Process re-engineering

There are many different spins on the process re-engineering definition. Although each definition is slightly different, all have the same overarching theme, the radical redesign of business processes to achieve dramatic improvements in productivity and performance. The two key words are radical and dramatic. Radical redesign means getting rid of existing processes and procedures and inventing new ways. Dramatic improvement means a quantum leap in performance. Both of these ideas are in direct conflict with the old thinking of constant incremental improvement. The original Industrial model that many companies still use today rests on the basic principle that workers have fewer non-complex tasks, which are completed within a large process line.

This model allows workers to focus on single tasks that are connected to the more complex processes. To reap the benefit from this approach, companies have to accept inconveniences, inefficiencies, and higher costs. Companies use process re-engineering to improve performance substantially on key processes that impact customers. Process re-engineering can reduce costs and cycle time. Process re-engineering reduces costs and cycles time by eliminating unproductive activities and the employees who perform them. Reorganisation by teams decreases the need for management layers, accelerates information flows, and eliminates the errors and rework caused by multiple handoffs. Improve quality– process re-engineering improves quality by reducing the fragmentation of work and establishing clear ownership of processes.

Workers gain responsibility for their output and can measure their performance based on prompt feedback In re-engineering, to meet demands for quality service, flexibility, and low cost, processes must be made simple. The following diagram depicts the themes which spring from re-engineering projects. As illustrated, process re-engineering radically changes the work environment. Individual processes are combined to gain efficiencies in productivity. Workers are allowed to make decisions on the spot to eliminate process roadblocks and increase speed to market. Not only is this beneficial for overall business performance, it can also increase employee satisfaction and loyalty. Employees can expand their skill and knowledge into other areas and have the ability to make decisions that affect their individual performance.

In other words, process re-engineering involves the radical redesign of core processes to achieve dramatic improvements in productivity, cycle times, and quality. In process re-engineering, companies start with a blank sheet of paper and rethink existing processes to deliver more value to the customer. They typically adopt a new value system that places increased emphasis on customer needs. Companies reduce organisational layers and eliminate unproductive activities in two key areas. First, they redesign functional organisations into cross-functional teams. Second, they use technology to improve data dissemination and decision making. How process re-engineering works– process re-engineering is a dramatic change initiative that contains five major steps.

Managers should refocus company values on customer needs, redesign core processes, often using information technology to enable improvements, reorganise a business into cross-functional teams with end to end responsibility for a process, rethink basic organisational and people issues, and improve business processes across the organisation.