Business Process Reengineering (BPR)

Business Process Reengineering

Business process reengineering (BPR) began as a private sector technique to help organizations fundamentally rethink how they do their work in order to dramatically improve customer service, cut operational costs, and become world-class competitors. A key stimulus for reengineering has been the continuing development and deployment of sophisticated information systems and networks. Leading organizations are becoming bolder in using this technology to support innovative business processes, rather than refining current ways of doing work.

Business process reengineering is one approach for redesigning the way work is done to better support the organization's mission and reduce costs. Reengineering starts with a high-level assessment of the organization's mission, strategic goals, and customer needs.  Basic questions are asked, such as "Does our mission need to be redefined? Are our strategic goals aligned with our mission? Who are our customers?" An organization may find that it is operating on questionable assumptions, particularly in terms of the wants and needs of its customers. Only after the organization rethinks what it should be doing, does it go on to decide how best to do it.

Within the framework of this basic assessment of mission and goals, reengineering focuses on the organization's business processes--the steps and procedures that govern how resources are used to create products and services that meet the needs of particular customers or markets. As a structured ordering of work steps across time and place, a business process can be decomposed into specific activities, measured, modelled, and improved. It can also be completely redesigned or eliminated altogether. Reengineering identifies, analyzes, and redesigns an organization's core business processes with the aim of achieving dramatic improvements in critical performance measures, such as cost, quality, service, and speed.

Reengineering recognizes that an organization's business processes are usually fragmented into sub-processes and tasks that are carried out by several specialized functional areas within the organization. Often, no one is responsible for the overall performance of the entire process. Reengineering maintains that optimizing the performance of sub-processes can result in some benefits, but cannot yield dramatic improvements if the process itself is fundamentally inefficient and outmoded. For that reason, reengineering focuses on redesigning the process as a whole in order to achieve the greatest possible benefits to the organization and their customers. This drive for realizing dramatic improvements by fundamentally rethinking how the organization's work should be done distinguishes reengineering from process improvement efforts that focus on functional or incremental improvement.

Figure 1 indicates that work processes, information needs, and technology are interdependent.  When a reengineering project leads to new information requirements, it may be necessary to acquire new technology to support those requirements. It is important to bear in mind, however, that acquiring new information technology does not constitute reengineering. Technology is an enabler of process reengineering, not a substitute for it. Acquiring technology in the belief that its mere presence will somehow lead to process innovation is a root cause of bad investments in information systems.

Figure 1: Relationship of Mission and Work Processes to Information Technology

Reengineering a business process drives changes in other aspects of the organization that support and control the process (figure 2).

Figure 2: Reengineering Drives Many Changes

Because so many issues are interconnected in reengineering, evaluators need to scope their assessments broadly and take a holistic view of the effort.  For example, an agency that is in the midst of designing a new process should have previously laid a solid foundation for change by clarifying its mission, identifying customer and stakeholder needs, assessing performance problems, setting new performance goals, and determining that reengineering is an appropriate approach to take. Even implementation issues need to be considered in the early stages of the project, so that executives can begin preparing the agency for changes in goals, values, and responsibilities.

SOURCE:

Dodaro, Gene L. and Crowley, Brian P. (1997) “Business Process Reengineering Assessment Guide”, Accounting and Information Management Division, United States General Accounting Office, May 1997, Version 3