Reengineering means that we take responsibility for the services we offer, the goods we produce and the processes we take part in. It means ownership and guarantees. It means getting involved and getting personal with your work. And it means radical breakthroughs in service and profits. It benefits customers and the company. This book explains the phenomena of reengineering, describes how it should feel and look like, and how to do it. The book is informative, Persuasive and educational.
Chapter one introduces the need for reengineering by showcasing the faults of today�s businesses. But not only does it rant about the shortcomings, but explains why they exist and offers a solution by way of reengineering. It talks about how no one is in charge of the processes in a business and that when a customer calls in for information no one person can adequately explain where their product or service is in the system because it gets shuffled around and is �lost� somewhere in there. The book shows examples that well illustrate the effects of reengineering which include IBM, Ford, Kodak, Wal-Mart, HP, and many more.
They make a good point that using the right technology is much more important than just using technology. Any technology can makes things faster. But you want to revolutionize technology and use it creatively to redesign the process and make it work for you not just with you. A database is an excellent way to speed up data entry and analysis, but if you can redesign your computer system so that these databases are used to make decisions for you (ie: how much to produce and when) you will cut executive salary cost, eliminate bias, poor judgment and uncertainty. This is another aspect of reengineering, inductive thinking. This is what you are doing when you take a revolutionary idea and find all the problems it could possibly solve. This usually helps you find problems that you didn�t even know you had! The best way to come up with revolutionary ideas is to take the old rules, the old assumptions, and break them, just throw them out! Then see what you come up with and see how it might work for you.
The authors want companies to eliminate handoffs, end standardization and �delinearize� processes. This means compressing horizontally as well as vertically so that there are less people involved at each level and less separation between senior executives and the customers. Empowering lower level workers means that decision making can be done where it needs to be done and not by someone three levels up who really doesn�t have the right perspective to make the decision anyway. It also means a different way of compensation and rewards for workers that encourage growth and creativity. Bonuses instead of raises for good work better reflect the current performance on the job. And of course there is a different breed of employees nowadays. In Ford�s assembly lines he had unskilled, uneducated immigrants working repetitive jobs that don�t require skill. But today employees come educated, much more Americans are getting through college and can offer more to the company. We should take advantage of this and steer away from mere training employees, to educating them and teaching the �why� instead of just the �how�. Workers aren�t dumb animals, believe it or not, they can think for themselves and even make decisions! We should encourage this and take advantage of it.
Chapter 8 gives a good walk through of how to get started in the reengineering process by using a fictitious company, Imperial Insurance. It is an excellent example of how they take crazy ideas and think about what it might solve. They find problems they didn�t know they had, like speediness. They started thinking from the customer�s perspective, which I think is one of the most important aspect. And they find themselves identifying and deciding to break the rules and assumptions the company had. After that the book goes into more examples Hallmark, Taco Bell, Capital Holding, and Bell Atlantic to show the reengineering experiences of these companies. It really helps to see how they implement and expedite the ideas and processes of reengineering. But it is important to know that reengineering is not easy. You must dedicate yourself and your company to it. Because it is so radical it can not be taken lightly.
The authors have defined three kinds of companies that need to be reengineered. First, the company that is in deep trouble, about to go under and needs all the help it can get. To them reengineering is their last hope, they have no other choice. Then there are companies that are doing just fine but they can foresee trouble in the future. The difference here is that they are smart enough to know that they better act now. In my opinion this kind of company will have the most difficulty getting the entire company to jump on the band wagon because most employees are content with the company�s standings thus far. Many on board may not want to rock the boat. The third kind of company, the kind that is ambitious and aggressive will have an easier time convincing the rest of the company because it is their very nature to be creative and revolutionary in their field. These company�s are on top but decide they want to widen the gap between them and their competitors. The authors put this idea so perfectly into this cute little analogy: �Companies in the first category are desperate; they have hit the wall and are lying injured on the ground. Companies in the second category are cruising along at high speed, but see something rushing toward them in the head lamps. Could it be a wall? Companies in the third category are out for a drive on a clear afternoon, with no obstacles in sight. What a splendid time, they decide, to stop and build a wall for the other guys.�
Reengineering is about throwing out the old and bringing in the new way to run a business. The authors make a very strong statement that Adam Smith�s views and philosophies no longer apply to today�s business world. Their claim is that it is now time for companies to update their structure and views to better compete and increase profits. There is discussion about how Adam Smith�s Wealth of Nations has been used as a model for businesses up until now. But Smith�s ideas are no longer relevant because of a new breed of customers, increased, global competition based on a variety of standards of comparison, and change itself coming at a much greater pace and becoming the norm. Yes, change has become the norm. So a company that does not Reengineer, will be light years behind the rest and losing out on immense financial gains. It is wave of the future as far as business is concerned.
DEFINITIONS
I have put together a collection of direct quotes and paraphrasing statements from the book that can act as a working glossary of terms presented.
Benchmarking � looking for companies that are doing something best and learning how they do it in order to emulate them. (pp. 132)
Business Process � collection of activities that takes one or more kinds of input that is of value to the customer. (pp. 35)
Case for action � a dramatically persuasive argument, supported by evidence, that spells out the cost of doing anything short of reengineering. (pp. 149)
Deductive thinking � defining problems then seeking and evaluating different solutions to the problems. (pp. 84)
Delinearizing � speeds up processes by eliminating the straight line sequence in which tasks must be done in order so that various tasks can be done simultaneously whenever possible. (pp. 54)
Discontinuous thinking � identifying and abandoning the outdated rules and fundamental assumptions that underlie current business operations. (pp. 3)
Humpty Dumpty School of Management � companies break processes up into lots of little pieces (or tasks) then has to hire all the king�s horses and all the king�s men to paste the fragmented work back together again. (pp. 29)
Inductive thinking � recognize a powerful solution and then seek the problems it might solve. (pp. 84)
Insiders � members of the reengineering team who currently work inside the process undergoing reengineering. (pp. 109)
Leader � in the reengineering process, a senior executive who authorizes and motivates the overall reengineering efforts. (pp.102)
Outsiders � members of the reengineering team that don�t work in the process that�s undergoing reengineering or the company. (pp. 110)
Process maps � a picture of how work flows through the company, thus creating a vocabulary for the reengineering team to work with. (pp. 119)
Process owner � a manager with responsibility for a specific process and the reengineering effort focused on it. (pp. 102)
Process Team � a unit that naturally falls together to complete a whole piece of work�a process. (pp. 66)
Reengineering � the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service, and speed. (pp. 32)
Reengineering czar � an individual responsible for developing reengineering techniques and tools within the company and for achieving synergy across the company�s separate reengineering projects. (pp. 103)
Reengineering team � a group of individuals dedicated to the reengineering of a particular process, who diagnose the existing process and oversees its redesign and implementation. (pp. 102)
Say�s Law � supply creates its own demand. (pp. 87)
Signals � explicit messages that the leader sends to the organization about reengineering: what it means, why we are doing it, how we are going about it, and what it will take. (pp. 105)
Steering Committee � a policy making body of senior managers who develop the organization�s overall reengineering strategy and monitor its process. (pp. 102)
Symbols � actions that the leader performs to reinforce the content of the signals, to demonstrate that he or she lives by his or her words. (pp. 106)
Systems � management systems must measure and reward people�s performance in ways that encourage then to attempt major change. (pp. 106)
Triage � the initial step in a process that determines which of the (usually three) different versions of a process the customer should be carried through. (pp. 55)
Vision statement � a qualitative and quantitative statement of the kind of organization the management believes the company needs to become. (pp. 154)