| Reengineering (or re-engineering)is the radical redesign of an organization's processes, especially its business
processes. Rather than organizing a firm into functional specialties (like production, accounting, marketing, etc.) and
looking at the tasks that each function performs, we should be looking at complete processes from materials acquisition, to
production, to marketing and distribution. The firm should be re-engineered into a series of processes.
The main proponents of re-engineering were Michael Hammer and James Champy. In a series of books including Reengineering
the Corporation, Reengineering Management, and The Agenda, they argue that far too much time is wasted
passing-on tasks from one department to another. They claim that it is far more efficient to appoint a team who are responsible
for all the tasks in the process. In The Agenda they extend the argument to include suppliers, distributors, and other
business partners.
Re-engineering is the basis for many recent developments in management. The cross-functional team, for example, has become popular because of the desire to re-engineer separate
functional tasks into complete cross-functional processes. Also, many recent management information systems developments aim to integrate a wide number of business
functions. Enterprise resource planning,
supply chain management, knowledge management systems, groupware and collaborative systems,
Human Resource Management Systems
and customer relationship
management systems all owe a debt to re-engineering theory.
Criticisms of re-engineering
Reengineering has earned bad reputation because such projects have often resulted in massive layoffs. In spite of the hype
surrounding its introduction (partially due to the fact that the authors of Reengineering the Corporation reportedly
bought huge numbers of copies to promote it to the top of bestseller lists), reengineering has not lived up to its
expectations.
The main reasons seem to be that:
- reengineering assumes that the factor that limits organization's performance is the ineffectiveness of its processes (which
may or may not be true) and offers no means of validating that assumption
- reengineering assumes the need to start the process of performance improvement with a "clean slate", i.e. totally disregard
the status quo
- reengineering does not provide an effective way to focus improvement efforts on the organization's constraint (as defined by Eliyahu M.
Goldratt in his theory of constraints).
References
- Champy, J. (1995) Reengineering Management, Harper Business Books, New York, 1995.
- Hammer, M. (1990)"Reengineering Work: Don't Automate, Obliterate", Harvard Business Review, July/Aug 1990, pp.
104-112.
- Michael Hammer, James A. Champy: (1993)
Reengineering the Corporation: A Manifesto for Business Revolution, Harper Business Books, New York, 1993, ISBN 0066621127
- Hammer, M. and Stanton, S. (1995) "The Reengineering Revolution", Harper Collins, London, 1995.
- "Reengineering Reviewed", (1994) The Economist, 2 July 1994, pp 66.
- Geary A. Rummler,
Alan P. Brache:
Improving Performance: How to Manage the White Space in the Organization Chart, ISBN 0787900907
|
