SYMBIOSIS INSTITUTE OF MANAGEMENT STUDIES

BUSINESS PROCESS RE-ENGINEERING

ASSIGNMENT I : BPR Activities to be undertaken by American Banks enabling them to provide quality service without comprising on liquidity (Case Study: Bank of America)

SUBMITTED TO: Prof. Siddharth Madhok SUBMITTED ON: 06th September 2011

SUBMITTED BY: Aditi Bhandari C-13 10020441004

SYMBIOSIS INSTITUTE OF MANAGEMENT STUDIES

BUSINESS PROCESS RE-ENGINEERING

ASSIGNMENT I : BPR Activities to be undertaken by American Banks enabling them to provide quality service without comprising on liquidity (Case Study: Bank of America)

SUBMITTED TO: Prof. Siddharth Madhok SUBMITTED ON: 06th September 2011

SUBMITTED BY: Gargy Shekhar B-67 10020441024

Process Re-engineering Business process re-engineering or BPR is defined as the search for and the implementation of radical change in business process to achieve breakthrough results BPR therefore is about searching for new business processes and implementing them to achieve breakthrough results. Information Technology is considered as the means to achieve these ends. New business processes are built using Information Technology and proper implementation of IT projects decide the success of process re-engineering. A business process is defined as a set of logically related tasks performed to achieve a desired business outcome. In the banking industry, the Business Process Re-engineering (BPR) means transforming the select processes and procedures with a view to empower the bank with contemporary technologies, business solutions and innovations that enhances the competitive advantage. BPR can be defined as the fundamental reconsideration and radical redesign of organizational processes, in order to achieve drastic improvement of current performance in cost, service and speed. To ensure survival in the changing global environment it is essential that banks respond to major trends reshaping the markets.

Objective: The objective of a BPR initiate is to create and enhance the value of the bank for the customers. It takes into account 4 important aspects customer (to given him enhanced value), competition (to meet it successfully), change (to manage it) and cost (to reduce). The basic objectives of BPR are to reduce the transaction process time without sacrificing security aspects, quality and real time service to clients and extensive propagation of single window concept. BPR basically aimed at maintaining long term profitability and strengthening the competitive edge of banks in conforming with transforming market realities.

The business process therefore comprises equipment, material resources and business procedures and people combined to produce a specified result. The following are some of the business process in banking:

Acceptance and repayment of deposits Sanction and disbursal of loans Transfer of funds for the customer and for functional units of the bank. Handling foreign exchange transactions Acceptance of deposits and making payments on demand.

Investing and disinvesting the resources of the banks for statuary requirements and investment.

Every business process has the following characteristics

Each process demands a set tasks Each process requires diverse resources within the business who receives the outcome of the process The outcome of a process can be report, an idea, a desire or a product Business processes cross organizational boundaries and require participation of different organizational groups in logically related tasks. Each business process or system is a collection of hierarchy of sub processes or business functions.

Hammer suggests the following principles that guide the process re-engineering activities.

Organize around outcome and not around tasks:

If the process re-engineering is done around the tasks without taking into account the outcome of process re-engineering, it becomes difficult to debug the process in case any problem.

Have those who use the output of the process, perform the process:

Those who need the business output should control all the variables that allow them to get the output in a timely manner , lesser the number of constituents to a process, smoother and more rapid would be the outcome.

Incorporate information-processing work into the real work that produces the raw information.

The spread of IT makes it possible to locate information processing within the organization. This localizes control, reduces communication time and puts computing power in the hands of those who are interested in information that is processed or produced.

Treat geographically distributed resources as though they were centralized.

The networking of computers makes it possible to network different resources at different geographical locations into a Virtual office. For example, it can be possible to have a global dealing rooms which can be dealing round the clock and located in three different cities in the world with a common back office located at a central place convenient for the bank.

Link parallel activities instead of integrating their results:

When different tasks in process are processed in parallel, it is essential to design a process that demands continuing communication and coordination. Put the decision part where the work is performed and build control into the process. It is possible to process the data for structured decision making and also incorporate organizational controls like limits, approved lists etc. into the application software so that decision making can be speeded up.

Capture data once at source:

Since the data collected at one point is processed again and again for process additions, it is advisable to capture the data only once so that multiple efforts to capture data are minimized and integrity of the data can be ensured. This principle is also known as source data automation. Observations Case Study: Bank Of America How it learned that what customers really want is to Keep the Change THE PROBLEM Innovation in services is rare. In financial services, the last big breakthrough was online banking, nearly a decade ago. In October, 2005, Bank of America (BAC ) brought out a radically different product that broke the paradigm. It's called Keep the Change. The concept solves a critical banking problem -- how to get consumers to open new accounts. The product works like this: Every time you buy something with a BofA Visa debit card, the bank rounds up your purchase to the nearest dollar and transfers the difference from your checking into your savings account. It also matches 100% of transfers for the first three months, and 5% of the annual total, up to $250 a year. Since the launch, 2.5 million customers have signed up for Keep the Change. Over 700,000 have opened new checking accounts and 1 million have signed on for new savings accounts.

THE RESEARCH How did Bank of America create Keep the Change? In the spring of 2004, it hired an innovation and design research firm in Palo Alto, Calif., to help conceive of and conduct ethnographic research on boomer-age women with children. The goal was to discover how to get this consumer segment to open new checking and savings accounts.

For the next two months, a team of five BofA researchers and four researchers from a West Coast consulting firm visited Atlanta, Baltimore, and San Francisco. They observed a dozen families and interviewed people on the streets. They watched people at home as they paid and balanced their checkbooks. They tagged along with mothers as they shopped at Costco, dined at Johnny Rockets, and made deposits in drive-through tellers. Ray Chinn, senior V.P. for new product introduction, along with Faith Tucker, another BofA senior V.P., saw two themes emerge from the research. In Atlanta, the team met a mother who always rounded up her checkbook entries to an even dollar because it was quicker. People also rounded up their financial transactions because it was more convenient. The second realization: Many boomer women with children couldn't save. For some, it was a lack of money. For others, it was a matter of not being able to control their impulse buying. PROTOTYPING In the summer of 2004, Chinn and Tucker put together a team of product managers, finance experts, software engineers, and operations gurus and held 20 brainstorming sessions. The team generated 80 product concepts, boiled them down to 12, and overwhelmingly favored one: rounding up the financial transactions of consumers and transferring the difference to their savings. The team created a Web-based cartoon that showed a woman buying a cup of coffee in a store for $1.50. Then it displayed the rounding up and putting the 50 cents into a savings account. Tucker and Chinn tested out the cartoon and concept in an online survey of 1,600 consumers. The result? Sky-high scores on uniqueness. In December, 2004, Diane Morais, Chinn's and Tucker's boss, pitched the idea to the bank's consumer division and got the green light. The first challenge was a name. A woman in a focus group suggested Keep the Change. That stuck. Three features were added to the original concept: (1) A summary of the rounded-up transactions in a consumer's checking and saving accounts (2) A fail-safe feature that automatically prevented a transfer from pushing a customer's account into overdraft (3) A promotion to match the rounded-up transfers to savings up to $250 a year. MARKETING The next challenge was selling Keep the Change to the public. The team stumbled upon an approach in another focus group when someone suggested getting people to dig for change among the cushions of a couch. The bank tweaked the idea by creating a custom-made 20foot-long red-velvet monstrosity that would really grab eyeballs.

To launch the product on Oct. 5, the bank staged a marketing event-cum-press conference in New York's Grand Central Terminal. The staff lugged the mega-couch into the station, stuffed it with coins and invited people to look for change. The bank sent replicas of the sofa to malls in Boston, Dallas, Los Angeles, and Miami and co-sponsored events with the National Football League. Wives of NFL players and retired gridiron stars such as Ed "Too Tall" Jones were hired to show up at malls and dig for change. Proceeds were donated to charity. Bank of America ran TV commercials for the program during the winter Olympics. The bank continues to promote Keep the Change on its Web site, and it has bought ads with search engines. To date, BofA says 99% of the people who signed up for Keep The Change have stayed with it.

II. Citizens Bank Proves that Statement Re-Engineering Delivers Results In a banking industry that has become very competitive and that requires contenders to offer more products and services as well as adopt innovative strategies to capture new market opportunities, Citizens Bank realized that there was a lot to gain in redesigning its entire document production process. In addition to signicantly reducing operational costs, it was possible to increase revenue streams by using transactional documents as a marketing tool to cross-sell products and services. As part of this strategy, Citizens implemented Sefas Open Print suite to redesign its transactional documents and better communicate with customers. Customer Background: Customer Background Citizens Financial Group has $159 billion in assets, making it one of the 10 largest commercial bank holding companies in the United States in terms of assets and deposits. Citizens has branches in 13 states, including Connecticut, Delaware, Illinois, Indiana, Massachusetts, Michigan, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Vermont, and Rhode Island. Citizens also has nonbranch retail and commercial offices in about 40 states. Like many banks, Citizens has grown through acquisitions, the largest of which was Cleveland-based Charter One in late 2004. Citizens Bank has consolidated all of its printing and mailing activities in a facility located in Riverside, RI. This centre, which is equipped with the latest IBM continuous printers and Kern inserters, is producing more than 95 million statements and over 300 million images per year The Problem After focusing on the most urgent issues at hand such as consolidating the print and mail production to a single production center and updating the printer and inserter hardware in the mailroom, Citizens realized that the entire document production process had to be re-engineered. Citizens realized that it needed to address the following problems:

The legacy document composition tool and check imaging tool did not enable the bank to easily convert the statements from simplex to duplex, which prevented Citizens from achieving signicant postage savings. The existing statements were still using OMR marks for insertion control, a method that does not provide document integrity. The company was facing address quality issues that resulted in a high numbers of returned mail pieces that needed to be manually reprocessed. A number of departments were outsourcing print and mail when they could have been producing these applications inhouse at a lower cost The existing composition tool could not perform functions that were critical to marketing effectiveness, such as white space management or easily adding promotional messaging and color. The Internet was now essential in the companys statement distribution strategy and the document production suite needed to support all distribution channels. For duplex conversion and statement integrity, Citizens used Open Print Remake. Remake is a print stream enhancement and transformation tool that is designed to re-engineer data streams without changing the original application. Remake was used rst to de-impose the pages that were originally imposed two-up side by side, insert a backer with the terms and conditions in the proper position, and re-sequence the pages in duplex. At the same time, Remake was able to decode the OMR marks and replace them with a barcode that also included additional information used to improve the integrity of the document. The core of Citizens requirements was the integration with the Kern Mail Factory software, which enables Producer to know the status of the inserters and keep track of jobs and mail pieces. In particular, Producer manages the delivery of the intelligent insertion les to the inserters and receives an updated le with a list of all the reprints. For the address quality project, Citizens used Delivery, the print stream optimization module. Delivery was designed to concatenate, merge, sort, and split data streams. Delivery uses the indexes and the address block information extracted by Remake and interfaces with third-party postal preparation software to correct, validate, enhance, and presort mail. Delivery was the key for the address correction needed to improve return mail. According to Cusick, for bringing the commercial loan applications in-house, the documents needed to be re-designed. Citizens used Open Print MiddleOfce to achieve this goal. MiddleOfce is a collaborative, objectoriented, document design and composition tool that was designed for the creation of the most complex transactional documents. In addition to being able to rapidly design the new documents and produce them in-house, Citizens was able to easily combine the composition process with the post composition process of address quality. Adding a planet

code further enabled Citizens to track the mail pieces through the U.S. postal service and be assured that the check is in the mail. ROI Achieved: A Strategic Plan with Tactical Results With its implementation of Sefas, Citizens has demonstrated the ability to plan strategically and implement tactically. It identied and deployed quick win projects that provide maximum benets with minimum investments, and is planning for migration to a full ADF over time. Since September of 2006, Citizens has seen over $3 million per year in readily identi able savings and there are additional bene ts that cut across the enterprise. They include: Duplex conversion: Between September and January, imaged and non-imaged deposit savings were converted to duplex, resulting in $2.1 million per year in savings to the bank in postage alone. In parallel, there was a substantial reduction in paper usage. The simplex to duplex conversion resulted in a 25% - 30% decrease in paper utilization. Address quality: While speci c dollars have not yet been attributed to the improvements in address quality, the Sefas software capability for preparation of the address block, extraction for data cleansing, and re-insertion off the block into the statement has generated substantial savings. Outsourcing to insourcing: A major nancial department was outsourcing statement work, but realized that insourcing the work with Citizens Enterprise Payment Print Center could save $500,000 per year in terms of signi cant functionality improvements. There are more that 1 million statements involved and the ability to produce these statements in-house saves $.05 - $.06 per statement mailed. Ad-hoc departmental support: Citizens Bank is also initiating the implementation of Sefas FrontOfce. This toolset will automate the process for all types of business communications from simple customer correspondence to complex personalization. It integrates with Web portals and delivers documents through any channel, such as centralized mail processing centers. Users can also access digital signatures that can be dragged and dropped into document letter templates. The utilization of this toolset for correspondence for internal claims and fraud will add an additional 57,000 pieces into the common mail stream with signicant postal savings for Citizens. The ADF Implementation Citizens selected Producer, the Sefas production management system, to become the heart and brain of its Automated Document Factory. Producer manages the entire document production process from the moment data becomes available through all the processing

steps. Those steps include document composition, post-composition such as address quality and postal presort, production steps such as printing and mailing, and the delivery to an archive system. For pre-print QA and manual reprints, Citizens selected Projector, the Open Print document search and viewing tool. Projector includes a very powerful search engine that enables users to immediately nd and view any document that has been processed by the Open Print suite. Projector is used to view documents before they are printed and to handle manual reprints Boundless Opportunities Ahead With an end-to-end document production suite in place, Citizens is now exploring a number of other opportunities that will help the company continue to lower its costs and offer better customer service. In the print and mail operation, Citizens is now considering manifesting. Manifesting eliminates the postage meters, increases efciency, and simplies the processing of mixedweight items. All of the required USPS documentation, including an itemized manifest, a postage statement, and a qualication report, will be generated automatically. Another opportunity is the elimination of the physical inserts that can be replaced with onserts, or onstatement inserts that consist of images that are added to the document during the composition or post-composition steps. Cusick stated, on the document composition side, FrontOfce will enable Citizens to automate even more decentralized document production by allowing branches to use Web-based templates to create highly personalized documents and produce them automatically in the centralized print and mail center. As the company redesigns its transactional documents, Citizens plans to consolidate information from multiple sources and add more personalized marketing messages to the documents.

Implementation 1. Promote Customer Responsibility: implementing a philosophy throughout the organization that shifts the orientation of the bank toward more customer responsibility. The process is not formally called re-engineering, but the strategy is changing the way the bank does business. Model Banking Center Program can be introduced wherein standards for quality service and products are examined and implemented from the customers' perspective. It is a series of independent initiatives that links together customer segments with a delivery process.

For example, within the customer base, preferences and objectives are identified by customer segments and products, and application systems and delivery processes are developed that take the customers' needs into account. Therefore when any changes are made, they are only implemented if they are appropriate for a particular segment. There are several components to customer satisfaction including product, price, service and delivery. All of those must be examined in the banking center program, but since delivery is such an important component, it is to be studied more extensively in the bank's Customer Access Project. Eg., A two-career couple that works 12-hour days does not have time to walk into a branch and may find telephone banking or PC home-banking more appealing. One program the bank has underway to appeal to this segment in the Washington, D.C. area is a telephone with a display screen that allows customers to conduct banking and bill-paying transactions from home. The bank must examine where its ATMs are located and the type of services they provide. In certain locations, it would be advantageous to have ATMs that provide interim statements on accounts so customers can see which transactions have cleared. Another part of restructuring the delivery system is to consolidate the number of customer service centres into a smaller number. Money is spent to make this happen, but there are some savings as common systems are consolidated to eliminate some costs.

A big component to any re-engineering effort is database analysis. For this extensive primary and secondary research to identify customer segments and their needs and preferences needs to be undertaken One of the outcomes to this initiative could be a sensitivity model that can predict attrition and the effect any price changes would have on the customer segment. So before the bank institutes any price changes, they will know how they will affect customers. Database modelling also is helping identify which products customers will want next. 2. Diagnoses Its Business Banks need to focus on the customers' viewpoint, and how any internal changes would have an impact on all customer segments Diagnostic process involves a multifunctional team from several areas of the bank including product management, systems, marketing and cash management. Surveys and interviews with customers were done at a different level. The questions were very specific and targeted for the day-to-day user of the product, rather than the buyer.

For instance, instead of asking the treasurer of a company about lockbox services, the survey was geared toward the clerk in accounting who was in charge of disbursements or receivables. Information is compiled and various projects that can be redesigned are identified. How the products would be refigured and implemented are examined from the customers' perspective with input from the multifunctional team. There is a lot of cross functionality when a bank sells to customers and implements new products so the bank must include employees from many different areas in the process. Once the diagnostic stage is completed the implementation stage begins. In this stage, information is examined to determine which changes are viable. Part of the process involves creating an image of what the bank should look like in the future. The bank must redefine goals, examine different types of technology and create benchmarks using other institutions in the market to determine what is best. After all that is completed the bank must make recommendations about what process or product would work best. One change that can be undertaken is the use of imaging to automate the lockbox process. Lockbox is cash management provided to corporate clients and can include disbursement and receivable services. Imaging will help cut down on paper work and eliminate the need for checks to be passed from department to department at the bank. Instead, images of the checks will be stored electronically and accessed by computer. 3. Process innovation A big part of the process is customer segmentation. The criterion the bank could use to segment its customers is "who values the offerings the banks provides?" Learning the answer to the question will allow the bank to understand where it makes money and why. The bank could determine profitability by product and by customer segment. The next step is to determine how the bank can provide service in a cost effective manner. A bank can develop a loyal customer base built on trust. The better the bank understands why this is so, the better it can enhance its value among its entire customer base. The 80/20 rule is a well known concept. The bank must thus identify customers in the 80 percent area that can be built into the 20 percent bracket. Thus even if the bank sells a service at a lower profit margin, if it has been able to engage trust and loyalty, the customer will come back to it for the next product. Market segmentation is an important tool in developing a pricing structure and determining who is likely to be a loyal customer. Products and how they are valued by customer segment are risk adjusted and priced accordingly. 4. Teamwork Builds New Structure

A bank could restructure by filing for a new state charter to reorganize as a holding company. Re-engineering will restructure the bank organizationally and will develop a new measurement system. A management system could be put in place that is built around the process of reengineering. Everyone needs to b involved in asking 'why' questions. Each quarter the management could meet in a strategic planning session where the bank's vision of the future would be discussed. Managers would be required to share input they have received from employees. During these sessions, every position in the bank is discussed and examined. Questions are asked such as: What is the work that needs to be done, who needs to be doing it and should it be done. For instance, cashiers at the United Nebraska bank told managers there was no point in balancing the ledgers daily because the computer system was integrated and automatically did the balancing. "They said they should be looking for exceptions and let the computer do what it was designed to do". This freed up time for cashiers to focus on other aspects of their job. In another instance, the lending area was re-structured into two job functions, a lending specialist and sales position. Previously, lenders completed all the loan documentation themselves. Now a lending specialist does the loan documentation and the lending officer is free to make sales calls. The restructuring represents a shift within the bank from a functional organizational structure to a marketing organization centred around teams serving a customer segment. One way United Nebraska is working to reach that goal is by segmenting its market into distinct customer groups. Some that have been identified include commercial sales, which include small businesses; professional sales, which include the medical, legal, accounting and educational fields; retail sales, which focus on relationships of $25,000 or more; and investment sales, which encompass trust and private banking services. 5. Identify Customers' Expectations Customers expect more integration of services from their financial institutions. To deliver quality service, banks need to identify customer expectations and developing feasible ways of meeting them. Re-engineering can thus help cash management "rethink" the way the bank delivers services. Increasingly banks have to build a set of services that assume a certain amount of customization- that means tailoring to meet the needs of your customers even in a welldefined market.

Re-engineering is not only understanding the market, but building flexibility within the system. This is very different from standardized systems in the past, where customers were expected to learn any changes in the back office process that might affect them. For instance, First Chicago created Windows 2000, a PC window-based system for corporate clients that has an integrated payment program. Corporate clients can perform 11 different types of payments through a single PC screen. Previously, four or five software systems were needed to perform a variety of payment methods from accessing the automated clearing house to making a state tax payment. The bank (First Chicago) saw a need in the market and were able to come up with a solution. The challenge is understanding what is important to your customers and then asking yourself, 'how can we as a bank deliver more timely information or products? Bank marketers who have implemented re-engineering strategies say it is important to maintain a balanced perspective about what customers expect and what the bank can feasibly deliver. Their advice is to use common sense. An example of BPR application A typical problem with processes in vertical organizational structure is that customers must speak with various staff members for different inquiries. For example, if a bank customer enters into the bank determined to apply for a loan, apply for an ATM card and open a savings account, most probably must visit three different desks in order to be serviced, as illustrated in figure 2. When BPR is applied to an organization. The implementation of "One Stop Shopping" as a major customer service innovation, requires the close coordination with a team of staff assigned to a process powered by IT for exchanging information and documents in order to service the customer's request. For instance a customer applying for a loan "triggers" a team of staff assigned to service a loan application. The customer communicates with only one person, called "case manager", for all three inquiries, shown in figure 3. Manager completes an application for a loan in electronic form, which in turn is submitted through the network to the next team member, the credit control director, who examines the credit status of the customer. If the credit status is not satisfactory the rejection of the loan is approved by the credit manager and a rejection form is filled and it is returned to the case manager. The case manager explains to the customer the reason that his application was rejected. On the other hand, if the credit status of the customer is satisfactory, the application is submitted electronically to the next team member, who calculates interest rates and payment tables. The application is then submitted to the credit manager for approval using a digital signature. The approval of the application along with the payment table is delivered to the customer by the case manager.

Most importantly, while the loan application team was processing the loan application, the case manager "triggered" the account team to open a savings account and the ATM team to supply the customer with an ATM card. The customer leaves the bank having a response for his loan application, a new savings account and an ATM card, And all these without having to move around the desks for signatures and documents. All the customer's requests were satisfied at the same time in parallel motion. The difference between the vertical organization (figure 2) and the cross functional organization (figure 3) lies in the way businesses are organized internally. The vertical organization is organized based on functional units (e.g. the sales, the accounting department). In cross-functional organizational units the main organizational unit is the process. Since "doing business" is mainly running processes, it would be very logical to organize companies based on processes. For instance, the ordering process crosses different departments. The sales department for order taking, the accounting department for credit control and invoicing, the logistics department for inventory control and distribution, and the production department for producing the order.

Later, the banking sector began to reengineer with a great degree of success such as CITIBANK , NORTHWESTERN BANK, BANK OF AMERICA and others. Major utility companies used reengineering as a technique to improve service like OTE, ELTA. BPR is also being used to change the organizational structure of public services. First the government cabinet of Egypt reengineered its processes along with many Municipals in Europe.

Analysis If a bank is to derive maximum value from its software implementation exercise, then it needs to avoid simply replicating the "As Is" situation in the new system. The implementation of a new core banking solution in place actually presents an excellent opportunity to the bank to improve its organization and processes. The BPR process involves diagnosing current processes and supporting organization & software by identifying bottlenecks, inefficiencies and unnecessary tasks and defining how, where and when improvements are to be made.

Assessing your current business improvement, standardization & alignment Identifying inefficiencies requiring process change Managing the process design Developing the policies, procedures and controls Overseeing implementations Training and coaching

In achieving,

Process architecture and re-engineering Process alignment Measurability through the SLA concepts Workflow simplification Reduced Cycle-times & hand-offs Minimized bureaucratic delays

Thereby Resulting in,

Reducing overhead Improving customer responsiveness Enabling the bank to derive maximum value from its investment in new technology

CONCLUSIONS, IMPLICATIONS AND RECOMMENDATIONS In general, the results indicate that organizations are not emphasizing some of the most important goals and objectives recommended in the BPR literature, such as ensuring the value-added element of every business activity, and applying the right innovative technology. Therefore, one may surmise that therein lies a major reason why many of the BPR project goals and objectives have been only modestly accomplished. On average, the most commonly encountered problems, while implementing BPR, seem to be rather basic and quite difficult to address in practice: implementation difficulties due to communication barriers between company sub-units, the unexpected size of the required BPR effort, its disruption to business operations, failure to get the expected benefits, making business mistakes under pressure to produce quick results, and reluctance of top managers to commit the funds necessary for the project. While many individual organizations have reported major benefits and significant favorable impact on organization performance, on the average, benefits and company impact from BPR seem rather disappointing compared against all the turmoil it seems to generate. Before embarking on a BPR adventure, executives should ensure that at least some of the success factors deemed important by the respondents are operational: BPR project is motivated by customer demands and competitive pressures, reeducate and retrain workers on what BPR actually is, use surveys to determine what's working and what's not, and utilizing hands-on experience in reengineering diverse processes. While on the average some of the success factors have received lower ratings, those with large standard deviations should be further considered since at least some of the respondents perceive them as very or extremely important from their perspective. The extent to which BPR goals and objectives are accomplished is strongly related to the benefits the organization derives from the BPR project, and also related to the extent the BPR project has an impact on company performance. The extent to which benefits are derived is also positively related to company performance. On the other hand, the number and/or intensity of the problems encountered during BPR implementation is inversely

related to the extent to which project goals/objectives were accomplished, the derived company benefits from the project and its favorable impact on company performance. Given that, on average, project planning does not seem to be a good insurance policy for success, managers should also attempt to develop their company's ability to manage unpleasant surprises effectively (implementation problems). Implementing the basic philosophy, tenets, mechanisms, methods and tools for organizational learning seems to be a major requirement for effectively managing the dramatic organization changes called for by BPR and the many resulting surprises.

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