ON BPR: Long Live Business Process Reengineering
As mentioned in Part
1: A Primer, companies should never lead with technology when trying
to solve business process problems. They should review their business
goals and objectives, examine, and refine or replace business processes,
and then, and only then, should they find the technology that matches
their business goals, objectives, and processes, to support those processes.
In this Part, we discuss some practical steps for actually performing
business process analysis and fostering change in your company.
I've practiced the art of BPR (Business Process Reengineering) in a phased
approach, each with a set of deliverables, to show progress toward the
ultimate goal of improving the customer experience, improving the daily
work experience for your employees, increasing profits, or, preferably,
Phase 0, both the BPR consultants and upper management meet and get
familiar with each other.
Phase 1, the team building begins.
Phase 2, data about how things currently exist and how processes are
currently conducted are collected.
Phase 3, you go through the re-design process, and document it.
Phase 4, technology needs are considered, the team goes through the
technology selection process. Both new processes and new technologies
are implemented and rolled out to the company.
0: "Why is Change So Important?"
Key upper management team members who will be supporting the change process
meet with the consultants. This is the getting to know each other step.
In this Phase, the consultants needs to discover the following about the
industry are they in?
are their key differentiators?
is the corporate vision and corporate goals?
is the company organizationally structured to deliver to that vision
and those goals? What, if any, technology solutions are in place to
support the delivery of the businesses' products or services?
strong a need does upper management feel to change the way they do
business? What do they see as "broken" that needs to be fixed?
also need to communicate some information, and establish that there
is a real need for their work. They explain what reengineering is and
isn't, and check the necessary conditions for their work; namely:
there real pain, either current or anticipated? What is the pain?
Are sales suffering? Has the company lost market share? Is quality
declining? Is morale in the company low? Are processes taking too
long? Are customers unhappy? Most change is pain driven, and pain
creates a readiness for change.
senior management be actively involved in the change process? This
is crucial. "Indispensable" staff will feel threatened; departments
will feel threatened. The very existence of an outside consulting
force examining the company and pushing for change will induce fear
and anxiety. Only the corporate leadership can deal with those who
see it in their interest to resist change. An Advisory Group composed
of senior management members will need to be established.
there a strategy for major change? When employees see a need for
change, when they believe a credible strategy is in place to foster
the change, when they know not only what sacrifices need to be made
but also what they will get in its place, and when they know they
can be part of the change process, they can be very supportive.
Without it, they won't be.
1: "Getting Organized"
"To mobilize, organize, energize, and inform the people who will perform
1: Secure executive team buy-in and their corporate communication
mentioned above, this is critical. The executive team must not only buy
in to the notion of change, but they must be the ones communicating the
need for change, and the steps that will be taken toward change. Outside
consultants, lacking initial credibility, can't do this.
2: Who will be part of the effort?
Improvement Team (PIT).
- A representative
group of people who actually work in the process is essential. An
information technology guru is needed. An outsider or "maverick" helps
the team. This is usually a person who works in another area in the
client organization. The maverick has the advantage of having no vested
interest in the process and hence can be totally objective. The outside
consultants often perform this role.
3: How will the PIT be trained on BPR?
the team with reengineering and the process. The consultants conduct formal
training sessions to educate the PIT.
4: How will the PIT be organized?
responsibilities include identifying subprocesses, determining where
to start the reengineering process, developing challenge goals, and
deciding which customers and employees to interview. A Project Champion
will remove obstacles needs to be identified. Define project parameters
regarding schedule, cost, and risk.
2: "Getting Data"
Key Questions to be Answered:
are our major business processes?
do these processes interface with customer and supplier processes?
are our strategic, value-adding processes?
processes should we reengineer within three months, six months, one
year, and subsequently?
organizations and jobs are involved in the processes? What pieces
of work are done by each job?
policies apply to the performance of the processes? In which piece
of work does each policy apply?
technology is used in the processes? In which piece of the work is
the technology used?
1: Identifying the Processes to Redesign
the following characteristics in choosing which processes to redesign:
customer requirement, but low performance (customers complain)
things just take too long
cost of poor quality (errors, rework, mistakes, scrap)
company throws people at the problem, but things don't get better
internal frustration factor and low morale
spans several functions and there is finger pointing and blaming
is not being measured, high variability in output or results
information exchange, data redundancy, and re-keying of data
buffers, and other assets sitting idle
ratio of checking and control to value adding
exceptions, and special cases
one is responsible for the process
2: Customer Interviews
of the process are interviewed to discover what they think of the
current process, what they like about it and what they do not like
about it. External customers, internal suppliers, and internal staff
members who work in the process but are not part of the Process Improvement
Team are also interviewed to get their ideas, comments and suggestions.
3: Internal "As Is" flowcharting
current processes in detail. Document: time, cost of poor quality,
and where frustration occurs. The bottlenecks, delays, areas of poor
quality and high frustration are ranked and prioritized.
At each step in the flowchart, ask team members to identify their level
of frustration experienced (H = high; M = medium; L = low). Write a brief
description of what the frustration is so that you can go back and specifically
redesign out those areas that are most troublesome.
to doing As-Is Flowcharts:
see the whole process, often for the first time
areas become easily visible
can vent about parts of the process that frustrate them
begin to offer improvement ideas after frustrations and problems are
problems point to which process redesign principles are not being
a shared understanding
produces definitions of customers and their performance expectations,
processes, and performance measures; identifies value-adding processes;
produces process maps, and; designates and orders the processes to reengineer.
3: "Getting Reengineered"
Step 1: First-cut Redesigns
with a clean sheet of paper. Ask: "If we were to invent this process today
with what we know, what would it look like?" Looking for "out-of-the-box"
thinking and innovative ideas.
these four questions about the things you are doing:
the customer willing to pay for this activity?
it add to the quality of our product or service?
it help us to respond faster to our customers?
it help us use our resources (people and inventory) more effectively?
2: Share first-cuts with Customer
actionable feedback for new designs.
3: Create second-cut Redesigns
based on the feedback from Step 2.
4: Share second-cuts with Advisory Group and Staff
are controversial elements or major capital outlays, the Advisory Group
(from the Executive Committee) needs to review and approve the plan.
with the rest of the people that work within the process to get their
ideas, comments, and suggestions.
5: Final Redesigns and Technology Considerations
the final redesigns, which should include considerations for the type
of technology that will be needed to support the new processes.
4: Beyond BPR: Getting the Technology and Implementing the Plan
the new business objectives and processes in hand, and technology requirements
documented, enter the technology selection process. Typically, by working
with consultants who are using a product like TEC's TESS, the selection
list can quickly be limited to two or three vendors that come fairly close
to your ideal solution. The technological gaps between your needs and
each of the two or three solutions is documented, and then the vendors
are brought in and asked to run their software through your business process
scenarios to give you both a general feel for the software, and a truer
understanding of their software's ability to deliver against your needs.
Be sure to consider such key factors as:
ability to implement, on time and within budget, what they demonstrate
on-going support programs
costs: Initial, maintenance fees, and support fees
past customers to understand their happiness with the software, the
implementation process, and their on-going experience with the vendor.
You'll be laying out a lot of money on both the software and the implementation
and rollout of the software (usually in a ratio of about 1 to 2 or 1
to 3, software to implementation). Take your time and be thorough.
in this series will address the steps of Implementation, Change Management,
and On-going Continuous Improvement.
sounds painful and difficult. It is. Don't let anyone fool you. But often,
process and technology changes become essential to not only the success
but the very existence of companies as their competitors progress and
improve rapidly. Undertake the work with determination and enthusiasm
for the health of the company, and keep focused. This kind of work is
always beyond the defined job descriptions of anyone in the company. Make
this work a measurable (and rewarded) part of the participants' work,
and document and publicize successes. Everyone will feel good about the