1 BPR
1 BPR
1 BPR
• Easy and Instant transfer of money - NEFT (National Electronic Fund Transfer)
• Powered by core banking solution, online payment facility for mobile bills, electricity bills,
credit card bills… made available
• Use of ATMs…
Dimensions of BPR
Physical Technical Layer
More
concrete , Process Technology Organization
easiest to Structure Structure Structure
change
Infrastructure Layer
Reward Measurement Management
Structure Systems Methods
Customer Focus:
• Customer service oriented process – aims to
eliminate custoemer complaints
Speed:
• Compression of time taken to complete key
business processes (May be from 5 hrs to 4
hrs…)
Compression:
• Cutting the major tasks of cost and capital
throughout the value chain
Flexibility:
• Adaptive processes and structures to changing
conditions and competition – spot weak points
and adapt to new requirements of the market
Quality:
• Quality is always controlled and monitored by
the processess
Innovation:
• Leadrship through imaginative change
providing to organisation competitive
advantage
Productivity:
• Improce effectiveness and efficiency
• Identifies any processes, sub-processes, costs and labor that are not required in an
organization
• Not only highlights the deficiencies of a procedure but also shows areas where business is
incurring costs without getting required returns
• Improves the communication within the enterprise and also enhances the quality of internal
management reports
• Provides management an opportunity to understand the systems of their business in more
detail
• (Makes Business as more pro-active) Provides an insight of business analysis to management
which can help in future decision making with the strengths and weaknesses of the business
and business’s ability to adapt and respond towards the changes in external environment
• Provides long term solutions to minimize the deficiencies of a business
• Focus to take short-term damage control measures but specifically to initiate a long-term
plan for the improvement in efficiency, capability and effectiveness of the organization
• Meet the customer needs and maintain product value
• However, BPR does not directly affect the customer satisfactions but it provides
organizations room for improvement
• As the non-value adding costs are minimized, businesses can improve the quality of products
and services by inducing or shifting these costs to the parts that ultimately add value for the
customers…..
• The concept of BPR is simple to discuss but its practical implementation is very difficult
• May consume more time due to detailed process analysis
• BPR requires monetary assets and also consumes much more time and human resources.
• May not suit to every business, and the size, availability of resources for every business are
different - BPR usually benefits large organizations
• Delay in achieving results - As BPR focuses majorly on the long term revenue synergies, this
approach does not provide immediate results
Role of Leaders in BPR :
• Signals are the explicit messages that the leader sends to the organization about
reengineering:
– what it means?
– why we are doing it?
– how we are going about it? and
– what it will take?
• Successful reengineering leaders have to learn how much communicating they must do
• Reengineering is a difficult concept for people to understand and cope up with because it
cuts against the grain of everything they've done in their careers
• Symbols are actions that the leader performs to reinforce the content of the signals, to
demonstrate that he or she lives by his or her words
• Some important symbolic activities that can prove to the organization that the leader is
serious about reengineering:
– Assigning the company's “best and brightest” to reengineering teams
– Rejecting wrong design proposals from the wrong assumptions
– Removing managers/people who block reengineering effort
• The leader also needs to use Management Systems to reinforce the reengineering message
• These systems must measure and reward people's performance in ways that encourage
them to attempt major change
• Management systems should reward people who try good ideas that fail, not punish them.
EX: - BPR
• In the 1980s, the American automobile industry was in a depression, and in an attempt to
cut costs, Ford decided to scrutinize some of their departments in an attempt to find
inefficient processes.
• One of their findings was that the accounts payable department was not as efficient as it
could be: their accounts payable division consisted of 500 people, as opposed to Mazda’s
(their partner) 5.
While Mazda was a smaller company, Ford estimated that their department was still 5 times
bigger than it should have been
• Accordingly, Ford management set themselves a quantifiable goal:
• To reduce the number of clerks working in accounts payable by a couple of hundred
employees.
• Then, they launched a Business Process Reengineering initiative to figure out why was the
department so overstaffed.
• They analyzed the current system, and found out that it worked as follows:
1. When the purchasing department would write a purchase order, they sent a copy to
accounts payable.
2. Then, the material control would receive the goods, and send a copy of the related
document to accounts payable.
3. At the same time, the vendor would send a receipt for the goods to accounts payable.
• Then, the clerk at the accounts payable department would have to match the three orders,
and if they matched, he or she would issue the payment. This, of course, took a lot of
manpower in the department.
• So, as is the case with BPR, Ford completely recreated the process digitally.
1. Purchasing issues an order and inputs it into an online database.
2. Material control receives the goods and cross-references with the database to make sure it
matches an order.
3. If there’s a match, material control accepts the order on the computer.
This way, the need for accounts payable clerks to match the orders was completely
eliminated.
1. Requirement of too much of Reengineering processes at the intial stage
2. Inadequate training of Team Leaders, Process Owners and Team Members (What , When,
Who, How…)
3. Unclear knowledge of Reengineering
4. Improper monitoring of Reengineering process
5. Waste of much more time in detailed business process analysis
6. Fear of faliure
7. Unfavourable organisational environment
8. Delay in showing the results
9. Improper appraisal system
10. Inability to quantify improvement
11. Non – availability of adequate resources
12. Limited awareness amongst the employees
13. Discontinuance of Reengineering after achieving benchmarks