Abstract
Purpose The purpose of this paper is to study the relationship between organizational adaptability, institutional leadership and business process reengineering performance using the tested complexity theory in a developing economy setting. Design/methodology/approach This study is correlation and cross-sectional and adopts institutional-level data collected via questionnaires from reengineered microfinance institutions in Uganda. Cluster analysis as data mining technique was used to classify cases based on respondents’ opinions into homogeneous clusters. Nvivo was used to understand the perceptions of business process reengineering performance based on qualitative data. The authors used structural equation modeling to derive the predictive model of business process reengineering performance in a developing world setting. Findings The authors find that organizational adaptability and institutional leadership are key predictors of business process reengineering performance. Results reveal a predictive model of 61 per cent based on structural equation modeling for the study variables. Cluster analysis as data mining approach explored complex patterns of reengineered business processes. Research limitations/implications The use of cluster analysis is susceptible to problems associated with sampling error and absence of fit indices. However, the likelihood of these problems is reduced by the interaction with the data, practical implications and use of smart partial least square to generate structural equations based on derived measurement models of each study variable. Practical implications Policymakers of Bank of Uganda, Ministry of Finance and Economic Planning, should develop sound policies in relation to knowledge management, institutional leadership and adaptive mechanisms to enhance business process reengineering performance to take advantage of new knowledge opportunities for the improvement of their businesses. Social implications Given the results from structural equations generated, managers need to consider institutional leadership and organizational adaptability as key drivers of business process reengineering performance in microfinance institutions. The results confirm the significant role of institutional leadership, organizational adaptability in determining business process reengineering performance outcomes. Originality/value Unlike most of the business process reengineering literature, this study contributes to literature by domesticating and testing complexity theory to explain business process reengineering performance in developing economies.
Highlights
Introduction and motivationIn this paper, we test the complexity theory and study the relationship between organizational adaptability, institutional leadership and business process reengineering performance in a developing economy setting using lessons from microfinance institutions (MFIs) in Uganda
The findings indicate that the reengineered business processes are homogeneous and belong to the same class of MFIs
We conclude that whereas previous scholars have focused on business process reengineering performance measures, such as efficiency and effectiveness in developing economies, this study has provided theoretical explanation of business process reengineering performance of MFIs in Uganda’s context (Sungau, Ndunguru & Kimeme, 2013; Eke & Achilike, 2014)
Summary
Introduction and motivationIn this paper, we test the complexity theory and study the relationship between organizational adaptability, institutional leadership and business process reengineering performance in a developing economy setting using lessons from microfinance institutions (MFIs) in Uganda. The reengineered core processes include; cheque processing, loan management, customer service, queue management, microfinance systems, accounting processes, service delivery, data processing process, claims processing, process scheduling and application processing These core processes are constantly changing to enrich the operational performance of MFIs. These core processes are constantly changing to enrich the operational performance of MFIs Models such as Malcom and technology acceptance have been widely used to automate, innovate, remove unnecessary processes and solve queuing decision problems. The theory elaborates the coalitions and networks among and between other financial services to ensure process innovations such as inters witch, internet banking and mobile banking in situations of complex interdependent social, economic, and political environments. They are institutionalizing a leadership that spurs process changes. To a small extent, constant microfinance strategic plans and stagnant structures after business process reengineering implementation may not be exhaustively explained by theory
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