Magazine 2012
Factors influencing success of Business
Process Reengineering Implementation in
Public Sector Banks
Dr. Ram Sable
P. G. Dept. of Commerce, S.N.D.T. Womenb s University, Mumbai.
1.
Introduction:
Banking as a whole has also undergone a change. A larger option for the consumer is getting translated into a
larger demand for financial products and customization of services is fast becoming the norm than a competitive
advantage. At the same time, the banking sector as a whole is seeing structural changes in regulatory frameworks
and stringent norms which mean that the faster, one adapts to these changing dynamics, the faster is one
expected to gain the advantage in the market. Banking scenario has changed rapidly since 1990s. The decade
of 90s has witnessed a sea change in the way banking is done in India. Technology has made tremendous
impact in banking. b Anywhere bankingb and b Anytime bankingb have become a reality. Hence, Public
sector banks have adopted Business Process Reengineering since the year 2000, as one of the opportunity,
which innovates upon people, processes and products to face the challenges in the 21st century.
2.
Concept and Review of literature:
Michael Hammer and James Champy (1) emphasized that todayb s businesses are being driven by 3 Cb s i.e.,
customer, competition and change (i) Customer as he is knowledgeable, have purchasing power and prefers
variety (ii) Competition from within and outside the country; ready to capture the market by tough competition
(
iii) Changes happening in the surroundings i.e., economic, financial, attitudinal, political, social, cultural,
technological, trade, environmental, etc. if the business is not aware of these changes, it will not be able to
take advantage of the opportunities in the market.
Further they (2) shows that b Reengineeringb , properly, is the fundamental rethinking and radical design of
business processes to achieve dramatic improvements in critical, contemporary measures of performance
such as cost, quality, service and speed, whereas, Davenport & Short (3) put it as b Business process reengineering
(
BPR) is the analysis and redesign of workflow within and between enterprise.b
Davenport (4) also defines BPR as b the critical analysis and radical redesign of existing business processes to
achieve breakthrough improvements in performance measures.b Rastogi (5) emphasize on the global
environmentb s complexity and uncertainty, which have forced to search for newer ways of facing it and that have
resulted in the development of newer concepts like Business process Reengineering/Redesign, Fast Cycle
Capability, and Mass Customization. Jawadekar (6) recommends redesigning to the business by clearly defining
its goals, restructuring its people so as to become leaner and sensitive to customer needs. Dey (7) has felt that
the business executives need to have a clear idea about BPR and the modalities of its implementation. He laid
special emphasis on the role of Information Technology (IT) as a powerful enabler to reengineer business
processes. BPR introduces major changes in the way of doing work, with emphasis on process orientation and
teamwork, thereby bringing in strong impact on existing structures, systems and procedures of hierarchical,
function based organizations. Therefore, the greatest challenge in reengineering the business processes is
change management in an organization.
Thus it can be seen from the above concept and review of literature that the business process reengineering is
the complete overhaul of a key business process with the objective of achieving a quantum jump in performance
measures such as return on investment, cost reduction and quality of service. An attempt is made in this study
to analyse what are the factors influencing success of BPR in public sector banks.
3.
Objectives of the study:
a)
b)
c)
To assess the decision making styles of Public sector banks.
To assess whether Decision making styles of managers (DMS) affect the BPR implementation success?
To assess whether Indian ethos in management (IEM) influence the success of BPR implementation success?
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d)
To assess whether development in information and communication of technology (ICT) influence the
success of BPR implementation success?
4.
Hypothesis of the study:
Regression Model is used to know the main factors. It is hypothesed that:
Hy 1: Decision making styles of Public Sector bank management influence the BPR success.
Hy. 2: Indian ethos in management influences the BPR success.
Hy.3: Development in information and communication technology influences the BPR success.
5.
Research Methodology:
5
.1 Samples and sample size of the study:
For the purpose of the study, 10 public sector banks were selected so as to represent the sample. The sample
has been selected on the basis of the banks who have already implemented BPR in their organization. The
method of sampling which has been used is Simple random sampling for the purpose of assessing the factors
for the successful BPR implementation in the banks, the employees of the above banks have also been selected
as sample totaling to 300 employees comprising to a number of 200 officers and 100 clerical employees
working in the banks.
5
.2 Sources of Data collection:
The researcher has relied on both the primary as well as secondary methods of data collection. Various books,
magazines, newspaper articles, journals available in the libraries, and relevant online websites were searched
periodically for the collection of secondary data. Primary data were collected using the questionnaire approach.
Field surveys and interviews were conducted to get the factual information from the respondents. The structured
questionnaire was administered to the branches of Public Sector Banks and Officer and Clerk respondents in
the branches of Public Sector Banks.
5
.3 Measuring levels of extent of influence:
The level of extent is measured on the basis of following reflected in Chart 1.
Chart1
Measure of Level of extent
Responses in Percentage
-33
4-65
6-100
. Data interpretation and Analysis:
.1 Decision making styles of public sector bank managers:
Level of influence
0
Low influence
3
Medium influence
High influence
6
6
6
To assess the factors influencing BPR success, first decision making styles of Public Sector bankb s branch
managers is assessed in terms of autocratic, semi autocratic and consultative style and extent of influencing
factors, its level and rank is also considered. Table 1 represents decision making styles of public sector bank
managers.
Table 1
Decision making styles of Public sector banks branch managers
(Top management)
Sr.
Decision making style variables
Decision making styles (%)
Auto Semi auto Consultative
Total
No.
1
2
Behavioural nature of manager
Extent of information sharing
85
60
10
30
5
100
100
10
(16)
3
Extent of participation in
decision making
92
5
3
100
4
5
Extent of delegation of authority
Depth of control mechanism
Overall (average)
82
77
79
12
20
15
6
3
6
100
100
100
It can be seen from Table 1 that:
1
2
3
.
.
.
85 percent respondents agreed that behavioral nature of managers in respect of decision making is
autocratic.
60 percent of respondents states that extent of information sharing on decision making is autocratic and
indicates that they are not sharing information at majority levels.
92% respondents agreed that managers of public sector banks are not allowing participating in decision
making to others but restricting entry decision making. They are completely autocratic in nature in this
respect.
4
5
.
.
82 percent respondents agreed Indian public sector bank managers are autocratic in delegating authority.
Majority of respondents states that they are fully autocratic in this respect.
77 percent respondents agreed that Indian public sector bank managers control decision making
mechanisms in autocratic way.
Thus overall result shows that 79 percent, 15 percent and 6 percent respondents agreed that public sector bank
managers are autocratic decision making style, semi autocratic decision making style and consultative decision
making style respectively. Majority bank managers are adopting autocratic decision making styles on behavioural
nature, information sharing system, delegation of authority and depth of control mechanism. Hence majority
managersb decision making style is autocratic and not democratic.
6.2 Influence of decision making styles of public sector bank managers on BPR:
This is shown in Table 2.
Table 2
Influence of decision making style on BPR success
Sr.
No.
Influence of decision making style of
mangers on BPR success
Extent of
Influence
Level of
Influence
Percent ranking
of Influence
1
2
3
4
5
6
7
8
Planning of BPR for banking
84
79
89
93
92
62
63
73
High
High
6
7
Organizing of BPR in banking
Co-ordinating of BPR in banking
Directing of BPR in banking
High
4
High
1
Effective supervision of BPR in banking
Productivity of banking through BPR
Growth of banking through BPR
High
2
Medium
Medium
High
10
9
Human resource development in
banking for BPR
8
9
Job-satisfaction on BPR in banking
88
90
High
High
5
3
10
Marketing of banking product through
BPR
Overall influence
81
High
It is observed from Table 2 that the directing of BPR by managers in banking had a highest influence on BPR
success(93 percent), followed by effective supervision of BPR in Banking (92 percent), marketing of banking
product (90 percent), coordinating of BPR (89 percent), job-satisfaction(88 percent), planning of BPR in
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banking(84 percent), organizing (79 percent), human resource development (73 percent), growth of banking
through BPR (63 percent), productivity of banking through BPR (62 percent) respectively.
The hypothesis that decision making styles of Public sector bank management influence the BPR success is
accepted as overall result of Table 2 shows that decision making style of bank branch manager (top management)
influence all 10 variables between 62 b 93 percent, maximum being 93 percent on directing of BPR in banking
followed by 92 percent on effective supervision of banking and minimum being 62 percent on productivity of
banking through BPR.
6.3 Influence of Indian ethos in management on BPR success:
Table 3 shows relationship between Indian manager ethos and BPR.
Table 3
Influence of Indian ethos in management on BPR success
Sr.
No.
Influence of IEM on BPR success
Extent of
Influence
Level of Rank
influence
1
2
3
4
5
6
7
8
9
Planning of BPR for Public sector banking
85
87
91
95
96
88
90
92
89
94
91
High
High
High
High
High
High
High
High
High
High
High
10
9
5
2
1
8
6
4
7
3
Organizing of BPR in Public sector banking
Co-ordinating of BPR in Public sector banking
Directing of BPR in Public sector Banking
Effective Supervision of BPR in Public sector banking
Productivity of Public sector banking through BPR
Growth of Public sector banking through BPR
Human resource development in public sector banking for BPR
Job satisfaction on BPR in Public sector banking
Marketing public sector banking product through BPR
Overall influence (average)
10
It is observed from Table 3 that the influence of IEM in respect of effective supervision of BPR in Banking had a
highest influence on BPR success (96 percent), followed by directing of BPR in banking (95 percent), marketing
of banking product (94 percent), human resource development(92 percent), coordinating of BPR (91 percent),
growth of banking through BPR (90 percent), job-satisfaction (89 percent), productivity of banking, organizing,
and lastly by planning of BPR in banking.
The hypothesis number two states that b Indian ethos in management influence the BPR successb is accepted as
out of 10 factors all the factors representing IEM influences success of BPR to the extent of more than 85
percent. The maximum and minimum influence is 85 to 96 percent; clearly indicating influence of IEM on BPR
implementation and its success also.
6.4 Influence of ICT on BPR success:
This is given in Table 4.
Table 4
Influence of ICT on BPR success
Sr.
No.
Influence of ICT on BPR success
Extent of Level of
influence influence
Rank
1
2
3
4
5
Strategic Planning of BPR for Public sector banking
92
90
82
78
96
High
High
High
High
High
3
4
6
7
1
Organizing of BPR in Public sector banking
Co-ordinating of BPR in Public sector banking
Directing of BPR in Public sector banking
Effective supervision (control) of BPR in Public sector banking
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6
7
8
Productivity of Public sector banking through BPR
Growth of Public sector banking through BPR
68
88
62
High
High
9
5
Human resource development in Public sector banking through
BPR
Medium
10
9
Job-satisfaction on BPR in Public sector banking
Marketing Public sector banking product through BPR
Overall influence (average)
69
93
79
High
High
High
8
2
10
It is observed from Table 4 that the influence of ICT in respect of effective supervision of BPR had a highest
influence on BPR success (96 percent), followed by marketing of banking product (93 percent), planning of
BPR in banking (92 percent), organizing (90 percent), growth of public sector banking (88 percent), coordinating
of BPR (82 percent), directing of BPR (78 percent), job-satisfaction (69 percent), productivity of banking through
BPR (68 percent), human resource development (62 percent).
The hypothesis that development in information and communication of technology influence the BPR success
is accepted as it is proven that ICT influences implementation of BPR and its success more than 62 percent. The
highest and lowest factors are effective supervision (96 percent) and human resource development (62 percent),
hence it is concluded on the basis of Table 4 that the development of ICT influence the success of BPR to a great
extent.
7.
Conclusion:
It can be concluded that Indian ethos is the main factor which influences success of BPR implementation in
public sector banks followed by decision making style of Indian managers and development of information and
communication technology.
References:
1
.
Hammer Michael and Champy James, b Reengineering the corporation: A manifesto for business revolutionb ,
HarperCollins Publishers, Inc., USA, 2004, pp. 21-28
2
3
.
.
Ibid, pp. 35
Davenport, T.H. & Short, J.E., b The New Industrial Engineering: Information Technology and Business
Process Redesignb , Sloan Management Review, Summer, 1990, pp. 11-27
4
5
6
7
.
.
.
.
Davenport, T.H. b Reengineering: Business Change of Mythic Proportions?b MIS Quarterly, July. 1994,
pp. 121-127.
Rastogi P. N., b Reengineering and Reinventing the Enterpriseb , Wheeler Publishing, New Delhi, 1995. (pp.
124-129)
Jawadekar S. Waman, b Redesigning the Business Organization b a prescription for business excellenceb ,
Jaico Publishing House, Mumbai, 1998.
Dey B. R., b Business Process Reengineering and Change Managementb , Biztantra publications, New
Delhi, 2005.
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