Fit-gap analysis and Business Process Reengineering are two frameworks used in enterprise software delivery. In Fit-Gap analysis, gaps are addressed via customisation or using a fit-to-standard approach. Consultants and solution architects working on CRM or ERP implementations use one of these two methods to gather organisations’ requirements and identify gaps and other details to help them design the overall solution.
Most enterprise software consulting firms default to Fit-Gap analysis when starting a new implementation because this method has been used for decades. Gaps addressed using a fit-to-standard approach are often portrayed as a business change effort. However, as enterprise software evolves and companies become more agile, new frameworks are being applied that allow consultants and architects to design and deliver enterprise software solutions faster, reducing the need for customisations while increasing customer satisfaction.
One of these frameworks that I use often in my role as a consultant is called Business Process Reengineering (BPR). In this blog post, we will learn how BPR can help you deliver a successful enterprise application project and why BRP is a radically different idea compared to the Fit-to-Standard approach.
What is Business Process Re-Engineering (BPR)?
Business Process Reengineering (BPR) is a discipline that allows organisations to engineer internal processes. The term engineering comes from the design nature of this framework, which is based on re-inventing a process rather than changing it. Unlike change management or business process improvement, which are used to improve efficiency or remove bottlenecks, BPR aims to redesign processes to meet strategic objectives for the benefit of the entire organisation.
In enterprise software delivery, BPR streamlines organisation processes so that employees can adopt best practices supported by ERP or CRM features.
Difference between BPR and Fit-Gap Analysis
In enterprise application delivery, fit-gap analysis consultants gather all the organisation’s requirements, which are then categorised into fit or gaps depending on whether the application supports the requirement or not. Requirements supported are classified as fit, which means the requirements can be met, usually via configuration or gaps which are addressed separately.
Some enterprise software consulting companies run separate workshops to address gaps, which are typically addressed via customisations, third-party software, or a change effort using a fit-to-standard approach.
Fit-Gap and BPR are fundamentally difference in their approach and application.
Consultants and solution architects who use BPR can examine how the organisation operates. This allows them to help their clients redesign processes using a holistic approach to ensure the company can benefit from the new application capabilities that software vendors deliver to address industry standards and best practices, not just specific features.
Conversely, fit-to-standard operates at a granular level to eliminate obstacles—the gaps—that require additional investigation, customisation, or additional third-party software. Business Process Reengineering is ideal when outdated workflows need modernisation and the organisation is ready to adapt its processes to leverage Dynamics 365’s standard features. Fit-gap analysis is better suited for scenarios where processes are already optimised and the focus is on ensuring feature alignment.
Why Fit-To-Standard is not BPR and What to Do About It.
As I mentioned before, the fit-gap analysis often includes a fit-to-standard approach to address gaps. This approach is not to be confused with business process reengineering. Fit-to-standard means changing a process to eliminate the gap. The distinction between Fit-Gap Analysis with a fit-to-standard approach and Business Process Reengineering (BPR) lies in the scope and intention behind the process change.
Unfortunately, some enterprise application firms often sell their clients a fit-to-standard approach disguised by BPR. That approach helps consulting firms avoid the complexity created by customisations or integrations to address the lack of features discovered during the analysis.
In essence, consulting firms that use fit-to-standard do so to ensure they can manage easy projects.
Let me explain this in detail and outline the differences:
Fit-to-Standard Approach within Fit-Gap Analysis
Using a fit-to-standard approach means applying adjustments to an organisation's processes focused on individual gaps. The effort looks at a specific process step rather than the process overall.
If the consultant identifies a specific gap when gathering the requirements, the client is persuaded to change how they operate to avoid customisation. However, the change is applied to the specific gap, and it does not address the process.
Here’s how it typically works:
1. Requirement Review (Fit-Gap Step):
The consultant identifies a specific gap. For example, the client's current approval process has three levels of checks, including an approval before the warehouse team can receive the items in a warehouse location, which is not supported by standard Dynamics workflows.
2. Challenge the Requirement (Fit-to-Standard Step):
The consultant questions the necessity of replicating the existing process and challenges the client to adopt standard purchase order approval workflows. The question for the client is the following: “Can the business achieve the same level of control with Dynamics' built-in approval rules?”
3. Suggest Standard Process:
The consultant proposes using Dynamics’ built-in approval workflows with threshold-based auto-approvals and exceptions requiring manual review. A warehouse management review of Pos accuracy before initiating the receiving process is also suggested to minimise risks of receiving goods with incorrect costing details without requiring custom approval workflows.
This minimises the need for customisations while addressing the business goal (approval governance).
4. Outcome:
The gap is closed by fitting the business requirement to the standard Dynamics functionality, avoiding custom development. The fit-to-standard approach has eliminated the gap, but that is not a BPR effort.
Key Characteristics of Fit-to-Standard within Fit-Gap:
Fit-to-standard addresses one gap or requirement at a time, and it involves minor adjustments to business processes to fit the standard system. The approach is tactical, and it’s aimed at reducing development time. However, this approach leaves the business goal unchanged as the original objective remains the same but is achieved differently.
The table below shows the key differences between the two approaches:
Aspect | Fit-to-Standard (within Fit-Gap) | Business Process Reengineering (BPR) |
Scope | Narrow focus on individual gaps. | Broad focus on redesigning entire workflows or processes. |
Objective | Adjust business processes slightly to fit the system. | Transform processes to achieve strategic improvements. |
Level of Change | Incremental adjustments to close specific gaps. | Fundamental rethinking of processes for innovation or efficiency. |
Timeframe | Short-term, quicker implementation. | Long-term, often requiring deeper stakeholder involvement. |
Customisation Impact | Reduces customisation by using standard features. | Minimises customisation by aligning with system capabilities. |
What Makes BPR Special, and How Consultants Can Use It to Succeed with Dynamics 365
BPR is a transformational approach that reimagines entire processes for greater efficiency, often leveraging industry best practices. It’s about asking, “How can we achieve better outcomes with the tools available?” The approach does not address specific gaps with tactical changes or by compromising features and capabilities.
Business Process Reengineering (BPR) goes beyond simply adapting to new technology. It’s about fundamentally rethinking how users get work done to achieve breakthrough improvements in efficiency, productivity, and customer satisfaction. BPR transforms outdated, fragmented processes into streamlined workflows that maximise the capabilities of modern systems like Dynamics 365.
Here are some examples and characteristics that set BPR apart from Fit-to-standard:
Focus on Strategic Transformation
Unlike incremental adjustments, BPR reimagines processes from the ground up. For example, consultants working on custom reports with scheduled updates can use BPR to question the requirement. By asking, “Do we even need custom reports, or can we achieve real-time reporting using Dynamics’ analytics capabilities?”
Alignment with Organizational Goals
BPR aligns processes with system capabilities, which means it aligns them with long-term business goals, such as scalability, customer-centricity, or operational excellence. When gathering requirements using fit-gap analysis, consultants often miss the bigger picture. Using BPR allows enterprise application consultants to design solutions that deliver measurable value.
Leveraging Best Practices
Modern enterprise systems like Dynamics 365 are built with industry best practices embedded. BPR encourages organisations to embrace these rather than trying to fit legacy processes into new applications. For example, a professional service company that wants to modernise its accounting software and develop a custom timesheet application can adopt Dynamics 365 Business Central Projects module to benefit from integrated project accounting and timesheets.
Scalable and Future-Proof Solutions
BPR allows consultants and their clients to co-design new processes that are scalable and adaptable to future growth. A fit-to-standard will always be a compromise that allows users to execute outdated processes using the latest technology. It will only last until the volume or pace of the process makes the compromise no longer viable.
Focus on Value Creation
BPR forces organisations to identify and eliminate inefficiencies while creating value-draining activities. It eliminates unnecessary steps and reallocates resources to value-creating activities. Value creation using Business Process Reengineering can sometimes result in customisation. However, this additional work is still geared towards creating value for the organisation, not eliminating a gap in the application.
Expanded Comparison: Fit-to-Standard vs. Business Process Reengineering (BPR)
Below is a more detailed comparison of Fit-to-Standard and BPR, focusing on their applications, benefits, challenges, and when each approach is most appropriate for Dynamics 365 projects.
1: Purpose
Aspect | Fit-to-Standard | Business Process Reengineering (BPR) |
Goal | Align business processes to existing system functionality to close gaps. | Redesign entire processes to optimise workflows and achieve strategic goals. |
Focus | Tactical: Solving specific functional gaps. | Strategic: Overhauling end-to-end processes for efficiency and innovation. |
Ideal Outcome | Minimal customisations and faster implementation. | Streamlined, scalable, and future-proof processes. |
2: Scope and Application
Aspect | Fit-to-Standard | BPR |
Scope | Narrow: Addressing one gap or process at a time. | Broad: Redefining workflows, roles, and processes across departments. |
Level of Change | Incremental: Small adjustments to meet the system’s capabilities. | Transformational: Fundamental shifts in how work gets done. |
Example Application (Dynamics 365) | Adjusting approval thresholds for purchase orders to fit standard workflows. | Reimagining the entire procurement lifecycle to reduce inefficiencies. |
3. Benefits
Aspect | Fit-to-Standard | Business Process Reengineering (BPR) |
Speed of Implementation | Faster due to limited changes. | It is slower because of deeper process analysis and stakeholder involvement. |
Cost Efficiency | Lower costs by minimising customisations. | Higher initial costs but more significant long-term savings through optimised processes. |
User Familiarity | Easier for users to adapt as processes remain largely unchanged. | It may face resistance due to significant changes, but it results in more efficient operations. |
4. Challenges
Aspect | Fit-to-Standard | Business Process Reengineering (BPR) |
Risk of Missed Opportunities | Focused on fitting processes into the system; may overlook inefficiencies that need redesign. | Requires significant buy-in and alignment from stakeholders; can be resource-intensive. |
Resistance to Change | Low, since changes are minor. | High due to the fundamental shift in workflows and responsibilities. |
5. When to Use Each Approach
Scenario | Fit-to-Standard | BPR |
Existing Process Efficiency | Current workflows are sound and align well with industry standards. | Current processes are outdated, inefficient, or not scalable. |
Project Size | Small to medium-sized projects with precise requirements. | Large, complex projects requiring holistic change. |
Customisation Tolerance | Minimal: Focus on out-of-the-box solutions. | Moderate: Willingness to customise if necessary for transformation. |
Using BPR to Address a GAP: A Use Case:
Let’s look at the example of the PO approval process I made before. Using a business process reengineering approach to address the warehouse team's approval gap means redesigning the procurement process to eliminate the gap.
When I worked on that project, I understood that the requirement to re-approve purchase orders to avoid receiving items with incorrect details was a symptom of an outdated procurement process, not a problem to address in the application.
The organisation’s procurement team used to create purchase orders for new products and request approval from the budget owner. The order was often created before the items were correctly configured. Once the purchase order was approved, it was automatically released so the warehouse team could receive the goods once they arrived at the warehouse.
The incomplete setup of the new items usually resulted in purchase orders received with incorrect details such as tracking and costing. The risk of receiving items in the warehouse with incorrect information made users think that they needed more robust approvals.
Instead of using a Fit-to-Standard approach to address the gap, my approach was to redesign the procurement process by using purchase quotes and involving the product team in the PO creation phase. The new process started with a purchase quote, which still required approval from the budget owner. After the approval, the product team was notified of any approved purchase quotes containing lines with missing details, such as standard costs or item tracking. The product team was then responsible for updating the product details, converting the quote into a PO and releasing the purchase order for the warehouse team.
With the new process, there was no need for more approvals, and the warehouse team would only receive released purchase orders for which the items were correctly configured. If a PO was still open, it meant that the items were still being configured.
The new process did not address the approval for the warehouse. It eliminated the requirement for further approvals and created a new, more robust procurement process that can scale.
Summary
Business Process Reengineering offers consultants and solution architects the opportunity to transform organisations' operations by not just implementing Dynamics 365 but also focusing on outcomes, leveraging best practices, and involving stakeholders throughout the process. BPR ensures that enterprise software delivers real, measurable value far beyond a traditional fit-to-standard approach.
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