Business process re-engineering (BPR) benefits can’t be overstated, as it is essentially a systematic approach to improving the efficiency of business processes, and when done right, it’s very successful.
BPR often employs the “best practices” from other industries to improve operational performance by identifying and eliminating inefficiencies, reducing costs, and increasing customer satisfaction.
Business process re-engineering isn’t a new concept, but it’s one that many businesses are still struggling to implement. The key to success is understanding exactly what BPR means, how it works, and why it’s so important for your company’s growth.
Let’s see what BPR is and when to use it.
What is Business Process Re-engineering?
A broad definition of business process re-engineering includes analysis of the business workflow, business process mapping, and eventually radical changes to these systems as well.
You need BPR when you’ve reached a point where it seems like something’s missing from your business strategy and when you need to improve business flow.
One of the benefits of business process re-engineering is that it’s very precise—it focuses on cutting down any unnecessary expenses, allowing you to recognize any tasks you can automate instead of spending extra time and resources on something software can do.
BPR analyzes where you stand against your competition and pinpoints the most important areas of your business you should focus on so you can improve your results as rapidly as possible.
If you’re selling a product or service, the main focus will be on your service quality and customer support. All business process reengineering steps are aimed at increasing productivity and removing any unnecessary, time-consuming tasks.
The main reasons for opting for BPR are major changes in the market, increasing competition, changes in your company’s financial situation, and decreased workflow.
BPR changes how businesses work on a large scale, which usually means radical ideas. It needs to be done this way; otherwise, the process would take too long, and when you want to step your game up, the structure needs to change quickly and efficiently.
One of the BPR benefits is the fact that it usually brings you more clients since the main point is to make changes for the better.
Business Process Re-engineering vs. Business Process Improvement
The main difference between business process re-engineering and business process improvement is that the core of each process differs in how they approach business models.
In short, BPI aims to make small changes, while BPR focuses on the whole picture and correcting everything that can be improved.
BPI provides suggestions when it finds bottlenecks, and it’s a non-intrusive way of bettering your processes. It’s up to you whether you want to implement them or not.
On the other hand, one of the benefits of business process reengineering is that it will deal with the whole company from a non-conventional angle, and it will start with higher-up management. It will detect any deficiency and demand action.
While this sounds aggressive, it is the best way to shake things up and move your company in a better direction without avoiding existing problems.
Benefits of Business Process Re-engineering
There are many benefits to business process re-engineering, and they will vary depending on your area of expertise.
The ones that are important and present in every market are the following:
Lower Operating Costs
One of the main benefits of business process reengineering is that it allows you to reduce the company’s operational costs by getting rid of extra fees and resource waste that might be connected to processes that no longer serve their purpose.
There are many seemingly low-cost operations that can add up to your operating costs, and why would you waste your money on them? Instead, you will either save your company’s money or invest it in productive tools.
Faster Operation Execution
By streamlining processes, you can get rid of elements that slow workflows down. There are many tasks you can automate, which will give your team more time to focus on the primary work. It will improve efficiency and lead to more creative ideas and constructive feedback.
Enhanced Customer Service
Another huge business process reengineering benefit is that it allows you to cut down on the client’s waiting time by speeding up the workflow process.
This benefit is connected to faster operation execution, leaving more time to focus on your client. Nobody likes waiting, and the faster you can deliver a product or answer a call or an email, the better it will be for your company’s reputation and profits.
Business process reengineering enables you to restructure the business so that output and efficiency remain top priorities, which may result in increased profits.
You can decide whether you want to save additional income for future improvements or reinvest it in your employees. Whatever you decide, it will be beneficial for the company.
Through business process engineering, you can review the goals of your company and assess and reevaluate any changes that have happened over time. Keeping track of your progress will make it clear what you should do to reach your goal efficiently. So the last BPR benefit, but certainly not least, is that it essentially brings much-needed clarity.
When to Consider Business Process Re-engineering?
Business process reengineering is easier to consider if you are a big company because it costs a lot. If you want quick but long-lasting results, the budget needs to be hefty. The larger your company, the more problems that need solving.
If you have a small business and you come across some major obstacles, business process reengineering can completely change your workflow design for the better. You will likely need far fewer radical implementations, meaning the cost won’t be as high as it would be for a corporation that has thousands of employees and clients.
Here are some examples of business process reengineering in action, or more precisely, when it can be useful:
Frequent Customer Complaints
Constant customer complaints clearly indicate something isn’t working within your company’s system. It’s up to you to identify the problem and act on it as quickly as possible because you will start losing your clients.
Everyone likes pleasant and efficient service. Your clients will switch to another company even if they’ve been with you for years if customer service isn’t functioning properly. Check if the product is being delivered on time and if it’s of the quality you present it to be. Everything can be a lead, showing you what you should pay attention to.
Decline in Profits
If the company constantly fails to achieve its monthly target, it’s everyone’s problem. It also means everyone can contribute to a sound solution. Pay attention to feedback and consider business process re-engineering if a decline in profits has been a problem for a while.
If your business is suddenly experiencing high turnover, business process engineering can help you reduce it. Are your methods outdated? Is there nothing for employees to learn or gain?
It may sound daunting to deal with these issues, and the process takes time, but the sooner you deal with the main problem, the easier it is to elevate things within the company, and business process engineering can be a great tool for doing just that.
Slow Response to Changes
If you’ve been implementing changes to your business, but there’s barely any result, there must be something you’re missing. You can always ask for a second opinion, but if the problem persists, hiring a team of experts and choosing to focus on a specific problem, such as a slow response to changes you think are positive, is the way to go.
Potential Risks of Business Process Re-engineering
In theory, once you make the decision, business process re-engineering should be very simple. Everyone is aware of their role; you can identify the main goal, and together you will work towards it.
Of course, it’s easier said than done. You will deal with lots of setbacks and confusion, so be prepared in advance.
Here are some potential risks of business process re-engineering:
- Resistance to change. Employees might find it hard to accept a new approach to how they work. Many unexpected situations and feelings may occur once you start implementing the new processes.
- Unrealistic expectations. When you pinpoint everything that needs to be removed from the equation, you’ll think the process will be smooth and have instant results. However, the reality can be quite different. Adjustment takes time because everything starts working quite differently from what you’ve been doing for months or even years.
- Cost-related issues. We mentioned briefly that the BPR process can cost a lot, depending on the size of your company. Think twice about whether the problem is solvable by gathering enough insight or whether you really need a whole makeover so your company can stay afloat.
- Disruption within the workflow. You can expect both employees and clients to be either taken aback or pleasantly surprised by the changes you make. Whatever the case, you will need some time until everyone adjusts to changes, meaning you will see different statistics in the workflow until everyone settles down.
- Lack of support. People dislike changes, and they’d rather stay in their comfort zone than try and make things better. Lack of support can be discouraging, but it shouldn’t stop you from taking the necessary steps if you’re sure business process engineering is the right thing to do.
Business process re-engineering is a popular approach to improving your business’ efficiency and productivity. It involves analyzing the current system, identifying the bottlenecks, and improving them. Processes are broken up into smaller tasks and tackled immediately.
BPR can help you respond to market changes more quickly by optimizing processes that perform well and eliminating unnecessary ones. It can help you respond to customer complaints and streamline tasks to improve efficiency.
It’s important that businesses continuously evaluate their processes in order to remain competitive in today’s marketplace.