Business Process

Reengineering
13 Aug 2021

Dr Amish Pathak
MBBS, MBA-HA, QM-AHA, PGDCR
linkedin :
https://www.linkedin.com/in/dr-amish-pathak-8b8913a/
Key Principles of
Business Process
Reengineering
Business process re-engineering aims at maximizing customer value
while minimizing the consumption of resources.

In the book Reengineering the corporation: A manifesto for Business

Revolution, Michael Hammer & James Champy suggested the following
seven principles:
 7 Principles of Business Process Reengineering

● Work should be designed such that it is result-oriented and not process-oriented

● Involve those people in the process who face the output
● Merging data collection and processing units
● Shared databases to interconnect dispersed departments
● Bridging the processes which are running on similar lines
● Decision making should also be a part of the work performed
● Capture data at its point of origins
1. Work should be designed such that it is
result-oriented and not process-oriented

The first principle states that the tasks performed by different people can
be combined into one specialized task. Taking an example, the redesign
of a manufacturing company with separate divisions performing different
functions in a sequence.

One determines the customer requirement the other passes in the

information, and the third convey this to various plants and warehouses.

These sequential based activities led to errors, rework, and delays.

When a company re-engineers, it eliminates the assembly line approach
2. Involve those people in the process who face the
output

This principle states that the work should be done by the individual getting
the output, i.e., the consumer. Today, this can be observed as the
“self-service”.

For example, if a customer is facing any problem, he has to fill in the data
himself instead of any office doing it for him. It pushes the work to the
consumer.
3. Merging data collection and processing units

This principle has matured and is visible in the concept, division of labor.
This means the data handling must be done by the same person who is
collecting the data. This reduces the number of errors by eliminating
external contact for a process.

For example, a company has a structure wherein one department collects

the information while the other records it. Here, the shared database will
have many errors while translating the information from one department
to another.
4. Shared databases to interconnect dispersed
departments

The advances in information technology allow the company to connect

separate units that are geographically dispersed by using a shared
database.

Centralized databases provide economies of scale in addition to providing

flexibility and quick responses to the customers as there are better
agreements between the vendors.
5. Bridging the processes which are running on similar
lines

According to Hammer, the processes of the activities must be integrated

rather than the end results. The parallel functions must be coordinated
using communication networks, shared databases.

These parallel activities must be linked continuously and coordinated at

the process execution. This will eliminate the high costs and delays in the
outcome of the process
6. Decision making should also be a part of the work
performed

There must be decision aiding-technology to cut unnecessary controls

and to keep a check in the process. Hammer states the decision should
be made by the person who is doing the work.

The processes can be improved by empowering the authority of the

resource with the responsibility to make the decision and improve the
workflow.

This is possible with an educated and knowledgeable workforce

7. Capture data at its point of origins

This approach saves costs by avoiding costly re-entries and invalid data
entries. It is the principle of capturing information only once at the source
where it was created.

This eliminates the difficulty of transmitting the information, and it doesn’t

have to be recorded at different locations at various times.
 By implementing the BPR, the business can achieve the following aims:
●

● Total customer satisfaction

○ we ask if the provided services matches the customer’s expectations and increase the sense of their loyalties.

● Cost Advantage

○ we measure the radical improvement due to BPR in term of the effectiveness and efficiency of the operations.

● Competitive Advantage

○ when a company focus on its core competencies, it gives it a competitive advantage. This gives the company

firm excellence in the broader business process.

● Creates value for customers

○ By putting relevant activities as design, production and product/service companies provide excellent customer

value. The firm analyzes value-creating activity and compares it with the competitors to find ways to improve it.

● Clear Business Vision

○ This way an organization acquires some brand identity and an ideal structure to target the customer.