Advantages of BPR

Satisfaction A big advantage of reengineering is that the work becomes more satisfying because the workers get a greater sense of completion, closure, and accomplishment from their jobs. The employee performs a whole job, a process or a subprocess, that by definition produces a result that somebody cares about. The workers not only try to keep the boss happy or to work through the bureaucracy. More important is the fact to satisfy the customer needs. Growth Knowledge Furthermore, the personal development within a process team environment does not play such an important role which means climbing up the hierachy is a minor goal. In this case it is much more important to get a widespread knowledge of the whole process and there are no such things as "mastering" a job; as a worker's expertise and experience grow, his or her job grows with it. Solidarity to the Company "Moreover, since workers in a reengineered process spend more time on value adding work and less time on work that adds no value, their contributions to the company increase, and, consequently, jobs in a reengineered environment will on the whole be more highly compensated. Demanding Jobs There is, however, a challenging side to all this good news about work in a reengineered environment. If jobs are more satisfying, they are also more challenging and difficult. Much of the old, routined work is eliminated or automated. If the old model was simple tasks for simple people, the new one is complex jobs for smart people, which raises the bar for entry into the workforce. Few simple, routine, unskilled jobs are to be found in a reengineered environment. This fact that the jobs are more demanding can be either an advantage or a disadvantage. It depends on the view from where you consider it. Unskilled employees might get difficulties to get along with the process changings. Some people are just not able to perform several tasks. For such persons it will be probably difficult to survive within this new environment which mostly leads to a personal failure in their job. Authority In a traditional oriented company, the management expects from the employees that they follow some specific rules. In contrast to that the reengineered companies dont want employees who can follow rules; they want people who will make their own rules. As management invests teams with the responsibility of completing an entire process, it must also give them the authority to make the decisions needed to get it done.

Benefits of BPR Business Process Reengineering (BPR) can be defined as the elemental rethinking and radical redesigning of the business processes in order to achieve remarkable improvements in critical measures of performance like cost, service, quality, and speed. An organization where application of BPR is being done, is process -oriented, where all processes are identified and given specific names. Each individual is aware of the particular process in which he or she is involved and complete process measurement such as monitoring and control is performed. Business Process Reengineering or BPR is also known by other names like Business Process Redesign, Business Process Change Management or Business Transformation. BPR brings numerous benefits to organizations and companies in which it is implemented. Some of the common benefits of BPR are:

Increase Effectiveness
As all employees are aware of the processes to which they belong , they have a greater sense of responsibility. All processes are completely monitored under the strict control of the management. The net result of this is that employees deliver high quality products to their customers. Helps to improve efficiency Proper management and control of all business processes reduces the time lag between different processes, which otherwise is quite high causing delays. This in turn reduces the time to market the product to the target customers and gives quicker response to buyers. Reduces Cost With the proper management of processes, improved efficiency and quick delivery of products to the buyers ,the overall product costs are reduced resulting in cost saving for the organization in the long run. Meaningful job for Employess As the time lag of product processing between different departments gets reduced due to the application of business process reengineering, there are more meaningful tasks to be performed by employees. This leads to increase their levels of motivation and the desire to perform well. Improvement in Organizational Approach As the time lag of product processing between different departments gets reduced due to the application of business process reengineering, there are more meaningful tasks to be performed by employees. This leads to increase their levels of motivation and the desire to perform well. Growth of Business Implementation of BPR results in the growth of the present business thus enabling the emergence of new businesses within the same organization.

Although BPR is very effective in controlling cost and improving efficiency, its implementation is a hard nut to crack. Employees are very resistant to this kind of change thus, it is important to have extensive support from the top management.

I. THE ROLE OF IT1

Enterprises wanting to increase their market share or obtain profits must adapt to changes in the environment. Consequently, many changes in business methods are beginning to appear, particularly Business Process Reengineering. Among the potential enablers of BPR is information technology (IT). IT makes it possible to obtain improvements in BPR. Enterprises can make their tasks easier, redesign their organization, change the way they work, and achieve spectacular improvement using, among other enablers, IT. Relationship Between IT and BPR The term reengineering first appeared in the Information technology field and has evolved into a broader change process. The aim of this radical improvement approach is quick and substantial gains in organizational performance by redesigning the core business process. In the late 20th century, many US companies embraced reengineering as an effective tool to implement changes to make the organization more efficient and competitive. The motivation was usually the realization that there was a need to speed up the process, reduce needed resources, improve productivity and efficiency, and improve competitiveness Working together, BPR and IT have the potential to create more flexible, team-oriented, coordinative, and communication-based work capability. IT is more than a collection of tools for automating or mechanizing processes. It can fundamentally reshape the way business is done and enable the process design. In leading edge practices, information technology makes BPR possible and worthwhile. BPR and IT are natural partners, yet their relationships have not been fully explored. What is the relation between BPR & Information Technology? Hammer and Champy consider IT as the key enabler of BPR. Davenport argues that BPR requires taking a broader view of both IT and business activity, and of the relationships between them. IT capabilities should support business processes, and business processes should be in terms of the capabilities IT can provide. They believe ITs promise and its ultimate impact is to be the most powerful tool for reducing the costs of coordination. It has been argued that innovative uses of IT would inevitably lead many firms to develop new, coordination- intensive structures, enabling them to coordinate their activities in ways that were not possible before. Such coordination-intensive structures may lead to strategic advantages. IT roles can be categorized into three phases: [Refer to Table 1]

1. Before the process is designed (Enabler) BPR is a strategic action and requires a clear understanding of customers, market, industry and competitive directions. Furthermore, like any other strategic action, it requires consistency between the companys business strategy and vision. Defining business strategy and developing a strategic vision requires understanding the companys strengths and weaknesses, and the market structure and opportunities. IT capabilities can provide good insight into the existing conditions. IT is one of several enablers, including human resources and organizational change, that all must be considered together to bring about change in business processes. Many companies ignore IT capabilities until after a process is designed. An awareness of IT capabilities can and should influence process design. Michael Hammer recommends companies to redefine the process first and automate it second. 2. While the process design is underway (Facilitator) This stage involves two activities: technical and social design. During the technical phase, information is consolidated, alternatives are redefined, process linkages are re-examined, and controls are relocated prior to applying technology. The social design focuses on human aspects and involves employees who will affect corporate changes: defining jobs and teams, defining skills and staffing needs, and designing incentives are considered carefully. This stage also requires development of test and rollout plans. After the objectives are identified, the existing processes are mapped, measured, analyzed, and benchmarked, and then are combined to develop a new business process. Development of people, processes, and technology are integrated. During the process design, accountability for development, testing and implementation must be clearly defined. Real benefits to the business result when IT becomes involved with more fundamental changes to the business process itself. 3. After the design is complete (Implementer) The bulk of the reengineering efforts lie in this phase. The reengineering efforts include planning and managing people, processes, and technology and driving the implementation toward the business vision. The objectives of this stage are to pilot test the new approach, to monitor the results, and to provide extensive retraining of employees. As reengineering efforts go forward it is important to define and redefine performance goals and objectives, maintain a strong commitment to the vision, break the barriers between the departments, and be flexible as the business environment changes.

Role of IT in Reengineering Business process reengineering is a pervasive but challenging tool for transforming organizations for radical improvement in all aspects of its performance. IT plays an important role by either enabling or constraining successful implementation of Reengineering. The role of IT in reengineering is not automating the business process. Companies that think of IT as the tool for automating its business process cannot reengineer. IT can be an enabler for reengineering by enabling the organization to reengineer. IT allows the organization to do business process more efficiently. IT can also become an inhibitor of reengineering if the organization's IT Infrastructure is inadequate or inflexible. IT infrastructure capability includes both the technical and managerial expertise required to provide reliable physical services and extensive electronic connectivity within and outside the firm. The major advantage of IT in reengineering lies in its disruptive power. IT has the power to break the rules and make people think inductively and give the company a competitive advantage. The company that used the disruptive power of IT to break all rules and gain competitive advantage was Amazon.com. Amazon.com broke the existing rules and sold books without a physical presence for its customers, through Internet. Amazon.com in doing so has completely changed the book store business and broke all the rules. The key to the effective use of IT lies not in moving the information faster but in doing right things with it. IT has to be used to make proactive decisions to improve business performance rather than report on it after the fact. In the design phase of implementation of reengineering the capabilities of IT can be used to simulate a model of the design and there by validate the new design.

Business Process Reengineering aims at enhancing customer service by improving productivity, eliminating waste and reducing the cost. The drive for BPR is to realize dramatic improvements by fundamentally rethinking how an organizations work should be done instead of mere process improvement that focus on functional or incremental improvement. Reengineering involves radical improvements and not any incremental changes. In this sense, reengineering without an IT support is nearly impossible. The evolution of IT provides multiple options for process execution that were not possible erstwhile, which opened the possibility of reengineering in the first place. IT system helps in process automation, integration of multiple processes and ensures consistency, thereby improving productivity and quality of the processes and reducing the cost. IT is an enabler of process reengineering and not a substitute for it. Role of IT in BPR is quite significant and continuous update on technology will help. IT enabled BPR ensures achieving larger target, reducing the risk and providing measures in sustaining results over a longer time. IT had a major role to play in BPR. The reason for that is very simpleIT is perhaps the only department in any organization which has a holistic view of the organization from a process perspectivefrom the perspective of what are the bottle necks, choke points, etc. Few years back, IT used to provide support to the business, then it started playing the role of an enabler, and now it drives the business. It is tough to think of BPR without IT, as the contribution of IT in these processes is around 80%-90%. IT also helps to improve business and enhance customer expectations. The need of IT, especially in todays slowdown scenario, is more and thus there is more expectation from it. Importance of IT Building an effective IT infrastructure is a vital factor in successful BPR implementation. An adequate understanding of technologies for redesigning business processes is necessary for proper selection of IT platforms. Effective overall system architecture, flexible IT infrastructure and proper installation of IT components all contribute to building an effective IT infrastructure for business processes. The IT infrastructure and BPR are interdependent in the sense that deciding the information requirements for the new business processes determines the IT infrastructure. In addition, recognition of IT capabilities provides alternatives for BPR. Building a responsive IT infrastructure is highly dependent on an appropriate determination of business process information needs. This, in turn, is determined by the types of activities within a business process, and the sequencing and reliance on other organizational processes. An effective IT infrastructure follows a top-down approach, beginning with business strategy and IS strategy and passing through designs of data, systems and computer architecture. Linkages between the IT infrastructure components are important for ensuring integrity and consistency among the IT infrastructure components. IT standards also have a major role in reconciling various infrastructure components to provide shared IT services that are of a certain degree of effectiveness to support

business process applications. The IT infrastructure shared services and the human IT infrastructure components, in terms of their responsibilities and their expertise, are both vital to the process of the IT infrastructure composition. Information and IT are rarely sufficient to bring about the process change; most process innovations are enabled by a combination of IT, information and organizational/human resource changes. IT provides project management skills and experience, which is a key ingredient in successfully implementing reengineering. The IT group of the company has experience in large scale project as they are exposed to the structured demand of large scale projects. Reengineering in a company is and should be undertaken as a project, this is the time when the project management expertise of the IT group becomes a key ingredient in the success of reengineering. IT can continuously reflect and reinforce bureaucratic and functional structures or IT can help to create a leaner, flatter and more responsive organization. For example, IT tools that are designed for functional hierarchies are primarily designed to support incremental improvements and cannot achieve the radical change in BPR projects. While information systems provide fast processing and response, they often fail to provide the flexibility for human communication, which can lead to serious consequences. This means IT may sometimes have a negative impact by merely automating the existing processes. However, it could also have a positive impact if it is deployed correctly in conjunction with the organizations goals. IT is the enabler to reengineer processes and is an important driving force for business transformation. Although, BPR has its roots in IT management, it is primarily a business initiative that has broad consequences in terms of satisfying the needs of customers and the firm's other constituents. The IS group may need to play a behind-the scenes advocacy role, convincing senior management of the power offered by IT and process redesign. It would also need to incorporate the skills of process measurement, analysis, and redesign.

II.

APPLICATION OF BPR