Reengineering

Reengineering

Reengineering –the radical redesign of business process to achieve major gains in cost, service or time.

* An effective way to implement a turnaround strategy

* Break away from old rules and procedures that become ingrained in an organization over time.

* Combination of policies, rules, provedures that were never closely examined because they were met there.

* May have been based on assumptions that are no longer relevant

* Reengineering question – “if this were a new company, how would we run this place”

* Popularized by Michael Hammer

* Organize around outcomes, not tasks- jobs and departments should be designed around specific objectives an outcomes instead of single tasks

* Have those who use the output of the process perform the process- people who need the results of processes can now reengineer the processes themselves

* Subsume information-processing work into the real work that produces information- instead of sending off raw data for use, people who produce it can process it themselves

* Treat geographically dispersed resources as though they were centralized- flexible service is provided locally while actual resources are kept in a centralized location.

* Link parallel activities instead of integrating their results: units performing different activites that end up together should communicate throughout the process so as to allow efficient integration

* Put the decision point where the work is performed and build control into the process: the people who do the work should make the decisions and be self controlling

* Capture information once and at the source: network databases should be set up so that all can access information there and independent units do not have to develop its own database.

For example, the EMI Records Group was having difficulty filling orders for its most popular CDs. Retailers and recording stars were rebelling--it took the company as much as 20 days to deliver...