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Business Process Reengineering (BPR)
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Wine, Business Process Reengineering & Strategy Based Learning
1st Quarter Issue 2011
Business Process Reengineering (BPR)
Dr Paul LAU

Business Process Reengineering (BPR)

Paul LAU, PhD

This journal is compiled aiming at the linkage of the three broad phases of a development project with three evolving concepts in the leadership and management literature. First, the pre-project planning phase is associated with the proactive, streamlining concept of business process reengineering (BPR). Second, the project execution phase is paired with total quality management (TQM). Third, the post-project learning phase is coupled with the competence building tenets of the learning organization (LO). Such a correspondence of development project phases to appropriate management concepts will enable us to do the some "parallel thinking". It also will significantly improve our appreciation of the key success factors (KSF) for competitive development projects.

Business Process Reengineering (BPR) and Preplanning

What is business process reengineering? Hammer (1993) argued that BPR is the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical contemporary measures of performance, such as cost, quality, service, and speed. This definition applies to organization-wide goals of radically streamlining business processes. For our purpose, this statement needs to be tailored to development project success. A modified definition in terms of pre-project planning is provided as follows:

BPR in a development project connotes a proactive, grassroots, comprehensive, and dramatic change in extant, suboptimal project performance. In relation to this, functional barriers are dissolved via the fluidity of highly effective, cross-functional development project teams. This pre-empts costly delays, duplication and waste in project execution-resulting in important, contagious, organization-wide quality and performance enhancements over time.

BPR is the effective use of the doctrines of change management. Mclnerney (1993) contended that a new hybrid of centralized and decentralized operations is created. It substitutes task simplification with task enrichment. Self-managed project teams are used to flatten traditional multi-layered pyramids.

These cross-functional teams thus increase managerial span-of-control from an organizational standpoint. While empowering employees, BPR should infuse the concept of streamlining development processes proactively, even during the pre-project planning stage. Reengineering should ideally commence from the very outset of a development project (Hammer et. al, 1995).

Rationales for Reengineering

The reasons for reengineering are as follows:
  • Combating competition in a dynamic and turbulent external environment;
  • Meeting evolving market needs;
  • Instituting speedy, flexible responses;
  • Meeting complex project needs by simplifying business processes (BP);
  • Connecting directly functional employees; and
  • Instilling excellence in employees;
There are many strategic triggers to BP, including the following:
  • Realization of competitive advantage;
  • Need to construct operational capabilities;
  • New markets / products / services opportunities;
  • Sharpening of strategic business objectives; and
  • Varying in the marketplaces, i.e. loss of market share, new regulations, shorter product life cycles, and new technologies on the horizon.
The key players in reengineering are as follows:
  • Strategic apex;
  • Champions of the reengineering concept;
  • Strategic and tactical steering teams;
  • Reengineering coordinator;
  • Self-operating project teams, including a leader facilitator, liaison with strategic apex, and members.
The strategic phases of BPR that can give pre-project planning a radical tenor are as follows:
  • Phase I: Position for change - Develop focus and mobilize resources;
  • Phase II: Diagnose the existing process – Fundamentally to evaluate the process;
  • Phase III: Redesign the process – Envision a new way of performing; and
  • Phase IV: Transition to the new design – Formulate a strategy and action plan.

Key factors for success in BPR are vision, skills, incentives, resources and a feasible and effective action plan.

Vision
Ensure your strategies are correct, creating the case for implementation, developing a clear and common vision, and setting empirical performance goals.

Skills
Educate the strategic apex, enlisting process leadership, thinking out of the box, tolerating ambiguities, and planning to manage diversity and conflicts.

Incentives
Initiated by the strategic apex, articulating vision periodically, recognizing and rewarding success, and driving cultural change.

Resources
Commit the best people, providing solid reengineering support, including outsiders, benchmarking for excellence, and using IT efficiently.

Action Plan
Plan for implementation challenge, planning and preparing to direct change, addressing all aspects of the plan, focusing on change management, and inculcate a value-adding and quality conscious cultural value.

Results that can be anticipated from a proper and resolute implementation of BPR are:
  • Essential process enhancement, i.e. 50% - 100%;
  • Lowered costs;
  • Increased speed, quality and service;
  • Accelerated growth and value creation; and
  • Disruption of the status quo.

Following the studies, we have noted the rationales, distinguishing features, strategic triggers, key players, strategic phases, and KSFs associated with reengineering BPR at the pre-project planning phase. Hence, we are proceeding to study a related concept, total quality management (TQM), associating with the next phase of the development project – project execution.

TQM and Project Execution

TQM is a "Total, company-wide effort that includes all employees, suppliers, and customers, and that seeks to continually enhance the quality of products and processes to meet the needs and expectations of clients (Dean, 1994).

TQM and BPR have many characteristics in common. Both focus on exceptional customers' satisfaction, are required toward streamlined processes, and are committed to enhance performance (Hammer, et. al, 1995).

The complementary aspects of TQM with respect to BPR are noteworthy: TQM emphasizes incremental enhancement via systematic problem identification and problem-solving throughout the project execution phase, whereas BPR seeks radical improvement via total process design at the front end. TQM seeks to further improve underlying processes established via BPR, primarily during the pre-project planning phase. Management must therefore clarify the nature of customer-focused quality improvement, and explain how TQM relates to reengineering (Hammer, et. al, 1995).

What are the objectives of TQM? As a structured system, it aims at securing the satisfaction of both the internal and external stakeholders. This is done by integrating continuous quality improvement (CQI), the development project environment, and the design-build-test cycles of the evolving project. In the process, there is a definite, positive change in organizational culture. Quality becomes a watchword, not a buzzword!

TQM embodies total dedication to incorporating continuous quality improvement (CQI) to meet customers' needs and even exceed their anticipations. Quality can never be static, because clients need and expectations are continuously varying. Indeed, TQM is an ongoing cultural value embedded in highly successful organizations via their development projects.

TQM is composite of every individual player adding value to the project. In the Japanese system of individual-oriented Kaizen, the worker identifies ways to improve productivity. The emphasis is on continually maintaining overall quality, cost constraints, tight time schedules, and project morale. When the development team members add value to the project, it has a dramatic impact on the overall project quality. This is perceived organization-wide, but also by the external customers and stakeholders. The enhanced quality, as well as reduced time and cost, become patently visible. Clients perceive value when such benefits are seen to exceed their cost in acquiring the innovative products of the organization. Quality is therefore more than a fad; it is the lifeblood of the effective, value-creating-and-value-adding project organization.

Quality is, in a nutshell, an ongoing commitment to faithfully serve both internal players and external customers.

Advances in computer-based tools such as CAD/CAM will continue. Quality function deployment (QFD) was developed by the strategic apex of Toyota and is presently widely implemented (Burgelman, 1988). It is a systematic procedure for linking customer requirements to design parameters, thus, QFD serves to apply rigor and completeness to cross-functional problem-solving activities that are ordinary to most complex, system-based development projects (Hauser, 1988 & Wheelright, 1992).

Even such TQM-related processes such as just-in-time, value-added analysis, and fast cycle time techniques are proving useful when applied to the task of new product and new process development. We are likely to note more of these tools applied broadly and systematically in building an organization's capabilities via development projects.

In its essence therefore, TQM leads to a competitive advantage via customer responsiveness, acceleration of results, and resource effectiveness (Thomas, 1993). To secure this, the project execution phase must be geared toward total cost management by adding value to the overall project and to targeted customers.

Learning Organization (LO) and Post-Project Learning

The dispassionate exercise of reengineering at the front end of the development project and of TQM during its execution will have enriched the project participants and the parent organization with a significant fund of knowledge. This must be harvested and optimized in the essence. The objectives of post-project learning phase is to apply that learning to achieve continual improvement in products / process development speed, productivity, and quality. The astute organization that harvests the accumulated knowledge from project execution experience is a learning organization.

In a world of intense international competition where customers are sophisticated and demanding and technologies are diverse and dramatic in their effects, organizations that stand still in product and process development will neither prosper nor survive (Burglman, 1988). Survival and continual success is dependent on the capability and resolve to continually learn from experience. In terms of innovative product and process development, such learning comes from competent development projects.

Organizational learning does not occur by accident, and is certainly not a natural outcome of development projects. In fact, the phenomenon is to bury unpleasant experiences, and gloat over outstanding success. The learning organization (LO) can – and should – learn from both. Systematic inquiries of cause and effect needs observation and recording of the outcomes via a continuous and historical project audit. This should be followed by a diagnosis of underlying causes by hindsight and compared to precious projects. It is apparently that a concerted effort requires to be made, focusing attention on learning from the development project just executed.

The prominent benefit derived by the LO is that it learns about development activity and creates capabilities to more efficiently implementation of such activities in the near future. One of the core rationales for the success of the LO is that such continuous and integrated sharing of knowledge, it is able to evaluate entirely the ongoing validity of the key assumption it holds about the nature and future of its business operations (Hitt, et. al, 1994). Further sharing knowledge across people, jobs and organizational functions often results in expansion of that knowledge in competitively relevant approaches. An appreciation of cross-functional learning perspectives makes for sustained learning. Re-education and retooling for ensuring development projects are laudable results of such a concerted and deliberate effort at post-project studies.

The LO will therefore provide forethought into the mechanisms of learning, its capture, and its consequent application to future projects for even greater success. Post-project learning is not merely an afterthought, but a crucial necessity for a successful stream of development projects in a competitive context.

Key Success Factors (KSFs) For Development Projects

The success of development projects is a function of the following:
  • The number and complexity of processes;
  • The sense of urgency on top-to-bottom players;
  • The level of resource commitment;
  • The extent of participation by all; and
  • The tolerance of ambiguities.

Business processes in most organizations are not engineered in the first place, they are historical accidents, accumulations of custom and practice with an overlay of system and procedures (Manganelli, et. al, 1994). New products and their associated manufacturing processes and delivery systems can leapfrog the competition, creating strong barriers that other must hurdle just to stay in the game, and establishing leadership position (Burgelman, et. al, 1988). Development projects of a competitive organization are to be characterized high quality, controlled cost, and speedy execution.

Just as an aircraft requires a robust frame to prevent collapse at supersonic speeds, a development project must be highly structured to manage speed. This can best be secured by firmly embedding the three managerial doctrines elucidated in this journal:

  • BPR in the pre-project planning phase;
  • TQM in the project execution phase; and
  • The LO in the post-project learning phase.

Conclusion

All things being taken into accounts, it is during pre-project stage that management has the most impact on the project. In doing so, reengineering is the core approach, as it involves challenging the way in which things have always been performed in the past, and looking for new, more effective and efficient approaches of doing them (Channon, 1997).

The project execution phase is fast-paced and streamlined, thanks to thorough, front-end reengineering. Post-project learning from past development project experience needs that stated cases be identified, diagnosed, captured, and then incorporated into the approach the organization implemented is development activities in near future projects (Burgelman, et. al, 1988). It must be kept in view that available knowledge is in the growth at an enormous rate, we can therefore anticipate that the level of turbulence and its absolute growth rate will be importantly greater in the near future (Huber, et. al, 1993).

Organizations have noted immense advantages in differentiating categories of development projects, enabling them to leverage scarce development resources, addressing markets' needs appropriately, and providing distinctive products offering competitive advantage (Burgelman, et. al, 1988). These development projects are most nimble and speedy when their organizational structure has a flatter configuration.

As communication in the life-blood of a fast-paced development project, the key to managing the flat project organization is information technology (Mclnerney, et. al, 1993). Close and holistically communication between the strategic apex and the internal and external stakeholders is critical, and should be effected via an optimal combination of teleconferencing, computer networking, walkie-talkie, electronic mail, and voice mail.

About the Author

Dr Paul LAU has been a "Leader Manager" within Hong Kong Police Force since April 1974 and was promoted from a Police Constable when having fulfilled the academic qualification via his evening school studies, performing remarkably well while serving within the Crime Wing, he secured the strong recommendation of promotion following the Extended Interview by its Panel in 1987, serving as a competent, professional and dedicated commanding officer in various Formations.

Being a strong implementer of life-long learning concept, Dr Lau has been conferred jointly DMS by Lingnan University and HKMA in 2002; BBBA by RMIT University "With Distinction" in Australia in 2003; MBA "With Merit" by Hong Kong Baptist University in 2005; MA by Macquarie University in Australia in 2007 and PhD in BA by Bulacan University in Philippines in 2009.