At the center of process reengineering lies the notion of thinking, which involves identifying and abandoning the rules and regulations that are outdated, and fundamental assumptions that has to do with current business operation. Reengineering is about inventing new approaches to process structures that bear little or no resemblance to previous processes, and it’s therefore far from tampering with what already exists alone, or making incremental changes that leaves basic structures intact. It means starting afresh to create an organizational product or service and scrapping former procedures in order to deliver lasting structures. Joyce and Woods (2001) identified the following elements as some of critical success factor that can be used to evaluate the progress and success of the reengineering efforts of an organization. They are; quality of product, quality of service, reliability of product, prompt payment of invoices, speed of delivery of product and service, efficiency of production line, flexibility of product, customer service, reduction in defects, research development and etc.
If there more than one unit or division in an organization, one way to measure the performance of process reengineering there is to compare it with other units or divisions within the organization. Also, Daft (2014) suggested a technique known as benchmarking for comparison with outsiders where requirements are similar to highlight the best industrial practices and promote their adoption where necessary. Operational performance benefits are measured in non-monetary terms. For example, constituents may want faster service times of a certain service or product where a product or service is delivered faster or more consistently.
Ranking of performance metrics to be used with managers and employees
One of the key challenges with performance management is selecting what to measure with the metrics to use. Good knowledge of how the different areas of an organization perform is valuable information, but a good measurement system will assist to examine the triggers for any changes in performance. With this kind of system in place, the organization is in a better position to manage performance proactively. In a study conducted by Bjelica, Mitrovi?? and Todorovi?? (2013) at project oriented organizations, employees were asked to identify the measurement put into practice to evaluate their performance; 34% of the respondents strongly agreed that time is the best measurement to evaluate performance, 30% of the respondents considered quality while 20% and 16% agreed that cost and efficiency were equally as important measurements for performance evaluation respectively. It is pertinent to note that the management of the process reengineering articulates what the key metrics or measures should be in order to motivate the right actions from the process performers.
Daft (2014) argued that gross margin is like the mother of all business metrics and the best indicator of an organization’s health. In other words, the higher the gross margin, the more the indication that the organization is on the right track in every operational aspect. Man??ag??ing and mon??i??tor??ing gross mar??gin on a reg??u??lar basis goes a long way in reducing results that are unpleasant. However, Adewale (2013) suggested that performance metrics are most useful when analyzed as a group. A very important step is to develop a matrix of measurements that, taken together, will provide management with insight into how a particular area of the business is performing in relation to strategic goals; the right combination of metrics, studied as a group, can show not only where the company is succeeding but also highlight specific areas of weakness (Adewale, 2013). In other words, as data accumulates, the matrix can display trends and identify places where management can take steps to improve performance. Adewale (2013) buttressed this notion of developing a matrix of measurements further when he suggested an XY matrix process to rank the performance metrics and to effectively measure the process reengineering. He described an XY Matrix process that can be used to develop both leading and lagging metrics. In other words, measures are called lagging metrics because they are collected and reported after something has happened and they are results-oriented and fine for tracking overall performance trends while leading metrics help predict what will happen, allowing at least some problems to be anticipated and avoided.
Bjelica, Mitrovi?? and Todorovi?? (2013) argued that project success should be measured at the project level by defining a set of performance measures and identifying different categories of KPIs (Key Performance Indicators). On the other hand, for the selection of the right KPI in project-oriented organizations, it is necessary to consider the most important characteristics of project-oriented KPIs. Bjelica et al. (2013) suggested a list of six characteristics and they are: (i) Predictive, where the is able to predict the future of the trend, (ii) Measurable, where the KPI can be expressed quantitatively, (iii) Actionable, where the KPI triggers changes that may be necessary for corrective action, (iv) Relevant, where the KPI is directly related to the success or failure of the project, (v) Automated, where reporting minimizes the chance of human error, and (vi) Limited or Few in number, that is, only what is necessary. It is pertinent to note that the management of the process reengineering articulates what the key metrics or measures should be in order to motivate the right actions from the process performers.
Successful transformation depends on conscious efforts to manage behavior as well as structural change, and both are sensitive to employee attitudes and perceptions. Process engineering implementation requires the reorganization, retraining, and retooling of people and business systems to support the reengineered process. Just as a company’s goals and objectives evolve over time, the set of performance metrics management uses to track progress toward those goals should also change over time. If metrics are well designed and continually examined for relevance, they can be the precise tools management needs to turn strategic planning into action, and guide organization decision making so that stated goals are achievable and continually in focus throughout the organization.
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