《电子商务 E-business》阅读文献：Redesigning Enterprise process for e-business

28 PART A: UNDERSTANDING BPR FOR e-BUSINESS typically well underway in about one year, but there are phased enterprisewide BPr im- plementation projects that take as long as five years before full implementation. For ex- ample, a global telecommunications equipment vendor that does business in 120coun tries and wants to reengineer its global order fulfillment process may phase the implementation over several years, for reasons of effort required and the sizeable infra structure investments that implementation may entail. Smaller BPR projects that focus on a narrow process in one geographical location can typically be initiated and re designed in weeks and organizationally implemented in months As our methodologies improve through the use of BPR software and advances in software allow us to design information systems very rapidly, we are seeing a decrease in the time needed for the implementation of BPR projects. Furthermore, the pressure of working and living on Internet time and the move to e-business are exerting further pressure for quicker BPR projects c 2. What Are the Most Common Reasons for Doing BPR? In the early 1990s, cost cutting and downsizing were prime drivers of BPR projects. BPR then was more often triggered by symptoms and manifestations that induced fear and pain such as the following Broken processes that the competition was taking advantage of. Sagging profits due to price cutting by global competitors Overhead costs that were growing faster than revenues Faster and nimbler competitors with shorter product lifecyo Stagnant business conditions that required targeting a new segment of the market. Unsatisfied customers who were leaving in droves BPR in this era had a negative slash and burn connotation and was closely associated with downsizing and layoffs. In the U.S.A., this also coincided with an economic re cession. As the recession ended and companies were again poised for growth, cost cut ting became less of a driver for BPR. Adding value for customers and creating new op- portunities became the more important BPR drivers BPR can be very exciting when accompanied with bold visions of growth, speed, and competitiveness. New information technologies enable innovative new product and services delivered through reengineered processes: a loan application process re- quiring only one phone call and an approval in 15 minutes; a global new product de- velopment process where remote teams videoconference and exchange CAD/CAM drawings in real time; an order fulfillment process that provides instant product reviews and product comparisons via the Internet and automatically connects customers to a competitor's Web site if the item is out of stock. These are the exciting scenarios that lead to dramatic changes and motivate bpr to create value 3. which Business Processes Need to be reengineered the most? The business processes most often targeted in early BPR efforts are the order fulfillment process and the customer service process(probably comprising about 50 percent of all BPR proj- ects). This is true of manufacturing and service industries. Both these processes are highly structured, can benefit in various ways through new information technologies

28 PART A: UNDERSTANDING BPR FOR e-BUSINESS typically well underway in about one year, but there are phased enterprisewide BPR im￾plementation projects that take as long as five years before full implementation. For ex￾ample, a global telecommunications equipment vendor that does business in 120 coun￾tries and wants to reengineer its global order fulfillment process may phase the implementation over several years, for reasons of effort required and the sizeable infra￾structure investments that implementation may entail. Smaller BPR projects that focus on a narrow process in one geographical location can typically be initiated and re￾designed in weeks and organizationally implemented in months. As our methodologies improve through the use of BPR software and advances in software allow us to design information systems very rapidly, we are seeing a decrease in the time needed for the implementation of BPR projects. Furthermore, the pressure of working and living on Internet time and the move to e-business are exerting further pressure for quicker BPR projects. 2. What Are the Most Common Reasons for Doing BPR? In the early 1990s, cost cutting and downsizing were prime drivers of BPR projects. BPR then was more often triggered by symptoms and manifestations that induced fear and pain such as the following: • Broken processes that the competition was taking advantage of. • Sagging profits due to price cutting by global competitors. • Overhead costs that were growing faster than revenues. • Faster and nimbler competitors with shorter product lifecycles. • Stagnant business conditions that required targeting a new segment of the market. • Unsatisfied customers who were leaving in droves. BPR in this era had a negative slash and burn connotation and was closely associated with downsizing and layoffs. In the U.S.A., this also coincided with an economic re￾cession. As the recession ended and companies were again poised for growth, cost cut￾ting became less of a driver for BPR. Adding value for customers and creating new op￾portunities became the more important BPR drivers. BPR can be very exciting when accompanied with bold visions of growth, speed, and competitiveness. New information technologies enable innovative new products and services delivered through reengineered processes: a loan application process re￾quiring only one phone call and an approval in 15 minutes; a global new product de￾velopment process where remote teams videoconference and exchange CAD/CAM drawings in real time; an order fulfillment process that provides instant product reviews and product comparisons via the Internet and automatically connects customers to a competitor's Web site if the item is out of stock. These are the exciting scenarios that lead to dramatic changes and motivate BPR to create value. 3. Which Business Processes Need to be Reengineered the Most? The business processes most often targeted in early BPR efforts are the order fulfillment process and the customer service process (probably comprising about 50 percent of all BPR proj￾ects). This is true of manufacturing and service industries. Both these processes are highly structured, can benefit in various ways through new information technologies

CHAPTER 2: KEY ISSUES AROUND BPR AND THE EVOLUTION OF BPR FOR e-BUSINESS and have direct customer impact. An increasing number of BPR efforts target core sup- ply chain management processes. Recently we have started to see more knowledge intensive processes such as new product development becoming the focus of BPR proj ects. However, are these the right business processes to pick for all companies? How de we identify the business process that most needs to be reengineered? Given limited re sources, time, and attention, to which process should we direct our efforts? strategic logic suggests that reengineering the business processes that add the most alue to improved business performance are where we should direct our attention. Or stated another way, we should first focus on core processes that are strategic to the com- pany. These generic statements are roughly at the same level of usefulness as the stock arket advice about identifying ght stocks to trade: Sell high and buy low. Peter Keen(1997) provides operationalized advice in regard to selecting the right business process to reengineer by regarding processes as a form of capital assets and liabilities that need to be wisely managed Keen provides a classification of processes based on two dimensions of value: worth and salience. The worth dimension classifies processes based on creating or destroying value. Processes are assets when they use the capital invested in them(people, infra- structure, management attention, technology) to create distinctive value for the com- pany-whether in terms of differentiation, reputation, efficiency, or any other value- creating criterion. Processes are liabilities when they drain value from a company and yet have much capital invested in them. The salience dimension has to do with the im- portance of the process relative to the company's strategic intent. There are several cat- egories of salience: identity processes that define a company to its customers(such as logistics at Fed Ex and customer service at Singapore Airlines); priority processes that have direct impact on customers and are important; and various types of background processes(some mandated by regulations such as compliance reporting)where invest- ng more capital will not add any more value The classification of processes along the two dimensions of worth and salience pro- vide guidelines for choosing which business process to reengineer. For example, iden- tity processes that are liabilities need foremost attention and BPR, while priority asset processes require continuous improvement. BPR on background liability processes may yield excellent performance improvement for that process, but very little overall impact to the company's overall performance 4. How Successful Are BPR Projects? What Is the Track record This is not a straightforward question to answer and there are many reasons why The fluidity of definition of what a BPR project is and what it is not make it hard to accurately assess the success or failure rate There is an aggregate learning effect over time that distorts statistics. We now know more about how to make BPR efforts successful than we did in the early 1990s The current advances in IT infrastructure development and electronic commerce are enabling BPR projects to become more ambitious over time The success rate is dependent on the scale and scope of the BPR project. BPR rojects that have broader scopes, a bigger scale, and consequently longer time frames

CHAPTER 2: KEY ISSUES AROUND BPR AND THE EVOLUTION OF BPR FOR e-BUSINESS 29 and have direct customer impact. An increasing number of BPR efforts target core sup￾ply chain management processes. Recently we have started to see more knowledge￾intensive processes such as new product development becoming the focus of BPR proj￾ects. However, are these the right business processes to pick for all companies? How do we identify the business process that most needs to be reengineered? Given limited re￾sources, time, and attention, to which process should we direct our efforts? Strategic logic suggests that reengineering the business processes that add the most value to improved business performance are where we should direct our attention. Or stated another way, we should first focus on core processes that are strategic to the com￾pany. These generic statements are roughly at the same level of usefulness as the stock market advice about identifying the right stocks to trade: Sell high and buy low. Peter Keen (1997) provides operationalized advice in regard to selecting the right business process to reengineer by regarding processes as a form of capital assets and liabilities that need to be wisely managed. Keen provides a classification of processes based on two dimensions of value: worth and salience. The worth dimension classifies processes based on creating or destroying value. Processes are assets when they use the capital invested in them (people, infra￾structure, management attention, technology) to create distinctive value for the com￾pany—whether in terms of differentiation, reputation, efficiency, or any other value￾creating criterion. Processes are liabilities when they drain value from a company and yet have much capital invested in them. The salience dimension has to do with the im￾portance of the process relative to the company's strategic intent. There are several cat￾egories of salience: identity processes that define a company to its customers (such as logistics at FedEx and customer service at Singapore Airlines); priority processes that have direct impact on customers and are important; and various types of background processes (some mandated by regulations such as compliance reporting) where invest￾ing more capital will not add any more value. The classification of processes along the two dimensions of worth and salience pro￾vide guidelines for choosing which business process to reengineer. For example, iden￾tity processes that are liabilities need foremost attention and BPR, while priority asset processes require continuous improvement. BPR on background liability processes may yield excellent performance improvement for that process, but very little overall impact to the company's overall performance. 4. How Successful Are BPR Projects? What Is the Track Record? This is not a straightforward question to answer and there are many reasons why: • The fluidity of definition of what a BPR project is and what it is not make it hard to accurately assess the success or failure rate. • There is an aggregate learning effect over time that distorts statistics. We now know more about how to make BPR efforts successful than we did in the early 1990s. • The current advances in IT infrastructure development and electronic commerce are enabling BPR projects to become more ambitious over time. • The success rate is dependent on the scale and scope of the BPR project. BPR projects that have broader scopes, a bigger scale, and consequently longer time frames

30 PART A UNDERSTANDING BPR FOR e-BUSINESS (such as large cross-enterprise efforts) are less likely to grandly succeed as they are more difficult to implement Similar to other organizational change and information technology implementa tion efforts, success is very dependent on contextual and organizational factors There are many dimensions to what constitutes success. BPR projects may be suc- cessful in that they operationally achieve the process advantage (in terms of reduced cycle time or cost, or increased flexibility or quality) but that may not translate into bottom-line profits or overall corporate performance improvement Given the above caveats, one should interpret any statistics about BPR success and fail- ure with caution and qualification. A 1994 reengineering survey of about 100 BPR proj- ects by CSC Index showed that 67 percent were judged by companies as producing arginal or failed results. Thus only one in three bPr projects produced great results As these large projects were reengineered in the early 1990s when many BPR projects revolved around cost cutting and downsizing. the statistics were not as bad as the trade press interpreted them. It is unclear whether the outcome was any different from the success statistics of other types of large-scale organizational change efforts. If one com- pares the percentage to the statistic that one out of every ten start-up companies is highly successful, it looks pretty good One of the more careful early assessments of BPR success and failure was a study by McKinsey consultants(Hall et aL., 1993)of BPR projects in 100 companies in the U.S.A. and Europe. They looked at 20 BPR projects in detail and identified two factors that seemed to make the difference in translating improvements brought about by BPR into companywide profits and longer-term success. The first factor was the breadth of the BPr project; thus the less broad the business process being redesigned was in terms of spanning customer value, the less likely it was to improve performance across the en- re business unit. Second, the less the depth of the BPr project in terms of penetrating to the company's core, the less the likelihood of significant business impact. The depth of penetration is the extent to which the BPR project fundamentally changes organiza- tional structure, roles and responsibilities, measurements and incentives, information technology, shared values, and skills (i.e, the organizational environment around the business process). BPR projects that were narrow in scope and not accompanied by fully implemented organizational change did not have any significant overall impact on bottom-line results. Out of the 20 BPR projects, I I of them achieved less than 5 per cent change in earnings or reduction in costs(even though they had reduced process costs by 15-20 percent) while only 6 achieved an average 18 percent reduction is business-unit costs. The latter were the broader, deeper BPR projects 5. What Are the Types of Failures That BPR Projects Have? A BPR project can fail from a variety of perspectives and due to a variety of reasons. The most common BPR project failures are related to human and organizational issues rather than techn cal issues. BPR projects have the same types of vulnerabilities that any large-scale or ganizational change effort has, with the added risk of often implementing new infor mation technologies. Typically failures occur due to a combination of factors There are several types of BPr failures

30 PART A: UNDERSTANDING BPR FOR e-BUSINESS (such as large cross-enterprise efforts) are less likely to grandly succeed as they are more difficult to implement. • Similar to other organizational change and information technology implementa￾tion efforts, success is very dependent on contextual and organizational factors. • There are many dimensions to what constitutes success. BPR projects may be suc￾cessful in that they operationally achieve the process advantage (in terms of reduced cycle time or cost, or increased flexibility or quality) but that may not translate into bottom-line profits or overall corporate performance improvement. Given the above caveats, one should interpret any statistics about BPR success and fail￾ure with caution and qualification. A 1994 reengineering survey of about 100 BPR proj￾ects by CSC Index showed that 67 percent were judged by companies as producing marginal or failed results. Thus only one in three BPR projects produced great results. As these large projects were reengineered in the early 1990s when many BPR projects revolved around cost cutting and downsizing, the statistics were not as bad as the trade press interpreted them. It is unclear whether the outcome was any different from the success statistics of other types of large-scale organizational change efforts. If one com￾pares the percentage to the statistic that one out of every ten start-up companies is highly successful, it looks pretty good. One of the more careful early assessments of BPR success and failure was a study by McKinsey consultants (Hall et al., 1993) of BPR projects in 100 companies in the U.S.A. and Europe. They looked at 20 BPR projects in detail and identified two factors that seemed to make the difference in translating improvements brought about by BPR into companywide profits and longer-term success. The first factor was the breadth of the BPR project; thus the less broad the business process being redesigned was in terms of spanning customer value, the less likely it was to improve performance across the en￾tire business unit. Second, the less the depth of the BPR project in terms of penetrating to the company's core, the less the likelihood of significant business impact. The depth of penetration is the extent to which the BPR project fundamentally changes organiza￾tional structure, roles and responsibilities, measurements and incentives, information technology, shared values, and skills (i.e., the organizational environment around the business process). BPR projects that were narrow in scope and not accompanied by fully implemented organizational change did not have any significant overall impact on bottom-line results. Out of the 20 BPR projects, 11 of them achieved less than 5 per￾cent change in earnings or reduction in costs (even though they had reduced process costs by 15-20 percent) while only 6 achieved an average 18 percent reduction is business-unit costs. The latter were the broader, deeper BPR projects. 5. What Are the Types of Failures That BPR Projects Have? A BPR project can fail from a variety of perspectives and due to a variety of reasons. The most common BPR project failures are related to human and organizational issues rather than techni￾cal issues. BPR projects have the same types of vulnerabilities that any large-scale or￾ganizational change effort has, with the added risk of often implementing new infor￾mation technologies. Typically failures occur due to a combination of factors. There are several types of BPR failures:

HAPTER 2: KEY ISSUES AROUND BPR AND THE EVOLUTION OF BPR FOR e-BUSINESS 31 Organizational change failures related to ineffective management of organiza tional transition Project management failures due to ineffective project management of the BPr ef- fort and the lack of use of disciplined methodologies and tools Technical failures related to flawed designs that do not fit the context, or reengi peered processes and/or their related information systems not performing as expected Strategic failures where the BPR design and implementation were successful but the expected overall strategic benefit brought about by the redesigned business process did not materialize Sustainability failures where the BPr effort is a one-shot effort that is initially successful but improvements are not sustained as the environment and conditions The commonly identified type of strategic failure is reengineering the wrong process For example, a new and improved customer service process is faster, more efficient, and provides more extended support for customers but does not translate into a higher cus tomer retention rate or an influx of new customers a much more dangerous strategic failure, however, is failing to reengineer the right process. The classic 1990 Hammer Don't Automate, Obliterate"article that launched the popularity of BPr had two il- lustrative examples. One described Mutual Benefit Life, a large insurance company that reengineered its insurance application process for handling by case managers supported by expert systems on PC-based workstations. The article lauds the quantum improve ment in cycle time and performance of the customer service process. However, in 1991 Mutual Benefit Life went nearly bankrupt due to accumulated bad investments. It was placed in rehabilitation and taken over by the state' s Insurance Commission. As they say in medicine-the operation was successful but the patient died. Perhaps they migh have fared better if they had reengineered their investment decision processes rather than their customer service processe 6. What Are the Requirements for BPR Success? How Critical Is Top Manage- ment Vision and Commitment to the Success of BPR? In order for a BPR project to succeed, a variety of requisite factors must be present. One factor that has been iden- tified as pivotal by a variety of studies is the clarity of vision of top management and their unhesitating commitment to the BPR effort. The McKinsey study by hall et al (1993)suggests that for very broad enterprise-wide BPr projects, chief executives may have to commit between 20 and 50 percent of their time in order to have successful large-scale organizational transformation results from the BPR effort. The study also suggests that a senior executive who is above the functional departments be responsible for BPR implementation so that no turf protection occurs. The key roles of top man- agers in BPR efforts include communicating the vision behind the change, getting early buy-in and full participation at all levels of the organization, and, most importantly managing fear and anxiety he depth of the effort in terms of fundamental organizational transformation(as ex plained in Question 4 above) is another critical factor for success common to all BPR projects. It is also clear that the softer side of BPR(that deals with the human and

CHAPTER 2: KEY ISSUES AROUND BPR AND THE EVOLUTION OF BPR FOR e-BUSINESS 31 • Organizational change failures related to ineffective management of organiza￾tional transition. • Project management failures due to ineffective project management of the BPR ef￾fort and the lack of use of disciplined methodologies and tools. • Technical failures related to flawed designs that do not fit the context, or reengi￾neered processes and/or their related information systems not performing as expected. • Strategic failures where the BPR design and implementation were successful but the expected overall strategic benefit brought about by the redesigned business process did not materialize. • Sustainability failures where the BPR effort is a one-shot effort that is initially successful but improvements are not sustained as the environment and conditions change. The commonly identified type of strategic failure is reengineering the wrong process. For example, a new and improved customer service process is faster, more efficient, and provides more extended support for customers but does not translate into a higher cus￾tomer retention rate or an influx of new customers. A much more dangerous strategic failure, however, is failing to reengineer the right process. The classic 1990 Hammer "Don't Automate, Obliterate" article that launched the popularity of BPR had two il￾lustrative examples. One described Mutual Benefit Life, a large insurance company that reengineered its insurance application process for handling by case managers supported by expert systems on PC-based workstations. The article lauds the quantum improve￾ment in cycle time and performance of the customer service process. However, in 1991 Mutual Benefit Life went nearly bankrupt due to accumulated bad investments. It was placed in rehabilitation and taken over by the state's Insurance Commission. As they say in medicine—the operation was successful but the patient died. Perhaps they might have fared better if they had reengineered their investment decision processes rather than their customer service processes. 6. What Are the Requirements for BPR Success? How Critical Is Top Manage￾ment Vision and Commitment to the Success of BPR? In order for a BPR project to succeed, a variety of requisite factors must be present. One factor that has been iden￾tified as pivotal by a variety of studies is the clarity of vision of top management and their unhesitating commitment to the BPR effort. The McKinsey study by Hall et al. (1993) suggests that for very broad enterprise-wide BPR projects, chief executives may have to commit between 20 and 50 percent of their time in order to have successful large-scale organizational transformation results from the BPR effort. The study also suggests that a senior executive who is above the functional departments be responsible for BPR implementation so that no turf protection occurs. The key roles of top man￾agers in BPR efforts include communicating the vision behind the change, getting early buy-in and full participation at all levels of the organization, and, most importantly, managing fear and anxiety. The depth of the effort in terms of fundamental organizational transformation (as ex￾plained in Question 4 above) is another critical factor for success common to all BPR projects. It is also clear that the softer side of BPR (that deals with the human and

32 PART A UNDERSTANDING BPR FOR e-BUSINESS organizational issues)has proved to be more difficult to manage than the technical as- design and information Other identifiable success factors that vary with circumstances but that cut across BPR projects of various scope and scale include the following Proper project management and teamwork Setting aggressive reengineering targets to motivate out-of-the-box thinking Conducting pilots to test new designs and their implementation impact Assigning high performers to reengineering teams Giving BPR project participants some release time from their day-to-day job activities Using disciplined BPR methodologies and tools ability to implement the requisite information technology infrastructure and align with reengineered business processes Moving quickly to capture momentum 7. How Popular and widespread Was First-Wave BPR? A 1996 survey by th Deloitte Touche Consulting Group of over 400 companies in the U.S. showed that 67 percent planned to start new BPR projects over the next two years. BPR was estimated to be a $60 billion industry in 1996 in the U.S. alone. BPR in the mid-to late 1990s was widespread and a global phenomenon. Various estimates conservatively suggest that about 70 percent of all large companies in North America and Europe were in the midst of so-defined BPR projects. BPR consulting practices thrived and were hiring business school graduates with process skills and information technology awareness in huge Given the rapid changes in the business environment, most innovations in manage ment go through a life cycle of popularity that grows and then wanes. The ones that grow management opular suffer the most from the hype of the trade press, the eagerness of management consultants, and the excitability of managers and educators. They become buzzwords and the operational realities and risks associated with the idea are sometimes lost. They then produce backlash and disillusionment when the over-excessive promises fail to materialize, the risks turn out to be greater, and the implementation more difficult than expected. Some of that happened with first-wave BPR. Fortunately, it was a lean- ing experience that made second-wave BPR successful When the over-hype is gone, the good, solid ideas with inherent value start to develop healthily and realistically, and serious reflective managers take the time and effort to make them work well. Tn the late 1990s there was no longer excessive promises in BPr realism had set in. Managers. consultants and scholars could better understand the risks and caveats as well as the success factors. Second-wave BP took hold in a much better informed and realistic environment and is consequently much more successful 8. What Do the Critics of first-Wave BPr Claim? The valid criticisms of BPR have mostly revolved around the misuse and extreme interpretations and implementa tions of BPR. Most criticisms came in the early days of BPR, and many of these died down as we learned how to better manage and implement BPR. Perhaps the spirit of the

32 PART A: UNDERSTANDING BPR FOR e-BUSINESS organizational issues) has proved to be more difficult to manage than the technical as￾pects of process redesign and information systems development. Other identifiable success factors that vary with circumstances but that cut across BPR projects of various scope and scale include the following: • Proper project management and teamwork. • Setting aggressive reengineering targets to motivate out-of-the-box thinking. • Conducting pilots to test new designs and their implementation impacts. • Assigning high performers to reengineering teams. • Giving BPR project participants some release time from their day-to-day job activities. • Using disciplined BPR methodologies and tools. • Ability to implement the requisite information technology infrastructure and align with reengineered business processes. • Moving quickly to capture momentum. 7. How Popular and Widespread Was First-Wave BPR? A 1996 survey by the Deloitte & Touche Consulting Group of over 400 companies in the U.S. showed that 67 percent planned to start new BPR projects over the next two years. BPR was estimated to be a $60 billion industry in 1996 in the U.S. alone. BPR in the mid- to late 1990s was widespread and a global phenomenon. Various estimates conservatively suggest that about 70 percent of all large companies in North America and Europe were in the midst of so-defined BPR projects. BPR consulting practices thrived and were hiring business school graduates with process skills and information technology awareness in huge numbers. Given the rapid changes in the business environment, most innovations in manage￾ment go through a life cycle of popularity that grows and then wanes. The ones that grow to be overly popular suffer the most from the hype of the trade press, the eagerness of management consultants, and the excitability of managers and educators. They become buzzwords and the operational realities and risks associated with the idea are sometimes lost. They then produce backlash and disillusionment when the over-excessive promises fail to materialize, the risks turn out to be greater, and the implementation more difficult than expected. Some of that happened with first-wave BPR. Fortunately, it was a learn￾ing experience that made second-wave BPR successful. When the over-hype is gone, the good, solid ideas with inherent value start to develop healthily and realistically, and serious reflective managers take the time and effort to make them work well. Tn the late 1990s there was no longer excessive promises in BPR; realism had set in. Managers, consultants, and scholars could better understand the risks and caveats as well as the success factors. Second-wave BPR took hold in a much better informed and realistic environment and is consequently much more successful. 8. What Do the Critics of First-Wave BPR Claim? The valid criticisms of BPR have mostly revolved around the misuse and extreme interpretations and implementa￾tions of BPR. Most criticisms came in the early days of BPR, and many of these died down as we learned how to better manage and implement BPR. Perhaps the spirit of the