ALLAMA IQBAL OPEN UNIVERSITY ISLAMABAD

(Department of Business Administration)

Business Process Re-Engineering (5016)
Semester: Spring, 2023
Level: MSc Administrative Sciences
Assignment # 1
Question # 1 What are the various steps of business process redesign? with
examples. Discuss them ?

Answer # Business Process Re-engineering (BPR) is the radical redesign of business processes to
achieve dramatic improvements in critical aspects like quality, output, cost, service, and speed. Business
process reengineering (BPR) aims at cutting down enterprise costs and process redundancies on a very
huge scale.

Is business process reengineering (BPR) same as business process

improvement (BPI)?
On the surface, BPR sounds a lot like business process improvement (BPI). However, there are
fundamental differences that distinguish the two. BPI might be about tweaking a few rules here and there.
But reengineering is an unconstrained approach to look beyond the defined boundaries and bring in
seismic changes.

While BPI is an incremental setup that focuses on tinkering with the existing processes to improve them,
BPR looks at the broader picture. BPI doesn’t go against the grain. It identifies the process bottlenecks and
recommends changes in specific functionalities. The process framework principally remains the same
when BPI is in play. BPR, on the other hand, rejects the existing rules and often takes an unconventional
route to redo processes from a high-level management perspective.

BPI is like upgrading the exhaust system on your project car. Business Process Reengineering, BPR is
about rethinking the entire way the exhaust is handled.
Five steps of Business Process Re-engineering
(BPR)
To keep business process re-engineering fair, transparent, and efficient, stakeholders need to get a
better understanding of the key steps involved in it. Although the process can differ from one organization
to another, these steps listed below succinctly summarize the process:

Below are the 5 Business Process Re-engineering Steps:

1. Map the current state of your business processes

Gather data from all resources–both software tools and stakeholders. Understand how the process is
performing currently.

2. Analyze them and find any process gaps or disconnects

Identify all the errors and delays that hold up a free flow of the process. Make sure if all details are
available in the respective steps for the stakeholders to make quick decisions.

3. Look for improvement opportunities and validate them

Check if all the steps are absolutely necessary. If a step is there to solely inform the person, remove the
step, and add an automated email trigger.

4. Design a cutting-edge future-state process map

Create a new process that solves all the problems you have identified. Don’t be afraid to design a totally
new process that is sure to work well. Designate KPIs for every step of the process.

5. Implement future state changes and be mindful of dependencies

Inform every stakeholder of the new process. Only proceed after everyone is on board and educated about
how the new process works. Constantly monitor the KPIs.
Question # 2 Discuss the distinguish advantages for commercial organization of
business process redesign with examples.?

Answer # Business Process Reengineering (or BPR) is the process that

helps businesses to recreate their core business processes. The
primary objective of BPR is to improve the quality of products or
services, as well as reduce cost and wastage. BPR basically involves
analyzing the current business processes to find processes that aren’t
meeting the requirements or are inefficient. Also, it helps to make
necessary changes to outdated processes, or replace them completely
with new and efficient ones. BPR no doubt is beneficial, but like with
any other thing, it is not without disadvantages. In this article, we will
take a look at the advantages and disadvantages of business process
reengineering (BPR).

Advantages of Business Process

Reengineering
The following are the advantages of business process reengineering:

Business Performance
Improving overall business performance is the biggest advantage of
BPR. As said above, BPR helps to make processes more efficient. This,
in turn, helps to boost productivity, employee morale, as well as the
bottom line.  
Motivation in Employees
A lack of change could make employees dull, or we can say they could
get bored. So, going for BPR could motivate employees that they will
now be handling processes that are more efficient. This would give
them more job satisfaction, and in turn, make them more efficient.

Boosting Productivity
BPR helps to identify and do away with processes that are reducing the
efficiency of different departments. This way, it helps to eliminate
inefficiency and boost productivity. It makes the company more
knowledgeable about its processes.

Flexibility
BPR makes a business flexible. This means it plans the processes in
such a way that it gets easy to make changes to them at minimum
costs. Or, BPR allows businesses to customize the processes to meet
the changing demand and trends.

 Risk Reduction
It helps businesses to come up with better and monitored
processes.  This, in turn, helps to lower operational risks, such as
fraud.X

Transparency
Using BPR ensures that businesses easily meet all regulatory
requirements, as well as remain transparent. This is because BPR
integrates regulatory requirements into the processes. And, this
automatically makes the processes transparent to all stakeholders.

Customer Satisfaction
It leads to higher customer satisfaction. When processes are efficient
and employees are happy, it would automatically results in better
customer satisfaction. Since BPR focuses more on processes, it is able
to interconnect different functional areas by cutting across the value
chain. This, in turn, boosts overall customer satisfaction.

Better Decision-making
BPR makes available reporting and analytical tools that could help
management make better decisions.

Better Control
Helps to lower the number of checks and controls as everything is
thoroughly planned and duplication is eliminated.

Disadvantages of Business Process

Reengineering
The following are the disadvantages of business process
reengineering:

No Guarantee of Success
Adopting BPR is no guarantee that a business will be successful. This is
because the success of a business depends on many macro and micro
factors.

Costly Process
Business process reengineering is a costly and time-consuming affair.
This is because BPR involves making big changes at the strategic and
operational levels. It won’t be wrong to say that small companies may
not be able to afford BPR.

Long-term Process
The results of BPR won’t be visible straightaway, rather it is a long-
term process. Or, we can say that result of BPR will show in the long
term only. This again makes BPR out of the reach of many companies
who don’t have the patience and money to carry ahead with BPR.

Requires Proper Training

Proper training needs to be given to employees to effectively
implement BPR. Employees must get training on when and how to
implement the new processes. If employees don’t get proper training,
it could derail the whole plan.
It is very important to properly structure teams for various process
reengineering tasks. Each team must have at least one manager who
is an expert in business processes. Failure to formulate proper teams
could make BPR less effective.

Unavailability of Resources
Businesses need to come up with the right resources at the right time
to implement BPR successfully. The resources could be human
resources, funds, process reengineering tools, data, and more. If one
or more of these resources aren’t available when needed for BPR, it
could slow down the whole BPR process.

Excess Fear & Excitement

Fear of failure is never good for the outcome, and the same is the case
with BPR as well. If employees fear that the BPR could fail, then they
may be hesitant to take the risk that is needed for the successful BPR
implementation.
There are chances that in excitement to benefit from BPR,
management may re-engineer too many processes.

Loss of Jobs
BPR could lead to the loss of jobs. Since BPR focuses on error-free
processes, it may replace humans with machines.
Final Words
The above advantages and disadvantages of business process
reengineering (BPR) make it clear that BPR is not an easy process.
Effectively implementing BPR requires a lot of planning, as well as the
willingness of top management and support from employees. So, it is
very important for a company going for BPR to get itself familiar not
just with the advantages but with the disadvantages of BPR as well.
Question # 1 What are the various steps involved in the
operational process for business improvement? Discuss
with examples ?
Answer # This means the processes are overly complex, variable and
difficult to control, which adds cost and risk to the business. To continue
growing, to improve margin, and to create a scalable company, these processes
should be evaluated and improved.
The crucial first step of effective process improvement is setting clear,
achievable goals that connect your process initiatives to business value. These
goals are the foundation of each improvement project — they will be the basis
of your communication to the managers and employees working on the
projects, make it clear why certain improvements are being prioritized over
others, and will provide accountability for hitting specific targets.
When deciding which goals to set, consider these four areas where better
business processes will add value.
1. Reduce costs
When processes are efficient they take less time to execute, can have fewer
steps, and can make wasteful activities more obvious and therefore easier to
eliminate.
Making a process efficient will reduce the cost of running the process itself
and will likely reduce the cost of quality. For example, take a process to
convert a customer quote into an order. If you have high-priced salespeople
re-entering orders into your systems, you have an expensive, revenue-
generating person performing a task that can be done by someone with less
knowledge of the sale itself. 
Removing or streamlining this process will help the salespeople generate more
opportunities and reduce sales operations costs — an average order entry
burden can cost a four-person sales team $120K to $150K a year over time.
Building the process in a disciplined fashion will improve the quality of the
data on the orders, reduce mistakes on product shipments to the customer,
reduce cost of quality and improve shipping times.
Improve customer experience and revenue
Effective processes on the revenue side of the business — sales, marketing,
R&D, etc. — drive sales success and improve pricing accuracy and product
development. Structured processes mean you can measure customers
throughout their lifecycle and create a consistently excellent customer
experience that the salespeople can use to sell and retain customers. 
This allows sales managers to actively manage the sales process, improve sell-
through rates and control pricing and discounts. It also usually helps reduce
the cost of customer acquisition, or at least more deliberately target
investment throughout the sales process.
3. Reduce risk
Consistent processes make for repeatable results. Repeatable results mean less
operating risk.
An example of this is a manufacturer’s quality control process. A repeatable,
predictable quality control process will have the same probability of defining
defects in every shift, all the time. A process that varies from shift to shift or
person to person will sometimes result in finding lots of defects and
sometimes finding very few, increasing cost of quality and making it difficult
to find the root cause of problems.
Since rigorous processes make it easier to identify root causes, they reduce the
risk of issues existing in your operations for very long.
4. Make the business easier to manage
Predictable processes that can be measured mean that you can put those
processes into systems, measure them and know their outputs without
needing to directly observe them. This means that good processes allow
executives and managers to manage the business without needing to be
involved with every operational detail. It helps leaders get “out of the weeds”
to spend their time working on the business itself.
Guiding principles
The following principles will maximize your chances of success:

 Focus on processes that have a disproportionate impact on either the

top or bottom line.
 Process improvement success is ultimately about execution. Choose goals you
have a realistically high chance of achieving based on your organization’s ability
to execute.
 Make sure employees understand the goals. Poor adoption is the top reason
process improvement projects fail. It is difficult to get people to change their
habits if they don’t understand why.
 Make sure it’s possible to measure your progress. Aspirational goals are
important, but for process improvement projects you need to make sure the
metrics you establish can actually be measured on an ongoing basis.
 Get advice. The business environment is changing quickly, and having an
independent point of view will help you choose the right goals and execute them
in the most effective, cost-efficient manner.

Question #4 How do business process and business

functions be effective in your view? Discuss with
examples.?
Answer # For a company to run successfully, it requires a
combination of various systems. All models must work together
towards specific goals. Business processes and functions are
some of the primary elements on which every company must
focus.Understanding the two areas makes it easy to work on
enterprise resource planning. The problem, however, is that not
every person gets the distinction between processes and
functions. Although the two are almost similar in some ways,
business owners, managers, supervisors, and other stakeholders
should know the differences. The success of any business process
or function depends on how effectively it’s implemented. For
that, you have to know what works where.
Business Functions
A business function consists of activities specific to a certain
operation. It is usually carried out by a department and occurs
regularly to help a business accomplish its mission. Functions can
be internal, meaning that they are part of the organisation, or
external, which are supplied by a third party.

The different areas of a business function are interdependent.

Therefore, they require data from each other. The success of a
company, workflow and communication all depend on how well
functional areas are integrated. Function falls into two
categories; core and support.

Core functions are the activities directly responsible for the

production of goods or services either for the market or a third
party. So, tense functions are part of the main activities of a
company.

Companies can have a single or several primary functions.

Support functions are secondary or ancillary, hence, contributing
to the success of core functions. The outcomes of these activities
don’t have direct contact with the intended market.
 Regardless of the business type (private, non-profit,
government), industry, or size, an enterprise has three standard
functions – operations, finance, and marketing.
Business Processes
A business process involves various activities that use available
inputs to create an output that contributes to a specific objective.
For this reason, successful business operations and growth rely
on the effective execution of processes.

Through business process management (BPM or BPMS),

enterprises can deliver their best value. The generated value has
to take the customer into consideration. Like with functions,
business processes have internal and external customers.
Depending on the elements involved, a business process can be
simple or complex.

How are business processes different from other tasks, though? A

process is flexible, measurable, repeatable and specific.

Examples of Functions and Processes

A practical scenario of each area gives a better comprehension of
how they both work.

Business function example: Let’s take marketing and sales as the

functional areas. In such a case, the functions include; marketing
a product, taking sales orders, customer support, advertising,
and sales forecasting.
Business process example: Consider the sale of a smartphone.
The functional area is accounting and finance. Here, the input is
financial help to buy a phone, while the process is a business
arranging financing options in-house. Thus, the output would be
a customer receiving financing through the tech company.

Importance of Business Functions and Processes

The business function sets the framework for the activities in a
business, thus, helping identify responsibility areas. Functions
can be separate from the product or service they are responsible
for creating. Therefore, when an organisation’s needs shift, the
functions can be adjusted, as well, to meet the new demands.

Business processes facilitate communication between customers,

suppliers, and stakeholders. All the infrastructure a company
builds should be aimed at enhancing processes. Improved
business processes boost productivity by eliminating
redundancies and unnecessary tasks.

Picking between business processes and business functions can

be difficult, especially when the distinction between the two is
unclear. Processes transform inputs into services and goods,
while functions are specific to a particular area. Both elements
are critical to business operations, which is why a company must
work on improving business processes and functions.
Question # 5 What are various principles of BPR? Discuss
them with examples.?
Answer # The principles of Business Process Reengineering
(BPR) play an important role in streamlining business operations,
improving service quality, and reducing costs.BPR is the
systematic analysis and improvement of business processes to
make them more efficient and effective. It involves identifying
and streamlining redundant or inefficient processes, and
implementing new best practices that can improve
performance.BPR can be applied to any business process, from
customer service and order fulfillment to manufacturing and
accounting.In this article, we’ll take a look at the BPR and its 7
core principles, along with some of the keys to success and
common challenges businesses face in implementing BPR.

Principles of Business Process Reengineering

Business process management with workflow automation
diagram and gears in virtual flowchart
To better explain business process reengineering and operational
processes, let’s analyze the seven core principles of this strategy,
as established by Michael Hammer and James Champy in their
book Reengineering the corporation: A manifesto for Business
Revolution.

The seven principles illustrate why business process

reengineering can be very helpful and successful in its application
in business operations.
Focus on Results Instead of Tasks

The first principle is for a business to focus more on the outcomes instead of
the operational processes.
This means that companies should pay more attention to their desired results
instead of how they will achieve them, and create the best strategies that will
guarantee these expected outcomes.
Essentially, they should aim to achieve their business goals and organize the
needed processes around said desired goals.

Allow Individuals Already Involved to Become Part of

the Process

The second principle is about involving people who are already participating in
one way or another in specific processes to become active contributors to the
entire process.
This principle can often be seen in customer-facing companies that allow their
customers to be part of the solution when they face an issue with the
company’s product or service through online DIY tools.
This principle promotes the participation of the party that is most directly
involved or benefits from the process.

Combine Data Collection With Processing Work

This principle suggests that the task of gathering information should be

completed by the same individual or department responsible for completing
the actual work.
In a more contemporary context, this could be interpreted as the use of
process automation through advanced information technology that merges
several processes into a single, more efficient one.
The combination and automation of tasks previously completed by employees
or other business departments have proven to prevent the frequent mistakes
that are generated due to human error.
Share Resources Between Usually Disparate
Departments

Interconnectivity is at the core of this principle. It suggests that sharing

resources connects separate departments of a company and produces a
centralized type of operation that can be very productive.

Join Parallel Processes Instead of Linking Their End

Results

The fifth principle indicates that it is more efficient to bridge a few different but
equivalent processes than to combine their outcomes.
If said processes run parallel to each other, and you aim to use their results in
tandem, it would be more beneficial to coordinate the processes during each
step to ensure that there won’t be any delays in the overall process.

Integrate Decision-Making Throughout the Steps of

Each Process

It is a fact that a lot of delays in certain work activities are due to approval
requirements from supervisors. According to the sixth principle, decision-
making should be implemented throughout each activity to accelerate
processing times.
This can be done by either having supervisors entrust their employees to
make certain decisions themselves or, in a more contemporary context, by
using decision-making technology that extracts the human component out of
the process in certain stages.
Accurate Data Collection Should Be Captured Once
and Directly from the Source

The more people involved in collecting data, the more errors can happen. This
last principle suggests that data should only be captured once, which is the
first time, and be directly from the source.
This allows the data collection process to be more efficient, not requiring
multiple reentries that lead to more errors. It ensures the data is valid as it
originates from the source.