Adaptive model to support business process reengineering

Step 1: initiate the building of BPR team.

The BPR team is firstly created to prepare a pilot study and interviews with stakeholders to know how willing they are to accept the change in their business so as to avoid resisting the change when the implementation of the new changes is completed which can lead to the failure of the BPR and big loss of money and time. In addition to gathering all information about organization and its activities to analysis the overhead activities of the organization in order to determine which of them need to reengineer for keeping in touch with the real objectives of organization. At the end of the implementation of BPR, this team will train stakeholders on the new changes.

Step 2: prepare a questionnaire for studying the relationship between CSFs of BPR and performance of business processes expressed as BPR success.

The questionnaire form for studying the relationship between CSFs of BPR and Performance of Business Processes expressed as BPR success was constructed based on successful studies previously constructed in the related field of study. There are two independent variables; Critical Success Factors (CSFs) of Business Process Re-engineering (BPR) and performance of business process which used a 5-points scale.

Step 3: identify the current processes and basic information of the business.

The history of the tax sector in Egypt is described, the types of direct and indirect taxes, and the changes that have occurred in tax sector. This was followed by submission of selected two case units: Joint-Stock Companies Tax Authority and Helwan Tax Authority and determine the specialization and departments of each. The current processes (As-Is model) in Egyptian tax authority are illustrated in detail in terms of its goal, input, activities, output and limitations.

Step 4: collect the data from respondents via the prepared questionnaire.

The data collected on the number of employees in two case units. Based on results statistics after analyzing questionnaire form in terms of the Mean and Standard deviation, it has two main conclusions that can be illustrated:

The first conclusion is about the level of satisfaction among the tax employees with the current CSFs. The results show that most of employees are disagree with existing CSFs which activated in their business (all the means are below than 3 except 6) means that relate to managers constructively use the idea of their subordinates, Quality Management System (QMS) works successfully on decreasing errors, cost and pledging the identification and control of processes, organization seeks to empower staff and dismantle the current structure, train employees on the new process, develop strategic plans, employees are responsible for the results of their business and give employees the necessary validities to enable them to perform their tasks. The second conclusion is about the level of satisfaction among the tax employees with the current performance of business processes. The results show that in general most tax staff are disagree with their processes that performed with more time, cost and less quality. Limitations and obstacles exist in processes. Processes aren’t integrated (all the means are below 3).

Step 1: propose a way using data mining algorithms to determine the CSFs which are related to the performance of business processes and have big effects in terms of cost, quality, process time, cycle time.

1. Selecting the dataset which included 1,080 records with Comma Separated Values (CSV) format for tax employees’ responses in 2019 after eliminating 24 non-responding employees because of their large number of works, they do not have time to fill out the questionnaire form and 19 ignored for missing the vital variables by respondents.

2. Running Waikato environment for knowledge analysis (WEKA) tool, selecting the explorer application and loading dataset into WEKA tool. Before applying the datamining techniques, WEKA tool accepts determined format where the dataset transformed into Attribute-Relation File Format (ARFF) as shown in Fig. 5.

3. After loading and converting dataset, there are 40 attributes; Attribute of name Qa1 is ignored because it is not the focus of this study, in addition to being optional.

4. Applying the apriori algorithm for association rules discovery which achieves the relationship between Critical Success Factors (CSFs) of Business Process Reengineering (BPR) and Performance of Business Processes as shown in Fig. 6.

5. New rules are discovered through the apriori algorithm for association rules and examining the output to select the suitable required schema which enhance the performance of processes in joint stock companies tax authority and helwan tax authority (as sample units of Egyptian Tax Authority) as shown in Table 4.

6. Filtering new rules according to the suitable required schema: {Qb(—) Qb(—) == <Qc(—)} which help the Egyptian Tax Authority to determine the best CSFs that impacts on the performance of current processes for focusing on them to enhance the performance of BPs after implementing BPR as shown in Table 5. There are suitable eight associations rules after filtering new rules and two rules which are ignored because they don’t match with suitable required schema.

7. Testing the validity of the questionnaire’s answers according to the following Table 6 that shows our constraints by two parameters which are intuitively estimated by the users from the result of applying apriori algorithm. Depending on the choice of those thresholds, association rule mining algorithms can generate best rules.

8. The support of an association rule given by S(X⇒Y) is the proportion of the number of questionnaire answers including both X and Y (|T_X∩|T_Y|) to the total number questionnaire answers of |D|. S(X⇒Y) is given by the following formula (Slimani & Lazzez, 2014). The association rules related to questionnaire answers are given in the following Table 7 (All rules have a support higher than 30%).

$$S(X\Rightarrow Y)={\displaystyle \frac{|T_X\cap |T_Y|}{|D|}}$$

Step 2: analyze the current (As-Is) processes and determine disconnects and value-adding of each process.

The current processes (As-Is models) of taxes are illustrated in detail. Analysis the current processes in Egyptian Tax Authority is very important, because they are previously modeled manually without using a specific modeling technique. So, it is important to model the current processes for analysis that will help in finding out the problem of detecting errors in the model such as redundancy, ambiguity etc.

Step 3: measure the performance of (As-Is) business processes.

In Joint Stock Companies Authority (for 122 sample of soft copy tax returns and 236 hard copy tax return), total of cycle time is 563 h, total of quality is 66% and total of cost for all processes is 7,756,250 EGP while in Helwan Authority (172 samples of hard copy tax returns), total of cycle time is 575 h, total of quality is 52% and total of cost for all processes is 7,655,250 EGP.

Step 4: identify the processes that need to re-engineer.

BPR team will decide which business processes that need to reengineer based on analysis the gathered information of two authorities and its activities in addition to measuring the performance of current (As-Is) business processes of each authority as presented in previous two steps in this stage. BPR team finds that all processes need to reengineer.

Step 1: create one or more alternatives that align with the strategic objectives of the organization to improve (As-Is) processes that need to re-engineer.

The most important critical success factors are discussed that need to be reengineered in Egyptian Tax Authority which align with its strategic objectives and impact on the current processes as follows:

Critical success factors of BPR findings from association rules:

• 1. Organizational structure

The organizational structure is the key factor of success factors that has a significant impact on re- engineering the processes in Joint Stock Companies tax authority and Helwan tax authority. The structure of each organization consists of different aspects such as values, traditions, philosophies, hierarchies, authorities and rules (Jurisch et al., 2012).

The Egyptian Tax Authority is striving to adopt a unified organizational structure for direct and indirect taxes based on the Integration Law in 2006. From our point of view, this caused that the Egyptian Tax Authority needs bureaucratic models, which require the distribution of responsibilities among the different departments and other organizations as well as adjusts its procedures to suit the integration of the two types of taxes. It is necessary to link all databases related to the affiliated authorities of the Egyptian Tax Authority or the authorities that the Egyptian Tax Authority needs to share data with it, such as the civil registry in order to ensure the accuracy of the taxpayer’s data and the Ministry of Finance. This facilitates the taxpayer’s submission of one tax return that includes all taxes that must be collected from him to combat tax evasion based on building a unified organizational structure. This confirms the BPR principle that states “treat geographically dispersed resources as though they were centralized”. Some respondents indicated during the interview that the authority needs to establish a risks and crises management unit that works to solve the crisis, anticipate crisis before it occurs and work to avoid it. Effective communication channels must be established among all departments of the authority.

• 2. Use of information technology

The initiative of the Egyptian Tax Authority to change old processes using information technology is not BPR, but it is automation. There is a misunderstanding in BPR initiatives that give a lot of focus to information technology in the redesign processes that are not among BPR principles. Information technology must be treated as an executor for desirable reengineered processes.

So far, the tax processes in Egypt are done manually although the electronic payment process has already been developed to some extent and the taxpayers have some electronic options to pay off their liabilities. However, it needs further analysis to enable taxpayers to easier and safer to pay tax liabilities to the Egyptian Tax Authority. To implement the changes to the processes to be re-designed using information technology must take into account the following:

• - All information systems within the authority must be effectively integrated and tax procedures checked to formulate them in line with the new implementation of processes, so that duplication of responsibilities can be averted and easily removing non-value-added transactions from the systems.

• - The effectiveness of information technology infrastructure must be measured quantitatively to ensure its success.

• - Proper use of all information technology related resources including desktop computers, laptop computers, servers, network equipment, printers, scanners, mobile Internet connection devices, software etc. that invest in BPR to implement reengineering of taxes processes at the expected level of quality.

• 3. Adequate financial resources

BPR is very expensive process. Respondents indicated that top management does not allocate capital or make plans to finance the re-engineering of existing processes. And that it is necessary to provide all the requirements and work tools to help the Authority’s employees to finish the work assigned to them in an easy way.

It is necessary for the Egyptian Tax Authority to draw up a budget plan to re-engineer the current processes, as it is a long-term investment for the Authority and will benefit from it with a lot of benefit. The capital allocated to the required changes in the Authority should not affect its obligations, workers’ wages, or any costs to its customers. We recommend that a training plan is prepared, as part of the financing plans for the BPR process, by the top management in the authority for its employees to encourage them to accept new changes and to develop themselves.

• 4. Egalitarian culture and leadership

Based on what respondents indicated in the interview and the questionnaire, there is no communication between employees in the authority and managers or an exchange of views and opinions. They explain that their proposals need to be taken into account in carrying out administrative processes. The features of the innovative organizational culture and leadership are the effective use of employee ideas for the authority to achieve the desired results, coordination, employee participation and friendly interactions. We propose to hold a monthly meeting between the managers and employees in the Authority in order to discuss the proposals submitted distribute the tasks to each individual and set an executive plan to perform the tasks in a specific time.

• 5. Change management

Change management is a practice that the authority follows in aligning changes in organizational activities in order to meet challenges and meet customer needs. A best practice is the reward system which was one of the most important items that respondents mentioned with dissatisfaction and that the current system of rewards is completely unfair and needs to be reviewed.

Through the interview with the respondents, they indicated that it is important to study a new tax law that is in line with the current era, as the current law is marred by many difficulties, and many amendments have occurred and it does not meet the needs of the present time.

Also, all employees of the Authority need to retrain; each of them within the limits required by the work carried out by him due to the current training in the authority is insufficient and characterized by incompetence and inadequacy. Finally, because of BPR changes organizational processes, employees must have sufficient skills to carry out new tasks. Through an appropriate training program, employees will have an in-depth understanding of their new tasks.

• 6. Customer focus

There are three questions under this factor, namely organization provides training for employees to determine the interaction with customers for creating long-term relations with them, employees have the motivation to carry out an effective training and the organization is able to provide customers’ demands based on the effective analysis of their requests. These questions illustrate that BPR aims to build long- term relationships by providing the necessary training for employees to deal with taxpayers and paying the employee to obtain training in relation to his work, redesigning workflows with the aim of improving the efficiency and effectiveness of customer relationship which is a process suggested in this study in order to provide financers’ demands and solve their complaints.

• 7. Top management commitment

Top management must have sufficient knowledge of BPR implementation and make important decisions in the BPR implementation process. Top management must motivate staff and friendly interaction with the BPR team. Additionally, Top management should use information and communication technology (ICT) to enhance efficiency of public service delivery (Alahakoon & Jehan, 2020). Respondents indicated through the questionnaire, a great disagreement with the strategic plans laid down by the top management in the authority, and they need to develop to suit the requirements of taxpayers and attract them to the authority by adding new activities that take into account the quality improvement, reduce crises and reduce the percentage of errors.

Some CSFs were included in this research such as less bureaucratic, project management, quality management and collaborative working environment for which WEKA did not find a significant association due to data set's attributes of success factors differ in each industry or organization from the other, depending on its business strategy and the logistical services it provides.

Step 2: use appropriate business process modeling techniques to design To-Be processes.

To-Be Processes are designed with the most suitable modeling techniques that are provided in each As-Is process. Business Process Modelling Notation (BPMN) Modeling Technique is applied in To-Be processes in registration process, risk management process, tax audit process, distraint/ enforced collection processes and customer relationship management process, while Unified Modeling Language Activity Diagram (UML-AD) Modeling Technique is applied in disputes resolution process.

Step 3: measure the performance of the re-engineered (To-Be) processes.

In Joint Stock Companies Authority (for 408 electronic tax return), total of cycle time is 264.55 h, total of quality is 6% and total of cost for all processes is 4,861,750 EGP while in Helwan Authority (124 electronic tax return), total of cycle time is 231.30 h, total of quality is 6% and total of cost for all processes is 4,840,250 EGP.

Step 4: compare the results of measuring the performance of business processes by four items namely, cost, quality, process time, cycle time through two stages As-Is stage and To-Be stage then identify the differences that support the successful implementation of the re-engineering process.

Findings comparison and discussion:

The performance of business processes has been measured by four items namely, cost, quality, process time and cycle time through two stages As-Is stage and To-Be stage then identifies the differences that support the successful implementation of the re-engineering process. BPR team decided to focus on eliminating unnecessary costs by reducing the cost of pool for each activity, reducing the frequency of activities to improve the quality of processes and saving time through the re-engineering process as shown in the Tables 8 and 9 below. In Joint Stock Companies, total cycle time in As-Is is 563 h with six official working hours equivalent of 94 working days which leads to the need for additional hours to work in the quarterly period while total cycle time in To-Be is 264.55 h/quarterly equivalent of 44 working days in the rate of change 53%. The rate of change in quality of processes is 90% for five processes while the rate of change in total of resource cost is 37%. In Helwan Authority, total cycle time in As-Is is 575 h with six official working hours equivalent of 85 working days which leads to the need for additional hours to work in the quarterly period while total cycle time in To-Be is 231.30 h/quarterly equivalent of 39 working days in the rate of change 53%. The rate of change in quality of processes is 88% for five processes instead of four processes as in As-Is while the rate of change in total of resource cost is 37% like in the other authority.

There are significant differences in time, cost, and quality based on previous comparisons to measure the performance of processes through interviewing the respondents of employees, supervisors and top management for introducing sufficient and relevant arguments to our case study. Respondents have pointed out that there are several reasons that led to these differences, which are the obstacles in the current processes (As-Is), and they are as follows: (1) repeating processes due to the lack of a unified system, (2) processes are executed manually and not electronically due to lack of readiness for technical change, (3) lack of a working environment commensurate with the tasks assigned to employees to reduce the percentage of errors, (4) the absence of communication channels between the departments of the Authority or between the employees and the top management to take their proposals into consideration in implementing the processes. (5) the lack of well-studied strategic plans to amend the organizational structure or tax law that is compatible with the current era. (6) activating the risk management process with all authorities instead of the audit process employees performing both processes that need high efficiency and accuracy to detect the risks and work to avoid it. All these reasons are due to the failure to study the factors that affect the processes that are previously explained above and applied in each process assigned to them in the new system (To-Be) to become factors of success rather than reasons/factors for the failure of processes in the authority for improving the performance.

Step 1: implement and test To-Be processes.

To-Be processes are implemented in all units of ETA. Then, we should continuously test process performance (cost, time and quality) to make improvements on them in addition to create an executive plan based on performed BPR to ensure that improved processes are activated over a long-term period.

Step 2: train staff on new processes.

After the completion of the new processes implementation, all employees of the Authority must be trained on them before embarking on their actual work in the Authority and generalize them so that these processes are applied by the employees properly and also give the desired results from their implementation.

Step 3: improve process continuously.

Action progress is accomplished by conducting questionnaires and conversations with those who did not initially participate directly with the re-engineering to know how much more informed the people feel, how much more commitment the top management presents and how well the BPR teams are agreed in the wider perspective of the authority. Total Quality Management (TQM) is used as a tool to handle with different problems encountered throughout the BPR effort and to continually enhance the process.