principal idea of reengineering

It allows organizations to view their business processes from a fresh perspective in order to understand how to redesign them to improve the way they work. The organization did face challenges in the migration, which included some legacy systems that didn’t fit in a virtualized infrastructure. Those systems would have required significant development costs to prepare them for migration. As they did so, Vodafone Germany built a new definition of their core and pushed their IT operating model to undergo a similar transformation. Vodafone Germany is one of the country’s leading telecom operators, offering mobile, broadband, TV, and enterprise services. In order to support its business needs and better integrate its markets, the company launched a multi-year program to modernize its infrastructure and ready its IT stack for digital.

IT leadership needed the corporate management team’s buy-in to pivot strategies and alter its current trajectory, into which they had sunk significant time, resources, and dollars. From an architecture perspective, many of the technologies central to the new approach—cloud, application modernization platforms, microservices, and autonomics—didn’t exist or were not mature when the original ERP strategy was formed. Implementing BPR successfully is dependent on how thoroughly management conveys the new cultural messages to the organization.[20] These messages provide people in the organization with a guideline to predict the outcome of acceptable behavior patterns. Change management is the discipline of managing change as a process, with due consideration that employees are people, not programmable machines.[18] Change is implicitly driven by motivation which is fueled by the recognition of the need for change.

Ongoing continuous improvement

In this article, published in Harvard Business Review, Dr. Hammer argued that a business should reduce and remove any business activities that do not actually work for the good of its customers. By the early years of the 1990s, businesses around the United States were adopting reengineering as a useful improvement process. “We are changing the technology and methodologies that we use, which requires new tools and processes. Ultimately, it means we change how we are organized.” With more than half of the IT organization having made the shift, teams are embracing new tools, techniques, and methods.

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This is where the senior management needs to identify the business situation; customer expectations, competition, opportunities, etc. BPR requires an organization to look closely at its strengths and weaknesses, ask difficult questions where necessary and make changes for the better of the organization. This is usually a long-term project that requires input from a variety of company departments. As IT scaled continuously over the last three decades, it became excruciatingly task-focused, not just in applications and infrastructure but in networks, storage, and administration. Today, IT talent with highly specialized skillsets may work almost exclusively within a single functional area.

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Rethinking the roles of third parties or outsourcing is also a crucial component of Business Process Reengineering. BPR involves the analysis and transformation of existing processes, workflows, and structures to identify opportunities for improvement, eliminate redundant steps, automate tasks, and streamline operations. Reengineering often requires a radical shift in the way your organization operates, and may involve changes to organizational culture, management practices, and technology infrastructure.

  • The reengineering technology trend offers CIOs and their teams a roadmap for fundamentally overhauling IT from the bottom up and the top down.
  • Reengineering can help your organization adapt to changes in the market, customer needs, or regulatory requirements.
  • Despite its recognized benefits, the process of reengineering an organization has come under criticism.
  • Benefiting from lessons learned from the early adopters, some BPR practitioners advocated a change in emphasis to a customer-centric, as opposed to an IT-centric, methodology.
  • Abrahamson (1996) argued that fashionable management terms tend to follow a lifecycle, which for Reengineering peaked between 1993 and 1996 (Ponzi and Koenig 2002).

Fragmented conventional processes and disjointed structures are the main cause of bureaucratic red tapes, slipups, cost inefficiencies, and unclear roles and responsibilities. BPR was implemented with considerable success by some high-profile organisations. For instance, Hallmark, a card company, completely re-engineered its new-product process; and Kodak’s re-engineering of its black-and-white film manufacturing process cut the firm’s response time to new orders in half. The idea was given a boost by the development of enterprise resource planning (ERP). ERP systems enabled a firm’s different operations to talk to each other electronically.

Principles of Business Process Reengineering

One of the most overlooked obstacles to successful BPR project implementation is resistance from those whom implementer believe will benefit the most. Most projects underestimate the cultural effect of major process and structural change and as a result, do not achieve the full potential of their change effort. Many people fail to understand that change is not an event, but rather a management technique.

Organizations that once seemed agile and focused during periods of growth may become sluggish and inefficient when demand drops off. Reengineering might not be appropriate in all situations, especially if your processes only require optimization and if your organization is not looking to undergo dramatic change. Usually, reasons like new market opportunities, increasing competition, poor financial performance, and decreasing market share trigger the need for a business process transformation. More specifically, this chapter evaluates the importance and relevance of reengineering interventions in the field and practice of OD. The key principles of reengineering and the main aspects of the reengineering process are outlined and analysed.

Want to Achieve Excellence in Process Improvement?

Business process reengineering (BPR) is a technique used to transform business processes for more effective achievement of business goals and purposes. If used properly, BPR will create an efficient, effective and responsive business for its owners, employees and customers. The process involves clearly defining your organization’s overarching goals and purpose, analyzing the current company processes, finding or creating ways to improve the process and implementation of the new process. Reengineering, also known as business process reengineering (BPR), is a methodology that focuses on the fundamental redesign of business processes to achieve significant improvements in productivity, efficiency, and quality. Kieran, a principal at Deloitte & Touche LLP, is the Transformation & Emerging Technology Market Offering Leader for the Cyber Risk Services practice of Deloitte Risk & Financial Advisory. With a deep technology background, broad range of experience over a more than 20-year career, and a focus on tackling emerging risks, Kieran provides clients with strategic yet pragmatic perspectives on cybersecurity and technology risk management.

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