Business Process Re-Engineering vs Continuous Improvement  –

Both involve change and improvement. However, the focus of each is

different. Continuous process improvement primarily focuses on the parts of a system
or process, while business process reengineering primarily focuses on the relations.

Business Process Re-engineering is the radial designs of the business that help to experience
dramatic improvements in the business cycle, quality, as well as productivity. The business Process
re-engineering is the great idea to introduce new plans on the existing processes that supports to
offer great value to the respective customer. Usually most of the companies reduce the
unproductive activities in two main areas, such as decision making and functional organizations. The
process re-engineering is the great fundamental rethinking of course this system is mainly
introduces to overcome all the drawbacks of the existing systems. By the way every organization has
chances to reach the process performance. Particularly this system designs for the continuous
process improvement, in general improvement is always essential to continue your position in
the global economies even it is the most effective choices to fierce the global competition. In general
re-engineering, is one of the necessary factors to improve, debug, improve as well as refine.
Re-engineering is the popular systematic transformation that helps to add new things in the existing
system. It is the newest form of the quality improvement. It is the finest way to enjoy greater ROI
(return of investment) through the latest development process. Re-engineering is also related to the
traditional maintenance, even it is the essential aspects to implement new capabilities at the same
time it also add functionalities, by the way every business people have chances to make substantial
improvements by using the new concepts. This process also includes new software technologies, in
general CPI and process re-engineering highly used in the organizational improvements at the same
time it helps to get desired result, these two process have the greatest benefits and highly support
for organizational growth.

Continous Process improvement

Polar opposite to the concept of Business Process Re-Engineering is the concept of continuous
improvement. It was developed by the Japanese after World War-2. Whilst BPR relies on radical
change, lean management relies on small incremental change. It stems from Japanese term called
“Kaizen” which means small improvement.
The concept relies on successive small improvements to bring about a big change over a period of
time. Instead of changing the process completely, only minor modifications are made to the process
and over time they accumulate to provide big benefits.
Corporations such as Toyota and Sony have dominated global markets with the help of this concept.
Even Wal-Mart has deployed it to make its supply chain powerful enough to offer EDLP (Every Day
Low Prices). Here are some examples of continuous improvement and how information technology
contributes:
Inventory Management: Toyota Inc realized that it was occurring costs of over 26% per annum for
maintaining inventory. So were all the other car manufacturers. This inventory was maintained
because the process was aiming at local optimization instead of total optimization. The inventory
department was trying to minimize its own costs rather than total costs and so were all the other
departments. Toyota used technology to build an impressive forecasting system. Then it streamlined
its supply chain to ensure that inventory arrived Just in Time (JIT). This cut all the storage,
administration and interest expenses. Toyota could price better and still reap high
Logistics: Wal-Mart used processes to its advantage when it built a world class inventory tracking
system. It cut administrative costs and supply shortages as it built information systems to share
information with the suppliers. P&G could see when the inventory had fallen below a certain level
and could replenish it without Wal-Mart making any effort. The use of RFID chips and barcodes
enabled the Wal-Mart to track its customer behavior better and develop relationships with them.
Thus a small change like introduction of RFID coupled with other small changes like automated
ordering brought down the clerical costs of the purchase department and also increased efficiency
manifold.
Push v/s Pull Supply Chain: While most PC manufacturers in the US were reeling from falling prices
and rising inventory, Dell Inc found a way to use processes to turn the situation in its favor. Dell used
technology to sell its computers as opposed to brick and mortar stores saving on overheads. But this
is just a small part in the strategy. Dell’s masterstroke was to change the supply chain from push to
pull strategy. Dell would manufacture only when ordered. It used information systems to ensure that
when an order was placed, all its suppliers got it simultaneously. They would then keep the order
ready and Dell would assemble all the parts and use a high-tech assembly line to build and deliver
the PC in no time. The customer didn’t mind waiting 4-5 days if Dell took 20% off. Even at this low
price Dell was earning superior profits thanks to the power of technology
BPR and Business process improvement
Both BPR and BPI essentially aim to improve the system. Business process reengineering involves
completely changing the process for an overall different result, which is the opposite of incremental
business process improvement. BPR aims at changing the way a process works while BPI is tweaking
an existing process to optimize it. But the difference is in the depth of change.
Here are some key differences between BPO and BPR:
While BPI or streamlining is done to improve processes within the existing organizational structure,
BPR is done to create dramatic improvements to enable the organization to break away from
conventional wisdom and approaches, thereby creating widespread change.
BPI is a preventive technique that should be applied as a principle across the business, whether or
not there are problems while BPR is often applied to fend off impending disasters. Some, however,
argue that whether or not BPI is implemented within the organization, BPR may still be necessary for
response to changes in the legal/political environment.
BPI is often seen as running repairs/maintenance and can be used to achieve quick wins while BPR
focuses more on the improvement of organizational operations enterprise-wide, which takes a
significant amount of time to accomplish.