Increasing Bank BPR Benefits by Managing Project Phases

In efforts to improve the performance of the banking/financial services sector, managers have widely recognized the importance of innovation and the adoption of new technologies. Nevertheless, success implementing the required changes is far from assured. BPR projects by their very nature are very expensive to prototype, forcing companies to follow a sequential methodology for changing and implementing new processes. This is the first study in the banking sector aimed at identifying the prescriptions for success proposed in the literature, and empirically testing the relationships between these success factors and the extent to which each BPR-project phase benefited from their presence. A usable sample of 276 banks' internal auditors shared their organizations' experience regarding their last BPR project implementation. The sample shows good representation based on banking center levels of total assets, self-rated IT sophistication, and self-rated degree of knowledge about the specific BPR project implementation they have addressed. Results indicate that some success factors are more or less important to a particular project phase. Except for the insignificant relationship between project inception and process change/redesign-phase, the relationships between the other phases are all significant and in some cases seem to represent a major determinant of success in the subsequent phase. Managers can increase the chances for overall BPR project success and success in each phase by ensuring that the prescribed success factors are in place before they start or as they pursue the project. Several managerial insights and implications are discussed.