The organization may be a for-profit business, a non-profit organization, a government agency, or any other ongoing concern. Most BPI techniques were developed and refined in the manufacturing era, though many of the methodologies (like Six Sigma) have been successfully adapted to work in the predominantly service-based economy of today. While there are differences in the challenges that each type of industry poses, the fact remains that the core principles of BPI and how they apply to business improvement remain portable across industries and functions.
It should be noted that BPI focuses on "doing things right" more than it does on "doing the right thing". In essence, BPI attempts to reduce variation and/or wastage in processes, so that the desired outcome can be achieved with better utilisation of resources.
BPI works by:
Defining the organization's strategic goals and purposes (Who are we, what do we do, and why do we do it?)
Determining the organization's customers (or stakeholders) (Who do we serve?)
Aligning the business processes to realize the organization's goals (How do we do it better?)
The goal of BPI is a radical change in the performance of an organization, rather than a series of incremental changes (compare TQM). Michael Hammer and James Champy popularized this radical model in their book ‘’Reengineering the Corporation: A Manifesto for Business Revolution’’ (1993). Hammer and Champy stated that the process was not meant to impose trivial changes, such as 10 percent improvements or 20 percent cost reductions, but was meant to be revolutionary (see breakthrough solution).
Many businesses in the 1990s used the phrase "reengineering" as a euphemism for layoffs. Other organizations did not make radical changes in their business processes and did not make significant gains, and, therefore, wrote the process off as a failure. Yet, others have found that BPI is a valuable tool in a process of gradual change to a business.
It should be noted that BPI focuses on "doing things right" more than it does on "doing the right thing". In essence, BPI attempts to reduce variation and/or wastage in processes, so that the desired outcome can be achieved with better utilisation of resources.
BPI works by:
Defining the organization's strategic goals and purposes (Who are we, what do we do, and why do we do it?)
Determining the organization's customers (or stakeholders) (Who do we serve?)
Aligning the business processes to realize the organization's goals (How do we do it better?)
The goal of BPI is a radical change in the performance of an organization, rather than a series of incremental changes (compare TQM). Michael Hammer and James Champy popularized this radical model in their book ‘’Reengineering the Corporation: A Manifesto for Business Revolution’’ (1993). Hammer and Champy stated that the process was not meant to impose trivial changes, such as 10 percent improvements or 20 percent cost reductions, but was meant to be revolutionary (see breakthrough solution).
Many businesses in the 1990s used the phrase "reengineering" as a euphemism for layoffs. Other organizations did not make radical changes in their business processes and did not make significant gains, and, therefore, wrote the process off as a failure. Yet, others have found that BPI is a valuable tool in a process of gradual change to a business.
Re-engineer your business to the needs of your customers [Lip, 1989] However, Business Process Reengineering (BPR) is a management practice that aims to improve the efficiency of the business process. The key to BPR is for organizations to look at their business processes from a "clean slate" perspective and determine how they can best construct these processes to improve how they conduct business. Reengineering is a fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in cost, quality, speed, and service. BPR combines a strategy of promoting business innovation with a strategy of making major improvements to business processes so that a company can become a much stronger and more successful competitor in the marketplace.
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