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Developing a Framework to Identify the
Factors Affecting the Measurement of
Organization Readiness for Business ProcessReengineering Implementation
an Exploratory Factor Analysis Method
(EFA)
INTRODUCTION
Today's world is a world of changes and mutation.
These changes include all aspects of economic,
social, political, and technological-based.
Organizations that work in unstable conditions face
with unexpected events that if they are not properly
ready, needful and proportionate flexible to the
current situation, they will lose their contest potency
in the market. Therefore, organizations must be
dynamic and have flexible structures to
accommodate with external environment
turbulences.
Business Processes Reengineering (BPR) is one
of the most widely used approaches to cope with
changes. Hammer and Champy introduced the
concept of business processes re-engineering in
1990 in an article in the Harvard magazine for the
first time (Hammer & Champy, 1993). BPR was
defined as a radical redesign of processes to
achieve salient improvements in cost, quality and
service(Ozcelik, 2010). The base of the re-
engineering is thematic survey and removes the
old rules and fundamental assumptions that plat
the performance of the current business.
Accordingly, anything that does not have
contribution in the product efficacy is doomed to
elimination(Ryan & Hurley, 2003). Generally, the
main reasons for using re-engineering are
external competitive pressures, reduction in
Hamid.Shahbandarzadeh
Department of Industrial
Management, Persian Gulf
University, Bushehr, Iran
ABSTRACT
Results of business processes reengineering (BPR) projects in Iran and many other
countries show that the most necessary and fundamental changes on processes do not
implement and remain only as a suggestion. Therefore, before attempting to redesign
and re-engineering business processes, variables and factors affecting the assessment
of organizations readiness for the re-engineering process should be identified in order
to improve conditions and making good infrastructure to implement re-engineering
projects. Therefore, the aim of this study is to identify the factors that affect the success
or failure of re-engineering projects in organizations, and to develop a framework for
assessing organization readiness for processes re-engineering implementation. This
research uses exploratory factor analysis method and opinions of 229 of Iranian experts
in the field of BPR to develop a framework for identifying the factors affecting the
measurement of organizational readiness for BPR implementation.
Keywords:
Business Process Reengineering, Organization Readiness, Success Factors, Failure
Factors, Exploratory Factor Analysis.
Khodakaram.Salimifard
Department of Industrial
Management, Persian Gulf
University, Bushehr, Iran
Farid.Saeedi
Department of Industrial
Management, Persian Gulf
University, Bushehr, Iran
© International Academic ResearchJournal of Business and Management Vol No.1, Issue No.6, Page no.1-16. ISSN Number : 2227-1287
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2 December International Academic Research Journal of Business and Management
internal costs and to improve productivity (Tennant
& Wu, 2005).
Predictions in 1995 showed that if all American
private companies proceeded tore-engineertheir processes, 25 million of workforcepopulation
wouldreduceand it is the most important reason of
personnel fray from this concept(Johnston,
1995).Researchresults revealed that in
companiesthat utilized re-engineering,onlya
fewhavebeen successful in implementing re-
engineering and most of companies failed (Hammer
& Champy, 2001). In general, 70 percent of
companies that went into re-engineering did not
succeed to implement it. All these results indicate
that this process has a high risk (Tarokh, Sharifi, &
Nazemi, 2008).
Since the lack of inattention to identify the factors
affecting the measurement of organization
readiness for processes re-engineering, it increases
the cost and time required to implement re-
engineering projects.If a company is not ready, it
leads to huge costs. Therefore, it is necessary to
identify the indicators, variables and factors
affecting the assessment of organizations
readiness for the processes re-engineering to
improve the situation and make appropriate
infrastructure ready to implement BPR project.
This study, therefore,intends to overview the
researches done in this area and to identify the
factors affecting the success and failure of
reengineering project implementation. Its objective
is to develop a framework for measuring the
organization readiness for processes re-
engineering implementation and itprovides someprerequisiteto successfully implement BPR in
organizations.
LITERATURE REVIEW
It is essential to carefully examine the factors that
challenge the future actions for change before
designing and re-engineering business processes.
Various available methods for re-engineering
implementation are not interchangeable because
none of these methods completely covers
requirements and major prerequisites for successful
implementation of BPR. Many articles have been
running the definition of the re-engineering nature
and its implementation processes, but they ignore
to clarify what is important in successful re-
engineering implementation and riskmanagement resulting from BPR implementation.
Following, we examine key factors in the success
or failure of BPR projects.
STRATEGIC FACTORS
Strategic factors are most important factors
affecting the measurement of organizations
readiness for processes re-engineering
implementation. Some researchers mention that
the most important reason for the failure ofBPR
is the lack of correlation between organization
and organization strategic objectives. Terziovski
and others (Terziovski, Fitzpatrick, & O’Neill,
2003) studied the Australian financial services
sector firms which engage in re-engineering.
They deduced that the strategy and customer
orientation are the most important factors in the
success of BPR projects. Paper and Chang
(2005) believe that factors related to organization
vision, such as development, prophecy, pitch and
flexibility, are essential for the successful re-
engineering program. Lack of good strategy is
one of the main obstacles to successful re-
engineering in the organizations (Attaran, 2004).
Other researchers such as Khong&
Richardson(2003), Wu(2002), and
Mcadam(2000)emphasized the importance of
strategic factors, such as prospective, market
environment and beneficiaries analysis, and
mutual relation between organization view andBPR goals and view.
PROJECT MANAGEMENT FACTORS
BPR requires planning and time scheduling,
enough budget, and accurate control as every
projects need. BPR projects should be based on
primal time schedule to prevent any time delay in
BPR implementation (Hutto & R. Kasich, 1994).
Lack of efficient planning, inadequate resources
in executive stage, and lack of utilizing project
management techniques are important BPR
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2012 Hamid.Shahbandarzadeh, Khodakaram.Salimifard and Farid.Saeed 3
failure factors(Tarokh, Sharifi, & Nazemi, 2008;
Hammer & Champy, 2001). Project management
should cover all required activities and resources
at any time during the lifecycle of the project (Obara
Magutu, Onserio Nyamwange, & Kiplimo Kaptoge,2010). Learning, careful redesign of processes and
determination of performance key goals are other
important factors in BPR project management
(Xiang, 2010). Many other studies have
emphasized on factors associated with project
management in BPR success and failure (Herzog,
Polajnar, & Tonchia, 2007; Ahmad, Francis, & Zairi,
2007; Salimifard, Abbaszadeh, & Ghorbanpur,
2010).
INFORMATION TECHNOLOGY FACTORS
Information technology (IT) plays a vital role in the
overall success of the initiative to re-engineer
(Akhavan, Jafari, & Ali-Ahmadi, 2006). IT is the
most effective factor in BPR success and failure
(Love & Gunasekaranb, 1997; Goksoy, Ozsoy, &
Vayvay, 2012; Herzog, Polajnar, & Tonchia, 2007;
Abdolvand, Albadvi, & Ferdowsi, 2008; Paper &
Chang, 2005; Ahmad, Francis, & Zairi, 2007).
Having the right IT infrastructure is a vital factor inthe successful implementation of BPR (Obara
Magutu, Onserio Nyamwange, & Kiplimo Kaptoge,
2010) because unlike other approaches such as
TQM, BPR is heavily based on IT. Attaran(2004)
believes that IT role is very important in three
stages: a) before BPR implementation, b)
implementation stage and c)after BPR
implementation.
FACTORS RELATED TO TOP MANAGEMENT
Top management performs the leader role in
process management paradigm with effective
cultural change and elimination of obstacles(Hutto
& R. Kasich, 1994). Many of reported failures in
re-engineering planning caused by lack of top
management support and disinclination towards
change (Adenso-Diaz & Canteli, 2001).It is
mentioned that elected leadership is one of the
biggest barriers to successful implementation of
BPR. It is important for a manager to have a proper
mindset in addition to his management
authority(Hammer & Champy, 2001).Changing
cultural attitudes, understanding and acceptance
of the selected orientation, face-to-face
communication, and education are other
committed top management tasks(ONeill &S.Sohal, 1998). Sutcliffe(1997)obtained two
important results in his research on the
relationship between leader behavior and the
results of re-engineering; 1) successful leaders
of BPR projects use leadership styles that have
better fitness with vital factors; 2) successful
leaders of BPR projects do their leadership duties
in a very balanced way.Abdolvand and others
(Abdolvand, Albadvi, & Ferdowsi, 2008) believe
that sufficient knowledge about IT projects,
realistic expectations of the BPR results, and
frequent communication with BPR users and
team are the most essential tasks for top
management in BPR implementation. Other
researchers such as Wu(2003),Khong and
Richardson(2003), Salimifard and colleagues
(Salimifard, Abbaszadeh, & Ghorbanpur, 2010),
andTerziovski and others(Terziovski, Fitzpatrick,
& O’Neill, 2003)emphasized the top management
role in the success and failure of BPR.
CULTURAL FACTORS
Cultural factors are among influential factors of
BPR project performance. In many previous BPR
projects, some resistances in the organization
against re-engineering were due to cultural
factors that would cause organization failure if not
to be considered (Warren & David, 2006; Attaran,
2000; HRFocus, 1994). BPR problems and
restrictions in developing countries such as Iranare more related to organizational and managerial
culture and not to technical or work capabilities
(Salimifard, Abbaszadeh, & Ghorbanpur, 2010).
Mainly traditional conservative organizations are
task-oriented and vertically structured while top
manager rarely deals with fundamental changes.
Employees do not feel that they belong to the
organization and avoid new experience and risks.
Therefore, there is no attention to long-term
needs of customers, and flexibility is minimized
(Sepehri, 2005). These changes led to more flat
organizational hierarchy or larger control area in
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4 December International Academic Research Journal of Business and Management
organizations, more productivity and employees
satisfaction(Goksoy, Ozsoy, & Vayvay, 2012). Yu
et al. (Yu, Yi, Wang, & Zhao, 2010) believe that
organizational culture plays two important roles in
the organization. Firstly, it fosters unity and makesa good communication mechanism in which they
cooperate better with high productivity. Secondly,
it helps organization to be consistent with external
environment in order to train employees the daily
responsibilities to work faster and become
consistent with changes in exterior environment.
Other researchers focus on the cultural factors in
investigation of the amount of BPR success
(Haghighat & Mohammadi, 2012; Ahmad, Francis,
& Zairi, 2007; F.Jarrar & M.Aspinwall, 1999;
Terziovski, Fitzpatrick, & O’Neill, 2003).
METHODOLOGICAL FACTORS
Methodological factors focus on attempts to
change, support, set goals, measurement,
modeling, customer orientation, BPR team and its
performance (Kyung Sung & Gibson, 1998). In fact,
methodology is a combination of organized
methods, techniques and tools to direct re-
engineering project towards success by helping tosolve problems in this risky trend (Vakola & Rezgui,
2000). Factors such as suitable guide, commitment,
orientation, continuous monitoring, customer
support, process- oriented, and generally BPR
performance are involved in this collection (Paper
& Chang, 2005; Kyung Sung & Gibson, 1998;
Hammer & Champy, 1993; Davenport, 1993;
Belmonte & Murray, 1993; Hall & Wade, 1993).
Certainly, selection of appropriate techniques and
methodology based on organization conditions for BPR implementation has a verysignificantimpact in
its success or failure.
FACTORS RELATED TO THE CHANGES IN
MANAGEMENT SYSTEMS
Human resources play a vital role in improving
organizational processes (Abdolvand, Albadvi, &
Ferdowsi, 2008) and since business processes
should be run by human resources, considering this
factor is among most important elements in
changing processes because employees resistance
against changes will cause project failure (Paper
& Chang, 2005). Previous approaches for BPR
success should be changed. Re-engineering is
not only changing the processes, rather it is a
change in all sections of organization. Withoutchange management process, no improvement
can be enforced in any organization(Tissari &
Heikkila, 2001). Changes in rewarding system,
changing of organization structure to a flat state,
improved communications and decision-making,
and training or empowerment of employees are
all among factors related to this category (Fortune
Magazine, 1998; Khong & Richardson, 2003;
Kyung Sung & Gibson, 1998; AL-Mashari & Zairi,
1999; Abdolvand, Albadvi, & Ferdowsi, 2008;
Jeston & Nelis, 2008).
METHODOLOGY
This study is a survey research. Considering
sampling performed in a period, this study is cross
section study. General model of this study
includes seven main categories described in
previous sections. Exploratory factor analysis was
used to classify and name each factors related to
each category. The purpose of the factor analysisis to reduce the volume of data and determine the
most effective variables in shaping
phenomenon(Dobni, 2008).
DATA COLLECTION
A questionnaire was used for data collection. The
questionnaire contained 80 questions for the
seven categories of factors that affect the
measurement of organization’sreadiness toimplement the BRR. It was designed for
exploratory factor analysis. Some of the questions
in the questionnaire were in the form of
compilation and others were designed with the
previous articles help. 15 experts in quality
management and industrial engineering in Tehran
confirmed the validity of the questionnaire. The
sample size for factor analysis should be between
40 - 400(Hanafizadeh & Osouli, 2011). Random
cluster sampling method was carried out in this
study. Namely, the overall sample divided into
three industrial, scientific and services areas and
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2012 Hamid.Shahbandarzadeh, Khodakaram.Salimifard and Farid.Saeed 5
then the questionnaire was distributed among
countries and institutions of higher education
randomly. In general, 500 questionnaires were sent
electronically to Iranian professionals among whom
183 questionnaires completed electronically and 46were completed face to face. A total number of 229
questionnaires were used for exploratory factor
analysis. Data collection was conducted in August
and September of 2012.
EXPLORATORY FACTOR ANALYSIS
In exploratory factor analysis, the researcher
intends to discover the underlying structure of a
large set of variables. In other words, the researcher
has no initial theory. SPSS v19was used for
exploratory factor analysis. The following conditions
should be observed for exploratory factor analysis:
1. KMO coefficient: this coefficient indicates
sampling adequacy that its value is always
between zero and one. The result is acceptable
if KMO is more than 0.6.
2. Significance of Bartlett’s test: it is a minimum
requirement for factor analysis.
3. Matrix coefficient is greater than zero.
ANALYSIS OF FINDINGS
Cronbach's Alpha method was used in this study to
assess the reliability of the questionnaire. In this
case, each statement of the seven major parts of
factors were analyzed separately in order to
determine the scores of statement related to each
factor have accurate measurement in explaining
the actual score of responded. Information about
measuring Cronbach's Alpha for each of sevencategories is presented in Table 1. It should be
noted that Cronbach's Alpha value of all eight
statement of the questionnaire was generally
calculated as 0.973 that indicated high level of
reliability in the research questionnaire.Table 2
shows the scope and frequency of respondent.
As already mentioned, the main measuring factors
of organizations readiness to implement BPR were
classified into seven main categories. Hence,
exploratory factor analysis purpose is to identify
latent measures of each of these main categories.
Table 3 represents KMO coefficient values,
Bartlett’s test and determining correlation matrix
for each of the seven categories.
STRATEGIC FACTORS
According to high amount of KMO that is above
0.6 and obtained determining value of correlation
coefficient bigger than zero, the results are
acceptable. Moreover, it is worth nothing that
finding rotation matrix of factors has been
obtained with 5 replications. As data in Table 4
represents, 60.459 percent of changes in
explained by three new factors. The eigenvalue
in finding of the rotated matrix have been obtained
for first factor as 3.069, for the second factor as
1.979, and for the third factor as 1.602. Naming
of the factors in the theoretical literature and
statement that have taken place in the same
categories has been performed. Now, three
outputs for statements concerning strategic
factors should be named and explained that will
be investigated in next part.
Vision and Strategy
The first category of statements classified based
on the type of exploratory factor analysis and
theoretical review of literature. The statement is
called "prospects and strategy". Five definitions
of prospects and strategy subcategories are
"landscape changes with the load factor of 0.834",
"identification and providing appropriate
strategies of changing with load factor of 0.846",
"re-engineering strategy consistent with the
overall strategy of the organization with factor load of 0.528", "commitment to changing prospect
with factor loading of 0.696" and "flexibility of
changing prospects with factor load of 0.547".
Top- down approach
The second factor extracted from related
statements was called "top-down approach". A
major change must start from the top level. It is
clear that re-engineering never be implemented
in bottom up approach. Undoubtedly, top
manager of an organization with a holistic view
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6 December International Academic Research Journal of Business and Management
of the process and a clear vision of re-engineering
should manage organization during changes and
re-engineering. Three statements of "requirement
of re-engineering of top top with a loading factor of
0.849", "cooperation of middle top managers inre-engineering with a factor load of 0.568" and
"announcement of guidelines from top managers of
the organization with factor load of 0.828" are in this
category.
Identification of stakeholders
Since business environment is continuously
changing and competitive environment will
determine the direction of the markets, so
identification of the market and stakeholders,
analyzing of environment and prediction of the
possible changes play an important role in long term
re-engineering planning. Statements of "market
analysis and identifying stakeholders" and
"prioritizing stakeholder expectations in re-
engineering plan" with load factors of 0.701 and
0.884, respectively, were in this category.
FACTOR ANALYSIS OF PROJECT
MANAGEMENT FACTORS
According to Table3, the determining value of
correlation coefficient matrix is greater than zero
and other indices are in acceptable range. It should
be noted that the rotated matrix of factors is
obtained with three iteration. As it can be seen in
Tables 4, eigenvalue of two new factors is greater
than 1. Therefore, it is acceptable for factor
analysis. Eigenvalue of the first and second factors
was 4.140 and 1.978, respectively. Generally,55.616 percent of the total variation is explained by
these two factors that are acceptable in factor
analysis.
Planning and project control
The first factor in a series of factors is called "project
planning and project control". These factors
represent a set of statements regarding the
management of re-engineering. It should be noted
that one of the major reasons for the failure of
re-engineering projects is that they are too long.
The main causes include lack of proper planning
and monitoring of project resources. Statements
of "effective planning and using project
management techniques of 0.721", "regular
reporting of project progress of 0.710", “proper timing of projects of 0.797, "regular project
monitoring and correction of 0.732"and "avoiding
long delays in project of 0.629" are placed in this
category.
Allocation of resources
Lack of allocation of necessary resources for the
re-engineering is one of the other reasons for its
failure. This includes skilled work force and capital
resources and tools needed to implement project.Existence of unnecessary workforces and lack of
skills and education will not only stops project
progress but also people will be disappointed.
Allocation of sufficient funds to advance the
project in accordance with the scheduled program
will be crucial. In addition, the role of top
management to guide the process in the right
direction is very important. Based on the results
of exploratory factor analysis, the factor of
"allocation of required resources" is formed by
statements of "having enough resources withloading factor of 0.812", "diversity of project
resources (use of consultants, users, customers,
suppliers, etc.) with a load factor of 0.585" and
"Allocation of resources consistent with the
estimated load factor of 0.664".
FACTOR ANALYSIS OF INFORMATION
TECHNOLOGY (IT) FACTORS
Since determining the correlation matrix was
0.002 and the other values of indicators wereacceptable based on obtained information, so
results of factor analysis are acceptable.
According to statistical data of Table 4, it can be
seen that 60.321 percent of changes are
presented by two new factors that are somehow
acceptable. Eigenvalue of first factor in rotated
matrix is 3.703 and for the second factor is 3.536.
IT knowledge and resources
As mentioned before, one of the most important
differences of process re-engineering with other
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2012 Hamid.Shahbandarzadeh, Khodakaram.Salimifard and Farid.Saeed 7
development approaches such as TQM is the
important role of IT in its success. In order to have
a successful process re-engineering, IT
opportunities should be used effectively based on
sufficient resources and update knowledge of individuals in the field of IT. Statements of “having
databases and appropriate information systems
with load factor of 0.741", "sourcing and suitable
investment in IT with load factor of 0.734",
"appropriate use of software with load factor of
0.755", "developed organizational information
system with load factor of 0.634" and "synergetic
use of IT and redesigning methods of process with
load factor of 0.549" are related to this category
based on obtained results of factor analysis.
IT infrastructure
Before implementingBPR, we should ask whether
there are appropriate software and hardware
facilities available. To what extent the technology
infrastructure of the organization can meet the
process reengineering requirements. One of basic
conditions of process reengineering is the
availability of a powerful IT infrastructure.Statements of "having appropriate IT infrastructures
with load factor of 0.615", "development of abilities
of IT unit with load factor of 0.758", "IT infrastructure
consistent with process reengineering strategies
with load factor of 0.728", "appropriate
measurement of effective IT infrastructure in
business process reengineering with load factor of
0.815"and "appropriate design of IT network with
load factor of 0.767" are classified in the IT
infrastructure category.
FACTOR ANALYSIS RELATED TO TOP
MANAGEMENT
According to high value of KMO and determining
value of correlation coefficient bigger than one,
obtained results are acceptable. Eigenvalues,
variance percentage and cumulative variance
percent are considered for new factors before and
after rotation of factor loads in Table 4. Generally,
59.626 percent of changes are presented by three
new factors. Eigenvalue of first factor in the rotated
matrix is 3.820, for second factor are 2.718 and
for third factor is 1.710.
Commitment and leadership
One of the most important factors in successful
implementation of BPR is commitment and
leadership of top managers during change
operation. It is considered thattop management
commitment is a requirement for successful
reengineering(Hammer & Champy, 2001).
According to obtained results, statements of
"planning, guiding and coordinating of resources
by top management with load factor of 0.640",
"cooperation of top management with load factor
of 0.606","top manager support during operation
with load factor of 0.738" and "braveness of top
management towards project failure with load
factor of 0.585" are classified in the factor
category of "commitment and management".
Knowledge and wisdom
Manager who has no understanding of how to
re-engineering or someone who has no
knowledge in this field cannot manage BPR
during implementationphase. Top manager of
organization not only should have a good
understanding of re-engineering but also should
clarify it for staff. According to the obtained results
of factor analysis, statements of "sufficient
knowledge of top manager about reengineering
with load factor of 0.659", "integrated
management approach to re-engineering in all
units with load factor of 0.575" , "tendency of top
manager to accept and perform suggestions of reengineering team with load factor of 0.736",
"having an understanding of reengineering with
load factor of 0.601" and "effective management
of risks by top manager with load factor of 0.848"
are in this group.
Open communications
Top manager should have a clear
commensuration with other units of the
organization. He/she should communicate all the
time and regularly with implementing team of the
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8 December International Academic Research Journal of Business and Management
project. He/she should have contact with staff,
investigate their work progress, and make staff
aware of project progress. According to related
statements and theoretical literature review, the
third factor in the collection of top manager factorsis "open communication". Statements of
"continuous communication of top manager with
staff during the project with load factor of 0.763",
"regular communication of top management with
the team with load factor of 0.572" and "continuous
communication of top manager with other
stakeholders of the project with load factor of 0.639"
are in this group.
FACTOR ANALYSIS RELATED TO CULTURAL
FACTORS
According to Table3, determining value of
correlation coefficient is 0.099 and other values of
indicators are acceptable. Eigenvalues, variance
percentage and cumulative variance percent are
considered for new factors before and after rotation
of factor loads in Table 4. Generally, 71.425 percent
of changes are presented by two new factors.
Eigenvalue of first factor in the rotated matrix is
2.679 and for second factor is 1.607.
The climate of trust and collaborative
environment
When employees are not very intimate with each
other in a corporate environment and there is no
trust to top manager, then they will never cooperate
in re-engineering project. It is necessary that all staff
cooperate in the project. According to obtained
results of factor analysis, available statements of this category are: "climate of trust and collaborative
environment between staff with load factor of
0.810", "existence of cooperation culture among
staff with load factor of 0.894", "giving more
authority for attraction of staff with load factor of
0.905".
Readiness and acceptance for change
It is natural that each kind of new change in the
organization environment will cause some opposing
ideas and resistance. However, the important point
is that manager should not give up on these
disagreements. Organization disagreement
against re-engineering is a natural phenomenon.
Therefore, another important factor for
preparation of organization to perform re-engineering project is intra-organizational
preparations to accept changes. Various
meetings and briefings are considered as the
most important factors to remove this problem.
According to obtained results of Table 4, 22
statements of this category are "creation of an
effective culture for organizational changes with
load factor of 0.806", "stimulation of the
organization to accept change with load factor of
0.690" and "reduce the fear of individuals and
units towards make changes".
FACTOR ANALYSIS RELATED TO
METHODOLOGICAL FACTORS
Determining value of correlation coefficient is
0.005 and other values of indicators are
acceptable based on obtained data. Eigenvalues,
variance percentage and cumulative variance
percent are considered for new factors before and
after rotation of factor loads in Table 4. Generally,55.917 percent of changes are presented by two
new factors. Eigenvalue of first factor in the
rotated matrix is 3.682 and for second factor are
3.028.
Process focus
Re-engineering of processes requires process-
based thinking, processes scope, graphical
mapping, analysis based on local needs and
expectations of customers. For this purpose, all
required techniques and methods such as
modeling and continuous monitoring should be
used. In this study and according to the obtained
results, statements of this category are: "having
a process-based thinking among project team
with load factor of 0.527", "performing an exact
evaluation for identification and deletion of
activities with no added value with load factor of
0.674","identification of purposes of developed
function that requires development and
reengineering with load factor of 0.788",
"definition of main processes to achieve goals
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2012 Hamid.Shahbandarzadeh, Khodakaram.Salimifard and Farid.Saeed 9
and giving services to customers with load factor of
0.767", "attempt to change business processes not
their modification with load factor of 0.720",
"identification of the main customers, their needs
and requirements consistent with future changes
with load factor of 0.681", and finally,"effective
training of modeling tools and business analysis
with load factor of 0.533".
Methodology and BPR team
Selection of methodology is dependent on time,
structural conditions and type of business.
Moreover, using a capable BPR team is considered
as the first step in successful re-engineering plan.
BPR team should be selected among most expert
people with high motivation and sufficient
knowledge of the organization process. This team
can be a combination of experts inside or outside
the organization. According to obtained results of
Table4, 25 statements in this category are: "using
appropriate methods and tools for implementing
re-engineering process with load factor of
0.564","allocation of best knowledgeable staffs for
reengineering process with load factor of 0.792",
"focus of this team on the results with load factor of
0.828", "using appropriate methodology in thisprocess consistent with time, cost, structure and
type of processes with load factor of 0.607", and
"good identification of process re-designers based
on their experiences with load factor of 0.677".
FACTOR ANALYSIS RELATED TO CHANGES IN
MANAGEMENT SYSTEMS FACTORS
According to Table3, determining value of
correlation coefficient is 0.002 and other values of
indicators are acceptable. Eigenvalues, variancepercentage and cumulative variance percent are
considered for new factors before and after rotation
of factor loads in Table 4. Generally, 60.685 percent
of changes are presented by three new factors.
Eigenvalue of first factor in the rotated matrix is
3.064, for second factor is 2.763 and for third factor
is 2.669.
Rewarding and motivation systems
Reengineering means changes in all organizationalsections. In order to change one or several
processes, all other sections should be changed.
Philosophy of re-engineering means a kind of
fundamental change in the previous methods.
One of the most important changes is changing
of rewarding and motivation systems. Allbureaucratic structures and mechanical
environments should be removed in which staffs
are working with senseless machines. Staff
should be motivated to cooperate and share
information in BPR project. Although some
occupations may be eliminated after re-
engineering and some staffs become unsatisfied
with this system. Traditional occupations should
be removed in order to make fundamental
changes. However, it does not mean to endanger
staffs job security. According to the obtained
results of the factor analysis, statements in this
category are: "designing of a new rewarding
system with load factor of 0.626", "encouraging
of staffs to help changing process with load factor
of 0.709", "maintenance of staffs job security with
load factor of 0.672", "having training classes for
staffs about the PBR with load factor of 0.543",
"related evidence feedback with new processes
for workforces with load factor of 0.574", "not
using of intensive and bureaucratic methods of re-engineering with load factor of 0.594" and
"preparation of conditions for an effective team
work with load factor of 0.572".
Participation and empowerment of employees
As mentioned before, performance of
reengineering will not be successful without
cooperation of all organizational units. It is clear
that those employees can help in present project
that are completely familiar with this concept and
understand its necessity. Another requirement of
successful reengineering is to have skilled work
forces with multiple responsibilities that can play
a role in different organizational posts when some
fundamental changes happen. According to
obtained results of the factor analysis, statements
of this category are: "empowerment of
employees for multiple responsibilities with load
factor of 0.758", "giving authority, motivation and
responsibility to employees with load factor of 0.665","measurement of work for efficiency with
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10 December International Academic Research Journal of Business and Management
load factor of 0.773", "training of decision making
skills and problem solving to employees with load
factor of 0.785".
Effective Communicative Channels
It is not possible to coordinate different sections of
an organization during project without an effective
communication channel. Communications
indifferent levels should be clear. Traditional
methods such as excess correspondence should
be avoided. Another way to accelerate
communication between different sections is to
make a network-based and information technology
via Office Automation System. According to
obtained results of factor analysis, statements of
this category are "maximum use of network,
computer and IT for acceleration of communication
with load factor of 0.684", "communication
development with external environment of
shareholders with load factor of 0.860" and "making
effective communication at all organizational levels
with load factor of 0.648". Finally, theoretical model
of this study can be seen in Figure 1.
SUMMARY AND CONCLUSIONS
Identification of capabilities, effective factors of
failure or success of BPR project has had a huge
impact on the results of this study. So far, in
IranBPR is used in many organizations and
institutions such as Railways, Customs, and Oil and
Gas companies. However, the results of BPR
projects remain as suggestions and not being used
in practice. The main reason is that preparation of
these organizations for BPR is not measured in theorganizations and they do not pay attention to
requirements, infrastructures and effective factors.
After the completion of BPR project, following
questions should be answered:
1. Is there any determined prospect and strategy
provided by organization to perform BPR?
2. Is the project correctly planed and required
resources are available?
3. Is IT infrastructure capable to support changes?
4. Is top manager prepared to manage, cooperate
and support BPR changes?
5. Are necessary measures provided to
manage, cooperate and support BPR
changes?
This study attempted to investigate effectivefactors of organizations readiness to perform
BPR. As it is shown, this framework includes 7
general categories with 17 factors each of which
are classified based on obtained results of factor
analysis. Criteria to select the main categories
were review of theoretical literature and amount
of focus on each category as effective factors on
BPR results. Next, a separate exploratory factor
analysis performed to identify each subset of
factors. It is suggested in this study to classify
each main category with their subcategories to
determine importance of each one in BPR
implementation.
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Table1. Cronbach's alpha coefficient value for each of the seven major categories
Category name Statements Cronbach's alpha coefficient
Strategic factors 01-11 0.829
Project management factors 12-22 0.868
IT factors 23-34 0.907
Top management factors 35-48 0.893
Cultural factors 49-54 0.814
Methodological factors 55-66 0.89
Changes in management
systems factors 67-80 0.912
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14 December International Academic Research Journal of Business and Management
Table2. Scope and frequency of respondent
Context Percentage FrequencyCumulativefrequencypercentage
Academic - Research 59.83 137 59.83
Computer and ElectronicCommerce
9.17 21 69
Production-Industrial 5.24 12 74.24
Car building 4.8 11 79.04
Services (Insurance) 1.31 3 80.35
Services (consultantengineering)
6.55 15 86.9
Services (health care) 0.87 2 87.77
Banks 0.44 1 88.21
Municipal administration 1.75 4 89.96
Telecommunications 1.75 4 91.7
Transportation (railway, subway,etc.)
4.37 10 96.07
Oil and Gas 2.19 5 98.25
Mining and Industry(Development and Renovation) 1.75 4 100
Total 100 229
Table 3. KMO Coefficient values Bartlett's test for each of the main factors
Indicator Strategic
Projectmanag-ement
ITTop
manage-ment
CulturalMethodol
-ogical
Changein
manage-ment
systems
KMO 0.805 0.865 0.896 0.866 0.779 0.89 0.856
Bartlett'stest
Chi-square
(X2)
864.646 922.544 1390.803 1393.582 521.791 1189.813 1440.105
Freedomdegree
55 55 66 91 15 66 91
Possibilityvalue
0 0.000 0.000 0.000 0.000 0.000 0.000
Determining the
correlation matrix
0.001 0.001 0.002 0.002 0.099 0.005 0.002
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2012 Hamid.Shahbandarzadeh, Khodakaram.Salimifard and Farid.Saeed 15
Table 4. Eigenvalues and percentage of variance explained for each factor in the matrixand the rotation
Category
Factor Initial eigenvaluesExtraction Sums of Squared
loading
Total% of
Varia-nce
Cumulative %of Variance
Total% of
Variance
Cumulat-ive % of Variance
Strategic factors
1 4.239 38.537 38.537 3.069 27.904 27.904
2 1.387 12.606 51.143 1.979 17.993 45.897
3 1.025 9.316 60.459 1.606 14.562 60.459
Projectmanagementfactors
1 4.967 45.152 45.152 4.14 37.635 37.635
2 1.151 10.464 55.616 1.978 17.98 55.616
IT factors1 6.018 50.149 50.149 3.703 30.859 30.859
2 1.221 10.173 60.321 3.536 29.463 60.321
Topmanagementfactors
1 6.034 43.097 43.097 3.82 27.285 27.285
2 1.196 8.544 51.641 2.817 20.124 47.409
3 1.118 7.986 59.626 1.71 12.217 59.626
Cultural factors1 3.151 52.513 52.513 2.679 44.645 44.645
2 1.135 18.913 71.425 1.607 26.78 71.425
Methodologicalfactors
1 5.524 46.035 46.035 3.682 30.686 30.686
2 1.186 9.882 55.917 3.028 25.231 55.917
Changes inmanagementsystems factors
1 5.964 42.603 42.603 3.064 21.886 21.886
2 1.47 10.498 53.101 2.763 19.734 41.62
3 1.062 7.585 60.685 2.669 19.065 60.685
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