Abstract
At the turn of the century, Frederick Taylor revolutionized the design and improvement of work with his ideas on work organization, task decomposition and job measurement. Taylor's basic aim was to increase organizational productivity by applying to human labor the same engineering principles that had proven so successful in solving technical problems in the workplace. The same approaches that had transformed mechanical activity could also be used to structure jobs performed by people. Taylor, rising from worker to chief engineer at Midvale Iron Works, came to symbolize the ideas and practical realizations in industry that we now call industrial engineering (EE), or the scientific school of management^In fact, though work design remains a contemporary IE concern, no subsequent concept or tool has rivaled the power of Taylor's mechanizing vision. As we enter the 1990's, however, two newer tools of the "information age" are beginning to transform organizations to the degree that Taylorism did earlier. These are information technologythe capabilities offered by computers, software applications, and telecommunicationsand business process redesignthe analysis and design of work flows and processes within an organization. The ideas and capabilities offered by these two tools working together have the potential to create a new type of industnal engineering, changing the way the discipline is practiced and the skills necessary to practice it This article explores in detail the relationship between information technology (IT) and business process redesign (BPR). We repon on research conducted in nineteen companies, including detailed case studies from five firms engaged in substantial process redesign. After defining business processes in greater detail, we extract from the experiences of companies we studied a generic five-step approach to redesigning processes with IT. We then define the major types of processes, along with the pnmary role of IT in each type of process. Examples are provided throughout of specific effons within these firms to use IT to radically redesign and upgrade particularly important business processessome as pan of a total business redesign, others as more isolated, but still valuable, effons. Finally, management issues encountered at our research sites in using IT to redesign business processes are considered. What Are Business Processes? We define business processes as a set of logically-related tasks performed to achieve a defined business outcome. This is similar to Pall's definition of process as "the logical organization of people, materials, energy, equipment, and procedures into work activities designed to produce a specified end result (work product)." Â set of processes form a business systemthe way in which a business unit, or a collection of units, carries out its business. Processes have rwo important characteristics: 1. they have customers; that is, processes have defined business outcomes, and there are recipients of the outcomes. Customers may be either internal or external to the firm; and 2. they cross organizational boundaries; that is, normally the occur across or between organizational subumts. Processes are generally independent of formal organizational structure. Common examples of processes meeting these criteria include: Developing a new product Ordering goods from a supplier Creating a marketing plan Processing and paying an insurance claim Writing a proposal for a government contract The process of ordering goods from a supplier, for example, typically involves multiple organizations and functions. The eventual user of the goods, the purchasing department, and the supplier organization ail are panicipants. The user could be viewed as the customer of the process. The process outcome could be either the creation of the order, or perhaps more usefully, the actual receipt of the goods by the user. The examples of processes mentioned thus far have been large-scale, affecting whole organizauons or groups. It is also possible to cite examples of more detailed processes that meet the definitional criteria above. These might include the process of installing a windshield in an automobile factory, or completing a monthly departmental expense repon. IT-driven process redesign may also be desirable for these more detailed processes, though the implications of redesigning these detailed processes may be important only in the aggregate. In many of the firms we studied, analyzing processes in great detail was highly appropriate for some purposes, e.g., the detailed design of an information system or data model to support a specific work process. However, in the firms that were truly beginning to redesign the way their business functions, however, a broader view of processes was taken.
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