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Chapter 9 • Organizational Change and Business Process Reengineering 251

BPM processes have been derived from the study on workflow technologies that aimed at
eliminating the manual intervention in the process implementation. 11 BPM became popular in the
1990s for improving the performance of organizations. Business process improvement involved the
usage of process benchmarking and BPR along with the implementation of ERP systems. The key
for improving processes is for management to understand of the differences between firm’s processes
12
and the best practice processes. Management that sees these differences will succeed in improving
their business processes. Process improvements occur by knowing the customers better, devising
processes to meet the needs of the customer, and continuously reevaluating to keep the focus on
high-level performance in this time of rapidly changing environment. 13 BPM institutionalizes this
continuous process change in organization. One of the Gartner surveys for top-level executives held
in December 2009 showed that more than two-thirds realized the value in using a BPM approach to
be successful in achieving their business goals. According to this study, the top-level executives are
proactive and think about the high volatility in the marketplace before making the changes in their
business models. As per the Gartner 2010 survey, organizations that have BPM system in place
spend around 55 percent of IT budget to run the business, while the industry’s average spending is
64 percent. 14 IDC research reported that the BPM market increased almost 80 percent in 2006,
reaching $890 million, and that this market will expand to $5.5 billion by the end of 2011. 15

Difference between BPR and BPM
BPR and BPM are not the same, and the differences between them are discussed in this section. BPR
suggests that businesses will become competitive by redesigning core business processes. It aims at
eliminating the human intervention and automating the process, wherever possible. BPM is not about
radical automation; instead, it follows an iterative approach of making incremental improvements in
the processes. For any industry, this approach enables to make frequent adjustments to the business
processes according to the rapidly changing operational conditions in the global markets. BPM put
processes in place to make continual incremental changes rather than aiming at one perfect solution, as
the cycle time between changes is really short in current business situation. BPR is all about automa-
tion and downsizing of the organization. The aim of BPM is not to eliminate the human efforts, but to
understand the dependencies and interactions among the people, system and the information needed to
do the tasks better. BPM starts with process modeling to understand the workflows and figure out the
manual and automated tasks and to improve the efficiency of the business processes. The business
model improves the transparency of the work steps and resources in the business process and also
clearly shows the information flows and business rules. The developed business model is then inter-
preted bythe BPM software (BPMS) and becomes executable. This makes the process to be visible to
the managers responsible for making decisions. Managers can modify the model by knowing where
the bottlenecks are present. The modifications are reflected in the execution right away. Business man-
agers can easily manage the processes, with IT deciding the implementation of some specific tasks. 16

11 O’Connell, J. (September 12, 2003). Measuring IT’s Effectiveness to the Business. Computer Weekly, 00104787.
12 Juan, Y.-C., and Ou-Yang, C. (April 1, 2004). Systematic Approach for the Gap Analysis of Business Processes.
International Journal of Production Research, 42 (7), 1325–1364.
13 Baker, B. (August 1997). Process Redesign: The Implementation Guide for Managers. Quality Progress, 30 (8), 174,
2 pgs, http://proquest.umi.com/pqdlink?did=13457720&Fmt=7&clientId=1531&RQT=309&VName=PQD
14 Gartner Research. Hype Cycle for Business Process Management, 2010.
15 IDC Predicts Rapid Growth for Business Process Management Software Market Reaching $55 Billion by 2011.
http://www.askwebhosting.com/story/8347/IDC_Predicts_Rapid_Growth_for_Business_Process_Management_Software_
Market_Reaching_$55_Billion_by_2011.html
16 BPM is Not the Same as BPR, By: Janelle B. Hill, Vice President, Gartner, Friday February 9, 2007. http://www
.bpminstitute.org/articles/article/article/bpm-is-not-the-same-as-bpr.html