A key disadvantage is that it is time-consuming and demands a high level of effort from the management to actually implement BPR efficiently. Many companies can even fail during the process, and hence a company’s management team may decide not to implement it. 

Still, executing business process re-engineering can be a great strategy to find out and eliminate the drawbacks or problem areas that businesses have in their processes and operations. This can lead to a noteworthy improvement in the performance of the business and its overall productivity. We hope the companies can weigh the pros and cons of this process, figure out if it is right for them, and make the most of it.