Transnational Research Associates
Journal Article Analysis: Business Process Reengineering
Art Madsen, M.Ed.
Gunasekaran, A and Nath, B., "The role of information technology in business process reengineering", International Journal of Production Economics, 50 (1997), 91-104.
Two Professors of Engineering Systems and Information Technology, from the United Kingdom and Australia, have offered, in their above-cited article, broad insight into Business Process Reengineering (BPR) and the importance of Information Technology (IT) within this relatively new and somewhat radical supply chain transformation methodology. In their article, BPR is shown in a highly positive light, although this type of thinking was especially prominent in the early 1990s and has since lost some of its luster in many industrial management circles. Their merging of IT with BPR, however, seems to place a ‘new spin’ on arguments that were perhaps devoid of support in much of the existing literature in this field. The Production Economics article in question emphasizes how BPR can favorably influence bottom-line cost, quality and production-time when implemented in conjunction with newly developed IT methods and systems. In this sense, the authors’ new conceptual model can be said to be extremely useful when considering overhauling and renovating of pre-existing production processes.
The present analysis will explore the major conceptual innovations published by Gunasekaran and Nath and provide a concise assessment of their thinking within the context of BPR as an emerging systemic influence on production and supply-chain processes.
One key notion which repeatedly surfaces in this article underscores the importance of realizing that BPR is not designed to merely hasten the manufacturing process, it is a systematic approach to actually simplifying such processes, by eliminating repetitive, useless or redundant production stages (92). The role of information is crucial in determining which steps can be eliminated entirely, or in intervals, thus reducing cost without sacrificing product quality. Keeping in mind that customer satisfaction is of utmost importance, the system designed by these two manufacturing engineers does not adversely impact either the appearance or the functionality of the product being marketed. On the contrary, properly implemented BPR thinking results in all elements of the equation being honored.
Through customization of the product to fulfill a specific need, costs can be reduced and customer requirements can be more closely matched. By insisting that production proceed in unit-stages, they assert, the flow of activity can be smoothed and costs minimized (93). Information technology serves the purpose of identifying where such units begin and end. IT is now capable of analyzing all crucial elements of production involved, such as manpower, materials and value-added tasks, and can arrive at optimal levels for each element, streamlining the process and improving overall efficiency. There are also human factors that must be injected into the changes required, incorporating actual, discernable behavioral change, in addition to close monitoring of physical aspects of production and delivery.
The most generally effective methods used to implement BPR, in conjunction with IT support, are, managerially speaking, essentially "top-down" command structures. The authors derive support for this assertion from Ardhaldjian and Fahner (94) who, among other points, stressed the need to ‘drive the process’ almost forcefully in new directions using multi-functional coordination and consistency as key tools. Such force needs to emanate from a top-down command structure, capable of overriding resistance from lower echelon or mid-management personnel.
The authors progress to a detailed description (95-97) of how IT can be optimally inserted into the BPR paradigm, yielding excellent broad-based results wherever drastic change, in cost, process or delivery-time, is desired. Such methods as EDI, EFT, MRP II are analyzed in terms of their applicability to process-simplification. Transfer of data (EDI), funds (EFT) and materials requirements planning (MRP) are all technologies that are taken for granted today but which can be implemented thoughtfully in conjunction with a radical process redesign strategy to yield impressive results. Due to the ability to visualize processes and work-flow, document image processing is also gaining support among BPR-oriented executives and managers. Combined with additional new techniques in artificial intelligence, computer assisted design and strategic planning, BPR and IT constitute a powerful force for maximizing profit, product image or quality, while minimizing needless expense, frustration or failure.
The authors refer briefly to the responsibilities of corporations implementing BRP to assist in reduction of stress among employees who are coping with often ‘massive’ change and pressure (99). Allowing employees enhanced flexibility in work hours and reassessment of wage & benefit packages might help ensure higher compliance among staff, reducing turn-over and dissatisfaction. Knowing when to "pull-back" and not to forge ahead with BPR-recommended change are also critical insights, they point out (101).
By properly implementing BPR in unison with the latest IT innovations such as those alluded to above, corporations can reduce costs, minimize stock overage, avoid loss of merchandise, improve customer relations and smooth work-flow, ultimately with the effect of maximizing profit and pleasing stockholders. Indeed, the flow of materials, proper positioning of manpower, and process renovation can all be enhanced through BPR in a manufacturing age where simplification, change and progress are sought by forward-thinking and astute executives, planners and production specialists. Gunasekaran and Nath’s article contributes tangibly to an understanding of the interaction of BPR and IT.