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Introduction
Business process re-engineering (BPR) is not another technique for downsizing an organisation. Re-engineering is not another quality improvement, just-in-time, or cycle time reduction program. These activities typically focus on improving the existing process, whereas re-engineering has the goal of radically changing the processes.
Hammer (1990), defined BPR as the "fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical measures of performance-cost, quality, capital service and speed". According to Davenport and Short (1990), business process is "a set of logically related tasks performed to achieve a defined business outcome".
BPR begins with process redesigning which leads to fundamental changes in many aspects of an organisation, including organisational structure, job characteristics, performance measures and the reward system. BPR relies heavily on the use of information technology (IT) to create radically different working methods to achieve improvements of the order of magnitude required. Furthermore BPR facilitates the change in corporate management's perception of technology. It also confirms an alternative channel through which IT solutions are being scrutinised and selected (Soliman, 1997).
Jih et al. (1995) suggested that management is taking a more holistic approach to the redesign and packaging of business processes and their relation with IT. This is fundamentally different from previous approaches where incremental improvements were sought. The reason for this is the belief that radical improvements in performance are both necessary and attainable. This belief is a driver for the BPR effort.
Implementing IT for business applications is traditionally aimed at automating the pre-existing processes in an organisation. IT cannot elevate productivity drastically unless management processes, including the very organisational structure, are changed to accommodate and maximise the benefits of the current advances in the IT environment.
Hammer and Champy (1991) cited the following four elements as the principles of re-engineering:1
process orientation;
2
ambition;
3
rule breaking; and
4
creative use of IT.
The creative use of IT plays an important role in shaping and restructuring the organisation. Previously, IT essentially implemented existing business rules and structures, thus playing the role of passively amplifying the given business structures. In BPR, IT is used as an active agent of change. After the re-engineering work is completed, organisations should look very similar to Drucker's notion of information-based organisations (1992).
Therefore...