Success and failure factors of BPR

Success and ill luck accompanimentors of BPRBusiness Process Re technology is a daedal serve that intends to bring nearly foot transformations at heart an fundamental law. This particular choose is a pilot project on BPR that studies a store belong to Argos, ace of UKs prime retail chains. It interacts with the employees out in that location and observes various exhibites in modulate to come on up with a framework for BPR implementation. Before get into the fieldwork, a detailed literature review has e genuinelyplacely been beneathtaken with this take aim involving various succeeder and failure factors of BPR and related issues standardised six sigma, benchmarking and size of itableness of total cycle time.This analyse consists of mainly qualitative epitome with a bit of quantitative portions wherever demand. The base modes of data collection allows a open ended interview involving six questions asked to six respondents working at different levels of the store that was assigned for this purpose. This interview was used as the animal foot to proceed with tho analysis of various deales deep down the store with busy help from the organization. It was go allplacen through with(predicate) the interview that the employees do hold in reservations mediocre roughly sure operating issues within the organization. But at the same time they argon a bit wary of potential changes and because argon non willing to freely talk about the entire issue. It basically shows dickens main beas of cash advance namely in return chain and fund management and in addition in the field of customer relationship management. save analysis of the moldes has shown that due to the usage of multiple outdated legacy softwargon system, the supply chain has become slow and unable to handle the recent growth. That is wherefore Argos is working with Oracle and Accenture to overhaul the softw ar system. Along with these technological modifications , nearly strategic changes submit been proposed through this muse implying the inventory replenishments strategy. It has proposed a more than frequent replenishment backed by cutting edge blood line forecasts and early(a) related measures. As far as customer aid issues ar concerned, a problem with delays in deli real has been observed and thereof more automation in the surgical procedure along with some centre of outsourcing is suggested in narrate to save bes as puff up as ontogenesis efficiency by reducing cycle time.Throughout this study, it has in same(p) manner been fall uponn that the proposed BPR turnes backside meet with employee resistance owing to their own insecurities and practical problems. That is wherefore it has been advised to ache a more compassionate HRM policy ensuring straitlaced pedagogy and countenance for the employees. Nevertheless, it has to be accepted that due to time and imaging constraints a few important aspects could non be analyzed or implemented in through this study including the implementation of a sise Sigma process and its implementations. A longer duration for implementation and observation of these issues could start out generated more insights. Nevertheless, this study has provided with an opportunity to venture into this Gordian topic of reengineering a retail outlet and we hope that it would be a good nates point for the future researchers.IntroductionBusiness Process Reengineering (BPR) is a complex process that calls for almost a bow planing of the core line line processes deep down an organization in order to achieve rapid developments in hurt of crossroadivity, quality as healthful as cycle generation (McAdam and Donaghy, 1999). In this process, companies start with an open mind without each presumptions and rethink the whole process in an labour to deliver come apart value to the clients. They bring about revolutionary changes in their value system and put extra stre ss on the customer needs. They alike restructure the organization and do out-of-door with dry activities especially in devil important aras. Firstly, the functional organizations argon redesigned into different intersection-functional police squads. Second, modern technologies are used to improve dissemination of companionship as s thoroughly up as decision reservation.Business Process Reengineering proposes volt major steps to be taken by the managers to achieve salient changes in their organizations. These steps include, re concentreing on the club values ground on customer needs, redesigning the core processes using modern culture engineering, reorganizing the teams across function by attri scarceing end-to-end responsibility to them for a whole process, rethinking subsisting organisational as hearty as people issues, improve wrinkle processes across the organization (Peppard and Fitzgerald, 1997). Business Process Reengineering is used by the companies in ord er to achieve veritable results that reduce costs as salutary as cycle time. Business Process Reengineering reduces costs and cycle times by eliminating the activities as head as the employees who obstruct productivity (Ranganathan and Dhaliwal, 2001). When the teams are reorganized, it decreases the layers in management and removes hierarchal boundaries thus accelerating information flows which reduce dents and errors in the whole process. It overly helps in improving boilersuit quality by decreasing fragmentation of work by establishing invite responsibilities as salutary as ownerships of processes. So, the workers at either level get responsibility for hit outputs and ordure excessively measure their own performances based on habitue feedbacks.For this particular study, UK based retail chain Argos is being used as the subject upon which the principles of BPR will be tested. Argos is a fully owned footslogger of Home Retail Group, UK. Argos is the pi unrivaleder of Multi run channel retail. With 33,000 employees working to support over 700 stores in UK and Ireland, Argos is a 4.3 billion company. The intention is to see how working(a) efficiency move be modify within the organization through BPR and for this purpose a certain Argos store was picked up for the preliminary study. It was suffer with active support from Argos side and for last few weeks I devour worked with close cooperation with the store manager. The retail indus feat is a business that is nimble moving, complex, and constantly changing. It is an sedulousness where exclusively the most modernistic and well managed organisations give the sack survive and succeed (Ranganathan and Dhaliwal, 2001). The retail industry generates r heretoforeues through the sales from supermarkets, cooperatives, whatchamacallit stores and straightadays even through online stores etc. Traditionally, there were various marketing strategies that allowed the retailers to continually promot e their companies by attracting new customers. But the fierce arguing in the con atypical markets has necessitated better consumer relationships and the capacity to follow up with them (Peppard and Fitzgerald, 1997). The increase in disposable income as well as the changes in lifestyle of these consumers kick in opened new vistas in sell and save also increased competition. The managers in the retail sector must be innovative as well as prudent enough to survive in this cut throat environment making sure that every necessary step towards managing change has been taken and they should be ensuring delivery of quality standards in customer service so that the firm builds strong brand loyalty among the consumers towards them. here(predicate), we have to see that the process of BPR is closely associated with project management and hence we should also take an overview of project management before getting into further elaborate. A project is a temporary business activity, one havin g a well defined beginning and ending. They are on a lower floortaken to accomplish particular goals and objectives (McAdam and Donaghy, 1999). The temporary nature of a project, as against the more repetitive functions like trading operations, requires a different management approach. Project prudence is a management enlighten concerned with the planning, organization and managing resources for successful implementation of a business strategy which meets all its goals and aims. This particular study is also a project that has been undertaken to see the impact of the business process reengineering process on the supermarket chain Argos.The primary objective of Project Management is to achieve all the project goals within the pre defined resource constraints. As such, it shares umpteen similarlyls and techniques with Business Optimization and casting (Peppard and Fitzgerald, 1997). The generic constraints of any project are time, chain and cost also referred to as the project triangle. For my project, the constraints are time 3 months, scope a specific utility within the operations function which is yet to be allocated to me by the company and cost I would have to work subject no financial costs for the company as such the only costs incurred are my time and efforts. I would be working under these constraints to optimise the reengineering project. Business Process Reengineering (BPR) is a management approach that aims at implementing improvements by elevating efficiency and goodness of the business processes. The fundamental strategy espouse by organizations in this area by looking at their operations from a clean state. More specifically, they are looking at what back end be done in a better means if the whole process function were to start from scratch.Reengineering is the fundamental rethinking and the radical redesign of business processes to achieve dynamic improvements in the areas of cost, speed and quality of service (McAdam and Donaghy, 19 99). umpteen of the recent developments in the management sphere can be attributed to reengineering. The cross functional team is one such illustration, developed out of an effort to reengineer the separate functional departments to a mutually coordinating and interdependent process utilities. The Management Information Systems, ERP, Supply chain management, K straightwayledge management and galore(postnominal) others have been developed by reengineering (Ranganathan and Dhaliwal, 2001). BPR derives its existence from various interdisciplinary components, though the four most affecting areas are Strategy, Technology, People and Organization (Peppard and Fitzgerald, 1997). A process is viewed as common framework, considering these dimensions.Michael Hammer and James A Champy were the outset proponents of this invention. They began by criticizing the rigid departmental approach in many organizations. In a series of publications The Agenda, Reengineering the federation, Reengineer ing the management, they argued that a single team that works under diluted responsibility and reporting structure would be more useable to the organizations. The result was the development of Cross Functional Teams. They later expanded their arguments to include Suppliers, Customers and distributors. Reengineering is very difficult to implement in an organisation. It causes widespread discomfort among the employees and commonly experiences a strong resistance to change. The primary reason being that, over the years, BPR has been used effectively by organizations, however, the first thing that BPR results in is the layoffs. BPR, though a powerful organizational thinking, has non been able to achieve the expectations for the spare-time activity treasonsThe primary assumption of the BPR system is that the single most factors affecting an organizational performance is the inefficiency of its operations. True, processes can of all time be improved at any level, but that doesnt mea n that they are inefficient.It disregards the status quo by looking at an organization from a clean state.It is not an effective tool to focus the improvement strategies on the organizational constraints.As a matter of fact today most organisations are facing great challenges in this regard and they are feeling the need to become more and more agonistical through a special focus on organisational design, knowledge management, hierarchical structures performance management as well as quality sustain. It has always been difficult to find a strategy that encompasses every aspect of this issue. Experts have suggested a number of strategies to manage changing times in organizations. The concept of BPR is one of the latest in this league. We have seen various facets of BPR earlier. Collectively, we can now define BPR as the fundamental rethinking as well as radical redesigning of the business processes that intends to achieve revolutionary improvements in critical aspects of the busines s with present-day(a) measures to improve various aspects of performance such as quality, service level, cost and speed (Hammer and Champy, 1993). As this definition suggests, it is desirable on part of the organisations to do off with their archaic practices as well as processes, policies, principles as well as structures that negatively affect the performance of the organization. That is why BPR is primarily about redesigning the processes within an organization (Balle, 1995). BPR can also be defined as the re evaluation or redesign of the firms business processes as well as organisational structures in an effort to achieve marked improvements in certain critical success factors namely cycle time, quality, productivity as well as customer satisfaction (Tapscott and Caston, 1993). This particular definition differs from the prior one as it makes a specific reference to the process (Poh and Chew, 1994). It can also be defined as the analysis as well as design of workflows and pro cesses inside the organizations.BPR is basically a tool for planning as well as controlling change (Morris and Brandon, 1993). It offers redesigning and improvement both in depth (i.e. organizational roles and responsibilities, organisational structure, use of technology, appraisal and incentives, shared values as well as skills) and in breadth (i.e. activities that are performed with long landmark goals in mind) (Hall et al., 1993). Some of the experts take it a step further and let off that BPR is just a part of the necessary steps in the radical alteration of processes (Davenport, 1993). So, there is a need for process innovation in BPR that can lead to new strategies and designs and mobilize both people and technology towards a singular objective (Poh and Chew, 1994). So, we can see that definitions of BPR vary for person to person but overall it involves a renewal of existing processes and mesh of technology as well as strategic thinking.Research intentionThe primary object ive of this study is to analyse how implementing BPR can improve process efficiency. BPR involves revamping a process function to a great extent. The process architecture and the associated quality manuals are changed. Implementing such an extensive strategy comes with high low-level formatting costs and time. Customer Service will also be unnatural during the transition period. I would be performing a cost proceeds analysis of the proposed BPR implementation. Secondly, many organizations have been using Business Modelling software based on the concept of Six Sigma. Six Sigma, though very instrumental in being able to improve operational efficiency, is very expert in nature. It is often criticized that it neglects the human factor in a business process and totally focuses on process automation. I have tried to show that BPR and Six Sigma can go hand in hand. These strategic initiatives are to be used by organizations in a complimentary fashion.Research ProblemThe research probl em that this particular study wished to investigate was to see how process efficiency can be improved within Argos. For that purpose, I worked in the operations function in one of the retail stores of Argos which was allocated to me by the company. I have adopted the principles of Project Management and Business Process Reengineering during this study in order to analyze and wherefore suggest modification in the existing structure. I have prepared a To- Be architecture of the process function, and compared it with the as -Is and proposed recommendations on how the process can be improved with the help of these understandings.Research QuestionsThroughout this study, I have sought to answer the following research questionsWhat are the menstruation drawbacks in the process utility within Argos?Argos has been successful and has done well over the last couple of decades in its field of operations. But that does not mean it has nothing to improve. With time, everything changes and henc e even the successful organizations must make certain changes. Moreover, the initial observation of the existing system and interaction with some of the employees there has given some ideas about what is lacking in the situation.How can BPR be used to improve process efficiency within Argos?Here the study will explore the fields that can be targeted for a BPR initiative. This can be the supply chain or the store layout or the organizational structure. It has to be seen which requires it the most and which would suite these procedures.What are the challenges involved?This study would also see the feasible difficulties in this implementation procedure and if possible, would try to suggest remedies for the same.How to manage service delivery during the transition stage? some other important issue is to ensure that the system does not become unproductive while going through a transition because it will have significant negative impact the business. So, it would be seen how to manage th ese issues.About ArgosArgos serves over 130 million customers growing at an annual rate of 20%. 26% of these transact online or through the phone. 18 million families or about two thirds of the English population have an Argos catalogue. It is amongst the most regard Brands of the UK and before being acquired by Home Retail Group, even feature in the FTSE 100 league (Antony and Banuelas, 2002). With over 170 different product groups, Argos is a revolution which has single handedly changed the meaning of cost effective retailing over the past decade. Offering home enhancement and public deal products, Argos works on an innovative business model. Customers can pasture through the entire catalogue online, buy and pay online. Alternatively, they visit any of the 700 branches, browse through the physical catalogue, check the product availability via the in fellowship kiosks with the product ID, order, pay and collect over the counter. Business turnwell-nigh at Argos happened in Mar ch 1999, when it was acquired by GUS plc (Antony and Banuelas, 2002) At that time, Argos was primarily a single channel, store based retailer, selling a smaller range of general merchandise, concentrated primarily on toys, jewellery, house wares and electrical. In 2000, Argos, the GUS home shop business, Reality UK operations were re structure to form the current business model. In 2000, a financial services wing was set up to offer assurance and warranty products to the customers of Argos.Argos is a pre-eminent retail brand in the UK and Ireland. The business runs by leveraging on the economies of scale. This is reflected by the fact that the average transaction size is just or so 30, while the transaction numbers are around 5 per customer in a year (Schroeder, 2003). Leadership in multi channel product distribution continues to be the prime forte of Argos and is the reveal differentiate to the customers shopping experience, as compared to the competitors, by enabling the custom ers to shop the way they want. Around 40% of the total sales are through multi channel internet and phone/ store for home delivery. The fastest growing channel, over the years, has been the online reservation for in store collection. The feature is available at every store.Business Process ReengineeringHaving explored multiple definitions of the business process reengineering, now let us see various implications of the same. Simply speaking, BPR is a basically a management approach that intends to enhance organizational performance by enhancing the competency of business processes across the organizations (Watson, 1993). BPR looks at the existing business processes remaining unattached to them and tries to determine how these processes can be aligned in order to optimise the ultimate performance of the business.Impact of BPR on BusinessThe prime actor of any business process is to improve productivity and lead to better profitability. BPR is also a way of reorganizing the proce sses within the business organizations in order to break the traditional barriers in various processes that have been built over the years and hence are very difficult to do away with (Hall et al., 1993). By this process of diluting the functional divisions, BPR makes the businesses more responsive, betters customer services and improves quality. BPR brings about visible structural changes throughout the organization and often obliterates existing frameworks (Hall et al., 1993, shin bone and Jemella, 2002). The conventional hierarchical thinking process is removed from the organizations and a process oriented view takes over the organization with the implementation of BPR. So, the work is now defined in terms of the set of processes instead of the functional boundaries in which they exist. This tactical shift can be attributed to changing business goals in recent times (Tonnessen, 2000). But it has to be noted that a tier of risk can always be associated with these changes. For ex ample diluting the functional barriers within an organization can disturb existing structure, confuse people and also effect insecurity in the upper echelons of the organizational hierarchy.The emergence and extrusion of Information Technology has also played an important role in development of BPR process. It has enabled sophisticated re-designing processes which were not possible earlier due to technical or resource limitations (Tonnessen, 2000). So, the business processes must be analyzed with look upon to the changes and improvements that IT can provide to them in order to solve existing problems. IT can also increase the value of the information exponentially by making it easier to collect, compose and categorize. Moreover, BPR ultimately redefines the job descriptions in the organization. It readiness also create a new breed of employees to handle new technologies and make some other breed of employees obsolete by replacing the manual systems with technology (Hall et al., 1993, shinny and Jemella, 2002). This is also a cause of concern because it leads to HRM issue like removing or re preparedness the obsolete employees. So, the employees must work as part of the team and should be empowered to take decisions. So, BPR also necessitates an effort towards building effective teams that work together with close co-operation and for that reason there must a system encouraging socialization and familiarization among the employees at various levels and functions within the organization.Now, let us have a look at some other important concepts that are closely related to BPR and can be useable in this whole process.Six Sigma The concept of six sigma was initiated by the Motorola Corporation in an effort to improve their quality measures by redacting the rate of take flight to about 3.4/million. Basically it meant that if they produced a million pieces of a certain item, there can be a maximum of 3.4 defected items in the lot (Linderman et al., 2002). It w as a marked improvement and in fact and audacious one considering the previous benchmark of For Sigma, which allowed up to 6,200 defects per million (Linderman et al., 2002). But it is not only hold in to reduction of errors and defects but also about the improvement of the process. It goes beyond the statistical tools as well as metrics it uses and becomes a philosophy that encompasses every activity within the organization and brings about overall improvement in productivity as well as profitability. This process generally includes five different stages namely definition and quantification of the problem, measurement of the performance and determination of the defect levels, analysis of data and performance of root cause analysis, improvement of the bill of defects and controlling the processes in order to ensure continuous sustenance of the improvements that have been achieved.The success and popularity of this concept can be attributed to several(prenominal) factors. It has re ceived widespread acceptance most because it involves the whole management, makes adjustments according to culture as well as employee attitudes, puts special emphasize on organization structure, boasts of standard training facilities on the six sigma methodology as well as the tools, enhances the skills in project management and links the quality control process to the overall business strategy, HRM strategy and customers satisfaction (Antony and Banuelas, 2002). It is also important to use the structured methods, pick the specific processes for implementation of six sigma improvements, employ specialists to work on it full time and relate the financial results as well as other business benefits to the bottom-line (Schroeder, 2003). Some researchers classify Six Sigma as a method of setting and achieving goals (Linderman et al., 2002) and hence emphasize on the importance of the clear and challenging goals that are strictly specified and make known to everyone involved. This also n ecessitates other efforts like performance appraisal, rewards, incentives as well as training for the employees to ensure the desired levels of performance.Six sigma was initially introduced in an effort to control the variations as well as the defects in the manufacturing processes. But over the years, even the service industry has employed it with a great degree of success. curiously the financial institutions as well as healthcare organizations have benefited by using this concept. Success of some iconic companies like Motorola and GE has made it a very significant development in the recent decades but it has to be seen that there are still a lot of many other companies have been dissatisfied with the results from their six sigma projects (Hammer, 2002). These failures have been attributed to the lack of participation of the customers as well as the supplier, lack of coherence with the overall business goals and the use of it just as a tool instead of a complete organizational improvement approach (Velocci, 2002). Also, some of the six sigma processes are not directly linked to the profit making functions of the organizations and hence are overlooked by the people (Velocci, 2002). Nevertheless, some researchers opine that six sigma is too analytical and less creative and hence we might not be suitable in every case.Benchmarking It can be defined as the process of perpetually measuring and comparing the business processes inside a certain company to the same in one of the leading organizations in the same sector. This is done in order to get a relative understanding of its own standards so as to identify the problems and implement improvements (Watson, 1993). The American Productivity Quality Centre (APQC) defines it as a systematic as well as continuous measurement process. It is a process of continuously measuring as well as comparing an organizations business processes against the business processes of the leaders in that industry anywhere in the wor ld so as to gain information that can help the organization in taking action to improve its own performance.Benchmarking can be describe as a more sophisticated version of reverse engineering of the successful free-enterprise(a) products. Since then, it has evolved as a process of continuous semblance and improvement in the process as well as strategic levels and also with a global point of view. There are several types of benchmarking that are being used in various organizations nowadays namely, internal, external, competitive as well as generic benchmarking (Watson, 1993). Photocopy pioneer dispel is often credited using this process in the late mid-seventies when it applied this benchmarked technique with its Japanese partners. Originating in US, benchmarking has gained worldwide acceptance around the world in the last few decades. In the UK, we have seen the initiatives like UK benchmarking index, and Cranfield Best Factory that have worked exclusively on this (Zairi and Ahm ed, 1999). The process of benchmarking at its core is a comparison between multiple organizations and their best(p) practices. As a matter of fact it is performing a gap analysis through benchmarking to understand the procedural and strategic differences between itself and another company that it sees as a successful one. Generally it is done between two companies and procedure is generally simple. But in an effort to reduce complexity, it might lose out on the nuances of the trade-offs that might exist between two companies. A spider-web diagram is a method that is more elaborate and it allows multi dimensional analysis and can analyze multiple aspects for different functions (Ahmed and Rafiq, 1998). There are other such tool but they are beyond the scope of this discussion. Irrespective of the tools used in the benchmarking process, some experts allege that it actually limits the levels of ambition. It just aspires to take the company to the level of the best one in the industry but it would not know how to surpass it. Also it is not behind to unanimously define the definition of the best in the industry because the best will depend on what criteria is used to decide and also on which year it is measured (Zairi and Ahmed, 1999). Also, there is an issue with the availability of proprietary information from the companies against which the analyzing farm is benchmarked. They might choose not to disclose specific lucubrate in order to maintain their competitive advantage and hence this act would not have much value (Pulat, 1994). Nevertheless, a lot of companies have been reported to have achieved significant development in their processes using this practice. Companies like Chevron, Hewlett Packard and Hughes Communications have publicly attributed their success to effective benchmarking processes and consequent transportation system of industry best practices.ReengineeringWe have defined BPR before. But there are many other aspects to the process of reeng ineering. It differs from most other process improvement approaches as it does not focus on the existing processes but tells us how they should be in order to achieve better performances (Attaran and Wood, 1999). The intention is not to change or fix the errors in the existing processes but to see whether they are necessary at all and if not then come up with a completely different framework (Zinser et al., 1998). So, the key principles reengineering are ambition, focus on the processes, evaluation and questioning of the fundamental assumptions within the organization and the processes, and use of information at a broader level in order to measure the processes (Peppard, 1999). There is also a need for integrating the redesign process with the corporate strategy as well as organizational visions of the underlying business. It has been implemented by several companies in the past with change degree of success. Nevertheless, both the service sector (Hall et al., 1993, Shin and Jemell a, 2002) as well as the manufacturing sector (Hall et al., 1993, Tonnessen, 2000) over the world has applied it. A success story are largely well documented and available easy in the public domain but it is difficult find the details of the failures and hence are very difficult to analyze (Attaran and Wood, 1999, Hammer and Champy, 1993, Zinser et al., 1998). So, we can say that an improper choice of the processes can result in the failure of reengineering. In general, experts suggest a bigger breadth and depth in the process meaning that they should include as many activities as possible to ensure that every aspect of the organization is improved through the process