Process Reengineering

Process Reengineering Definition and Meaning

Abbreviated as PR by AbbreviationFinder, Process Reengineering is a management tool that aims at profound restructuring of the way a company performs its work on a daily basis with the objective of obtaining improvements in its performance. Among the possible improvements are the reduction in costs, the increase in quality offered to customers and greater competitiveness in the market.

Reengineering works on reviewing a company’s processes so that they become more effective and efficient, that is, that they achieve the desired results better using fewer resources.

This means that, even if it continues to offer the same products or services, the company will review the way it produces them, simplifying procedures, correcting errors, eliminating waste and getting rid of obsolete procedures, for example.

Reengineering presupposes major changes. In other words, the creation of totally new processes, practically a reinvention of the company’s way of working. The term, therefore, does not fit companies that intend to make only a few adjustments to improve their performance.

Often, reengineering requires a revolution in the organizational culture of the company as a whole, with a review of habits, languages, models of conduct and forms of hierarchy, leadership and relationships with employees, for example.

Among the reasons that can lead an organization to choose a reengineering process are:

  • The loss of customers or the difficulty in winning new ones
  • The need for revival to face increased competition
  • The verification that there was a decrease in profit margins
  • The need to rethink the mission and business objectives due to changes in the market
  • The finding that the company has not kept up with technological advances

Reengineering steps

A reengineering project usually shows its results in a period between 2 and 4 years and is implemented in stages:

Preparation

If a company concludes that it needs to reengineer its processes, the first step is to create a team to develop this change project. This team may be formed either by employees of the company itself, who will be temporarily disconnected from their duties, or by external consultants, who can bring new perspectives.

In this phase, an initial analysis is made to identify the objectives that the company wants to achieve after the end of the restructuring project.

Process mapping

The first task of the team responsible for reengineering is to map and analyze in detail and critically all processes adopted by the company, to find flaws and analyze their impact on the quality of services and costs.

Some authors argue that, for there to be a really radical change, this mapping is not necessary, on the contrary: creating new processes from scratch would help to foster creativity.

Process redesign

After identifying priorities and opportunities for improvement, a search for alternatives to the current routine begins. One of the mechanisms of this search is benchmarking, which is the comparison of the company’s processes and performance with those of other companies.

The benchmarking process does not necessarily have to be limited to competing companies, since successful ideas adopted in other sectors can be adapted to achieve the established objectives.

After identifying possible solutions, the team should analyze the feasibility of its implementation, for example, considering factors such as the time and cost involved.

Implementation of changes

It is the stage of transition from the old processes to the new ones. This phase depends on the alignment between the organization’s organizational structure, information technology and procedures. Achieving the engagement of company employees in the change process is one of the main challenges of this stage.

Continuous improvement

After the reengineering, it becomes necessary to monitor the results of the implemented action, to verify if progress has been made and where the reformulation has not been successful.

Essential reengineering tools

Reengineering is closely linked to innovation and, consequently, to information technologies. During the reengineering process, information technology supports the teams that are reformulating the processes, assisting in the communication and training of human resources for the adoption of new practices.

It can also be used, during the implementation of the new procedures, to reduce the need for human work in some processes, to capture data that allow a better analysis of the results, to eliminate intermediaries, to help coordinate tasks, among other functions.

Another key factor in the reengineering process is the motivation of human resources. For a radical transformation in the processes of an organization, it is essential that investments are made in training and communication with employees, so that they not only understand the need for changes, but also accept its implementation and actively participate in the process.

Process Reengineering