Professional Documents
Culture Documents
TEAM MEMBERS
Rakesh Ranjan, SE, CTPS – TEAM LEADER
Jaydev Barai, EE, CTPS
Arvind Kumar, AE, CTPS
S Jolly Samad, AE, CTPS
No. of words – 5726 (Presentation) + 430 (Abstract)
Date of submission – 27.09.2013
TABLE OF CONTENTS
1. Keywords i
2. Abstract i
3. What is BPR 1
4. Definition of BPR 1
5. Origins of BPR 2
6. BPR as Radical Change 2
7. Era after 1995 4
8. BPR success & failure factors 5
Organisation commitment 5
Organisational team 6
Project planning and 7
management
Adequate IT infrastructure 7
Effective change management 8
Continuous improvement 9
9. Case Studies 9
BPR case study at Honeywell 9
Lessons learned at Honeywell 10
Another case study of M&M 12
10.BPR in DVC 13
11.Concluding Remarks 14
12.BPR implementation in Tabular 16
form
13.References 17
A bstract
The globalisation of the economy and the liberalisation of the trade markets have
formulated new conditions in the market place which are characterised by
instability and intensive competition in the business environment. Competition is
continuously increasing with respect to price, quality and selection, service and promptness
of delivery.
Within the framework of this basic assessment of mission and goals, re-engineering 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. Re-engineering
identifies, analyzes, and re-designs an organization's core business processes with the aim of
achieving dramatic improvements in critical performance measures, such as cost, quality,
service, and speed.
In this paper we have tried to explore the principles and assumptions of BPR and identify the
D efinition of BPR
It is argued by some researchers (for example, van Meel et al., 1994; MacIntosh
and Francis, 1997; Peltu et al., 1996) that there is no commonly agreed definition
of BPR. Peltu et al. consider that this lack of an accepted definition of BPR makes it
difficult to assess the overall success or failure of its concept. Thus it is essential to
make clear what the definition of BPR is before we propose any framework and techniques
for BPR. The book “Reengineering the Corporation: A Manifesto for Business Revolution by
Hammer and Champy (1993)” is widely referenced by most BPR researchers and is regarded
as one of the starting points of BPR. The following is their definition of BPR:
Another BPR father, Davenport (1993), describes ‘business process redesign’ as:
... the analysis and design of workflows and processes within and between
organisations. Business activities should be viewed as more than a collection of
individual or even functional tasks; they should be broken down into processes that
can be designed for maximum effectiveness, in both manufacturing and service
DVCTC-2013: BPR for organisational renewal and growth
environment.
O rigins of BPR
The concept of BPR is widely regarded as having been introduced as a perceived
solution to the economic crisis and the recession of the late 1980’s and early
1990’s (Butler, 1994; Arnott and O’Don- nell, 1994).
As Butler describes it: “the ‘80s were a time for financial reengineering ... the ‘90s
are for technological reengineering”.
Hammer and Champy (1993) propose that “BPR can help organisations out of crisis
situations by becoming leaner, better able to adapt to market conditions, innovative,
efficient, customer focused and profitable in a crisis situation”.
MacIntosh and Francis suggest that it is becoming more important “to develop new
products effectively than to produce old products efficiently”. Hammer and Champy
conclude that previously divided tasks are now being reunified into coherent business
processes. Thus one reason why BPR becomes popular is that it provides a mechanism to
make the changes better to fit the competitive environment to which the enterprises must
adapt themselves in this new and post-industrial age.
B PR as Radical Change
BPR is a radical change, rather than incremental change. Hammer and Champy
(1993) highlight this tenet as:
One reason the change in BPR is radical rather than incremental is “to avoid being trapped
by the way things are currently done” (Vidgen et al., 1994).
Robinson (1994) concludes that radically revisioned processes drive the shape of the
organisation, rather than current structures. Even such radical changes are not limited to
inside one organisation but forge with other organisations, which generate new views of an
organisation (Vidgen et al., 1994):
In 1990, Hammer, published the article "Reengineering Work: Don't Automate, Obliterate"
in the Harvard Business Review, in which he claimed that the major challenge for managers
is to obliterate forms of work that do not add value, rather than using technology for
automating it. This statement implicitly accused managers of having focused on the wrong
issues, namely that technology in general, and more specifically information technology, has
been used primarily for automating existing processes rather than using it as an enabler for
making non-value adding work obsolete.
Hammer's claim was simple: Most of the work being done does not add any value for
customers, and this work should be removed, not accelerated through automation. Instead,
companies should reconsider their processes in order to maximize customer value, while
minimizing the consumption of resources required for delivering their product or service.
This idea, to unbiasedly review a company’s business processes, was rapidly adopted by a
huge number of firms, which were striving for renewed competitiveness, which they had lost
due to the market entrance of foreign competitors, their inability to satisfy customer needs,
and their insufficient cost structure. Even well established management thinkers, such
as Peter Drucker and Tom Peters, were accepting and advocating BPR as a new tool for (re-
)achieving success in a dynamic world. During the following years, a fast growing number of
Despite this critique, reengineering was adopted at an accelerating pace and by 1993, as
many as 60% of the Fortune 500 companies claimed to either have initiated reengineering
efforts, or to have plans to do so. This trend was fuelled by the fast adoption of BPR by the
consulting industry, but also by the study Made in America, conducted by MIT, that showed
how companies in many US industries had lagged behind their foreign counterparts in terms
of competitiveness, time-to-market and productivity.
E
ra after 1995
With the publication of critiques in 1995 and 1996 by some of the early BPR
proponents, coupled with abuses and misuses of the concept by others, the
reengineering fervour in the U.S. began to wane. Since then, considering business
processes as a starting point for business analysis and redesign has become a widely
accepted approach and is a standard part of the change methodology portfolio, but is
typically performed in a less radical way as originally proposed.
More recently, the concept of Business Process Management (BPM) has gained major
attention in the corporate world and can be considered as a successor to the BPR wave of
the 1990s, as it is evenly driven by a striving for process efficiency supported by information
technology. Equivalently to the critique brought forward against BPR, BPM is now accused of
focusing on technology and disregarding the people aspects of change.
The following analyses the BPR implementation process by reviewing the relevant literature
on both soft and hard factors that cause success and failure of BPR efforts. The factors listed
below are distilled from various articles and empirical research on BPR implementation.
They were then categorised into a number of subgroups representing various dimensions of
change related to BPR implementation. These dimensions are:
Before any BPR project can be implemented successfully, there must be a commitment to
the project by the management of the organization, and strong leadership must be
provided. Top management must recognize the need for change, develop a complete
understanding of what is BPR, and plan how to achieve it. Leadership has to be effective,
strong, visible, and creative in thinking and understanding in order to provide a clear vision
to the future. By informing and convincing all affected groups at every stage, and
emphasizing the positive end results of the reengineering process, it is possible to minimize
resistance to change and increase the odds for success. The ultimate success of BPR depends
on the strong, consistent, and continuous involvement of all departmental levels within the
organization. It also depends on the people who do it and how well they can be motivated to
be creative and to apply their detailed knowledge to the redesign of business processes.
After the most important organizational commitment is secured from all departments
involved in the reengineering effort and at different levels, the critical step of selecting a BPR
team must be taken. This team will form the nucleus of the BPR effort, make key decisions
and recommendations, and help communicate the details and benefits of the BPR program
to the entire organization.
The most effective BPR teams include active representatives from the following work
groups: top management, business area responsible for the process being addressed,
technology groups, finance, and members of all ultimate process users’ groups. The BPR
team should be mixed in depth and knowledge. For example, it may include members with
the following characteristics:
Moreover, Covert (1997) recommends that in order to have an effective BPR team, it must
be kept under ten players. If the organization fails to keep the team at a manageable size,
the entire process will be much more difficult to execute efficiently and effectively. The
efforts of the team must be focused on identifying breakthrough opportunities and
designing new work steps or processes that will create quantum gains and competitive
advantage.
Too often, BPR teams jump directly into the technology without first assessing the current
processes of the organization and determining what exactly needs reengineering. In this
business analysis phase, a series of sessions should be held with process owners and
stakeholders, regarding the need and strategy for BPR. These sessions build a consensus as
to the vision of the ideal business process. They help identify essential goals for BPR within
each department and then collectively define objectives for how the project will impact each
work group or department on individual basis and the business organization as a whole. This
plan includes the following:
Most analysts view BPR and IT as irrevocably linked. Walmart, for example, would not have
been able to reengineer the processes used to procure and distribute mass-market retail
goods without IT. Ford was able to decrease its headcount in the procurement department
by 75 percent by using IT in conjunction with BPR, in another well-known example.
Al-Mashari and Zairi (2000) suggest that BPR involves changes in people behaviour and
culture, processes, and technology. As a result, there are many factors that prevent the
effective implementation of BPR and hence restrict innovation and continuous improvement
(Fig – 1 at Page/16 may be referred to). Change management, which involves all human and
social related changes and cultural adjustment techniques needed by management to
facilitate the insertion of newly designed processes and structures into working practice and
to deal effectively with resistance, is considered by many researchers to be a crucial
component of any BPR effort. One of the most overlooked obstacles to successful BPR
project implementation is resistance from those whom implementers believe will benefit the
most. Most projects underestimate the cultural impact 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.
Continuous Improvement
BPR is a successive and ongoing process and should be regarded as an improvement strategy
that enables an organization to make the move from traditional functional orientation to
one that aligns with strategic business processes.
Hammer and Champy (1993) use the IBM Credit Corporation as well as Ford and Kodak, as
examples of companies that carried out BPR successfully due to the fact that they had long-
running continuous improvement programs.
C ase Studies
BPR success factors are a collection of lessons learned from reengineering projects
and from these lessons common themes have emerged. In addition, the ultimate
success of BPR depends on the people who do it and on how well they can be
committed and motivated to be creative and to apply their detailed knowledge to
the reengineering initiative. Organizations planning to undertake BPR must take into
consideration the success factors of BPR in order to ensure that their reengineering related
change efforts are comprehensive, well-implemented, and have minimum chance of failure.
What separates success from failure is execution. Top management has to be willing to
dedicate substantial training resources to educate the workforce about the four mechanisms
and how they work. Management behaviours have to change from autocratic to facilitative.
Teams have to be rewarded for enterprise value-added activities. Finally, the organizational
structure has to change to allow an environment conducive to innovation. rewards, and
At Honeywell, the path toward change is probably much smoother than in most
organizations because the organization has embraced change for many years. Honeywell is a
pioneer in quality management and has always developed its people through training
programs and rewards for value. Hence, execution was easier and resistance was not as big
an issue. However, problems had occurred.
The biggest obstacle to execution was within the middle management ranks. Members of
middle management were too used to being experts in a specific area. For instance, one
operations manager was the resident expert in materials flow, but he managed technology,
engineering, and manufacturing people. He would manage sub-optimally because every
problem was solved through materials flow. He could not see the cross-functional or cross-
specialization nature of the problem because of his narrow focus on materials flow. He had
to ``let go’’ of his expertise and let his people solve the problem as a cross-functional team.
It may sound like a simple change for this manager, but it took years.
Lesson ten: execution is the real difference between success and failure
The Honeywell case introduces four powerful mechanisms to facilitate enterprise change.
However, real change will not happen without a plan for change and aggressive execution of
that plan. We believe that execution fails in many cases because organizations are not
willing to dedicate resources, time, and energy to the effort.
By the mid 1990s, BPR had become a popular tool globally, with many leading organizations
implementing it. However, when M&M undertook the exercise, it was still a new concept in
India.
After five months, the workers ended the strike and began work in exchange for a 30% wage
hike. As the situation returned to normalcy, BPR implementation gained momentum. M&M
realized that it would have to focus on two issues when implementing the BPR program:
reengineering the layout and method of working, and productivity.
Summing up the company's BPR experience, Anand Mahindra said, "Let me put it in a simple
way. If we have facilities in Kandivili today, which are not just surviving but thriving, it is all
due to BPR.
While DVC and power sector in India as a whole has witnessed a few success stories in the
last 4-5 years, the road that lies ahead of us is dotted with innumerable challenges that
result from the gaps that exist between what’s planned versus what we been able to deliver.
India has historically failed to meet its power sector targets by a significant margin and with
tremendous opportunities ahead, the power sector continues to be affected by the shortfall
both on generation as well as transmission side.
As discussed initially, the overall intent of this paper is to highlight each and every aspect of
BPR which may be utilised in our organisation as well as the power industry as a whole to
address these challenges.
It is worthwhile to mention here that DVC has already started taking initiatives in this regard
viz. Formation of SBUs, IT enabled services and EBA, introduction of KPA and revised
promotion policy and APAR, restructuring of DVC organisation after revision of DVC Act,
gearing up for floating Special Purpose Vehicles for listing
Another major issue is dealing with change. Change is painful and difficult to implement.
‘Change of even the simplest sort is hopelessly complex . . . even making the case for change
is close to impossible’’. However, change is a fundamental aspect of BPR. Organizations
should therefore openly deal with change. Top management needs to communicate to its
people why the change is necessary and how it will impact everyone’s current job and future
with the company. Top management needs to convey to its people that BPR is not being
used to replace workers, but to improve quality, reduce cycle time, and create value for
customers. Patience is also needed. Change takes time.
Last but not least, for making any new thing successful, first and foremost requirement is to
move together as very well said in our own very old philosophy and culture which we have
learnt from our past.
“ॐ संगच्छध्वं संवदध्वं. सं वो मन ं सस ज नत म् .
दे व भ गं यथ पूवे. सञ्ज न न उप सते ||”
Which means “Let us move together, let us interact together, let us know each other’s mind;
as learned sages and seers have been practicing” (Shloka from Rigveda).