The Effects of Asymmetry on Business Process Redesign

Abstract:     
The effective design of business processes is a subject of considerable importance to corporations today. Our research focuses on developing a theoretical framework for process design in order to provide some guidelines for mangers. The abundant context-specific case studies which exist today share many success stories but provide little in terms of a general methodological approach. In this paper we describe our general framework for the analysis and design of business processes. We outline a typical business process and critically evaluate typical pre- and post-reengineering process designs. Explicit aspects of our analysis address workflow design and task bundling, technological enabelers, and performance based incentives. We examine the effects of task size asymmetry and information, and performance control asymmetry on the optimal process design. Our results indicate that, with increased asymmetry, certain types of process designs become more desirable. Furthermore, we look at the interaction between job asymmetry and other process design factors such as knowledge intensity and level of job customization. Finally, we show how asymmetry causes process redesign to complement performance based incentive compensation. The practical implications of these results are illustrated for a variety of process design environments.

JEL Classification: M11, M12, M13, D21, D23

working papers series