Business Process Management (BPM), Process mining
7 Steps of Business Process Reengineering Implementation and the Role of Process Mining
Business Process Reengineering (BPR) separates superficial steps (does the boss really need to approve this invoice?) from the fundamental (Purchase Order must be created immediately).
Also called Business Process Redesign, it's an approach to structurally changing your process workflows.
What are the 7 steps of BPR implementation? Vision, Hypothesis, Mining, Design, Simulation, Go Live, and Monitoring.
But first, a story.
A Short Story Before Diving into the 7 BPR Steps
A missionary, a motivator, and a leg-breaker walk into your office. They preach about BPR, the discipline that’s going to save your business from hyperautomation and chaos.
You quickly learn two things:
#1: Chaos is not a prerequisite to doing business.
#2: The missionary, the motivator, and the leg-breaker are actually the same person, because that’s what it takes to reengineer the corporation. Guts, gusto, and sometimes a baseball bat.
At least, that’s according to Michael Hammer, the founder of BPR and an MIT professor who gave voice to this radical approach of getting things done.
“To succeed at reengineering, you have to be a missionary, a motivator, and a leg-breaker.”
Hammer educated a generation of business leaders and woke them up to the fact that business processes were born in the image of the Industrial era, and it was time to change.
To paraphrase Michael Hammer's quote from his book Reengineering the Corporation, “business is entering the twenty-first century with companies designed during the nineteenth century to work well in the twentieth.”
Minit Process Mining is reapproaching Business Process Reengineering with a strong technological mandate, one which declares process automation and process redesign as friends, not adversaries. By adding Process Mining and Process Simulation to the stages of BPR implementation, you are not pushed to choose between process automation or process obliteration.
Rather, Process Mining technology supports bold changes with data authority, allowing for drastic BPR and smart process automation.
How to implement Business Process Reengineering in 7 steps, then?
How to Implement a Business Process Reengineering Project
1) Vision – apply bold, beyond the box thinking that challenges conventional wisdom
Industry disruption is usually the driver behind a vision, and is often led by a single visionary.
This visionary should be able to communicate the big idea to the right people, and importantly, be able to convince others to support it.
Having a vision is the first step of Business Process Reengineering implementation because it sets the tone for the entire project. It inspires others to think big and gives people the courage to make drastic changes to the status quo.
Paris, The City of 15 Minutes (Forbes)
Paris’ mayor has a vision of a city without cars, where everything you need is reached within 15 minutes on foot. The new plan will include making key thoroughfares in Paris inaccessible to motor vehicles, giving way to pedestrians-only plazas, community gardens, and play zones.
This vision will impact the way businesses operate in and around Paris. How will companies which rely on daily deliveries adapt? Which companies will seize this as an opportunity for major BPR? Which ones will resist this vision and be pushed out of operations?
2) Hypothesis — incorporate the vision to your business and create a hypothesis related to a core business process
A daring, yet well-founded hypothesis will serve two purposes: propose sufficiently drastic change and be realistic enough to get others behind you. The hypothesis can be in the form of a statement or a question.
- By delivering 100% of our products via autonomous vehicles, we can capture a new market segment.
- If we deliver 100% of our products via autonomous vehicles, how will this transform our customer base? Our delivery costs? Or go-to-market strategy?
If Japan Can, Why Can’t We? (Harvard Business Review)
Ford Motor used to employ 500 people in Accounts Payable. Mazda, their Japanese competitor, employed only 5. Although Mazda was considerably smaller than Ford, the difference in headcount was astounding.
Ford formulated a hypothesis — if we rethink how Accounts Payable, part of the Procure-to-Pay process, creates value, then we can restructure our entire approach to invoicing, and thus, save a lot of money. Ford put this hypothesis into action, took a page from their competitor’s playbook, reengineered the procurement process, and reduced headcount by 75% through “invoiceless processing”.
3) Mining — analyze the data to discover the as-is process
The as-is process gives process architects a solid foundation to stand on.
Mining process data helps to separate fundamental process events from superficial ones. Which process stages are done because they are necessary, and create real value? And which process stages are done out of habit, or because “so and so said so”?
The as-is process data will highlight all the ways in which superficial process steps are clogging up the pipeline.
A Telco Mines for $5M in Savings (Minit)
A global telco with annual revenue exceeding $13 billion, came to Minit with a complicated P2P process. They had working capital tied up in inefficient processes, and were losing money on unnecessary process rework.
Before trying to blindly automate an underperforming process (common misstep of BPM) or obliterate it completely (original call to action of BPR), this telco chose to mine process data before implementing Business Process Redesign. Read more in our Telco Process Mining Case Study.
4) Design — apply the hypothesis on the mined process model and design a new business process
Designing a new process which is cross-functional in scope and organized around outcomes pulls from all the previous steps.
The reengineered process should incorporate elements of the vision, hypothesis, and findings from Process Mining. The new design should capture the principles of Business Process Reengineering as outlined in the Harvard Business Review by Michael Hammer:
- Organize around outcomes, not tasks.
- Have those who use the output of the process perform the process.
- Subsume information-processing work into the real work that produces the information.
- Treat geographically dispersed resources as though they were centralized.
- Link parallel activities instead of integrating their results.
- Put the decision point where the work is performed, and build control into the process.
- Capture information once and at the source.
Airbnb Reengineers how Product & Design Teams Work (Wired)
To make “mobile the best way to book Airbnb,” the team needed to not only redesign the app in a traditional sense — colors, UX, buttons — but also in a process sense.
Previously, the product development team and the design team worked in silos. They had an elaborate back and forth process filled with “quasi-prototypes” and “layers of abstraction,” says design head Alex Schleifer.
Schleifer, together with 300 people on Airbnb’s product team, spent nine months trying to reengineer how the product development process works. The new app is the first major outcome of this new system. A process that used to take days of revision is now done in 45 minutes thanks to successful Business Process Reengineering.
5) Simulation — using business data, simulate the redesigned process with a Process Mining software
Process Simulation creates a huge space for play. The main use case of Process Simulation is to preview proposed changes or ideas for improving the original (as-is) process.
This allows you to verify “what-if scenarios” in a virtual setting with real data, and explore the feasibility of proposed changes.
Being part of the BPR project, Process Simulation can also quantify and validate the potential benefits (cost, time perspective, decreased variations, etc), as well as reveal unintended consequences of the proposed changes.
Learn more about Process Simulation, Custom Metrics, Hierarchical Process Mining built into Minit’s solution.
6) Go Live — put new process into action
Supported by data-based Process Simulation, the risk of process fallout has been mitigated and you’re ready to go live with the redesigned process.
The launch of a new process may have different rollouts and approaches to scaling, but keep in mind, BPR is meant to be bold. Impact should not be minimal and rollout should not be overly incremental.
Proceed with a healthy level of risk and optimism, but be sure that change can be measured and felt immediately.
KPMG Goes Live with Process Mining (Minit)
“We appreciate the speed and optimization of Minit’s algorithms, for analyzing large data sets and clear visualization of the process made it easy for clients to understand what the issues were.”
David Slansky, Partner in Global Data & Analytics Team, KPMG
7) Monitoring — use Process Mining for continuous process monitoring and improvement
As with most BPM approaches, BPR is a never-ending cycle. Rather than a checklist of events which can be marked as “done” and forgotten, process redesign should be constantly monitored and adapted according to data outcomes.
While the foundation of BPR is radical transformation, the roots of BPM is measured change.
Minit proposes a meeting in the middle.
Think big, stay data-focused, and adapt to redesign outcomes as they come. Even better, use Process Mining tools to anticipate problems and capture them at the source.
Stora Enso Monitors to Make Day-to-Day Improvements (Minit)
“Process mining with Minit has proven to be a key driver in making intelligent, day-to-day improvements, on every level. Giving our business users the power to understand, in detail, the processes they work on, without the need for expert-level data analysis knowledge, has been groundbreaking.”
Juha Byman, Head of Advanced Analytics, StoraEnso
Start Your BPR Project with Minit Today
Digital transformations don’t happen overnight, and neither will your BPR success. But if you find yourself in an industry in disruption, or want to be that disruptor yourself, it starts with a vision.
Immerse yourself in conversations about the future.
Talk to friends in other industries who are undergoing rapid change. Read contributor perspectives on Forbes, talk to people at various levels of your organization about what works and what doesn’t.
Already have a vision of the future?
Try Minit Process Mining, including all features such as Process Simulation, with an option to upload your own data during the trial version. It’s an opportunity to explore your processes like never before. Get your free 30-day trial or book a demo here.
12. 02. 2020