Vicro Failure at Bpr and ERP What

Vicro Failure at BPR and ERP

What is BPR? In a plain language, what does it mean to an organization that is underperforming?

Business Process Re-engineering (BPR) are a series of processes, systems and techniques for increasing the efficiency and profitable performance of businesses by re-architecting their workflows (Hammer, 2001). BPR for an underperforming organization is specifically designed to provide a pathway out of the inefficiencies and lack of internal communication and collaboration that over time degrade the operational and financial performance of an enterprise (Hammer, Haney, Wester, Ciccone, Gaffney, 2007).

Why can IT be one of the biggest obstacles for BPR?

Information Technologies (IT) often unnecessarily complicate the process of redefining and re-engineering processes by forcing organizations to change how they do business to just fit into an IT-supported framework (Tsai, Chen, Hwang, Hsu, 2010). IT can become more of a constraint than an enabler of organizational change quickly given its lack of agility and flexibility in supporting complex processes. This is exactly what happened at Vicro from a systems-based standpoint. The greatest factor of the Vicro failure however was the lack of change management planning that was put into place before the systems were installed (Khosrow-Pour, 2003).

What went wrong with the ERP implementation? Note four (4) major issues.

There were many factors that contributed to the ERP implementation at Vicro failing, with the greatest being the lack of planning for change management programs to overcome resistance to change and fear of what the system would do to people's jobs and stability in the company (Khosrow-Pour, 2003). This is often the most critical success factor for any ERP system, yet the management and system integration teams completely missed this aspect of developing their implementation plan. The system integration teams did not ask for any feedback from the employees most affected by the systems being installed, virtually guaranteeing these shifts in how people did their jobs would fail over time (Khosrow-Pour, 2003). A second major initiative or area where the ERP implementation was the complete under-scoping and underestimating of the costs, complexity and time to complete the process and system integrations. This was a major shortcoming of the implementation plan as it actually fed the first factor even more into a cause of failure. The third factor was the fact that the ERP system chosen did not have enough customization capability, lacking the necessary technologies to support the unique needs of the company. The fourth factor was the lack of realistic measures of performance that continued to keep management blinded about the true status of the project. This lack of metrics and measures of performance left the management and integration teams in the dark about project status until it became clear the project failed (Khosrow-Pour, 2003).

What could Vicro have done differently to make its BPR successful? Would you have stayed away from HPT ERP?

It needed to first focus on re-engineering the process first and allowing employees to own the changes more. That would have made the transition to more effective processes more successful. I would have stayed away from the ERP system until the processes being re-designed had proven themselves to be highly effective first. The bottom line is that Vicro needed to have a more agile, fluid system architecture, yet ironically kept moving away from it the more they adopted technologies over change management initiatives to get people invested in their direction first.