Business process re‐engineering pays after enterprise resource planning

Abstract

PurposeThe purpose of the paper is to demonstrate that significant improvements through business process re‐engineering can still be achieved after the implementation of enterprise resource planning systems. While the business process re‐engineering benefits of enterprise resource planning systems have been widely published, the opportunities for process improvement after the installation of integrated systems have not been extensively explored.Design/methodology/approachThis paper results from a case study of the highly successful intervention in the purchasing and accounts payable functions of Mobil Oil Australia Limited undertaken well after the implementation one of the widely used off‐the‐shelf enterprise resource planning systems, SAP (Systems, Applications and Products in Data Processing).FindingsSignificant benefits were achieved in the purchasing and accounts payable functions of Mobil Oil Australia Limited, via a focus on best practice and radical process improvement. Invoices and invoice processing were largely eliminated. Cheque usage was reduced by 87 per cent and the staff paying accounts cut by almost 75 per cent.Originality/valueThe case study demonstrates clearly to companies and practitioners that business process re‐engineering can achieve “dramatic improvements in cost, quality, service and speed” even after an enterprise resource planning solution has been implemented via a focus on best practice benchmarking and using best practice to provide a target for the change team. Companies can leverage existing, often substantial, investments in installed systems to further improve their processes and increase the return on those investments.