Business Process Improvement has been called by many names since the mid nineteen-nineties when ‘business process’ became part of normal organisational speech.
These names include:
- Business Process Reengineering (BPR)
- Business Process Innovation (BPI)
- Business Process Management (BPM)
- Business Process Design (BPD)
- Business Process Improvement (BPI)
Various interest groups have taken one or more of these and used them for their own purposes and definition. This page is intended to unwrap them and provide some context for them.
TQM (Total Quality Management)
Although not traditionally promoted within the ‘BP..’ family, TQM was in many ways the precursor of the focus on business processes as there were attempts to increase awareness of the ways that tasks were carried out. It provided an umbrella under which everyone in the organisation could strive for and create better customer satisfaction at continually lower costs.
TQM was the ‘fashion’ in the late eighties and well into the nineties, having evolved from Western recognition that one reason for achievement of radically different reject rates in Japanese manufacturing was the move from Quality Control to Quality Assurance. The Quality department became a proactive force, with quality engineers involved in organising office procedures, manufacturing processes and supplier relationships rather than simply inspecting components and products.
Many of the changes carried out throughout Western industry during this period were undertaken under the TQM banner since, of course, product quality is one of the key factors in productivity. In fact MLG conducted one of its first full-bloodied BPR projects under this title. In that case BPR was the corporate initiative but the Divisional Vice-President for the business unit in question was aware that the workforce had seen many successes come from TQM initiatives and wanted to build upon these. Another piece of jargon might have been seen as a ‘flavour of the month’ and therefore not received the commitment that we were seeking. To read more about this particular assignment click here.
For more on TQM click here.
BPR (Business Process Reengineering)
This is the original business process expression and was coined by Michael Hammer & James Champy in the definitive text ‘Reengineering the Corporation’ (1993). BPR was defined as:
”...the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures such as cost, quality, service and speed...”
The goal is one of radical change (revolutionary breakthrough solutions) rather than the series of incremental changes generally encouraged by TQM. Although the original front cover featured a quote from the business guru Peter Drucker saying that “reengineering is new, and has to be done” it went on to list a number of examples of radical changes made by large corporations. Some of these had clearly been made over a number of years so in that sense the idea wasn’t new. Hammer and Champy hadn’t invented anything; they had observed something and given it a name.
In fact this is unfair, they had spotted a number of features and extracted these to provide a thought-provoking text. They have produced more excellent material in the years since their first offering but this is still a valuable read.
For more on BPR click here
BPI (Business Process Innovation)
One of the criticisms of the initial BPR projects was companies’ inability to find breakthrough solutions and only manage incremental improvements. As a result competitors could move past these organisations with modest improvement effort. When Stephen Shapiro’s ‘24/7 Innovation’ was published in 2001 it was even lauded in some quarters as being a step forward from BPR which sought only minor improvements rather than complete re-writing of processes. (All this despite BPR being defined as ‘fundamental rethinking and radical redesign’ and its objective as ‘dramatic improvements’ in critical areas of performance.)
The term ‘innovation’ helped people focus on being radical. One of the key aspects was emphasising the need for not just the creativity to come up with new ideas but the culture to innovate; that is to actually do genuinely new things and approach business in a genuinely new way.
The approach is very focused on the customer needs and integrating the various aspects of possible changes. It also sees information technology as an enabler rather than the driver of change.
Its provision of a framework or checklist in Shapiro’s “7 Rs” of innovation makes this approach a very valuable element of the improvement toolset. This is an approach to improving business processes which MLG takes very seriously in its projects.
For more on Business Process Innovation (BPI) click here
BPM (Business Process Management) and BPD (. . . Design)
BPM, of which BPD is the first step, has been defined as ‘the intersection between management and information technology, encompassing methods, techniques and tools to design, enact, control and analyse operational business processes involving people, organisations, applications, documents and other sources of information’.
This emphasises the ‘obvious’ step of managing the processes on an ongoing basis rather than simply through the major change project. It is a management model that allows organisations to manage their business processes and improve them over a period of time.
This phrase has been particularly adopted by the software industry, keen to sell products which purport to ‘help organisations manage their processes’. This was initially totally misleading but now there is the software capability to make this effective. However, the software used is the least important part of the project (a fact rather unpopular with the software suppliers!) and it may even be considered irrelevant.
Because some managers are always seeking to use the latest technique, BPM may be the term in most frequent use at the moment. We are happy to use whatever term our client organisation wishes to adopt for any exercise, while mixing the best of the above elements to best meet the client needs. (Of course an improvement activity may also draw on any other element of best practice from Customer Relationship Management to RFID tracking of goods in a warehouse.)