Reengineering….

BPR, Process Innovation, ERP,

Mass Customization, Networked
Organization, Empowerment, Teams,
Virtual Corporations, TQM, JIT
 Supply Chain

Flow of materials, information,

and services
Includes organizations and
processes
Manage the entire process
Business Process
Reengineering(BPR)
 Reengineering the
Corporation

Written - 1993
Michael Hammer
– One of 1996 most influential
people in the U.S.
Time Magazine
July 17,1996
James Champy
What is Reengineering?

“the fundamental rethinking and

radical redesign of business
processes to achieve dramatic
improvements in critical,
contemporary measures or
performance, such as cost,
quality, service, and speed”
p. 32
 Reengineering is...

Reversing the Industrial

revolution
Starting Over from Scratch
Re-creating
Re-Inventing
Innovation
Process Oriented
 Impacts

Company Customers Employees

 Increase  Benefit Teams
product by an from better Less
order of product
Workers -
magnitude  Needs are More Work
 Examine met
process Empowered
 Tendency
 Vision to return Layoffs
 Increase  Loyalty
Profits
 Why Reengineer

The 3 C’s
– Customers
– Competition
– Change
Nothing is Constant or Predictable
Change is the only constant
To reengineer a company is to
take a journey from the familiar
into the unknown. The journey
has to begin somewhere and
with someone. Where and with
whom?
– P. 101
 Keys

Leaders
Staff Empowerment
Broader Scope
– Knowledge / Skills
Tasks to Process
– Redesign of Systems
Information Technology
Community
 The 3 R’s

Redesign
– Cross-function approach
Retool
– Information Tools
Reorchestrate
– Organization changes
 Problems

Fix vs. Change

Focus
Ignore
Quit
Scope
HR / Unions
Success Rate
 Bell Atlantic’s
Experience

 The difference is that in a compliance

mode I do what I must do because my
boss tells me I must do it. In a
commitment mode, I understand what the
corporation is trying to achieve and how
we’re going to achieve it, and I will do
whatever it takes to make that happen,
including changing the way I do my job if
that is what is required
– p. 196/197
 BPR

No longer a need to destroy

everything - start from scratch

Instead - Flexible approach that

can be executed by proven
methodologies and principles.
Hammer and Stanton[1995]
& Champy [1995]
 Process Innovation

Encompasses the envisioning of

new work strategies, the actual
process design activity, and the
implementation of the change in
all its complex technological,
human, and organizational
dimensions – order-of-magnitude
improvements
Davenport (1993)
 Process Innovation vs.
Incremental Improvement

Process Innov. Incr. Improv.

 Change  Abrupt,  Gradual,
volatile constant
 Effects  Immediate  Long-term
 Involvement  Few  From few to
champions everybody
 High initially,  Low initially,
 Investment
less later high to sustain
 Orientation  Technology  People
 Focus  Profits  Processes
 Networked Organization

Classical/Hierarchical Networked Organ.

 Formal  Informal
 Highly Structured  Loosely Structured
 Manage  Delegate/lead
 Control  Ownership/participation
 Direct  Empower
 Employee a cost  Employees an asset
 Information  Information
management owned shared-ownership
 Risk avoidance  Risk management
 Individual  Team
contributions contributions
 Enabling IT
(P. 133)

Old Rule Intervene Tech New Rule

 Information  Shared  Information
appears in only Database, appears
one place Inter, Intra simultaneously
 Only expert can  Expert  Novices can
perform Systems perform work
complex work  Decision  Decision making
 Only managers support is part of
make decisions systems everyone’s job
 Locate items  Tracking  Items located
manually technology automatically
Add p 138
 CHANGE

“It is an educational and

communications campaign”
– p.148