Business Process Reengineering
Part 4 of 6 

To date, much of the literature dealing with BPR can be characterized as highly descriptive and anecdotally based. This is natural given the relatively young age of this technique. There are guidelines for what the desired process should look like after the project has been carried out (e.g., several jobs should be combined into one where possible, workers should make the major decisions, steps in the process should be performed in a natural order, process should have multiple versions, work should be done where it makes the most sense). However, the field suffers from the lack of any guidelines for how to approach the formulation, implementation and review of a BPR project. In other words, there is a need to answer the "How" of BPR.

In many instances, the BPR process follows the same sequence of steps as initially outlined by Juran (3) in his "Universal Breakthrough Sequence" (UBS). The UBS identifies a set of events which are used and followed for making major leaps in system effectiveness. First devel­oped for implementing improvements in quality, the UBS has now become recognized as being applicable o a large number of different applications, including BPR. The effective application of this sequence is highly dependent on having management first accept responsibility for improvement. The sequence is seen as being universal since all breakthroughs follow the same sequence of events. This sequence consists of seven major stages.

1. Proof of Need: The first step is to create an awareness of need—an awareness that something is wrong with the processes as they are currently organized and that some­thing must be done now (or else). This can be done in a number of different ways. Mercury Marine in the early 1980s showed its people the problems with the current manufacturing processes by following an order through the system and videotaping it. The resulting performance, as reported in terms of number of steps (total and opera­tion), number of feet traveled, number of hours within the system and the number of people touching the order, made everyone in the firm aware of the full costs of the current processes. Another way of creating awareness is to try to assign costs to the operation of the current system. Still another way is that of a survey.

Surveys or structured conversations with customers, both internal and external, is a very useful way of gathering information and making useful comparisons. In a recent project carried out by Michigan State University for a medium-sized manufacturer located in central Michigan, a survey was carried out on both the firm's internal and external customers. Everyone was asked to rate what they thought ultimately was wanted of the process and the products produced by the process. To this end, the survey contained a list of attributes (e.g., quality, reliability of delivery, flexibility in accommodating change). The re­spondents were asked to rank each attribute using a five point scale (A, B, C (for average), D, F). Next, all customers were asked to rank all of the major suppliers of the product on these same traits using the same five point scale. This information was used to construct a two identical graphs—each consisting of two intersecting lines. The first graph was based on the external customers' responses. In this graph, the vertical line represented the weighted custom­ers' assessment of the various traits, while the horizontal line represented the performance of companies on these traits. For each trait, only two points were plotted: the best in class for the industry (i.e., the firm which did the best) and the position of the firm. The result is shown in Figure 1.

In this figure, we have shown only the attribute ranked as being most important by the external customer (quality in this case). We can see that overall it falls between an A and a B. The best in class firm is depicted by an O while the firm's position is shown by an X. In this figure, there are several important points to note. First, we are interested in the firm's position, both absolute and relative. The absolute position indicates that we are not doing badly on quality. However, we are performing below that of the best in class. Furthermore, we are interested in the distance between ourselves and the best in class (since this is an indication of the strength of the advantage). In general, the larger the gap between ourselves and the industrial best-in-class, the more likely that the best-in-class has devel­oped a sustainable competitive advantage. We repeat this exercise of comparing our position to the best-in-class for each attribute (moving from the highest ranked to the lowest). The result is a graphically representation of our position in the marketplace and the extent of any "problem" as indicated by our customers.

To be Continued