Business process reengineering refers to the complete overhaul of business processes that are central to your organization. The primary goal of business process reengineering is to foster significant enhancements in employee productivity, cut costs, move products to market faster, and enable greater customer satisfaction.
The first phase in the business process reengineering model is to start with a completely blank slate. The goal isn’t to fix small problems in processes, but to think of them with a radically different lens. You might want to eliminate organizational layers completely and focus on cutting activities that you deem are unproductive.
The purpose of business process reengineering is to eliminate wastage and reimagine what it might take to build a leaner business. For example, you could use technology and analytics to understand what parts of your business are a net resource drain.
Another useful application is understanding what parts of your organization would work better if they were merged into one, or serve as cross-functional teams.
The business process reengineering definition was first outlined by Thomas Davenport who stated that it is a “set of logically related tasks performed to achieve a defined business outcome.”
What are the steps in business processes reengineering?
Business process reengineering steps typically involve the following 5 key processes:
- A recalibration of company priorities to focus on client needs
- Transformation of core processes in conjunction with technology, designed to improve service quality levels
- Encourage the development of cross-functional teams as opposed to siloed departments
- Improve employee engagement processes
- Design, build, and test the new prototypes