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 Quality Management

Reinventing Reengineering

Hiring a strike force to install new,
effective processes sounds far better than it works.

A few years ago, one of the hottest trends in U.S. business was reengineering. Some companies even had "reengineering departments" and "directors of reengineering." Courses on reengineering were packed, and it was almost impossible to pick up a magazine or journal that did not have at least one article on reengineering.

And then, almost as suddenly as it had appeared on the scene, it disappeared. Even some of the best proponents of reengineering were writing articles about its failures and why it didn't work. Now, in some companies, the term "reengineering" is no longer allowed to be spoken. It has become so associated with downsizing that it creates noticeable panic whenever mentioned.

Other companies have quietly integrated reengineering into their total quality system and moved on to other areas of emphasis. They have found many of the concepts to be valid and useful, and continuously apply them as they strive to improve organizational performance.

The question has been how to separate the wheat from the chaff. Many great ideas and new practices came with the business process reengineering flurry. But a lot of hype and unfulfilled promises also appeared.

The true pioneers of business process quality management took basic quality improvement and control ideas, and applied them where no one had ventured before: to administrative and business processes.

Some of the early results were truly staggering. Cycle times were reduced by more than 90 percent, with reductions in staff of 50 percent or more. Processes were simplified from 20 or 30 steps to three or four -- or even to one. Paper flows were cut drastically; sometimes paper forms were eliminated completely. Insurance agents were completing claims at auto crash sites; orders were being taken, filled and shipped in a few minutes vs. weeks or even months. Customers were able to check order status online rather than going through four or five "customer representatives."

But what went wrong? With so much promise and such potential, why did so many companies fail?

One reason was the endless search for the "silver bullet," the one method that would solve all problems. Many managers failed to understand that process thinking was a fundamentally new idea for them, and they didn't understand the critical differences between task management vs. process management. Without the fundamental ideas of quality management well-understood and practiced within an organization, the organization does not have the tools to manage the critical processes.

A second reason was the tendency to try to "buy" reengineering. Hiring a strike force of outsiders to come into the organization to quickly destroy the old processes and instantly install new, effective, efficient processes sounds far better than it works. Our own people still have to manage these processes in the long run. They have to make the measurements, fix the problems and continuously improve both efficiency and effectiveness.

The third reason was the failure to understand the tight connection between truly world-class business processes and information technology.

One of the true pioneers in business process reengineering is Gabriel Pall, formerly the director of IBM's Quality Institute and now one of my colleagues at Juran Institute. Gabe's 1987 book, Quality Process Management, was the first significant text on the subject and the one that introduced me -- and many others -- to these concepts. Gabe recently shared with me his views on the major developments in business process reengineering in the past five years.

First, enterprises accomplish their business strategies through their critical business processes. Business process reengineering is thus a strategic management undertaking.

Second, the deployment of key resources such as information technology and human resources (for many organizations this involves culture change) is an integral part of reengineering.

Third, the emergence of process ownership is a viable and practical management role, not just a concept or label.

And, finally, the organization must recognize that a business process is not just the transformation of inputs into outputs but comprises the communication and management of commitments.

The other point Gabe emphasized is how much the various reengineering methodologies have been enhanced by their integration with advanced information technology tools and systems.

For many companies, reengineering has become a valuable tool in their continuing efforts to build world-class organizations. Used intelligently, these ideas lead to major breakthroughs in business performance.

About the author

A. Blanton Godfrey is chairman and CEO of Juran Institute Inc. at 11 River Road, Wilton, CT  06897. He can be reached by e-mail at agodfrey@ qualitydigest.com.


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