Corporate Reengineering
Corporate
Reengineering
refers to a modern business concept that involves the analysis and
creation of new or radically modified workflows and processes to achieve
breakthrough
results in the organization's performance.
It consists of identifying key processes within an organization and making them
as lean
and efficient
as possible. This organizational streamlining may
mean a complete overhaul of existing systems to eliminate
peripheral processes, and produce drastic improvements in the corporate
metrics.
Corporate
reengineering was conceptualized by James Champy
and Michael Hammer, with the latter proclaiming, "don't automate;
obliterate." Champy and Hammer defines 're-engineering'
as "the fundamental
rethinking
and
radical redesign
of business processes to achieve dramatic improvements in critical
measures of performance such as cost, quality, service, and speed."
Corporate reengineering
has become more popularly known as
'Business Process
Reengineering', or
BPR,
but Champy and Hammer considered this phrase to be too limiting. To them,
true reengineering of a corporation encompasses not only the
alteration or refinement of its individual business processes, but
revolutionizes it in its entirety as well. Nonetheless,
reengineering and BPR will be used interchangeably in this article.
Reengineering integrated a handful of modern business concepts (such as
TQM, JIT, CRM, and lean manufacturing) into a tidy business philosophy for
reinventing
a company by making it 'lean and mean'. Many companies found this
new concept appealing, and so paid large consultancy bills to get it
institutionalized internally.
A business
process is a set of activities that convert a set of
inputs
into a set of
outputs
(products or services). Large corporations recognize the need for
continuous improvements in its internal processes to keep one step ahead
of the competition. Many business concepts involve incremental but
continuous improvements on existing processes to improve company
performance. In contrast, reengineering promotes
drastic redesign
of processes to
achieve a step-function improvement in results. It even promotes the
abolition
of processes
that don't work so that new and more effective ones can be created to
replace them. In
fact, many reengineering experts recommend that the revolution of change
be started on a blank piece of paper.
Different experts have
different opinions on how to put BPR into practice. An example of a
BPR process may consist of the following
steps:
1) develop the business vision and the business' specific objectives; 2)
identify the processes that need to be redesigned based on this vision; 3)
understand the current processes as baseline for future comparison and/or
others' processes as reference; 4) design and build the new processes; 5)
transition from the old to the newly-created processes.
Unfortunately, BPR has
become synonymous with
'downsizing.'
This can
not be blamed on the proponents of the concept, but on companies that
abused the term 'reengineering.' These companies implemented
indiscriminate
cost-cutting under the guise of BPR, using the theory as a convenient and
more palatable excuse for the sole purpose of cutting down on manpower. To
many critics, reengineering's greatest weakness is its lack of a human
side, or its
depersonalization.
Primary
Reference: Des
Dearlove, "Ultimate Book of Business Thinking", Capstone Publishing
See Also:
Knowledge Management;
Learning Organization
HOME
Copyright
©
2005
EESemi.com.
All Rights Reserved.
