Organizational Development: A Manual for Managers and ... - FPDL

Business Process Reengineering
It must be considered that there is nothing more difficult to carry out,
nor more doubtful of success, nor more dangerous to handle,
than to initiate a new order of things.
Machiavelli (1513)
Business Process Reengineering (BPR) emerged as formal business practice in the United States
during the 1980’s and early 1990’s and was generally understood as a ‘radical reinvention of
organizations along process lines.’ (Beckford, 2002) Michael Hammer and James Champy
formalized the approach in 1993. They define BPR as ‘the fundamental rethinking and radical
redesign of business processes to achieve dramatic improvements in critical, contemporary
measures of performance, such as cost, quality, service and speed.’ (Hammer and Champy, 1993)
BPR rejects the idea of reductionism – the fragmentation and breaking down of organizations into
the simplest tasks; it encourages organizations to utilize substantial developments made in
technology, particularly IT; and enables organizations to take better advantage of the skills and
capabilities of the staff they employ.
Hammer and Champy defined three factors that call for principal re-thinking of organizational
design – Clients, Competition, and Change (3Cs). Clients have power. There is not a ‘client in
general’ any longer, only concrete clients - here and now. The mass market is segmented into
pieces down to the individual client. Competition is rising. Being a big company does not mean
being invulnerable any longer. Newly established companies that do not possess ‘organizational
baggage’ and are not limited by their past may be more successful with their products and market
policies. Change becomes permanent and penetrates everything. These three ‘Cs’ have created a
new world for business, where old organizational solutions are not viable.
The authors point to IT as the main force in changing rules that affect organizational order. For
example, the old rule, ‘Information may be available only in one place and time’, is replaced by a
new one - ‘Information may be available at the same time in any place it is needed’. The old rule,
‘Only specialists may perform difficult tasks’, is changed to the new one - ‘A wide-profile worker
may do the job of a specialist’. The rule, ‘All decisions are made by managers,’ gives a way to a
new one - ‘Decision-making is part of the job of any employee,’ and so on.
In their answers to readers’ questions, Hammer and Champy pointed out that reengineering is fully
applicable to the public sector, and they drew attention to specific problems, which BPR faces
here. First, it is difficult to estimate results. Many organizations in the public sector are oriented
according to indexes of expenditures – this makes it difficult to choose between quality and effect.
In fact, this was the main challenge in all public organizations where the author and his colleagues
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