Challenging the paradigm of the process enterprise : a case-study analysis of BPR implementation

The dangers of functional organisation structures are well documented and have led to the advocation, particularly by exponents of BPR, of the process enterprise paradigm. This paper reports the results of case-study research that was conducted in order to explore the operational changes resulting from re-engineering companies along process, rather than functional lines. Increased market responsiveness, improved collaboration between functions and alignment of organisational objectives were some of the perceived benefits of the new process structures; but some disadvantages were also identified. Duplication of functional expertise and increased operational complexity resulted in an escalation of costs, the emergence of horizontal silos, inconsistency in the execution of functional decisions between processes, and general erosion of the efficiency of the operations network. These preliminary findings point to some possible contingencies of organisational design, suggesting that process structures may be conducive to the realisation of differentiation strategies, whilst functional structures may offer benefits to cost leaders. It is further proposed that matrix structures may be appropriate for companies adopting mixed strategies; however, it is envisaged that a more flexible approach to organisational design, based on a network rather than a matrix paradigm, could stimulate new developments in the future quest for strategic and structural alignment. (C) 2002 Elsevier Science Ltd. All rights reserved