Changing to beat change

Business Process Reengineering, or BPR, is changing the way companies conduct their core businesses by ‘revising’ the business process using Information Technology as a key enabler.

By and large, many business organisations today tend to assign individual employees focused tasks. The summation of such tasks is then taken into consideration by the management team to determine the resultant impact on business performance.

However, with each individual’s contribution, there are likely to be some undesirable risks such as inefficiencies, wastages, hidden costs and bottlenecks. These risks, when compounded, could also pose a significant threat. With BPR, the objective is to minimize these risks, while reaping the benefits to produce greater business value.

BPR is proving attractive to businesses, especially in the manufacturing and supply chain management environments. This is because by authorising line employees to monitor in-process real-time helps solve problems faster and with more confidence. This results in faster turn-around time to decision bottlenecks, increased productivity, and a more skilled and motivated workforce. In addition, it increases customer satisfaction and business confidence as well. Software solutions, which help manage these processes, are termed Business Process Management (BPM) software.

Ideally, BPR should focus on crossfunctional processes that belong to a supply chain to maximise its benefits. These benefits can be especially seen in one or more of the following engagements:

Relocating work to suppliers or customers. Let suppliers manage your inventories while having customers transmit orders using internet technologies. This reduces duplication of in-house work and data redundancy, thereby increasing focus on the core of your business specialisation.

Delaying the final product as late as possible. Building a standardised generic product at the initial phase of the process not only reduces your cost of production but also increases the accuracy of forecasting. Keeping any customised configuration to the end of the process minimises wastages and improves process agility. Enterprise Resource Planning, or ERP, systems increase the flexibility and agility in the business process by allowing replication of such configuration across multiple sites and, in return, bring about better visibility of work-in-progress.

Engaging in concurrent rather than sequential processing. As time is money for businesses, collaboration among different functional teams within a supply chain eliminates bottlenecks and minimises time wastage. Having Product Data Management (PDM) software is the ideal way to enable the building of complex products as it is possible to share product data simultaneously among marketing, procurement, research and development teams, while managing document version control and release.

Assigning case managers to deal with customers. Accountability for order fulfilment using Customer Relationship Management (CRM) software means better accountability by one person to the customer organisation, leading to increased visibility on customer delivery, improved communication, and higher customer satisfaction.

Reengineering is an essential tool to achieve ambitious supply chain goals. Other techniques that companies use to improve performance, from incremental improvement through reorganisation to restructuring, though valuable, do not have the power to create breakthrough results. Only reengineering can do that.

At first, some companies reengineering their supply chain thought it would be a one-time event, a radical treatment that would overcome decades of inertia and transform obsolete processes into ones suitable for a highly competitive world. Little did they suspect that reengineering would still be going strong well into the 21st century.

The hallmark of the modern age is constant change, and no sooner do companies finish one round of reengineering than they discover they must embark on another to respond to new challenges, capitalise on new technologies and cope with new circumstances. Far from being a thing of the past, reengineering is here to stay.

Albert Tan is Assistant Professor at the University of Wollongong in Dubai. He teaches courses in Supply Chain Management and Operations Management.