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Bruce Ware, USA
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Costs of BPR - Any ideas?
Hoping that someone can point to some reference providing info on how much a BPR activity would cost -- some percentage of overhead expenses??
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Tomas Helling
Manager Corporate Business Processes, Sweden
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BPR Cost —> Investment Bruce, there is no simple answer to this. I would not even talk about "cost" for BPR-initiatives as they all by nature are aiming at increasing revenue, time-to-market, shorten lead times, reduce waste etc.
I would rather talk about investments. Depending on the scope of the initiative, the kind of industry / business and the as-is status the investment will vary a lot between different initiatives.
I was involved in a BPR initiative at a national utility company in the late 90´ies. We invested (labour cost and consultants) about 1 million $ in the project. We could release $ 40 million in annual savings.
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Jaap de Jonge
Editor, Netherlands
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The Required Investment in BPR. Costs Obviously the amount of money, time, effort and other resources involved in a BPR project depends on the situation at hand. I think there is no such thing as a percentage of overhead expenses to use as a rule of thumb.
Because BPR efforts are by definition aiming at fundamental reconsideration and radical redesign of organizational processes - in order to achieve drastic improvement of current performance in cost, services and speed - we would typically expect a large investment to make all that happen.
If an organization has little experience with BPR, it could be smart to start with a project of a modest scope and hopefully achieve some quick results, while learning what needs to be learned for more substantial efforts in the longer term.
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Salman Ali Siddiqui
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BPR: Process Improvements versus Cost Doing away the manual processes and bringing in technology and tools to make a process time efficient is one way of doing BPR.
However, technology and tools also come at a certain cost. That's why decision makers are often hesitant to invest in automation without evaluating the business gains. Business dynamics are causing automation to change as well, this is inevitable. Time windows are shrinking, customers are very demanding. They are wiser compared to yesterday. They want value additions and higher value for their money.
To retain, sustain and enhance organization's business/revenues customer base you must have processes with:
- Reduced errors; meaning greater reliability
- Enhanced controls; meaning precision
- More delivery in less time; meaning the processes go faster
- Less physical and mental fatigue; meaning safer working environment
A word of caution. Just because something can be automated that doesn't mean they should be. Automating is not always a good thing to do. Some people may fall into the trap of thinking that if something can be automated, it should be. But that is like someone purchasing a robotic lawn mower, while he enjoys mowing the lawn...
And remember boons and banes (pros and cons) don't travel alone. They always come in pairs.
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