Business process reengineering: concept, goals, principles

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Business process reengineering management includes a set of methods and techniques. They are used by an organization to successfully design its activities. This happens according to the set goals.

Business process reengineering implies a complete rethinking and further redesign of all organizational processes. This is necessary to achieve the goals and objectives. Improvements can occur very abruptly, in leaps and bounds. Despite this, the organization is able to achieve success and make the desired adjustment in the cost of goods and services, the quality of services provided, and the improvement of service delivery.

Components of a definition

The definition of business process reengineering includes four basic words: fundamental, radical, sharp, process.

Fundamentality enters the first stage, in which it is required to answer a number of questions related to the main ones:

1. Why does an organization do this activity and not something elseothers?
2. Why does an organization do its job in these ways and not implement other options?
3. What organization plans to become in the end and what does it see itself in a few years?

People answering some of these questions need to rethink the current rules for doing business. Often they may be outdated, ineffective and not applicable to a particular production.

Radicality refers to the redevelopment of doing business. The changes are not just superficial. The entire operating system is subject to change. The business owner is offered options, the implementation of which can change the entire production.

Sharpness. Business process reengineering is not used in cases where it is required to improve and increase the indicators of income received by a certain percentage, up to a maximum of 100%. The expediency of use is due only if the entrepreneur wants to increase the performance by 500% or more. In such cases, there is a complete replacement of the methods used to conduct business and produce goods. Everything new comes to replace them.

Business process reengineering management involves the use of new methods in the company step by step, thanks to which you can create a completely new product that is currently relevant to the consumer. Well-designed processes allow the organization to achieve its goals and solve a number of problems.

For whatorganizations can use reengineering?

At the moment, there are three types of organizations that need to adjust or completely change their work:

Organizations that are at the stage of bankruptcy. Often this is due to the fact that prices for goods and services are set much higher than those of competitors, or the quality does not match the declared value. If measures are not taken in time, the organization may be liquidated after some time

• Organizations that currently do not have problems and difficulties in doing business, but they may appear after a while and negatively affect the business. Such problems may be associated with an increase in the market for goods and services of competitors or a change in the needs of buyers.
• Organizations that have no problems, but the owner of the business is looking to the future. He wants to prevent problems that may arise in the way of the company. Such organizations are predominantly leaders. Their marketing policy is aggressive, they are not satisfied with a good market position, they constantly want to improve their work processes.

Thus, the main tasks of business process reengineering include the introduction of innovations that will allow the organization to firmly consolidate its position in the market and not lose the ability to compete. All this allows the company to survive and continue its full functioning, regardless of how manycompetitors.

You can consider the development of a business process reengineering project using the example of the stages that are included in the work:

1. At the first stage, an image is developed that the organization will correspond to. To do this, a certain picture is being built, which will include the necessary directions for the development of activities. All this will contribute to the achievement of the set goals.
2. Analyze the performance of an existing organization. At this stage, specialists conduct a study of the enterprise, on the basis of which a scheme is built that corresponds to the work at a given point in time.
3. The process of developing a new activity. In this case, new processes are built or existing ones are changed. Thanks to information systems, these processes are beginning to be tested.
4. After passing through all the stages, the developed process is implemented into the work of the enterprise.

It is at these stages that the essence of business process reengineering is completely built.

Main steps

Any process and its implementation consist of stages. The main stages of business process reengineering include:

1. Global thinking, on the basis of which perspectives in approaches are developed. Leading managers must be well oriented and understand all the features that are associated with the development of the enterprise. In the process, you need to take into account the needs of customers, the advantages of competitors and the latest developments in technology that can be implemented in business.
2. Work to prepareorganizations. Communication is the main key to success. In advance, you need to make a list of tasks and goals, the solution of which is planned. In cases where the initiative comes from employees, they should be encouraged.
3. Constantly review the implementation of processes. If something needs to be improved, then it is worth returning to it, this approach will allow you to avoid a number of errors in the work. If necessary, you can contact full-time specialists who may encounter problems in the course of work and describe them in detail. Any ideas that come up should be recorded so they can come in handy later.
4. Determine the level of efficiency. Efficiency can only be monitored if a reference point has been provided in advance.
5. Be creative with the process. The first step is to pay attention to the needs of potential customers. The collection of information must be carefully monitored, the sources that provided it should be monitored, and, if necessary, the dissemination process should be accelerated. If necessary, delegate authority and control customer service.
6. Change in activities in an organization must be planned in advance. Undoubtedly, improvements in performance can occur in a short time, but implementation will take time. In advance, you need to draw up a plan in which you can specify all the desired indicators, and they should be converted.
7. All processes must be reviewed and evaluated. There must be feedback from employees. It is necessary to control all stages of implementation and evaluateefficiency and performance.

Thus, when using effective methods in an organization, you can easily and quickly achieve your goals.

What methods are used in the work?

To improve the activities of organizations and enterprises, it is necessary to use certain tools. The main methods of business process reengineering include:

1. In the process of business transformation, it may happen that unnecessary processes appear that must first be disposed of in order not to waste time on this. Such processes include verification and approval.
2. In the process of activity, gaps can occur between processes, which also need to be identified and eliminated in a timely manner.
3. All reorganization work should cost the minimum amount of resources spent. For example, if you need to solve several tasks, then it is best to group them and entrust the execution to one employee. This method allows you to reduce not only costs, but also the number of employees involved in the business process.
4. Some processes can be delegated to employees of third-party organizations and companies.
5. In the process of activity, you may encounter difficult tasks. Each such process should include several options for solution. This will allow you to have a choice and choose the best option.
6. Cycle time can be reduced by doing multiple steps in the same place at the same time. itmay help reduce shipping costs.
7. Combine multiple tasks. If the solution of tasks falls on the shoulders of employees, then they can be gathered into one unit and given the opportunity to perform not a single task, but the whole process.
8. Make the job as easy as possible. In most cases, employees in the organization have limited working hours, lack the proper skills, and there is no time for training. At such moments, it is necessary to simplify the work as much as possible, which will be extremely clear and clear for anyone.

Over time, when employees personally fulfill their goals and solve problems, they will begin to gain experience, so that in the future it will be possible to entrust them with more difficult processes.

What are the operating principles?

The main principles of business process reengineering include:

1. Several types of work are combined into one. During the functioning of the enterprise, employees spend most of their time not on solving problems, but on coordination and interaction. In this case, not only wasted time, but also increased costs. To reduce these indicators, it is advisable to combine.
2. The decision is up to the performer. The person who is trusted to do the job can personally make decisions about the task he is doing. This will avoid wasting time and slowing down all processes when contacting the manager.
3. All work must be done in strict order.
4. Work is done whereit's necessary. Functions are distributed depending on the work process, and not on duties. For example, if it is easier and better for an employee to purchase what he needs for work on his own, then it is better to entrust it to him, and not to the person whose duties it should be.
5. Any process implies several options for execution. The implementation of the process is carried out depending on the situations.
6. Reduce the work of verification and control, since all this entails not only additional time, but also unforeseen costs.
7. Reduce the share of approvals - this does not incur costs, but slows down all processes.
8. As a responsible person, you can appoint a manager who is assigned the responsibility to complete the task.

If we turn to the assessment of experts, we can understand that almost 50% of projects fail. To prevent this, it is necessary to approach the work responsibly and perform it efficiently.

What are the objectives of the work?

The main objectives of business process reengineering include:

1. Not only increase the level of ability to compete with other companies providing the same range of goods and services, but also increase the profitability of the business. Taking such a step is simply necessary if the organization is on the verge of bankruptcy and subsequent liquidation.
2. Prevent possible problems that may appear over time. For example, if the activity of the organization is quite successful, then with the advent of newplayers in the market may increase competition. This can lead to an increase in the quality of the goods produced, a decrease in cost. For this, the necessary processes must be developed in a timely manner.
3. Help in preventing the loss of position in the market for goods and services. This may refer to leading organizations that are trying to reach the next level and are not satisfied with a good job. In the process of ongoing work, indicators are improving, and the business owner may not worry that he will lose his leading position.

What is the concept of reengineering?

The result of the work done is determined by the effectiveness of motivational systems and business process reengineering technology. The main feature of the decision and implementation of processes is that in the work, employees who perform delegated powers have the opportunity to independently make decisions within the framework of their duties. This helps to improve and increase the efficiency of both the enterprise and employees.

Reengineering is based on the use of radical measures, the work is done once, but the scope is wide. The concept of business process reengineering lies between management and information technology, which contributes to the creation of additional tools for support. To consolidate the implemented process, the use of new information systems and instructions is required, which will be extended to staff members. In some cases, it will be necessary to improve the skills of workers and their furthertraining.

What changes may occur in the work?

The modern world in which entrepreneurs carry out their work has changed significantly over the past few years. Undoubtedly, changes in business process reengineering also affected:

1. At the moment, consumers began to independently exercise control over the market, took this matter into their own hands. Now any person has enough knowledge and ideas about how a product should look and what functions it should perform, and, accordingly, determines the cost of this product, the amount that he can spend and not be disappointed. And most importantly, the buyer has a choice.
2. Consumers form expectations that relate to a particular product. Regardless of whether it has just entered the market or is it an old product that has undergone some changes. Goods will only be in demand if they are able to meet expectations and needs.
3. At the moment, productive technologies have undergone significant changes, and in particular information technologies, which have the ability to use the method to transfer the necessary information to consumers.

Despite the changes that have taken place, there remain organizations and enterprises that still use the old methods to develop and implement performance management ideas.

Project Implementation

Projects can be implementedconsider clearly on the example of business process reengineering of a company that is the largest mobile operator in Russia, namely Rostelecom.

The management team entered into a service agreement with one of the companies back in 2003, and the optimization of management processes continues to this day. As an example, we can consider a specific stage that ended back in 2005 and is still functioning. Among the main developments is the constructed model, which allows the process of calculating services for the use of communications.

From the words of Vadim Izotov, who is the Deputy General Director, it can be understood that the developed model allowed us to approach the introduction of a new billing system.

What can influence

The business process reengineering of an organization can be influenced by a number of factors:

1. Employee motivation. For the effective implementation of the project, it is necessary to introduce motivation that will be understandable to everyone, as well as documented. The head of the organization must clearly understand that the measures used will lead to success and that all built activities will be radically changed. To ensure success, the business owner must be aware that the reengineering of the organization's business process is a necessary measure, and provide all the necessary conditions for its further implementation.

2. Leadership team. The implementation of any projects should be carried out under the supervision of the management team. In turn, he isauthority among subordinates and bears full responsibility for the work carried out. To achieve the desired results, business process reengineering must be managed competently, clearly, firmly, skillfully. A businessman must clearly understand that some problems may arise in the process, as the organization will be completely reorganized. He must stand firm and not resort to the old methods. The manager is obliged to take all measures so that the planned project reaches the end and is subsequently implemented.

3. Staff. The management business process reengineering team should include full-time employees who will be previously vested with the appropriate authority. They must have a clear understanding of why change is needed and what is hindering effective work within the company. The employee must comply with the authority given to him and competently perform his duties.

As practice shows, it is much easier for lower-level employees to explain why they need to use innovations and rebuild the work of the entire enterprise. It is much more difficult for employees who are part of the managers to convey this idea, since they do not understand what the new production will give them. Researchers in America have identified three groups that managers can belong to:

• Tigr is a young employee who has just begun to build his career. He has a desire to participate in the project, has enthusiasm, clearly fulfills the tasks assigned to him, does no harm.
• Donkey is a specialist who works incompany for a long time and reached the peak on the career ladder. He wants stability in work, calmness. He absolutely does not understand why reengineering of business processes of an enterprise is necessary. Such employees should be treated carefully, as they can harm the implementation of the project.
• Shark - specialists who develop management procedures and instructions, which allows you to manage a number of operations within the organization. Such employees often have influence in the organization. They should be treated with caution, as they can cause great difficulties and problems if they begin to sabotage changes in the life of the enterprise.

4. Communication skills. In the event that employees need to set a new task, then it must be formulated very clearly in advance. It needs to be communicated in a language that everyone understands. Success in the effectiveness of business process reengineering of enterprises will depend entirely on how clearly employees understand their leader. This is what will allow you to achieve the desired goals and results.

5. Budget size. Carrying out business process reengineering implies that a certain amount of funds will need to be invested in the implementation and implementation. Particular attention should be paid to this point if it is planned to involve information technology in the work. Organizational leaders often tend to assume that reengineering is self-financed, which is not the case at all. Take care of the size of the budget that can be spent on allworks, need in advance.

6. Technological support. To effectively carry out work on the implementation and implementation of a business process reengineering project, support is required that is fully consistent with the selected methods and tools. In most cases, it involves building an information system that can support new business.

Begin preparatory work should be in advance. Since in most cases it is impossible to form a style in relation to staff members and in the team as a whole in a short time.