Business Process Reengineering: Its Value and Relationship to ERP
Business process reengineering gives organizations the opportunity to rethink the design of their processes. In doing so, organizations can identify changes that will positively impact their costs and quality, and ultimately help to improve customer service.
Due to the impactful nature of BPR, many organizations include this process with the implementation of new enterprise software as a way to further the return on their software investments. It’s also common for organizations to utilize consulting services to help identify and achieve process improvements. A qualified consultant has experience in the organization’s industry, has effectively managed BPR processes, and has deep experience with the ERP system being used. The consultant should provide examples of industry best practices that help to further the organization’s goals, and may even identify changes that the organization otherwise would not have considered on its own.
If you’re considering launching a BPR process for your organization, following are the steps and outcomes you’ll want to keep in mind.
What are the steps involved in Business Process Reengineering (BPR)?
- Step 1: Analyze current business processes and refocus the organization’s values.
- Step 2: Based on the organization’s new values, redesign core processes to fulfill the values. Information Technology such as Enterprise Resource Planning is a valuable tool to support these improvements.
- Step 3: Restructure the organization based on a set of cross-functional teams. These teams will each be responsible for a set of processes within the organization and for tracking effectiveness of identified improvements.
- During organizational restructuring into cross-functional teams, companies are provided the opportunity to reconsider staffing issues and ensure employees are allocated to teams based on their contribution to the newly established processes.
- Step 4: After all of the groundwork is set, the final step to business process reengineering is to implement the new processes and continually improve them across the organization, while keeping in mind the values established in step 1.
Why implement Business Process Reengineering?
Why should an organization go to all of the work involved in business process reengineering? The short answer is to lower costs and improve quality.
Let’s start with lowering costs. By going through the steps of a BPR process, businesses gain a holistic view of their organization. A holistic view enables the organization to eliminate wasteful activities that have negatively impacted overhead. This elimination typically begins with identifying inventory loss, reducing materials waste, and updating or eliminating outdated or unnecessary steps. It then moves on to identifying new processes, followed by workforce changes that are necessary based on new and efficient processes.
In addition to lowering costs, the opportunity exists in business process reengineering to drastically improve quality. By involving employees in the BPR process and utilizing cross-functional teams, the company realizes improved productivity and attention to quality control. Employees in cross-functional teams gain new insight to how they are dependent on the speed and accuracy of others in completing tasks and achieving company goals.
Enterprise Resource Planning Facilitates Business Process Reengineering
Business process reengineering provides monumental long-term process improvements. Without adequate technology tools to manage changes identified in a BPR process, however, effecting change and realizing improvements comes at a large cost to the organization in terms of human capital, inconsistent leadership, and the inability to do a total organizational overhaul. Enterprise Resource Planning helps to facilitate BPR on a global scale. Organizations are able to improve current processes step-by-step through the use of Enterprise Resource Planning software with great effect. Utilizing ERP, organizations more easily facilitate costs reductions and achieve drastic increases in quality. With companies offering Enterprise Resource Planning solutions in the cloud, the adoption and success of process improvement has never been easier to achieve. Learn more about cloud ERP