Balanced Scorecard Benchmarking Business Process Reengineering Collaborative Innovation Core Competencies Customer Relationship Management Customer Segmentation Decision Rights Tools Downsizing Growth Strategy Tools Knowledge Management Lean Six Sigma Loyalty Management Mergers and Acquisitions Mission and Vision Statements Online Communities Outsourcing Price Optimization Models Scenario and Contingency Planning Shared Service Centers Strategic Alliances Strategic Planning Supply Chain Management Total Quality Management Voice of the Customer Innovation Related topics Cycle-Time Reduction Horizontal Organizations Overhead-Value Analysis Process Redesign Description Business Process Reengineering involves the radical redesign of core business processes to achieve dramatic improvements in productivity, cycle times and quality. In Business Process Reengineering, companies start with a blank sheet of paper and rethink existing processes to deliver more value to the customer. They typically adopt a new value system that places increased emphasis on customer needs. Companies reduce organizational layers and eliminate unproductive activities in two key areas. First, they redesign functional organizations into cross-functional teams. Second, they use technology to improve data dissemination and decision making. Methodology Business Process Reengineering is a dramatic change initiative that contains five major steps. Managers should: Refocus company values on customer needs; Redesign core processes, often using information technology to enable improvements; Reorganize a business into cross-functional teams with end-to-end responsibility for a process; Rethink basic organizational and people issues; Improve business processes across the organization. Common uses Companies use Business Process Reengineering to substantially improve performance on key processes that impact customers. Business Process Reengineering can: Reduce costs and cycle time. Business Process Reengineering reduces costs and cycle times by eliminating unproductive activities and the employees who perform them. Reorganization by teams decreases the need for management layers, accelerates information flows, and eliminates the errors and rework caused by multiple handoffs; Improve quality. Business Process Reengineering improves quality by reducing the fragmentation of work and establishing clear ownership of processes. Workers gain responsibility for their output and can measure their performance based on prompt feedback. Related Bain capabilities Business Process Redesign Cost & Supply Chain Management Performance Improvement Selected references Al-Mashari, Majed, Zahir Irani, and Mohamed Zairi. "Business process reengineering: a survey of international experience." Business Process Management Journal, December 2001, pp. 437-455. Carr, David K., and Henry J. Johansson. Best Practices in Reengineering: What Works and What Doesn't in the Reengineering Process. McGraw-Hill, 1995. Champy, James. Reengineering Management: The Mandate for New Leadership. HarperBusiness, 1995. Davenport, Thomas H. Process Innovation: Reengineering Work Through Information Technology. Harvard Business School Press, 1992. Frame, J. Davidson. The New Project Management: Tools for an Age of Rapid Change, Complexity, and Other Business Realities. Jossey-Bass, 2002. Grover, Varun, and Manuj K. Malhotra. "Business Process Reengineering: A Tutorial on the Concept, Evolution, Method, Technology and Application." Journal of Operations Management, August 1997, pp. 193-213. Hall, Gene, Jim Rosenthal, and Judy Wade. "How to Make Reengineering Really Work." Harvard Business Review, November/December 1993, pp. 119-131. Hammer, Michael. Beyond Reengineering: How the Process-Centered Organization Is Changing Our Work and Lives. HarperCollins, 1997. Hammer, Michael, and James Champy. Reengineering the Corporation: A Manifesto for Business Revolution, revised and updated. Collins, 2003. Keen, Peter G.W. The Process Edge: Creating Value Where It Counts. Harvard Business School Press, 1997. Sandberg, Kirsten D. "Reengineering Tries a Comeback-This Time for Growth, Not Just Cost Savings." Harvard Management Update, November 2001, pp. 3-6.