Elias Adem Thesis

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ANALYISIS OF EFFECTS OF BUSINESS PROCESS REENGINEERING

ON HARAMAYA UNIVERSITY PERFORMANCE

MBA THESIS

ELIAS ADEM

June 2020

HARAMAYA UNIVERSITY
Analysis of Effects of Business Process Reengineering on Haramaya
University Performance

A Thesis Submitted to the Department of Management, Post Graduate


Program Directorate HARAMAYA UNIVERSITY

In Partial Fulfillment of the Requirements for the Degree of MASTER OF


BUSINESS ADMINISTRATION

Elias Adam

June 2020

HARAMAYA UNIVERSITY, HARAMAYA


ii

HARAMAYA UNIVERSITY

POSTGRADUATE PROGRAM DIRECTORATE

I hereby certify that I have read and evaluated this Thesis entitled: “Effects of BPR
Implementation practices and challenges on organizational performance: the case of Haramaya
University” Prepared under my guidance by Elias Adam. I recommend that it be submitted as
fulfilling the thesis requirement.

Mulugeta Damie (Ph.D.)


Major Advisor Signature Date

As a member of the Board of Examiners of the MBA Thesis Open Defense Examination, we
certify that we have read and evaluated the Thesis prepared by Elias Adam and examined the
candidate. We recommend that the thesis be accepted as fulfilling the Thesis requirements for
the Degree of Master of Business Administration.

Chairperson Signature Date

Internal Examiner Signature Date

External Examiner Signature Date

Final approval and acceptance of the Thesis is contingent upon the submission of its final copy
to the Council of Graduate Studies (CGS) through the candidate's department or school
graduate committee (DGC or SGS).
iii

STATEMENT OF THE AUTHOR

By my signature below, I declare and affirm that this thesis is my own work. I have followed
all ethical and technical principles of scholarship in the preparation, data collection, data
analysis and compilation of this Thesis. Any scholarly matter that is included in the Thesis has
been given recognition through citation.

This thesis is submitted in partial fulfillment of the requirements for a Master of Business
Administration degree at Haramaya University. The Thesis is deposited in Haramaya
University Library and is made available to borrowers under the rules of the Library. I
solemnly declare that this Thesis has not been submitted to any other institution anywhere for
the award of any academic degree, diploma or certificate.

Brief quotations from this Thesis may be made without special permission, provided that
accurate and complete acknowledgement of the source is made. Requests for permission for
extended quotations from or reproduction of this thesis in whole or in part may be granted by
the Head of the School or Department when in his or her judgment the proposed use of the
material is in the interest of scholarship. In all other instances, however, permission must be
obtained from the author of the Thesis.

Name: Elisa Adam Signature: _______________________

Date: June 2020

School/Department: Business and Economics/Management


iv

LIST OF ACRONYMES AND ABBREVIATIONS

BPR Business Process Reengineering


CSFs Critical Success Factors
CVI Content Validity Index
OP Organizational Performance
RTC Resistance to Change
SFF Success and Failure Factors
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BIOGRAPHICAL SKETCH

The author was born on February 24, 1964 G.C in Oromia Region, East Hararghe Zone,
Haramaya Woreda, Tiniqe Keble. He attended his primary and junior education at the Bate
Primary School and Junior Secondary School.

He completed his comprehensive secondary education in Haramaya University Evening


School. After high school completion, he was employed at Haramaya University, Finance and
Budget Division in 1994 G.C. After serving for 4 years, he continued his diploma study in the
Continuing Education Program, Haramaya University in the field of Accounting from 1998-
2002. Similarly, he studied for his first degree in the same program and the same field from
2003-2008 G.C. Finally, he has been attending his MBA study in Haramaya University since
2016.

Currently, he is working as a director of Procurement and Property Administration


Directorate, Haramaya University.
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ACKNOWLEDGEMENTS

Above all, I highly thank the Almighty Allah, whose mercies have been upon me throughout
my life and I have thus reached this far. Next to Allah, my profound thanks are due to my
advisors Dr.Mulugeta Damie for his precious time, professional suggestions, guidance,
valuable and constructive comments, and intellectual encouragement he gave me from the
time of setting up the proposal to the final write-up of this thesis.

I am also grateful to Haramaya University for giving me this chance to attend Masters
program by sponsoring my study. I would also like to express my special thanks to my
beloved family members for their words of encouragement, affection and prayers that served
me as a source of strength, inspiration and impetus throughout the study period.

I also want to thank from the bottom of my heart the hard-working friends who squeezed the
time out of their busy schedules to contribute a lot during data collection and entry period.

Special thanks go to Mohammed Ahmed and Elias Ahmed. Finally, I would like to happily
appreciate and give very special thanks to the employees of Haramaya University for their
cooperation and willingness to give needed information. The thesis would not have been
possible without their help and cooperation.
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Table of Contents
statement of the Author ............................................................................................................. iii
List of Acronymes and Abbreviations ........................................................................................ iv
Biographical Sketch..................................................................................................................... v
Acknowledgements ....................................................................................................................vi
List Of Figures ............................................................................................................................ ix
List Of Tables .............................................................................................................................. x
ABSTRACT ............................................................................................................................... xi
1. INTRODUCTION ................................................................. Error! Bookmark not defined.
1.1 Background Of The Study ................................................................................................. 1
1.2. Statement Of The Problem ............................................................................................... 3
1.3. Research Questions ........................................................................................................... 4
1.4. Objectives Of The Study................................................................................................... 4
1.5. Scope Of The Research ..................................................................................................... 5
1.6. Significance Of The Study ................................................................................................ 5
1.7. Limitations Of The Study ................................................................................................. 5
1.8. Organization Of The Paper ............................................................................................... 6
2. LITERATURE REVIEW.. ...................................................................................................... 7
2.1. Key Concepts And Definitions ........................................................................................ 7
2.2. Theoritical Reviews ......................................................................................................... 8
2.2.1. Resources Base Theory…………………………..………………………………….. 8

2.2.2. Factors Related To BPR Success ................................................................................. 9


2.2.2.1. Factors Related To Managemen Change System ................................................... 9
2.2.2.2. Factors Relating To Mangment Commitment ....................................................... 10
2.2..2.3 Factors Related To BPR Management Commitment And Leadership ................. 10
2.2.2.4 Factors Related To IT Infrastructure ..................................................................... 10
2.3 Evolution Of BPR ............................................................................................................ 11
2.4. Measuring Organizational Performance And BPR ........................................................ 13
2.5. Emprical Literature ......................................................................................................... 15
2.6. Conceptual Framework .................................................................................................. 17
3. RESEARCH DESIGN AND METHODOLOGY ................................................................. 18
viii

3.1. Study Design ................................................................................................................... 18


3.2. Target Population ............................................................................................................ 18
3.3. Sampling Technique And Size Determination ............................................................... 18
3.4. Methods And Source The Of Data Collection ................................................................ 20
3.5. Measure Of Consistency And Dimensionality…………………...…………………….20

3.6. Methods Of Data Analysis .............................................................................................. 22


3.7 Relaibility Test……………………………..……………………………23

3.8. Variable Definitions …………………………………...………………23

4. RESULT AND DISCUSSION .............................................................................................. 25


4.1. General Information About The Respondents ................................................................. 25
4.2. Effect Of BPR Implimentation On Organizational Performance ................................... 27
4.2.1. The Extent To Which BPR Gal And Objective Are Acomplished ………..……...27

4.2.2. Organizational Performance Measure…………...…………………...………..29

4.3. Evaluation Of BPR Success Factors At Haramaya University....................................... 31


4.4. Challenging For BPR Implementation In Haramaya University .................................... 36
4.5. Factor Analysis .............................................................................................................. 42
4.6. Regression Model Output…..…………………………………………..48

5. SUMMARY, CONCLUSION AND RECOMMENDATIONS ........................................... 52


5.1. Summary ......................................................................................................................... 52
5.2. Conclusions ..................................................................................................................... 52
5.3. Recommendations ........................................................................................................... 53
6. REFERENCES ...................................................................................................................... 55
APPENDEXES…………………………………………………………..……..61
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LIST OF FIGURES

Figure 1. Conceptual Framework 17


x

LIST OF TABLES

Table 1. General Information about the Respondents 26


Table 2. Respondent’spositionattheir University 27
Table 3. Goal and objective Achived 27
Table 4. Respondents on organizational performance measure 29
Table 5. Response on Implimentation of BPR sucssus factors in Haramaya University 32
Table 6. BPR Implimentation Challenge Factors 36
Table 7. Factor Analysis for Change Management 43
Table 8. Factor Analysis for Effective Communication 45
Table 9. Factor Analysis for Mangment Commitment 46
Table 10. Factor Analysis for Information Technology 46
Table 11. Factor Analysis for Organizational Performance 48
Table 12. Mutiple Regression output for Service improved as dependent variable 48

Table 13. Multiple Regression output for overall organization performance as dependent
variable 49
xi

ABSTRACT

Organization has been facing with different environmental dynamics, making it necessary for
it to reinvent itself in order to be strategically competitive. One of the channels available for
this process is the Business Process Re-engineering. The purpose of the study is to analyze of
the effects of BPR on Haramaya University performance. The study used mixed method
approach for triangulation purpose. A cross-sectional data was collected at HU during
2018/2019 fiscal year for this study. The study used stratified random sampling method and
316 samples were randomly selected, 217 academic staffs and 99 administrative staffs were
randomly selected from the two strata using proportional to size. Quantitative data were
analyzed using both simple descriptive and advanced statistical methods. Multiple regressions
were used to establish the relationship between the university performance and factors
affecting the university performance including BPR factors. The qualitative data were
analyzed using thematic analysis. The result from descriptive analysis indicated that the
implementation of BPR in the university did not bring the desired change. The mean rating response is
ranging between 2.8-2.69 which is close to the moderate value mean that the effect is moderate.
Factor analysis was conducted to estimate the score for the construct variables that was in regression
analysis. The strengthen of each factor was tested using Cronbach Alpha test only one factor failed to
pass the test and not used in the regression analysis. The regression result indicated that BPR success
factors like change management, management commitment and IT support have significant effect on
the organizational performance measured by services improvement dimension at 1 %, 10 % and 5 %
significance level, respectively. Similarly, effective communication as a proxy for the leadership affects
organizational performance significantly at 1 % significant level. The qualitative result also
confirming the quantitative result most of the key informants indicated that the effect of BPR was not
as expected initially by the management. Therefore, based on the findings, the study
recommended the top management should increase their commitment for the proper
implementation of BPR. The university should increase the investment in IT infrastructure and
improve the communication of top management with its employee to improve the Haramaya
University services delivery to its customers.

Keywords: BPR, BPR success factors, Organizational Performance, Factor analysis


1. INTRODUCTION

1.1 Background of the Study

Business is faced with different market dynamics, making it necessary for it to reinvent itself
in order to be strategically competitive (Okumu, 2013). One of the channels available for this
process is the Business Process Re-engineering. Today, Business Process Re-engineering
(BPR) has become a necessity in the business world, because it is considered as one of the
main methods which lead to modifications and development in the business processes (Tka
and Ghannouchia, 2012). BPR is determined as one of the most important solutions for
organizational improvements in all business processes and performance measures. However, it
reported high failure rates of 70% when using it and the main reason behind this is that the
process tends to be focused on, regardless of the surrounding environment and the knowledge
of the organization. According to Abdellatif et al. (2017) the reasons of failed of BPR is due to
the lack of tools to identify the causes of the contradictions and inefficiencies.

Nowadays, BPR has been suggested as an effective management tool in both profit and
nonprofit organizations to deal with technological changes as well as and any other changes
that arise from environment. It leads to minimized activity costs across the process or the
organization as a whole organization by analyzing and redesigning work flow and processes
within and outside the organization (Omidia and Khoshtinata, 2016).

The primary objective of BPR is to achieve improvements in the contemporary measure of


performance that is cost, quality, service and speed (Nangami, 2014). It is the redesigning of
the work to better support organizational objectives while reducing on the cost implications
(Kawa, 2013). In order to do this, BPR involves a complete overhaul of the organizational
structure, job characteristics, performance measures and the reward system. Therefore, the
overall aim of BPR is delivering more value to the customer through a rethinking of existing
processes, use technology to improve data dissemination and decision making, redesigning the
functional organization into cross-functional teams (Kangogo, 2014).

Successful implementation of BPR projects benefited the organization by increasing its


productivity through reduced process time and cost, improved quality, and greater customer
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satisfaction (Carr and Johanson, 1995). The implementation process must be checked against
several success/failure factors like setting comprehensive implementation plan, addressing
change management issues and measuring the attainment of desired results so as to ensure
successful implementation, as well as to avoid implementation pitfalls (Hammer and Stanton,
1995). The ultimate success of BPR depends on the people who do it and on how well they
can be committed and motivated to be creative and to apply their detailed knowledge
(Champy, 1995).The change process itself should emphasize the value-added element for
every activity, recognizing them as a competitive weapon, focusing on end results and
objectives, ensuring quality at the source, planning for an end-to-end solution, challenging the
old ways and proposed new ways, using the right technology, empowering people and
building consensus on making changes, and setting aggressive goals for the new process
(Stadler, 1992).

Higher institutions like any other organization undergo different changes. Fundamental
principles in higher education are seen in isolation as freedom of the academic faculty; the
combined focus on research and teaching is pervasive. Higher Education Institutions in the
developing world are facing financial and structural crises. Hence, they need to find new
methods and make better use of existing technologies to develop and transfer knowledge in
more productive ways. Current developments such as virtual classrooms, digital libraries,
computer simulations, and many other technologies affect the core of higher education, which
is, developing and transferring knowledge (Tsichritzis, 1999). This demands a radical process
redesign, which is mainly driven by new technological possibilities and new learning
environments (ibid).

According to Porter (1990), the performance of higher education is very critical to the
competitiveness of nations. Although the introduction of BPR in Ethiopia is a recent
phenomenon over the past years, business process re-engineering (BPR) has been
implemented in many public organizations in the country with the hope of bringing about
efficiency and effectiveness in organizational performance. Among these institutions
Haramaya University is one among many other. Therefore, assessing BPR implementation
practices and how it affects the organizational performance caught the interest of any
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researcher. As far as the researcher knows, study was not conducted in Haramaya University.
These are the motivating factor to conduct this study.

1.2. Statement of the Problem

Until very recently most of public universities in Ethiopia were inefficient including
Haramaya University. Resource was miss managed, and services delivery was also not
satisfactory to its customers. To turn over such problem in public organizations the
government of Ethiopian implemented BPR as a solution. Business Process Re-Engineering
(BPR) has been marketed as a necessary change methodology to rejuvenate the organization,
improve on its competitiveness, manage costs, improve on the service delivery and introduce
operational efficiency (MoH, 2007 and Owuor, 2011). However, Attaran and Wood (1999)
noted that BPR as an unfulfilled promise for many organizations despite all the energy, money
and efforts spent by organizations trying to make their BPR efforts successful.

There are studies conducted in public organizations like Debela (2009), Debela and Hagos
(2011), and Mengesha and Common (2007) studies acknowledged as a stepping stone on
issues of BPR in Ethiopian public organization. However, studies at the universities level are
rare to find study by Girmay et al, (2009) showed that Ethiopian universities are not able to
effectively discharge their national responsibilities in producing qualified human power and
BPR was started to solve the problem and enhance the universities' performance. Asrat and
Dejen (2017) conducted study on BPR as Faison or Solution in Ethiopian Universities in
general. This study not sees the critical success factors at individual university level.

Haramaya University implemented BPR before 11 years in 2008/9 academic year. The desire
is to improve the University performance in different core functions. There are debates among
scholars and questions among staff members on whether the BPR really changed Haramaya
University services for the customers or not? Is BPR success factors worked in Haramaya
University context? What are the challenges to successful implementation of the BPR in
Haramaya University context? The answer to such questions required partly conducting an
independent evaluation of the impact of BPR on the university performance. In addition it
need a scientific investigation by research scholars. Hence, this study is motivated to address
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this issue. Through the vast literature survey there is no single study on BPR and its effect t on
the university performance and challenges it face during the implementation. Therefore, this
research tries to fill this knowledge gap by deeply investigating on the issue. This research is
the first of its kind (specifically for Haramaya University) and it helps the university
management to praise their success factors and also to know what hinders the successful
implementation of the process and focus on those issues.

1.3. Research Question

This study tries to answer the following basic research questions:

1. How successful was the BPR implementation as compared to in the implementation plan of
the University?

2. What are the success factors in relation to BPR implementation at Haramaya University?

3. What are the challenges faced in BPR implementation processes at Haramaya University?

4. Is the performance improvements were achieved at Haramaya University due to BPR


implementation?

1.4. Objectives of the Study

The general objective of the study is to analyze effect of BPR in organizational performance
the case of Haramaya University.
The following specific objectives were addressed:
1. To evaluate effectiveness of BPR implementation practices against the implementation plan
of the Haramaya University.
2. To assess the influence of success factors in relation to BPR on the university performance..
3. To identify the challenges faced in the course of BPR implementation at Haramaya
University.
4. To evaluate the performance improvements at Haramaya university due to BPR
implementation.
5

1.5. Scope of the Research

The study was conducted at Haramaya University. The study was also restricted to the
evaluation of the challenges and successes of the BPR implementation and academic
performance improvements after BPR implementation.

1.6. Significance of the Study

The result of the study would contribute meaningfully to the implementation of BPR by
pinpointing possible sources of challenges and suggesting possible strategies of alleviating the
problems, as BPR is a continuous process. BPR at Haramaya University was believed to high
chance of implementation provided that all implementation challenges have been understood
by the implementers.

This study has great contribution the make advancement based on the exploration of baseline
information. It enables researchers who that are interested in the BPR implementation and its
challenge at university level. It can serve a good springboard for other researchers to conduct
further studies on the topic but in different organizational settings.

1.7. Limitations of the Study

The researcher has identified the following limitation during the data collection process. There
was reluctance of some respondents to timely return the questionnaires. This had delayed the
completion of research work since data were not collected and analyzed timely due to delay in
the collection.

1.8. Organization of the Paper

The study was organized into five chapters. The first chapter dealt with the introduction:
background of the study, a statement of the problem, objectives, significance, scope and
limitation of the study. The second chapter contained the review of related literature. Chapter
three dealt with methodology of the study. Chapter four focused on analysis and interpretation
6

of the data collected through questionnaire and interview. Finally, summary, conclusion and
recommendation of the study were provided under chapter five.
7

2. LITERATURE REVIEW

In this part of the dissertation, key concepts and their (operational) definitions, theory of BPR
and measurement issue are presented. In addition, relevant empirical literature and conceptual
framework of the study are presented.

2.1. Key Concepts and Definitions

Business Process Re-engineering (BPR) is a concept about process improvement in


dramatically approach. BPR is concerned with making significant, radical changes to a
company based on the business process. It has been defined by Hammer and Champy, 1993
(in Jones, 1997) as the fundamental rethinking and radical redesign of processes to achieve
dramatic improvements in critical contemporary measures of performance, such as cost,
quality service, and speed (Bernardo, 2002).

Business Process: the concept of business process is central in understanding the concept of
BPR as it is the paradigmatic change in the way organizations are designed and subsequently
managed. It represents a decisive movement away from the traditional functional concept,
with its high emphasis on vertical differentiation and hierarchical control to a view which
stresses horizontal integration across intra- and inters organizational functions. The definitions
of the term “process” by different researchers are also slightly different. For example,
Hammer and Champy (1993) define a process as a collection of activities that takes one or
more kinds of input and creates an output that is of value to the customer. For Davenport
(1993) it is a process is a specific ordering of work activities across time and space, with a
beginning, an end, and clearly identified inputs and outputs: a structure fraction. Warboys et
al. (1999) define a process as a structured change, i.e. there is a pattern of events which an
observer may recognize across different actual examples (or occurrences) of the process, or
which may be made manifest, or implemented, in many different occurrences.

In BPR, the process to be reengineered is the so-called business process. Davenport (1993)
describes a business process as “simply a structured, measured set of activities designed to
produce a specified output for a particular customer or market”. From these definitions, we
8

can conclude that business processes start and end with customers, and the value of business
processes is dependent upon customers. Processes have: customers (internal or external), and
cross organizational boundaries, that is, they occur across or between organizational subunits
(Adebayo, 2009). One technique for identifying business processes in an organization is the
value chain method proposed by (Porter and Millar, 1985). It should be noted that BPR is
concerned with customer-orientation. Thus, the outputs of business processes should not only
achieve the company’s objectives, but also need to satisfy customers’ requirements.

2.2. Theoretical Reviews

2.2.1. Resource base view theory

The resource based view theory has widely been used in the studies of organizational
performance (Innocent, 2015). The resource based view theory talks about the organizational
unique resources and capabilities which differentiate the one organization with the other
organizations in the similar industry. The resource based view theory also tries to answer
the question that how can organizations achieve the competitive advantage over other
industry organizations and enhance their organizational performance?

The resource based view theory suggested that organizational achievements are truly based on
the internal properties of an organization. Both organizational assets (tangible and intangible)
and capabilities (internal Knowledge and competencies) are defined as the organizational
internal properties (Chuang & Lin, 2017; Tece et al., 1997). Similarly, the RBV considered
that an organization contains the different types of organizational resources such as,
assets resources, capabilities resources, process resources, management competencies,
technological resources and knowledge resources (Barney,1991). These resources and
capabilities enhanced the organizational performance and works as a basis of competitive
advantage (Barney, 1991). Hsu and Pereira (2008) stated that RBV helps the organization in
identifying its unique internal resources which not only enhance the organizational
performance, but also creates the competitive advantage for an organization. BPR is one
of the process resources considered in the RBT that is used as underpinning theory for this
research.
9

An organization’s resources are identified, classified and categorized by various researchers,


such as Fahy (2000) into: tangible, intangible and capability. The study focuses’ on
intangible resources (BPR factors), management resources and organizational capability the
organization uses these resources to realize superior organizational performance. Thus, RBV
is an appropriate theoretical framework.

2.2.2. Factors related to BPR success

According to Porter (1990), the performance of higher education is very critical to the
competitiveness of nations. Therefore, assessing BPR implementation and identifying the
success factors at universities is highly significant Critical success factors (CSF) of BPR
described by authors vary from each other. These factors play an important role in successful
achievement of organizational goals and fulfillment of expectations from BPR. BPR does not
guarantee profits unless the CSF is properly worked out. The BPR success factors have been
grouped as: (1) teamwork and quality culture, (2) quality management system and satisfactory
rewards, (3) effective change management, (4) less bureaucracy and more participation, (5) IT,
(6) effective project management, and (7) adequate financial resources (Ahmad, Francis and
Zairi, 2007; Al-Mashari and Zairi, 1999). The success factors identified by Yahya (2002)
include: (1) egalitarian leadership, one based on the principle that all people are equal and
deserve equal rights and opportunities, (2) collaborative working environment to build
teamwork and trust, (3) top management commitment and ability to comprehend BPR projects
and their scope, (4) change in the management system, and (5) use of Information
Technology. Abdolv and et al. (2008) assessed the readiness of two companies from Iran
towards the BPR and to understand the degree of success and failure factors effect on the
readiness. The first five categories, egalitarian leadership, collaborative working environment,
top management commitment, supportive management, and use of information technology are
positive indicators. The sixth category, resistance to change has a negative role (Habib, 2013).

2.2.2.1. Factors Related to Management Change System

Carr (1993) states that, “change management, which involves all human and social-related
changes and cultural adjustment techniques is required by management to facilitate the
10

insertion of newly designed processes and structures into working practice and to deal
effectively with resistance”.

Organizational change management begins with reviewing current performance measuring it


against the standard set by the organization’s management. It is not possible to improve what
is not measured. This measurement gauges the current level of performance against the desired
future performance against the desired future performance level (Zairi and Sinclair, 1995). The
ability of management to be adaptable and to be able to manage change is considered by many
researchers to be a crucial component of any BPR effort and managing the change process is
an integral element of successful BPR implementation (Graham, 2010).

Employees must be taught what the reengineering process actually is how it differs from
known work patterns and what role they will play in it (Goll and Cordovano, 1993). The
culture of experimentation is an essential part of a successfully re-engineered organization
and, therefore, people involved or affected by BPR must be prepared to endure errors and
mistakes while re-engineering is taking place. Managers are also encouraged to reconsider
mechanisms for reward and recognition to keep the reengineered organization moving
forward, to instill in people the willingness to share information, and to use hands-on
experience in redesigning new processes (Goll and Cordovano, 1993). Communication is
needed throughout the change process at all levels and for all audiences (Davenport, 1993).

Zairi and Sinclair (1995) place emphasis on the revision of reward systems, creating a culture
for change and stimulating receptivity of the organization to change. Commitment and
leadership in the upper echelons of management are often cited as the most important factors
of a successful BPR program (Janson, 1992; Kennedy, 1994). Revision of reward systems,
communication, empowerment, people involvement, training and education, creating a culture
for change, and stimulating receptivity of the organization to change are the most important
factors related to change management and culture. Staff motivation through reward program
has a crucial role in facilitating re-engineering efforts and smoothing the insertion of new
processes in the workplace (Towers, 1994).
11

2.2.2.2. BPR Management Commitment and Leadership

A BPR leader is a senior executive who authorizes and motivates the overall reengineering
efforts. The leader is the primary or key ingredient for reengineering to happen. This is so
because reengineering succeeds when driven from the top most level of an organization
(Hammer and Stanton, 1995). In the view of McAdam and O’Hare (1998), process analysis
revealed that top management, employees’ commitment, effective communication, teamwork
and their empowerment are the important critical success factors in public sector. This vision
must be clearly communicated to a wide range of employees who then become involved and
motivated rather than directly guided (Carr and Johansson, 1995). Zairi and Sinclair (1995)
commented that “successful BPR implementation is highly dependent on an effective BPR
management program which should include adequate strategic alignment and effective
planning and project management techniques”. These techniques should identify a
methodology for external orientation and learning, making effective use of consultants in
building a process vision, which integrates BPR with other improvement techniques, and
ensures adequate identification of the BPR value.

As stated by McAdam and O’Hare (1998), successful implementation of BPR in public sector
can happen with top management’s commitment and support, education of workforce
regarding BPR, their commitment and with teamwork spirit. Communication and commitment
building are particularly important aspects of BPR, and the ease with which management can
communicate through all levels of the organization during a BPR effort will have a significant
bearing on the success of the program. It involves communicating and translating the ideas
and vision of management, which must then be translated into the attitudes and behaviors of
those impacted by the program. It is necessary to ensure, that the communication effort starts
well in advance of the commencement of the BPR program (Carr and Johansson, 1995).

2.2.2.3 Factors related to IT Infrastructure

According to Branchiat et.al, (1996), factors related to IT infrastructure have been


increasingly considered by many researchers and practitioners as a vital component of
successful BPR efforts. IT function competency and effective use of software tools have been
proposed as the most important factors that contribute to the success of BPR. Mcdonald
12

(1995) advised to adopt the stance that “IT can best enhance an organization’s position by
supporting a business-thrust strategy which should be clear and detailed. The degree of
alignment between the BPR strategy and the IT infrastructure strategy is indicated by
including the identification of information resource needs in the BPR strategy.

2.3. The Evolution of BPR

In today’s ever-changing world, the only thing that doesn’t change is ‘change’ itself. In a
world increasingly driven by the three Cs (Customer, Competition and Change), companies
are on the lookout for new solutions for their business problems (Hammer and Champy,
1993). Faced with intensified competition, ever changing customer requirements and increased
new environmental regulations, business organizations need to make drastic changes for future
success and economic survival by looking for new management approaches and techniques.
Since the 1990’s and the late 1980’s, particularly the service industries have experienced
unprecedented substantial changes. Consequently, organizations are forced to develop new
customer-oriented processes and to redesign existing ones (Heckel and Moormann, 2007).
Many studies have been done and showed that the business world has become aware of the
potential of re-engineering in planning and designing processes and organizations based on the
principles of business process re-engineering (Kuwaiti and Kay, 2000).

It has been commonly agreed that BPR first became known in the late 1980’s and developed
into one of the important management concepts discussed by organizations and by the mid-
1990s attracted strategic management or senior managers of giant organizations, particularly
in the US (Rigby, 2001). The concept of BPR has attracted academic and industrial attention
in the 1990’s mainly as a result of two papers by Michael Hammer (an engineering, see
Hammer, 1990) and Thomas Davenport (on business process redesign, see Davenport and
Short, 1990). In 1993, they further published two key books (Hammer and Champy, 1993 and
Davenport, 1993) which brought widespread attention to the emerging field of BPR.

It is possible to identify several approaches to BPR, which approximate “generations” and


which serve to illustrate the changing views over time. The first approach viewed BPR as
“radical restructuring”, as shown in the following definitions: the fundamental rethinking and
radical redesign of business processes to achieve dramatic improvements in critical,
13

contemporary measures of performance, such as cost, quality, and service and speed (Hammer
and Champy, 1993). In this view, engineering, first determines what a company must do, then
how to do it. It ignores what is and concentrates on what should be done; the actual business
strategy or vision of a company may also be subject to scrutiny, and possibly change.
However, the emphasis is on radical process redesign, which challenges the bureaucratic
assumptions behind the processes and events, new ways of working that are completely
different from those of previous eras. Such radical re-engineering should be undertaken when
a “quantum leap” in business process improvement is required, and a breakthrough in
performance cannot be achieved by simply redesigning existing processes. A “clean sheet”
approach to BPR is being advocated here, in which existing business processes and structures
are set aside or purposely disregarded.

The other different view of BPR, also known as the second generation of BPR, emphasized a
less radical view “conservative “in which case, similar to Total Quality Management (TQM)
and process improvements, BPR targeted improvement is significant. As we know, in these
approaches (both process improvement and TQM) the aim is to streamline the process in the
organization’s value chain in order to add value incrementally. In BPR, the goal is to replace
the whole process with one that is “much more effective for both the customer and the
organization itself”. This is intended to shorten lead times and reduce bureaucracy. This will
result in lower costs, better service levels and consequently the opportunity to improve
competitiveness and increase market share. These effects could be achieved through TQM or
process improvement as well as BPR, but with BPR the targeted improvement will be
significant. This approach to BPR is essentially similar also to certain aspects of the “systems
approach” as the interdependence of tasks, roles, people, departments and functions is
highlighted and cross-functional thinking is encouraged. The change integrates with IT
infrastructures concentrate on powerful, standardized, and sharable web related business needs
software and hardware with a reliable, high level network topology architecture, Digital
artificial intelligence technology and online security technology than it was the case in the first
generation. The contemporary definition of BPR, therefore, encompasses a continuum of
approaches to process transformation that may include both radical and incremental
improvements, depending on the nature of the problem.
14

2.4. Measuring Organizational Performance and BPR

Efficiency and effectiveness are critical factors that determine the level of performance in any
organization (Khuhil 2013). Performance, in both profit and non-profit making organizations,
can be defined as an appropriate combination of efficiency and effectiveness. However, there
seems to be some inconsistency in the use of these terms in the existing literature on the
subject matter. For the managers, these terms might be synonymous but each of these has its
own distinct meaning. Drucker (1977) distinguished efficiency and effectiveness by
associating efficiency with “doing things right” and effectiveness with “doing the right
things.” In terminology this author, a measure of efficiency assesses the ability of an
organization to attain the output(s) with the minimum level of inputs. It is not a measure of a
success in the market place but a measure of operational excellence in the resource utilization
process. More precisely, efficiency is primarily concerned with minimizing the costs and deals
with the allocation of resources across alternative uses (Achabal et al., 1984). While
commenting on effectiveness, Keh et al. (2006) observed that a measure of effectiveness
assesses the ability of an organization to attain its pre-determined goals and objectives.
Simply, an organization is effective to the degree to which it achieves its goals (Asmild et al.,
2007). In sum, effectiveness is the extent to which the objectives of an organization are
achieved.

Good performance measures generally include a mix of outcome, output, and efficiency
measures. Outcome measures assess whether the process has actually achieved the intended
results. Output measures examine the products and/or services produced by the process, such
as the number of claims processed. Efficiency measures evaluate such things as the cost of the
process and the time it takes to deliver the output of the process (a product or service) to the
customer (GAO, 1997). Business process efficiency is an important determinant to measure
how well a process performs, that is, it represents the performance of a business process
(Zaheer et al., 2008). Process efficiency can be improved by minimizing cost, reducing
variability and improving cycle time. The cost indicator involves minimizing resources in
terms of money, time, material and human resources (Tenner and Detoro, 2000).
15

Previous studies have extensively used organizational performance as a dependent variable


(Jaworski and Kohli, 1993). Performance measurement is an essential part of organizational
strategy in a highly competitive environment (Houldsworth and Machin, 2008).

Organizational performance can be measured using two approaches, judgmental and objective.
The judgmental approach to organizational performance measures the overall performance of
organizations as assessed by organizational members and customers. The objective approach
uses financial performance parameters, such as return on assets, market share and profitability
(Jaworski and Kohli, 1993). Bureaucracy and extensive layers, within management
hierarchies, hinder business processes that impede innovation, quality and service (Zaheer
Rehman et al., 2008). Cycle time is the time required to complete a customer-related activity
or business process. Processing time comprises activities that add value to a process by
converting input to output and helps meeting the customers’ expectations.

In the current understandings of performance, companies strive to redesign business processes


to achieve simultaneous significant improvements in quality, cycle time, cost, service and
productivity (Harrison and Pratt, 1993). Improving and shortening cycle time invariably
depends on quality improvement by “doing it right the first time” (Harrison and Pratt, 1993).
Stalk and Hout (1990) address cycle time as an important measure of strategic performance.
Time-based companies determine what the customer wants and then shape business operations
and policies to provide the desired deliverables in the minimum possible time. Traditional
companies invest to reduce cost, but time-based companies invest to reduce time. In this study
the judgmental approach to measure the university performance is adopted. Accordingly the
customer asked on to make their own judgment on the Haramaya University performance.

2.5. Empirical Literature

This part of the thesis presents empirical literature on Effect of BPR on the organizational
performance. However, the literature on BPR and Higher institution are very scanty in
Ethiopia, in general, and in the study university in particular. The available materials are
reviewed and presented as follows.
16

Aruna, (2015) management level, institute level, department level with evaluated framework
of existing activities a team of experts need to form with required resources. Mary (2017)
found that to increase BPR success rates, organizational leaders must understand what specific
factors contribute to successful BPR implementations. Grounded in Lewin’s field theory, the
purpose of this no experimental, cross-sectional study was to examine the impact of gender and
education on BPR. The MANOVA results indicated no significant gender, education, or
gender and education interaction effect on a linear combination of perception of BPR success
factors.

Asrat and Dejen (2017).Lack of participator, inadequate attention by management, lack of


transparency, centralized resources, and discriminatory organization culture affect BPR
implementation. Michael, (2014) found that lack of commitment, accountability problems, and
disagreements are the main challenges to the successful implementation of BPR. Hope et al.
(2015) they used Principal Component Analysis and Multiple Regression Analysis and the
result of the analysis revealed that there was a significant relationship between BPR factors
(change management, process redesign, management commitment, and IT infrastructure) and
overall organizational performance of the selected Courier Service Organizations.

David et al., (2017) examines the demands of 21st century universities and why Business
Process Reengineering (BPR) won’t get us there. By presenting an ethnographic case study of
one PRU’s tragic journey with business process reengineering and reflecting on the
unintended but predictable consequences, a socioeconomic approach that is decidedly against
reengineering is proposed to be the path forward. A socioeconomic approach builds human
potential and launches revenue development projects self-financed by diagnosing and
redressing hidden costs.
17

2.6. Conceptual Framework

Process Resources Management Resources -


Leadership of the top
BPR Factors Management

- Change Management -Effective communication

- Management Commitment

-IT Infrastructure

Organizational
Performance

Capability Resources

- Knowledge and Skills


of Employee in the
Organization

- Education

Sources: Own Construction Based on Theoretical Framework of the Study

Fig 1: Conceptual Framework


18

3. RESEARCH METHODOLOGY

In this part, description of the study design, sampling design, sources and type of data, method
of data collection and analysis and description of the variables and hypotheses are presented.
The relationship between the organizational performance and BPR are modeled in using the
multiple regression equation.

3.1. Study Design

The study was conducted in Haramaya University during 2018-2019 G.C. In this study, the
descriptive survey design was used. Since the study involved different groups of people from
different units of the university, it is appropriate to use this method to obtain information about
organizational performance improvements due to BPR implementation. And also it is used to
obtain information concerning the current status of the phenomena to describe “what exists”
with respect to variables or conditions in a situation.

3.2. Target Population

In this research, the target population was HU employees who have six years of working
experience and with education level of diploma and above. Based on this 1499 employee
fulfill this criteria and constitute a target population for this study. The target population
includes both administrative and academic staff of Haramay University. The data were
collected from the representative sample selected from this target population

3.3. Sampling Technique and Size Determination

Samples are the selected respondents to represent the entire population. The need for sample is
to save the cost, time and energy of researcher and to get accurate information for the study.
This study was employed the sample size formula which was driven by Yamane (1967) to
determine the required sample size at 95% confidence interval (CI) and 5% significant level
(SL).

n=
19

n =316

Where, n = sample size

N = Target population of HU academic and administrative staff which 1,499 involving 1,031
employees are academic staff and 468 employees are administrative staff).

e = estimated error

By using Yamane’s (1967) sample size formula the sample respondents provided for this
study is 316 employees.

The study employed multi-stage sampling to select the actual respondents. First the University
of Haramaya is purposively selected. Second stage stratified sampling was employed
accordingly the target population was divided into two strata (academic staff and
administrative staff). The distributed of the sample is proportional to size along the two strata.
For this purpose Walpole (1982) formula was used to allocate the sample between the strata:

=( )n

Where: = № of staff in each stratum size required

= Total № of academic/administrative staff in each stratum

N = Total study population

n = Total sample size uses for the study.

Sample respondents of the administrative staff were considered as:

=( ) 316=99

And respondents of academic staff were considered as:

=( ) 316=217
20

Therefore, the total sample of 316 respondents will be proportioned to 217 academic staff and
99 administrative staff of HU for selection. Finally, the respondents were selected from the
two groups using simple random sampling techniques.

3.4. Methods and Source the of Data Collection

This study was a descriptive study; it assessed the status of BPR implementation in detail and
describes various factors that would have significant impact on BPR implementations. In order
to achieve the stated objectives, primary data collection was carried out by using mixed
method that includes both qualitative and quantitative designs by application of triangulation
approach. Quantitative data were collected from academic and administrative staff members
using self-administered questionnaires with questions rated from 1 to 5 Likert Scale. These
Likert Scales are commonly used in attitudinal measurements. This type of scale uses a five-
point scale ranging from strongly disagree, disagree, neither agree nor disagree, agree,
strongly agree to rate people’s attitudes. And the qualitative data were collected through
interviews from administrative team leaders, BPR managers (form transformation directors),
and president and vice president. This instrument was chosen because of its ability to collect
the primary data accurately.

3.5. Measure of Consistency and Dimensionality


To evaluate the consistency of the variables used the study employed Cronbach’s alpha test. It
is a measure of internal consistency, that is, how closely related a set of items are as a group.
Cronbach’s alpha tests see the multiple-question Likert scale surveys like in this study are
reliable. Cronbach’s alpha will tell you if the item you have designed is accurately measuring
the variable of interest.

The resulting α coefficient of reliability ranges from 0 to 1 in providing this overall assessment
of a measure’s reliability. If all of the scale items are entirely independent from one another
(i.e., are not correlated or share no covariance), then α = 0; and, if all of the items have high
covariance, then α will approach 1 as the number of items in the scale approaches infinity. In
other words, the higher the coefficient the more the items have shared covariance and
probably measures the same underlying concept.
21

Many methodologists recommend a minimum α coefficient between 0.65 and 0.8 (or higher in
many cases); α coefficient that are less than 0.5 are usually unacceptable, especially for scales
purporting to be one-dimensional (Bruin, 2006).

In addition to computing the alpha coefficient of reliability, the study also wants to investigate
the dimensionality of the scale by applying the factor analysis.

Factor Analysis (FA) is a technique applied to a set of observed variables that seeks to find
underlying factors (subsets of variables) from which the observed variables were generated.
The underlying, influential variables are the factors. Factor analysis is carried out on the
correlation matrix of the observed variables. A factor is a weighted average of the original
variables. The factor analyst hopes to find a few factors from which the original correlation
matrix may be generated. Usually the goal of factor analysis is to aid data interpretation. The
factor analyst hopes to identify each factor as representing a specific theoretical factor.
Therefore, many of the reports from factor analysis are designed to aid in the interpretation of
the factors. Another goal of factor analysis is to reduce the number of variables. One of the
most subtle tasks in factor analysis is determining the appropriate number of factors. Factor
analysis attempts to bring inter-correlated variables together under more general, underlying
variables. More specifically, the goal of factor analysis is to reduce “the dimensionality of the
original space and to give an interpretation to the new space, spanned by a reduced number of
new dimensions which are supposed to underlie the old ones” (Rietveld & Van Hout, 1993).
Thus, factor analysis offers not only the possibility of gaining a clear view of the data, but also
the possibility of using the output in subsequent analyses.

The starting point of factor analysis is a correlation matrix, in which the inter-correlations
between the studied variables are presented. The dimensionality of this matrix can be reduced
by “looking for variables that correlate highly with a group of other variables, but correlate
very badly with variables outside of that group” (Field, 2000). These variables with high inter-
correlations could well measure one underlying variable, which is called a ‘factor’. This
projection of the scores of the original variables on the factor leads to two results: factor scores
and factor loadings. The factor scores can then for example be used as new scores in multiple
regression analysis, while the factor loadings are especially useful in determining the
“substantive importance of a particular variable to a factor” (Field, 2000).
22

3.6. Methods of Data Analysis

The collected data were analyzed using descriptive statistics (measures of central tendency and
measures of variability). Once the data were collected, the questionnaires were edited for
accuracy, consistency and completeness. The responses were coded into numerical form to
facilitate statistical analysis. Data was analyzed in using statistical package for social sciences
(SPSS Version 22) based on the questionnaires. Among the descriptive stat measure of central
tendency, measure of dispersion and frequency distribution were used. In particular mean
scores, standard deviations, percentages and frequency distribution were used to summarize
the responses. Results were presented in tables and figures format. Qualitative data was
analyzed using thematic analysis method.

In addition advanced statistical method specifically regression was used in assessing which
factors significantly affecting the organizational performance. For this purpose multiple
regressions found to be appropriate. The specification of the regression model is given below.

OPi  0  1CM   2TMC  3 IT   4 EC  5 Educ   i

Where

OP is refer to Organizational Performance

CM Change Management

TMC Top Management Commitment

IT Information technology

EC Effective Communication

Edu Education Level

The dependent variable in the specified regression model is organizational performance which
is constructed as index from Likert scale from multiple questions on organization
performance. Actually literature showed that when the dependent variable in a regression
23

model is a index between 0 to 1, it can be tricky to decide on the appropriate way to model it.
In many cases, the dependent variable of interest when it is a proportion, i.e. its values range
between 0 and 1. Wooldridge (1996, 2011) discuss a few different ways for analyzing such
dependent variables: fractional response models (both heteroskedastic and
nonheteroskedastic), zero one-inflated beta models, and fractional ivprobit models. Others
suggest multiple regressions under certain conditions.

In general first the question is it the index is continuous or discrete? The discrete or continuous
nature of your index is the relevant question to adopt discrete models like probit/Logit or
continuous models like multiple regressions. In the case of this study the organizational
performance index is continuous value and the study opt for multiple regression approach to
analyze it. The independent variables in the model include different factors that affect
organizational performance including the BPR variables. The regression parameters were
estimated using OLS estimation method.

3.7 Reliability Test

This section presents the test for the reliability measured by Cronbach alpha for the items used
in this study. The study conducted pilot test on 100 samples. And test the reliability of the
instrument used. The variables has been tested for reliability by using Cronbach’s Coefficient
Alpha which results that all group of variables obtained value for Cronbach’s Coefficient
Alpha which ranges from 0.63 to 0.782 this is the indication of acceptability of the
questions asked for each group and it can be used for further analysis.

3.8. Variable Definitions

The dependent variable and independent variables included in the multiple regression model
are presented as follows.

Dependent Variable
24

Organizational Performance: The dependent variable in the specified regression model is


organizational performance which is constructed as index from Likert scale from multiple
questions on organization performance. It is a continuous variable take a value between 0 and
1. The index is derived from the employee judgment on their organization performance they
work in. It is the subjective response on a multiple questions. The overall performance
measure an aggregate measure of the performance of the university derived from services
improved dimension and quality input dimensions. It is constructed as an average score from
the two diminutions.

Independent Variables

The independent variables in the model include different factors that affect organizational
performance including the BPR variables. The variables have an effect on the organizational
performance, their hypothesis and expected signs are portrayed hereunder:

Change management, Management commitment, IT and effective communication these


variables are considered as BPR factors except effective communication that serve as a proxy
for the top management leadership. All are constructed from a serious of question asked of the
respondents. The value for this variable measured as a continuous variable, the value range
between 0 to 1. All these variables have expected to have positive significant effect on the
university performance.

Education level of the employee: - in the resources base theory education is one of the
capacity resources which are internal to the organization. The notion of capacity implies a
benefit of education includes enhancing the organizational productivity and performance.
There are different ways of measuring educational levels presented in empirical works. Here,
it is measured using level of degree an individual employee hold. It is only considered for
employee who has a minimum of 6 years and above. It was a categorical variable containing
four categories as diploma, degree, master and PhD holders. When used in the regression
analysis one is used as reference category. The variable it is hypothesized as positive and
significant effect on the university performance.

4. RESULT AND DISCUSSION


25

A total of 316 questionnaires was distributed all of which were filled and returned to the
researcher. It means that 100 % response rate. Beside the survey data, interviews were
conducted face to face and transcribed for the purpose of analysis. The interview continued
until saturation points. The quantitative data gathered through questionnaire were analyzed by
employing the computer software known as Statistical Package for Social Science (SPSS
version 22). The results were described by using descriptive statistical methods such as
frequency, percentage, arithmetic mean standard deviation. The regression model result also
presented here under. The data obtained through interview were also analyzed qualitatively.
The result was presented in a mixed manner in the following section.

4.1. General Information about the Respondents

Employees were asked about their sex, work experience, age and education level. This
information was required to ensure that the sample that participated in the study have a
similar distribution of the respondents of characteristics to that of the population it was drawn
from. This determines the accuracy and representativeness of information drawn from the
sample to the population.

Table 1 showed that 99.4% of the respondents have work experience of above 6 years. Hence,
qualification and work experience have a positive impact on the quality of the response and
understanding of the subject. This implies the majority of respondents responded in this study
was experienced workers, that means to understand the changes (performance improvement)
after and before BPR implementation. This information to help the researcher’s to get accurate
information about current status of BPR results. Tables 1 also showed that majority (i.e.
86.3%) of the respondents are within the age range between 18-45 which is a productive age.
Using this potential working force, one can change the organization forward. Respondent’s
profile with respect to their current educational level, and their position at the university were
analyzed and the result is presented in Table 1. Of the respondents, about 16.8 percent were
Diploma holders, 26.9 percent were first degree holders, 50.9 percent were MA/MSc holders,
and the remaining are PhD holders or above. The majority of respondents were MSc holders
which are the most important for the study as it enabled the respondents to indicate a clearly
the perceived influence of business process reengineering on organizational performance.
26

Regarding their sex, majority (87%) of the respondents were males, while the remaining
(13%) were females. From this, we conclude that our respondents’ population is male
dominated. The detailed results are presented in Table 1.

Table 1: General Information about the Respondents

Item Frequency Percent %

Sex

Male 275 87

Female 41 13
Total 316 100%
Educational level
Diploma 53 16.8
Undergraduate 85 26.9
MA/MSc 161 50.9
PhD or above 17 5.4
Total 316 100%
Working Experience
6-10years 145 45.9
11-20 years 131 41.6
>21 years 39 12.5
Total 316 100%
Age
18-35 130 41.2
36-45 143 45.3
46-55 41 12.9
>55 2 0.6
Total 316 100%
Source: Own Computation from Survey Data, 2019

Table 2: Respondents’ Positions at the University


Position Frequency Percent (%)
27

Academic staff 217 68.7


Administrative staff 99 31.3
Total 316 100.0
Source: Own Computation from Survey Data, 2019

Table 2 showed that data were collected from administrative and academic staff; members
out of which 67.9% were academic staff while 30.9% of them were administrative staff.

4.2. Effects of BPR Implementation on Organizational Performance

4.2.1. The Extent to Which BPR Goals and Objectives are Accomplished

The respondents were asked to state their extent of agreement with different statements
relating to the extent to which goals and objectives of BPR were accomplished. Each of the
questions is framed in a 5-point Likert Scale ranging from not at all to highest extent. The data
are then coded with a weight of 1 for not at all, 2 for smaller extent, 3 for moderate extent, 4
for higher extent and 5 for highest extent. The percentages and means of all responses for each
question were shown in Table 3.

Table 3: Goals and objectives achievements


BPR goal /objective Mean Std.dev.
Do performance measures show that BPR implementation is on
2.75 1.07
track for achieving its expected return

Emphasized the value-added element at every activity 2.54 1.06

Executives, managers and staff actually use the measurement


2.70 1.23
data to assess new process performance
Formulate practical targets (business process goals) and focus
2.77 1.16
on achieving end result and objective

Performance measures linked to the office's strategic goals 2.89 1.27

Used time as a competitive weapon (decreased cycle time of


service
2.83 1.14
delivery)
28

The organization increases its own competitiveness by


2.69 1.26
reducing costs and quality improved
Increasing employees satisfaction expected as a result of
2.80 1.21
implementing the BPR
Source: Own Survey Data 2019

For all BPR goals/objectives except increasing competitiveness by reducing costs and quality
improvement, and increasing employee satisfaction expected as a result of BPR implementing
show that responses are closer to a moderate extent ranging from mean values of 2.54 to 2.89,
respectively. The obtained measurements through above mentioned results are not adequate to
bring a desired change since they are less than moderate (3).

One of the key informants reported: “As far as my view is concerned, BPR could not
contribute big towards boosting organizational performance. There were even cases where it’s
wrong implementation created unnecessary disruption and disconnection within the university.
There was cases particularly where it implementation misplaced workers. Of course, in the
university’s finance and procurement area where the workflows and processes as well as
controlling mechanisms are systematically interlinked and the functional tasks are broken
down into distinct processes, one can say that BPR brought about clear improvements. Even
then, the implemented BPR could not as such transform the efficiency of organizational
processes in terms of quality, cost, services and speed”.

Another key informant said: “Not at all, because the real hard skill performance and soft skill
of the workers were not weighed properly. Some workers were wrongly placed to lead units
out of their areas of expertise. BPR did not succeeded to improve efficiency as to be not
internal initiative of the university management at all levels rather it was pushed down from
top as government policy direction.

One of the respondents also said: “For me, BPR did not improve the performance of the
organization as it remained at the beginning phase. However, it created a lot of employment
opportunities which enabled the administrative staff of the university and its environs to get
better work positions and benefits. However, its implementation did not bring performance
improvements as expected”.
29

Some of the respondents said: “we do not see any quantifiable improvement as BPR did not go
beyond the first phase. Staff were assigned based on their qualifications and experiences, but
did not bring any improvement on the effectiveness and efficiency of the institution”.

The majority of participants said: “there is good improvement seen particularly in terms of
resource utilization and management”.

4.2.2. Organizational Performance Measure

Universities have two main function, academic function and management function. The
overall performance ought to be a combined set of performance dimensions derived from the
functions. The following table summarizes result from performance measurement items used
in this study.

Table 4: Responses on organizational performance measure items/indicators


Question items Mean SD
Quality of teaching, learning ensured 2.69 1.04
Assess educational needs of society regularly 2.85 1.28

Satisfy educational needs of society 2.81 1.24

Ensure international recognition of academic programs 2.65 1.18


Provide seamless services to students 3.11 1.21
Provide state-of-the -art infrastructure 2.78 1.13
Establish teaching, learning quality assurance system 2.88 1.22
Recruit competent students 2.86 1.24
Recruit qualified academic staff 2.80 1.22
Recruit qualified support staff 2.78 1.22
2.81 1.23
Continuous assessment being practiced
2.88 1.19
Summative exams given based on student convenience
3.01 1.25
Student centered teaching, learning processes are installed
All academic recruitment are made based on open competitions 2.91 1.19

Academic staff members devote 25% their time on academics 3.16 1.22
Researches and Community services
3.19 1.17
Proper documentation of academic related documents
2.85 1.24
There is continuous staff training and upgrading
30

3.45 1.22
There is a stable course schedule
2.52 1.02
Demand driven programs are being designed and developed
Efforts are made to assess training needs 3.38 1.38

3.75 1.07
Remedial actions are given regularly
3.97 0.88
Continuous career guidance and support provided to students
3.92 1.03
Up-to-date learning materials are available
3.41 1.20
There is online registration to students
3.29 1.23
Online grade submission system
Source: Own Survey Data 2019

Respondents were asked to rate the extent to the core academic performance of the university
achieved. The respondent is only from academic staffs who bitterly respond on the issue
raised. Table 4 showed that for all items used to assess the achievement of the performance
their value moderate. On average, the variables have less impressive impacts on the
performance of core academic activities of the university, which implies lesser achievement in
this regard. The mean values for the variables are close to one another ranging from 2.52 to
3.97, more or less approximated to a moderate extent.

According to one motivated and concerned informant, “As a result of BPR implementation,
the university was able to realize improved services and workflows in its finance and
procurement areas. The business flow from university management down to case handlers is
also okay. But this is not the case in areas where business processes are run through functional
structures that promote top-down structural relationships between the management and
workers of the university. There are also cases where BPR relatively improved resource
utilization and customer servicing. The university’s fleet management and recreational areas
have somewhat benefited from BPR implementation, though there is now a general tendency
to relapse to traditional practices”.

Similarly, another informant briefly said, “It is a pity to associate improvement made in
performance of core academic activities to BRP implementation”.
31

In contrast to the above respondents’ ideas, one of the respondents said, “the impact of BPR
variables is very little. Activities are still centralized and employees can make limited
decisions. There is little empowerment of employees based on BPR principles”.

Others respondents said, “All concerned bodies enthusiastically and eagerly attempted to
achieve the tasks at the time of implementation accordingly but through time they lag behind
unless and otherwise some encouragements, incentives and recognitions forwarded for their
good achievement”.

The current status of operational change in core academic processes was also examined.
Respondents were asked to rate the proposition against what they have observed a change. In
this regard, only three propositions (the practice of continuous assessment, practice of
summative exams, online grade submission, sufficient ICT support for teaching learning
process) were rated slightly above moderate. On the other hand, online registration and
devotion of academic staff scored far below moderate level.

This indicates the academic core issue was not dramatic, improvement after BPR
implementation. This core process is the output of BPR then the inadequate improving current
work processes and lack of assessing which processes were greatest need of improvement in
terms of cost, quality, and timeliness that affect the outcome of BPR on performance
improvement.

4.3. Evaluation of BPR Success Factors in Haramaya University

The respondents were asked to state their extent of agreement with twenty different statements
related to important factors that determine the success of BPR implementations. Each of the
questions was rated on a 5–point Likert Scale ranging from strongly disagree (1) to strongly
agree (5). The frequency and mean values of all responses for each question are shown in
Tables 5.
32

Table 5: Response on Implementation of BPR Success Factors in the Haramaya


University
Factors Mean Std. Deviation
Factors related to change management system
Re-educate and retrain workers on what BPR actually means 3.05 1.26
Training of employees in the new process and system to be used 3.64 1.18
Regular communication of BPR progress to all staff 3.30 1.41
The reward system adjusts to serve the employees after the change 3.32 1.37
Performance measurement adequately corresponding to the change 3.60 1.23
Employees are empowered to make decisions 3.65 1.12
Overall 3.43 1.26
Factors related to Leadership and Effective Communication
Use a well-trained, diversified, expert team 3.92 .94
Use a re-engineering team well-informed in BPR method 3.92 1.04
A BPR team shares a clear vision and understanding of BPR
3.68 1.09
success
Co-workers feel as if they are working in a cooperative
3.47 1.19
environment
Open communication between supervisors and their subordinates
3.21 1.46
on BPR progress
Managers place confidence between supervisors and their
3.73 1.16
subordinates by setting realistic expectations from BPR success
Managers constructively use their subordinates' idea 3.51 .94
Overall 3.63
Factors related to top management commitment
Top management frequently communicates with project team and
3.08 1.36
users about the core business process (key issue)
Top management sets strategic plans in pursuit of service quality
3.65 1.05
and customer satisfaction through various BPR projects
Top management considers BPR as a way to improve service and
4.16 .85
product
Top management is committed and ensure that everyone in that
organization share the achieving dramatic improvement through 4.05 .88
fundamental rethinking and radical re-design of business process
Efforts are made to raise staff commitment to implement BPR
2.82 1.200
recommendations
Overall 3.55
Factors related to IT
Information technology is integrated in to the business plan of the
3.82 1.02
organization
Efficient communication channel in transferring information 3.48 1.12
33

The organization is exclusively using the information system 3.66 1.02


Applied the right innovative technology 3.56 1.00
The process improvements are based on the capabilities of
2.94 1.28
information technology
There is sufficient ICT supports for teaching learning
3.13 1.085
Process
Overall 3.43
Source: Own Survey Data 2019

As shown in Table 5, the success factors have been classified into four major success
categories namely, change management system and culture, organizational structure, top
management/ leadership commitment and IT. The overall mean value of all factors related to
BPR implementation is 3.5 implying that the BPR implementation was somewhat moderate,
slightly above neutral. Among the four factors, Leadership and Collaborative working
environments the most important factor that determined BPR implementation with a mean
score of 3.63 followed by top management commitment with respective mean values of 3.55.
Change management system and IT with a mean values of 3.43 are found to be the least
important factor.

Critical success factors play an important role in successful achievement of organizational


goals and fulfillment of expectations from BPR (Habib, 2013). BPR does not guarantee profits
unless the CSF is properly worked out. Therefore, the findings of this study support the ideas
of the author mentioned above. If properly utilized, the above mentioned factors with no doubt
will ensure the accomplishment of BPR objective and goal at a desired level. One of the
actively participated informants said, “Yes, the university tried to offer certain trainings for
some key workers from all areas, but most of the work entered the implementation phase
without proper training and acclimatization with BPR principles and practices”

Another informant said, “Yes, training was given at the start of BPR about BPR, its
advantages, and implementation processes. However, to my knowledge, the training was not
continuous and it was not even provided after the existing staffs were reshuffled as per their
educational qualification”.
34

Other respondents also said, “We did not see well planned and organized trainings and
capacity buildings delivered to the staff or customers of the university pertaining to BPR.
Even in case training has been given, the outcome and effectiveness has not been assessed”.

Looking at the factors under change management and culture category, re-educating and
retraining workers on what BPR actually is, regular communication of BPR progress to all
staff is more important success factors than training of employees in the new process and
system to be used. Among organizational structure related factors, the use a well-trained,
diversified, expert team and use a re-engineering team well-informed in BPR method is more
important success factors than co-workers that can create cooperative environment, and a BPR
team shares a clear vision and understanding of BPR success.

One of the key informant participants explained the issue in-depth as follows. "There was no
specific mechanism for selecting and organizing BPR team members. It was simply based on
voluntarism. No one considered the work experience and expertise of the members. I
remember where a person from the natural sciences area was involved to design the BPR for
finance and procurement. It is difficult to imagine this what a natural scientist can do in doing
fundamental rethinking and formulating radical redesign of finance and procurement business
processes. The workflows and processes in finance and procurement areas need specific and
complex knowledge base which a person of pure natural science cannot have. Similar
problems occurred also for designing BPR for other functions of the university. In general,
membership in the teams did not consider expertise, work experience and other peculiarities. It
was also male-dominated and as a result failed to consider the interests of females in business
re-designing”.

Another key informant also said, “There were no criteria in place. I presume the team was
handpicked based on mere experience. I don’t think that was inclusive enough”. Two of the
respondents reported similar responses as follows. “It was not inclusive and there was no
standard set”.

Others described their ideas as follows. “Some of the points that make implementation of BPR
are difficult include: (i) the norm and culture of the community or staff that resist
acknowledging or accepting changes in the institute; (ii) characteristics and nature of the
35

institute by itself can not contribute to implement the process. The environment also affected
BPR’s implementation (iii) miss- conceptualization or misunderstanding of the system or BPR
has also challenged the implementation; (iv) poor management skills in many departments
heads or directors or top management officials influenced the process largely; (v)
misperceptions of the term BPR itself. Some people still define some of the terms of BPR
which really challenge the implementation; (vii) strategy scarcity is another challenge; (vii)
the less value BPR gives to employees; (viii) lack of infrastructure mainly in line with
information technology which plays a big role in challenging BPR implementation

In the BPR managers commitment and leadership category, top management consider BPR as
a way to improve service and product, top management are committed and ensure that
everyone in that organization share the achieving dramatic improvement through fundamental
rethinking and radical re-design of business process is the most important of success factor
than managers constructively use their subordinates' idea, top management set strategic plans
in pursuit of service quality and customer satisfaction through various BPR project, managers
place confidence between supervisors and their subordinates by setting realistic expectation
from BPR success top management frequently communicate with project team and users, open
communication between supervisors and their subordinates. Finally, an efficient
communication channel in transferring information is more important than the remaining of IT
related category.

One of the key informant participants said, “the university staff did not get adequate
awareness for the purpose, meaning and institutional implication of BPR. BPR was thus seen
by most of the administrative staff of the university as a destabilizing process instead of being
seen as a process of devising new ways of organizing and processing tasks and re-invigorating
human functioning. Awareness was really lacking on the role of BPR to re-organize human,
financial and material resources to attain better flow of tasks and performance”. Another key
informant said, “Attempt was made, but not enough to create awareness to the level expected
from such huge and complex institution”. Similarly, one of the respondents said, “the level of
understating of the staff towards BPR is low”.
36

The rest other respondents reported their ideas as follows: “the level of understanding of the
staffs of our university about BPR is moderate level. It is still in infant stage. The other
possible explanation for this is staff turnover. Several well trained staff leaves our university
every year and several others; join the institution which makes a wide gap in understanding
BPR. It is difficult to see any trend that aimed at experience sharing and awareness creation
forums for those newly recruited employees or staff. Such kind of staff will take much time to
adapt the process or the system of BPR”.

4.4. Challenging Factors for BPR Implementation in Haramaya University

Table 6: BPR Implementation Challenging Factors


Factors Responses Total
Problems related to Top Management Commitment
Failure to implement BPR caused 1 2 3 4 5
by lack of commitment and Frequency 6 39 73 117 81 316
support demonstrated by the
university’s highest level Percent 1.9 12.3 23.1 37 25.6 100
management
Lack of understanding the BPR Frequency 8 73 81 82 72 316
implementation requirements Percent 2.5 23.1 25.6 25.9 22.8 100
Lack of management Frequency 1 50 61 129 75 316
determination when the problem
Percent 0.3 15.8 19.3 40.8 23.7 100
comes
Average % 1.5 17.1 22.7 34.6 24.0
Problem related to change management and culture
Managers are anxious about losing 1 2 3 4 5
their authority after the change Frequency 1 31 88 107 89 316
Percent 0.3 9.8 27.8 33.9 28.2 100
Employees resistance to change due to Frequency 0 57 105 93 61 316
job displacement Percent 0 18 33.2 29.4 19.3 100
Not enough employee training to Frequency 7 24 131 76 78 316
implement BPR Percent 2.2 7.6 41.5 24.1 24.7 100
Absence management system (e.g. Frequency 5 45 68 74 124 316
incentive, training, education, Percent 1.6 14.2 21.4 23.4 39.2 100
communication about BPR progress
Average % 1.0 12.4 31 27.7 27.8
Problem related to Organizational Structure
37

Problems related to rigid 1 2 3 4 5


hierarchical structures, job Frequency 6 50 97 68 95 316
definition, and responsibility Percent 1.9 15.8 30.7 21.5 30.1 100
allocation
Difficult to implement BPR due to Frequency 33 47 106 60 70 316
teams’ communication barriers Percent 10.4 14.9 33.5 19 22.2 100
Average % 6.2 15.4 32.1 20.3 26.2
Problem related to IT
Employees and customers know-how 1 2 3 4 5
Deficiency about the use of IT in the Frequency 49 84 73 82 28 316
Redesigned processes impede BPR
Percent 15.5 26.6 23.1 25.9 8.9 100
implementation
Problems related to training provision Frequency 15 39 49 138 75 316
About IT use in the redesigned
Percent 4.7 12.3 15.5 43.7 23.7 100
processes
Average % 10.1 19.5 19.3 34.8 16.3
Problem related to BPR Project Management
1 2 3 4 5
Inappropriate alignment of BPR
Frequency 0 25 54 93 144 316
Strategy with the corporate strategy
Percent 0 7.9 17.1 29.4 45.6 100
Spending too much time in Frequency 14 51 72 84 95 316
analyzing existing processes
Percent 4.4 16.1 22.8 26.6 30.1 100
Conflict between traditional
Frequency 52 34 42 102 86 316
performance measures and BPR
goals Percent 16.5 10.8 13.3 32.3 27.2 100
Inadequate focus on core processes Frequency 42 40 60 79 95 316
(Key issues) Percent 13.3 12.7 19 25 30.1 100
The BPR process was much larger Frequency 17 44 43 110 102 316
than anticipated Percent 5.4 13.9 13.6 34.8 32.3 100
Top management reluctant to Frequency 10 34 65 116 91 316
commit funds for BPR Percent 3.2 10.8 20.6 36.7 28.8 100
Unrealistic report to outsiders that Frequency 0 17 68 131 100 316
hide actual progress of BPR
implementation Percent 0 5.4 21.5 41.5 31.6 100
Inadequate regular and scheduled
Frequency 0 37 57 97 125 316
meeting of project management to
38

get feedback on BPR


Percent 0 11.7 18 30.7 39.6 100
implementation progresses
Not use progress evaluation to Frequency 8 33 80 104 91 316
determine what is working and not Percent 2.5 10.4 25.3 32.9 28.8 100
Average % 5.0 11.1 19.0 32.2 32.7
Source: Own Survey Data 2019

As shown from Table 6, the challenging factors have been classified into five major categories
namely, top management commitment, change management system and culture,
organizational structure, IT and BPR Project Management. The employee responses show that
top management is not consistent in controlling the BPR projects to monitor how things are
actually proceeding and to take action before any difficulty arises.

Generally speaking, top management is found to be weak from the 58.6 average percentages
of respondents who responded to agree or strongly agree to the three items of the variable
whereas 22.7 took neutral position and nearly 18.6 percent disagree or strongly disagree. The
results of our study indicate that there may still be a lack of high level management support for
BPR implementation. According to one of the key informants, BPR was then a national
agenda. It was imposed from the top. It was not initiated by the university as such. This is the
case in all change processes. All change processes are nationally proposed and imposed on
institutions. The university was thus forced to embrace the idea of doing fundamental
rethinking of its business processes and considering internal re-ordering in terms of
organizational re-structuring. Based on this, the university introduced a considerable
restructuring and functional re-grouping. But it became clear soon that it is not easy breaking
from traditional wisdom's and conventions”. Another key informant said, “The urgent need for
work efficiency and above all it was transformative government policy”

Majority informants said, “Redundancy of the problems of functional processes and the
inability of the system to respond satisfactorily to the need of customers in the government
institutions re-enforced the government to think out of the box and designing business re-
engineering processes”.
39

The existence of problems related to change management system and culture is proclaimed by
nearly 58.6 percent respondents on average value while 13.4 percent reported to disagree and
about 31 are indifferent. As a result, it can be concluded that the majority of respondents
agreed that lack of reward and motivation is the common factor faced by the organization and
the biggest barrier to change. In addition to lack of enough training and education for all staff
members were other reasons for challenges caused by change management system because not
properly managed. One of the key informant participants explained the issue in-depth as
follows:

In general, the workers had negative attitudes towards BPR. The administrative workers
considered it as a change that the government has imposed on them to increase control their
freedom and sense of selfness. They felt that the check and balance system inbuilt in BPR
would make personal accountability tenser. The academic staff resisted it with the view that
BPR is appropriate only in industrial areas where productions are mechanically controlled and
workflows can be easily automated. They had the view that in universities where workers deal
with complex human and social dynamics, it is difficult to think control academic workflows
and process as if they production processes in factories. The other source of resistance against
BPR was that the manual working conditions in the university that are performed by workers
with no educational background would not allow the effective exploitation of technologies to
optimize productivity.

One of the key informants said, “It is very negative so the reason is unclear”. One of the
respondents also said, “The existing workers have been deployed based on their qualification
and work experience. However, many of them failed to serve in their positions as expected
due to lack of willingness about BPR and the tasks assigned to them”.

The rest others explained their ideas as follows, “There is a positive attitude to BPR. BPR
improved our institution in a number of ways even though difficulties in its implementation.
The basic importance of the implementation was that it allowed a tremendous number of staffs
to allocate at their appropriate working position with reasonable wage. Many staffs of the
university were happy with its overall benefit which actually in turn enhanced the performance
of service delivery for students or stakeholders”.
40

In the case of organizational structures, 46.5% of the respondents agreed while responding to
the two items, rigidity of hierarchy and ineffectiveness of BPR team communication.
Consequently, the overall response shows that problems related to organizational structure are
significant in the organization.

One of the key informants described the implementation challenges as follows, “The main
factors that hindered proper implementation of BPR are the inability to create awareness on
the meaning of BPR and its role in optimizing productivity and minimizing wastages and
redundant efforts. The other factor was that some of the works are not suitable to redesign
following principles and values underlying BPR. The third and most serious factor was
inability to utilize technologies such as ICT to control and monitor workflows and processes”.
Another key informant said, “Resistance to change is natural and always expected, regardless
of the positive outcome or otherwise. The challenge in the context of HU includes enforcing it
without giving due attention to workers experience and mere focus given to the paper based
qualification”.

Other key informant described his ideas as follows, “For me, BPR is very challenging to
implement for a number of reasons. The first is lack of motivation. The second is poor
committed by certain management who own the BPR process from top to lower level and this
is lacking at HU. Lack of competent staff to implement BPR was also a big challenge. There is
a lack of skill and experience in effectively carry out the tasks and responsibilities assigned to
them. Lack of computerized system in service provision and teaching are some of the
challenges”.

As the above table (6) indicates that the majority of respondents (42%) disagree regarding the
problem of IT use to aid the implementation of the redesigned process. This implies that
respondents could not understand the importance of IT to improve the competitive position of
the organization, i.e., information exchange, knowledge transfer, collaboration, information
storage, preservation, dissemination and use. Regarding to training, provision of IT, 67.4% of
respondents have agreed. That means training was not given to employees related to IT
provision for improving quality of services. One of the key informants clearly explained about
deployment of workers. He said, “There are cases where workers have been deployed or
assigned as per their work experiences and based on their educational expertise. There are also
41

cases were deployments did not seriously take into consideration experiences, educational
preparations and peculiar receptivity towards skills and performance. Surprisingly, there were
conditions were workers were dislocated from work areas where they had gained rich skills
and technicalities and made to go to new places where they had to start from the scratch. This
was devastating to the workers and to the work to be performed”. Similarly, another informant
said, “BPR created confusion to some employees following displacement from former jobs.

According to another key informant, deployment for former jobs created confusion on the
workers. The respondent hotly and painfully said, “Some of the workers attended the new
educational program which is irrelevant with their long term job experience and submitted
their document. The job experience was neglected and paper based deployment processes
carried out. The right paper is in the right place, but the right person is not in the right
position”.

The majority of respondents said, “Placement of employees as part of BPR implementation


majorly affected some of the supportive services due to skilled technician’s displacement from
their previous working environment. Certainly, some centers of supportive services lacked
skilled human resources”.

Finally in the same table (6) shows inappropriate alignment of BPR strategy with the corporate
strategy. The overall percentage value (64.9%) of all items under the variable (BPR project
management) proves that the problem is significant compared to those who tend to disapprove
(16.1%). From Table 10, we can conclude that dealt with issues of timing in the sense that the
project taking too long and uncertainty about the project's time frame. It suggests that
managing the timing of the project and setting realistic expectations are critical problems for
BPR success.

The other one is managing the human and technical issues surrounding implementation of new
process and assess the results of its engineering effort; i.e. inadequate ongoing performance
measurement and feedback to continually improve the new process, poor managed
communication, the employees will not have the accurate information and know what to
expect from change with the right reasoning. This in turn results in rumors and resistance to
change and exaggerating the negative aspects of the change. A failure to re-engineer from a
42

customer’s perspective has been blamed for disappointing BPR results (Terziovski et al.
2003). The other challenge was lack of arranging and providing sufficient resources over the
life of the project to achieve goals are the major problems arise as the above table indicates.

One of the key respondent wisely said, “Among other factors, effective implementation of
BPR calls for institutional stability and institutional memory. The high rate of change and
mobility within the management system of the university has enormously affected proper
implementation of BPR. Most of the current leaders of the university are either non-existent
when BPR was designed and implemented or have little awareness of its essence. One can say
that the university’s BPR was hugely affected by cultural, organizational, human and political
factors that interacted to generate popular and administrative frustration. The management
may focus on facilitating conditions by availing enablers of BPR such as adopting effective
human resource management and utilization of information systems. One hope is that the
current management of the university is trying to finance innovative projects that can enable
BPR implementation. A good example is the effort to automate human resource management,
finance division, property management and procurement systems. The key staff members of
these divisions have already been introduced to information systems and software systems that
help transform data processes, information exchanges and decisions that are made in and
based on those processes”.

Another informant said, “HU is more or less encountered good commitment and passion. The
commitment of the lower level employees is exceptionally impressive, especially those
engaged in student service their commitment is highly outrageous which could be witnessed in
very difficult times the university passed through. The leader's commitment at different levels
is mixed, but most of the leaders are committed. These can be assessed based on their delivery
of tasks assigned to them. Naturally, they are expected to be measured on peer evaluation and
evaluation by immediate boss, but this has been unacceptably inflated. We need to change the
mentality of/attitude towards revaluation”.

Other participants also said, “In our case of leadership, it is different from person to person in
terms of BPR implementation. Some are committed and strive for the development of their
organization, whereas others are running to make benefit out of it. Leadership commitment
failure leads to severe problem in organization improvement”.
43

4.5. Factor Analysis Result

This section presents the summery result from factor analysis. Factor analysis is used as data
reduction techniques this is often used to validate a combination of questions used to measure
a particular phenomena. In the questionnaire set of variables were asked to measure each of
the following variables like organizational performance, organizational change management,
top management commitment to BPR, BPR goal and objective achieved, effective
communication, IT infrastructure and challenging factors. Totally 77 items are used to
measure these variables, the item response all measured with Likert scale 1= strongly disagree,
2= disagree, 3= neutral, 4=agree and 5=strongly disagree. For change management 6 items
used, management commitment and IT infrastructure 4 and 6 items used, respectively in
addition BPR goal Achieved, effective leadership and challenging factors 8, 7, 21 items are
used, respectively. The organizational performance is measured by 26 items. To conduct
factor analysis a minimum of 4 items must be used in each group, hence, the items used for
this study pass this criteria implying that factor analysis can be performed. More importantly
the 316 samples used in this study are more than the requirement to perform factor analysis
which is 200. The study use Kaiser-Meyer-Olkin (KMO) test for Measure of Sampling
Adequacy (MSA).

Here we wish to create a variable that summarizes the information on each employee response
from the item used. One option would be to average the question responses. But this gives
equal weight to each response. Another option would be to create a factor dependent variable.
This can be done by running Principal Component Analysis (PCA). The advantage of PCA
over an average is that it automatically weights each of the items in the calculation. The
reduction is achieved by transforming the items used to a new set of variables, the principal
components, which are ordered so that the first few retain most of the variation present in all
the original items.

Factor analysis involves two step factor extractions and rotation, the former involves making a
choice about the type of model as well the number of factors to extract. To aid in the
interpretation rotation was performed. The rotated results for each category presented here
under.
44

Table 7: Factor Analysis Result for Change Management


Items /Variables Components Factor

Q2 Training of employees in the new process and system 0.6150


Q3 Reduce resistant to change and uncertainty 0.6820
Q4 The reward system adjusts 0.7734
Q5 Performance Measurement practiced 0.7154
Q6 Employees are empowered to make decisions 0.7716
Eigen value 2.548

Kaiser-Meyer-Olkin measure of sampling adequacy 0.6923

Cronbach Alpha 0.7574


Source: Computed from Own Survey Data 2019
To perform a factor analysis first weather the sample is adequate or not must be tested. In the
table 7 the result for measure of sample adequacy Kaiser-Meyer-Olkin measure of sample
adequacy indicated 0.69 which is above the desired level of 0.6. This confirms it is possible to
conduct the factor analysis. At the beginning change management is proposed to be measured
by six items. To accept all these six items as a measure of the same factor the factor loading
must be >.50. Accordingly one item is deleted (question 1) because of loading is below 0.5.
The remaining items factor loading ranges between 0.61 to 0.7734. This testifies the validity
of indicators used to capture change management. The result indicated that the change
management is a critical factor for the successful implementation of the BPR in Haramaya
University.

The principal component analysis result showed that only one factor retained with Eigen value
exceeding 1. Implying that only one factor is extracted and its loading is given in the table 7
above. The component extracted explains 51 % of total variance. The factor loads positively
on all five items and describing the university employee tendency to agree with any positive
idea put forth regarding change management. Moreover, the strength of the extracted factor
was tested using Cronbach alpha after factor analysis was performed as the result in the table 7
showed that alpha is 0.7574. This is acceptable reliability of the indicators used in measuring
change management factor. The extracted factor renamed as change management.

The extracted factor is defined by all items training of employees in the new process and
system, reduce resistant to change and uncertainty, reward system adjusts, and performance
45

measurement and employees are empowered to make decisions. The last three items loadings
are higher than the reaming two items. Indicating that those three items are weighting higher
to the factor.

The result for the proposed effective communication by the top leaders was summarized using
the table 8 below. The proposed variable measured by seven items. KOM measure of sample
adequacy of 0.723 indicated that the sample is adequate to perform the factor analysis. As the
result indicated one factor is retained from the principal component analysis estimation. The
rotated solution give the retained factor is defined by six items out of the seven items included.
One item is deleted (Question 11) due to low factor loading which is less than 0.5. The
component extracted explains 44 % of the variation. Cronbach alpha 0.7900 measures the
strength of the factor extracted, the measure indicated it is in the acceptable value. The
extracted factor renamed as effective communication. All factor loading showed that positive
for all items indicating that the employee of the university tends to agree with the top
management make effective communication with their subordinate within the organization.

Table 8: Factor Analysis Result for Effective Communication


Items /Variables Components
Factor
Q7 Open Communication between Management and subordinate 0.6586
Q8 Use a re-engineering team well-informed in BPR method 0.7345
Q9 Shared vision/Information 0.7623
Q10 Co-workers feel as if they are working in a cooperative environment 0.7398

Q12 Managers place confidence between supervisors and their subordinates 0.6721
Q13 Managers constructively use their subordinates’ idea 0.5832
Eigen value 3.088

Kaiser-Meyer-Olkin measure of sampling adequacy 0.7236


Cronbach Alpha 0.7900
Source: Computed from Own Survey Data 2019

Table 9 below presented the result for top management commitment towards BPR. Here only
four items were used which is the minimum required items by the factor analysis. The
diagnostic test result for sample adequacy measured by KMO=0.7003 showed that the sample
is enough to conduct factor analysis. The Eigen value for all items in unrotated factor
46

estimation are positive (not reported) for all items indicated that it is a good sign confirming
no problem with the estimation model.

Only one factor is retained and extracted and loads positively on all four items. The retained
factor defined by top management frequently communicate with team and users, top
management set strategic plans in pursuit of service quality, top management consider BPR as
a way to improve service and top management are committed to BPR implementation. The
loading factors for the items are ranging from 0.54 to 0.75 which is inacceptable range for the
factor loading magnitude. To measure the strength of the factor identified alpha test was
conducted and the result indicated that satisfactory with the value of 0.64. The positive factor
loading describing the employee of the university tends to agree with any positive ideas asked
about top management commitment towards BPR.

Table 9: Factor Analysis Result for Top Management Commitment


Items /Variables Components
Factor
Q14 Top management frequently communicate with team and users 0.5430
Q15 Top management have sufficient knowledge about BPR 0.7527
Q16 Top management consider BPR as a way to improve service 0.7398
Q17 Top management are committed to BPR implementation 0.7200
Eigen value 1.927
Kaiser-Meyer-Olkin measure of sampling adequacy 0.7003
Cronbach Alpha 0.6354
Source: Computed from Own Survey Data 2019

The factor analysis result for IT infrastructure is summarized here under table 10 below. IT
infrastructure at the beginning proposed to be measured by the six items. The sample is
adequate as testified by the KMO adequacy test results of 0.70.

The principal component result retained two factors. The estimated factor loading positively
load on all items for both retained/extracted factors. The first factor retained defined by four
items Information technology is integrated in plan, efficient technology used, organization
units connected via IT system and sufficient ICT support to the BPR. And the second retained
factor defined by the remaining two items applied the right innovative technology and IT
system examined regularly in the university. The two factors extracted explaining 59% of
47

variance in the data. However, only the first factor pass the factor strengthen test of Cronbach
alpha with the value of 0.74 while the second factor failed to pass the test with the value of
0.413 and we are not use in subsequent analysis like index construction and in the regression
model. Only the first factor used for further analysis renamed as IT support System. IT is very
important critical factor for facilitation of BPR implementation as indicated by the indicators
factor loadings. IT infrastructure facilitate exchange of information among various unites of
the university and create enabling environment for the BPR success full implementation.

Table 10: Factor Analysis Result for Information Technology Infrastructure


Items /Variables Components
Factor 1 Factor 2

Q18 Information technology is integrated in plan 0.8150


Q19 Efficient technology Used 0.8606
Q20 Organization units connected via IT 0.7059
Q21 Applied the right innovative technology 0.7854
Q22 IT system examined regularly 0.7768
Q23 Sufficient ICT support 0.5807
Eigen value 2.252 1.299

Kaiser-Meyer-Olkin measure of sampling adequacy 0.7047


Cronbach Alpha 0.7405 0.4131
Source: Computed from Own Survey Data 2019

Organizational performance result summarized here under table 11 below. The diagnostic test
for sample adequacy indicated that 0.77 confirming the sample adequate to perform the factor
analysis. The principal component result indicate that eight component retained with eigin
value greater than 1. Originally organizational performance ensured by 26 items. However, 3
items are deleted because of factor loading below 0.5. To use these factors for further analysis
it is good to measure factor strength using Cronbach Alpha. The result indicated for the first
two factors extracted Cronbach Alpha is 0.98 and 0.82, respectively. Indicating that the two
factors pass the test that the items used to measure the first two factors are reliable indicators
of the factors. However, for the remaining six factors the scale reliability measure alpha ranges
between 0.0780 to 0.5774 (not reported in the table), which is beyond the acceptable range.
More importantly the six factors are defined by only one or two items except for the third
48

factor defined by four items with average alpha of 0.5774. Thus, the test result showed the six
factors (factor 3 to factor 8) are not suitable for further analysis and they are as weak as
indicated by their reliability scale measure. Therefore, the estimation result indicated factor
extracted are two. The first factor defined by five items and the second factor defined by seven
items as reported in table 11 below.

For the first factor the highest loading is for the recruit quality academic staff, however others
also have very similar loading values that indicate the weighted of each items and also reflect
how the items used and the factor are correlated to each other. Hence the first factor can be
named input dimension performance measure. Similarly by seeing the highest loading among
the items on the second factor the factor renamed as service improvement dimension. The
retained factor loads positively on all 12 items and it describing the employee of the university
tendency to agree with any positive ideas asked on organization performance.

Table 11: Factor Analysis Result for Organizational Performance


Items /Variables Components
Factor 1 Factor 2
Q57 Establish teaching, learning quality assurance 0.9707
Q58 Recruit competent students 0.9646
Q59 Recruit qualified academic staff 0.9742
Q60 Recruit qualified support staff 0.9693
Q61 Enough divers staff available 0.9669
Q69 There is stable course schedule 0.5132
Q71 Efforts are made to assess training needs 0.7025
Q72 Remedial programs are given regularly 0.7044
Q73 Continuous career guidance provided 0.7799
Q74 Up-to-date learning materials are available 0.6051
Q75 There is on line registration to students 0.7271
Q76 There is online grade submission system 0.7326
Eigen value 4.926 4.15

Kaiser-Meyer-Olkin measure of sampling adequacy 0.7771


Cronbach Alpha 0.9873 0.8263
Source: Computed from Own Survey Data 2019
49

4.6 Regression Model Output

To identify the effect of BPR success factors and other predictors on the organizational
performance multiple regressions is used. The dependent variable is organizational
performance. The independent variables considered are change management, management
commitment to BPR and IT support which are BPR success factors and also education level of
the respondent as a proxy of organizational capacity resources and the effective
communication as indicator for leadership resources. The study employs multiple regressions
to examine the significance of the explanatory variables including the BPR success factors.
The estimated result from the regression model is portrayed in Table 12 and 13.

Table 12: Multiple Regression Output for Service Improvement as dependent variable
Variables Coefficient t-test p-value
Change Management .434*** 10.28 0.000
Management Commitment -.110* -2.26 0.024
IT Support .133** 2.93 0.004
Effective Communication .351*** 6.20 0.000
Education
Master . .0282 1.43 0.138
Degree .0307 1.54 0.124
Diploma .0191 0.93 0.373
R2 0.75
Sources: Own Calculation data 2019 t statistics in parentheses * p<0.05, ** p<0.01, *** p<0.001

Table 13: Multiple Regression Output of Overall Organizational performance as


dependent variable
Variables Coefficient t-test p-value
Change Management .214 1.53 0.126
Management Commitment -.199 -1.23 0.218
IT support .155* 2.20 0.028
Effective Communication .530** 2.84 0.005
Education
Master . .116** 2.99 0.003
Degree .124** 2.91 0.004
Diploma .151** 2..23 0.026
R2 0.28
Sources: Own Calculation data 2019 t statistics in parentheses * p<0.05, ** p<0.01, *** p<0.001
50

Different diagnostic tests were run to check it the model fits the data at hand. The first concern
was model specification test multicollinearity, heteroskedasticity test and omitted variable.

For independent variables used in both regression reported in table 12 multicollinearity


among the independent variable were tested using the Variance Inflationary Factors (VIF) the
VIF values for all the independent variables confirm that there is no multicollinearity (VIF <
10); as well as the tolerance (1/VIF) confirms the same.

To test for the heteroskedasticity the study used Breusch-Pagan / Cook-Weisberg test for
heteroskedasticity with the null hypothesis of Ho: Constant variance the test indicates that the
regression of the residuals on the predicted values reveals no significant heteroskedasticity.
The Prob > chi2 = 0.3119 and Prob > chi2 = 0.0079 > 0.05 obtained for regression reported in
table 12 and 13 respectively. The test for the first regression result showed insignificant
indicating no rejection of heteroskedasticity however, the test reject the null hypothesis of
constant variance for the regression result in table 13 indicating the presence of
heteroskedasticity. To solve this we use the robust standard error option in the estimation and
the reported result is after this correction.

Finally the model is tested for omitted variable bias using the Ramse test with the null
hypothesis of the model has no omitted variable. The F-test value is given as F (3, 304)=
2.42 Prob>F=0.0659 which is insignificant indicating no rejection of the null hypothesis
indicating the model is correctly specified.

The model pass the major diagnosis performed and indicated that the model is healthy and
ready for interpretation of the results. The interest is to know the influence or effect rather than
the estimated magnitude.

The result in table 12 showed that the sign of the estimate were as prior expectation for all
explanatory variables except for management commitment all BPR success factors variables
have a positive relationship with the service improvement dimension of an overall
organizational performance measure. As the result indicated among the four variables related
to BPR change management, top management commitment towards the BPR and information
technology support for BPR are significantly affecting services improvement dimension at 1
51

percent, 5 percent and 10 percent significance level, respectively. But these success factors
have a mixed result on the overall organizational performance as reported in table 13 above.
Among the BPR success factor only IT support is significantly affecting the organizational
performance while others are not significant.

Change management is the focus on the human resources part. The top management by
focusing on the employee to equipped them with the required knowledge and skill that
facilitate the implementation of BPR properly and this tends to contribute improve
organizational performance.

Management commitment to BPR is significant among BPR success factors in the services
improvement dimension performance measure but not significant in the overall organizational
performance. It is negatively affecting the organizational performance. This is totally
contradicting to the theory which explains positive relation with the organizational
performance. One of the possible reasons may be the top management committed on solving
the instability observed in the universities than commitment towards BPR implementation.
This result is supported by the qualitative finding which indicated that some of the top
management currently the top management position are more unstable than ever which may
compromise the top management commitment towards BPR.

In addition, information technology support as one of the success factors to BPR is


significantly affecting the organizational performance. The result indicating the presence of
this infrastructure is very critical for the BPR to be successful in the organization and intern
affecting the performance of the organization in positive manner.

Moreover, the model result showed effective communication is one of significant factor that
affect organizational performance at 1 percent significant level. Communication is critical via
which leaders communicate their vision and any other relevant information between them and
their employee. This facilitate the right information exchange among the university unites and
contributing to sound and timely decision making at Haramaya University.

The capability of the University proved by the education level of the employee. This variable
is insignificant in the first regression where the dependent variable is services improvement
52

dimension. However, in the table 13 educations influence the organizational performance at 10


percent for all three categories. The base categorize is diploma level as compared to the
diploma holders those who have the BA, MSc and PhD have significant effect on the
university performance.
53

5. SUMMARY, CONCLUSION ANDRECOMMENDATIONS

5.1. Summary

In this study, the effects of BPR in relation to the university performance were assessed. The
BPR objective /goal didn’t achieve as expected and as perceived by the employee. This may
have a tendency to compromise on the university performance. The Haramaya University
faced many challenges on the BPR implementation among these: lack of motivation of
employees to influence the engineering effort, insufficient top management commitment and
inconsistent support provided by top management, absence of incentive system for the
employees and inadequate information communication system are the major one.

To establish the relationship among the university performance and factors affecting the
university performance multiple regression were used. BPR was found to be one of the
significant factors affecting the Haramaya university performance. Change management, ICT
support are positively and significantly affecting Haramaya university performance. These
factors were used as a proxy for BPR factors in the regression analysis. In addition, effective
communication a proxy for leadership of top management and education level were significant
and positively influencing the service improvement and over all Haramaya university
performance.

5.2. Conclusions

Based on the key findings of the study, the researcher concluded the following: at Haramaya
University BPR encounter different constraints to be successful. This may range from luck of
commitment by top leaders to insufficient infrastructure for easy implementation. After
implementation of BPR, incentive and reward system was not developed and materialized in
the University. The university did not provide enough training and education in order to
increase awareness of employees. The greatest challenges lay not in managing the technical or
operational aspects of change, but in managing the human dimensions of change. The
implication is that the most important dimension of the BPR project, that is, the human
dimension, remained to be the living challenge of the institution.
54

The insufficient and inconsistent support provided by top management has resulted in the
decline of the likelihood of effective implementation of the BPR which may in turn
compromise the Haramaya university performance.

5.3. Recommendations

Based on the key findings of the study, the researcher has forwarded the following
recommendations.

Hence, to improve the university performance and meet the customer needs the top university
administration must be taken care of all critical success factors that significantly influences the
HU performance.

 Leadership plays significant role in improving the university performance. Effectively


communicating allow the top management to communicate the vision and the mission of
the university to the employee. This allows the management to lead the entire employee in
the same direction to achieve its mission.
 The institution needs improvement in core function of teaching and learning in order to
fulfill its goal. Improving the IT infrastructure has significant role in the university
performance. The university management has to invest on IT infrastructure to improve its
services delivery.
 The top management should focus and committed on the human dimension and preparing
and equipping the employee with both in knowledge and skill required for better
implementation and effectiveness of BPR. For this development and training should play a
crucial role.
55

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60

APPENDIXES

Appendix 1

Table 1: Variance Inflationary Factor Result

. vif

Variable VIF 1/VIF

ChangeMang 3.36 0.297410


Effective~un 3.95 0.253054
BPRMagCommit 2.82 0.354704
ICTSupp 2.93 0.341638
Education
1 5.19 0.192667
2 4.35 0.229955
3 3.50 0.285388

Mean VIF 3.73


61

Appendix 2

HARAMAYA UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS DEPARTMENT OF MANAGEMENT

QUESTIONRIE/INTERVIEW SCHEDULE

This questioner is prepared in order to gather the necessary information (data) that help to
study an evaluation of BPR implementation: - success and challenges in Haramaya university
and to point out relating to this BPR implementation.

The information you are going to give here is very important for the study
Any information you fill in this questionnaire will be confidential and used only for
this study. We thank you in advance for your cooperation

Part 1: Respondent’s profile (please tick the box that best describes your response)

1. Gender Male -----------Female------------


2. Age __________________
3. Which of the following best describes your current educational level?

□ Diploma or certificate

□ Undergraduate

□ Postgraduate

□ PhD or above
62

4. Work experience -----------------------

4. What is your position at your university?

□ Academic staff

□ Administrative staff

□ Academic and administrative staff

5. What was/were your role during your university engaged with BPR project?

□ Redesign team member

□ Implementation team member

□ Redesign and implementation team member

Other

Part 2 A: BPR implementation success factors at Haramaya University

Question items Strongl Agree Neutral Disagree Strongly


y agree disagree
Factors related to change management system and culture
Re-educate and retrain workers on what
BPR actually is
Training of employees in the new process
and system to be used
Regular communication of BPR progress
to all staff
The reward system adjusts to serve the
employees after the change
The performance measurement adequately
63

corresponding to the change


Employees are empowered to make
decisions
Factors relating to organizational structure
Use a well-trained, diversified, expert
team
Use a re-engineering team well-informed
in BPR method
A BPR team shares a clear vision and
understanding of BPR success
Co-workers feel as if they are working in a
cooperative environment
Factors related to BPR management commitment and leadership
Top management frequently
communicate with project team and users
Open communication between supervisors
and their subordinates
Managers place confidence between
supervisors and their subordinates
Managers constructively use their
subordinates’ idea
Top management set strategic plans in
pursuit of service quality and customer
satisfaction through various BPR projects
Top management consider BPR as a way
to improve service and product
Top management are committed and
ensure that everyone in the organization
share the achieving dramatic improvement
through fundamental rethinking and
radical re-design of business process
64

Factors related to IT
Information technology is integrated in
business plan of the organization
There is efficient communication channel
in transferring information
The organization is exclusively use the
information system

Part 2 B: BPR implementation challenge/problem classification

Question items Strongly Agree Neutral Disagree Strongly


agree disagree
Problem related to top management commitment and support
Failure to implement BPR caused by
lack of commitment and support
demonstrated by the university’s top
level management
Lack of understanding the BPR
implementation requirements
Lack of management determination
when problem comes
Problem related to change management and culture
Managers are anxious about losing their
authority after the change
Employees resistance to change due to
job displacement
Not enough employee training to
implement BPR
Absence of management system ( e.g.
incentive, training, education
65

communication about BPR progress


Problem related to organizational structure
Problems related to rigid hierarchical
structures, jobs definition, and
responsibility allocation
Difficult to implement BPR due to
teams communication barrier
Problem related to IT
Employees and customers know-how
deficiency about the use of IT in the
redesigned processes impede BPR
implementation
Problems related to training provision
about IT use in the redesigned processes
Problem related to project management
Inappropriate alignment of BPR
strategy with the corporate strategy
Spending too much time in analyzing
existing processes
Conflict between traditional
performance measures and BPR goals
Inadequate focus on core processes (key
issues)
The BPR process was much larger than
anticipated
Top management reluctant to commit
funds for BPR
Unrealistic report to out siders that hide
actual progress of BPR implementation
In adequate regular and scheduled
66

meeting of project management to get


feedback on BPR implementation
progresses
Not use progress evaluation to
determine what is working and what is
not

Part 3: Extent to which goal and objective accomplishment over all Haramaya
University

Question items Strongly Agree Neutral Disagree Strongly


Agree disagree

Do performance measures show that


performance goals are being met and that
the project is on track for achieving its
expected return
Emphasized the value-added element at
every activity
Executives, managers and staff actually
using the measurement data being gathered
to assess the new process performance
Built consensus on making changes
The performance measures linked to the
office’s strategic goals
Applied the right innovative technology
The process improvements are based on
the capabilities of information technology
Used time as a competitive weapon
(decreased cycle time of service delivery)
67

The organization increases its own


competitiveness by reducing costs and
quality improved
Increasing employee satisfaction expected
as a result of implementing the BPR

Part 4: BPR’s impacts on organizational performance

Question items Strongly Agree Neutral Disagree Strongly


agree disagree
Quality of teaching learning ensured
Assess educational needs of society regularly

Satisfy educational needs of society

Ensure international recognition of academic


programs
Provide seamless services to students
Provide state-of-the -art infrastructure
Establish teaching, learning quality assurance
system
Recruit competent students
Recruit qualified academic staff
Recruit qualified support staff

Part 5: Current status of BPR implementation for core academic issue in Haramaya
University

Questions item Strongly Agree Neutral Disagree Strongly


agree disagree

Continuous assessment being practiced


Summative exams given based on student
68

convenience
Student cantered teaching learning
processes are installed
All academic recruitment are made
based on open competitions
Efforts are made to raise staff
commitment to implement BPR
recommendations
Academic staff members devote 25%
their time on academics researches and
community services
Proper documentation of academic
related documents
There is continuous staff training and
upgrading
There is stable course schedule
Demand driven programs are being
designed and developed
Efforts are made to assess training needs
Remedial programs are given regularly
Continuous career guidance and support
provided to students
Up-to-date learning materials are
available
There is sufficient ICT support for
teaching learning process
There is on line registration to students
There is online grade submission system
69

KEY INFORMANT INTERVIEW

1. What do you think of the level of understanding the staff? Does sufficient awareness
creation made before BPR implementation?
2. Would you mention the criteria for how BPR team member’s formation and their
composition? Does the composition of BPR team inclusive? (All stakeholders equally
represented?
3. How would you rate employee’s attitude towards BPR?
4. Would you mention in details why BPR implementation is challengeable and what
challenges are observed during implementation of BPR?
5. Do you believe that the BPR that was introduced in the organization has improved the
performance of the organization, if yes in what way, if no why?
6. Would you explain the factors that forced the University to introduce BPR to its system?
7. Have the existing workers been deployed as per their qualification and work experience?
8. Did the University provided trainings and education on BPR implementation to
Customers? What kind and how frequently it has been conducted?
9. Would you mention quantified improvement in terms of Service, Material and Resource
and Other major achievements gained as a result of BPR?
10. Would you say something on the level of commitment of leaders and employees in
different stages of the hierarchy in Haramaya University? How can this be measured?

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