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Abstract
This paper investigates the perceptions of staff with regard to
critical success factors (CSFs) for successful Business Process
Re-engineering (BPR) for the upstream sector of the
Exploration and Production (E&P) companies. The conclusion
and recommendations were drawn after a detailed review of
literature discussing BPR implementations in various
industries and using the results of a study performed on a
specific implementation of a BPR project for Information
Management in a mid-size E&P company.
This paper shows that the factors deemed most important
for successful BPR included items such as top management
support, commitment and understanding of BPR,
communication, empowerment and alleviation of downsizing
fears. Some unique characteristics for the E&P sector have
particular bearing on the application of BPR. They include the
existence of many intricate overlapping processes with
multiple stakeholders, changes in policy direction or in Oil
prices, the existence of a professional workforce and the
existence of defined internal organizational boundaries.
Suggestions on how to maximize the chances of success in the
BPR are discussed.
Introduction
With the recent mergers, most majors have considered
embarking on a massive re-engineering effort in order to
streamline their front office of exploration and development.
Similarly, the major resource holders have embarked on very
creative re-engineering projects in order to keep their position
in their market place and the small players that were left out
have been forced to re-engineer in order to attract financial
backing or partnership.
Re-engineering has a great potential of increasing
productivity for an E&P company through reduced cycle time
and cost, improved data and information quality and greater
One may conclude then that the BPR effort has undergone a
refinement process since 1993 following the capture of
knowledge that lead to believe that at the heart of the
refinement was the determination and the evaluation of critical
success factors throughout the implementation of the BPR.
Critical Success Factors from the ProSci Study
ProSci is the recognized leader in re-engineering and change
management research, and is the world's largest provider of reengineering toolkits and benchmarking information. ProSci
study (1999) gave a comprehensive look at a broad spectrum
of industries and businesses from both the private and public
sectors from around the globe and the result of their
experiences in BPR. Two hundred and forty eight
organizations from forty-four countries in six continents
participated at the study. The participants to the study
represented a diversity of industry groups, ranging from health
care to manufacturing. The service industry led all segments
representing 40% of the participants followed by
R&D/manufacturing with 26%, Government-Civilian for 10%,
Education for 6%, Government-Defense for 5%, Distribution
and Health care for the rest.
ProSci (1999) emphasized the following success factors as
major contributors to the overall success and I quote ProSci
(1999, p29):
Employ change management techniques including a strong
emphasis on communications and training with key
stakeholders and employees.
Get top-management support for the project. Agree on
scope and goals and engage managers throughout the
project with period performance reviews.
Select the right team and train members properly. Use
senior employee or manager as the team leader and bring
in external experts or consultants when needed.
Create excellent project plan that clearly documents goals,
scope, charter and success measures. Obtain agreement on
this plan from project sponsors.
Looking at the success factors that gave the results in Dr
Armitech study in 1996, the most significant factors that
contributes to BPR success are:
Top management support 78%.
Keeping open lines of communication that counts 44%,
A strong project management team 41%
An appropriate leadership 41%
Various literature and studies examining the success or
failure of BPR, have identified specific CSFs which underpin
the above results. A review of these literature and studies was
carried out and the identified CSFs were categorized below.
Critical Success factors from Litterature Reviews
The authors reviewed and listed below are among the best in
the consulting industry. They have documented one or many
of the critical success factors listed in this paragraph:
Leith, 1994; Feltes and Karuppan, 1995; Alavi and Yoo,
1995; Gorver et al., Johansson et al. 1993, Barrett, 1994;
Towers, 1994; Furey, 1993; Dawe, 1996; Hagel, 1993; Zairi
and Sinclair, 1995; Dixon et al., 1994; Harrisson and Pratt,
1993; Carr, 1994; Klein, 1994; Moad, 1993; Guha et al., 1993;
Katzenbach and Smith, 1993; Talwar, 1993; Hammer, 1990;
Bashein et al., 1994; Carr, 1993; Jackson, 1997; Guha et al.,
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1993; Grover et al., 1993; Bruss and Roos, 1993; Hagel, 1993;
Guha et al., 1993; Feltes and Karuppan, 1995; Hammer and
champy, 1993; Stow, 1993; hall et al., 1993; Zairi and
Karuppan, 1995; Gould, 1993; Davenport, 1993; Towers,
1994; Rastogi, 1994; Klein, 1994; Clemmer, 1994; Shabana,
1996; Boyle, 1995.
From the readings, critical success factors were extracted
and grouped under five different categories:
1. Factors related to change management systems
and cultures
2. Factors related to management competence and
commitment
3. Factors related to organizational structure.
4. Factors related to BPR project management.
5. Factors related to IT infrastructure
For the purpose of this paper, when stating a documented
CSF, reference to the authors was omitted but
acknowledgment is preserved through the list of references at
the end of the paper.
1. Factors Related to Change Management
Systems and Cultures (CM)
Reward the team: Reward systems should be revised for the
new environment. It must be widespread, fair and encourage
harmony among employees
Communicate effectively: At all levels and all audiences.
Inside and outside the organization to market the BPR
program and to ensure patience and understanding of the
changes needed. Open, honest and clear. Frequently and in
both directions between those in charge and those affected by
BPR. Focus on something of value to internal and external
stakeholders. Time and quality are both excellent targets for
improvement.
Empower: Do not ignore the human factor - Empowerment of
"process owners". Staff at all levels feel more responsible and
accountable. Staff is given the chance to participate in process
redesign. Staff is able to set their goals and monitor their
performance and solve the problems that affect their work.
Involvement: All people must be openly and actively
involved and should be consulted at all stages on the process
and its leaders. People include line managers, process owners,
IS staff, Human resources and workers.
Train and educate: Increase training budget, train on BPR
skills and techniques and IT skills, on process analysis and
implementation.
Create an effective organizational culture adaptable to
change: Must understand and conform to new values,
management processes and new communication styles.
Working co-operatively, without competing against each
other, teamwork and integration of labor, co-ordination and
empowerment of employees become the standard attitudes.
Stimulate the organization willingness to change: Make
people resilient to change to remain positive, focused, flexible
and pro-active. Requires one-on-one and one-to-many
interactions with groups within and without the organization.
2. Factors related to Management competence
and commitment. (MC)
Committed and strong leadership: Leadership has to be
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20%
40%
60%
80%
100%
Percent of respondents
20%
40%
60%
80%
100%
Percent of Respondents
20
40
60
Percent of respondents
80
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engineering project or as an apparent extension to the reengineering efforts that is visible to the Company.
Furthermore, A competency based training program was
high on the importance list of the overall response of
Company compared to regular training program that is low on
both surveys. While the training budget was established earlier
due to contractual commitments, Consultant has changed the
standard classroom training and the original training scope of
work with a newly designed and customized competency
based training program named E&P Technology Mastery. The
major reasons behind the change is the ability of the
Consultant to effectively train, coach and mentor the Company
users and BPR team and monitor their increasing capabilities
while easing up the burden of change to the new process.
Competency training methods are growing rapidly and are
becoming increasingly strategic in E&P Companies. This
rapid increase in education investments is occurring because
learning is prerequisite for change and change is a
fundamental attribute of the knowledge era. The capacity to
learn and respond to advances in technology has become a
major factor that distinguishes organizations that prosper from
those that do not.
CSFs with mixed responses
1. Change Management Factors analysis: Examining further
the overall responses, While Consultant values Change
management and project management as the next batch of
CSFs, Company views them as slowly making it to the list of
CSFs but with more priority put on Project management
leaving Change management among the last factors.
One important fact is that Company does not see the real need
for "creating an effective organizational culture adaptable for
Change" as they rank this CSF among the least important
factors and it is consistent over the three Company levels.
The Consultant Information Management team also agrees
with the importance of this factor as opposed to Consultant
Senior Managers response that believes firmly in the strong
importance of this factor. This indicates that the Company
from senior managers to users is ready to change and adopt the
new process. However from feedback taken from the survey
and from the re-engineering team, some members of the users
community have expressed their skepticism over the success
of the project as they feel that the approach was a top-down
BPR, an important point that was not picked up by the survey
and therefore not communicated to the rest of the stakeholders.
In a top-down BPR, employees tend to be insufficiently
involved in the early approach and goal setting stage. The
Change management program is then key to address the issue
and overcome the resistance to change that some of the staff
might put ahead.
According to the various industries survey by ProSci, 1999,
Most change management steps used during BPR
implementations are good plan for communications, proper
training program, general change management techniques to
manage change and the implementation of a motivation and
recognition plan.
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Didn't matter
3%
20
40
60
80
Not so
important
2%
Critical
36%
So-so
19%
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10
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Data Analysis
Data Analysis
Discussion on Results of
the survey on the three
groups (external)
Discussion on Results of
the survey on the three
groups (internal)
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11
Category
MC
OS
MC
PM
Score
3.76
3.43
3.38
3.33
CM
3.29
PM
CM
PM
3.29
3.24
3.24
CM
PM
CM
PM
PM
CM
CM
MC
OS
CM
CM
IT
OS
IT
CM
PM
PM
IT
IT
CM
OS
IT
3.21
3.21
3.19
3.17
3.10
2.95
2.90
2.81
2.81
2.76
2.69
2.69
2.67
2.67
2.64
2.57
2.55
2.50
2.50
2.43
2.40
2.31
IT
PM
PM
2.19
2.05
1.86
12
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Item
11
14
33
4
5
6
7
8
9
10
11
12
13
32
12
18
19
28
4
29
30
8
25
14
15
16
17
2
5
21
15
18
19
20
21
22
23
20
16
27
31
9
22
24
25
26
27
28
29
30
31
32
33
3
17
7
24
26
6
10
13
1
23
Category
MC
OS
IT
Score
3.44
3.40
3.40
IT
MC
PM
PM
IT
CM
IT
IT
CM
PM
3.32
3.28
3.24
3.24
3.20
3.16
3.12
3.12
3.08
3.08
CM
CM
PM
OS
3.04
3.04
3.04
3.00
PM
OS
PM
IT
CM
PM
3.00
2.96
2.92
2.92
2.88
2.88
CM
OS
CM
PM
PM
CM
CM
MC
CM
PM
2.84
2.84
2.80
2.76
2.72
2.60
2.48
2.44
2.36
2.04