8uslness rocess 8eenglneerlng

Analysls and 8ecommendaLlons

8y
Maureen Welcher
Wllllam W Chu
Wan Chlng Lln
van Le
uomlnlc ?u
1hanks Lo ur Samuel 8yan of 8aruch College ClLy unlverslLy of new ?ork
CopyrlghL uecember 1993 1hls paper ls was wrlLLen by a group of M8A and MS
sLudenLs aL 8aruch College May be freely quoLed as long as credlL ls glven lease
send any quesLlons or commenLs Lo Maureen Welcher (maureenw[neLllbcom)
Crlglnally posLed on wwwneLllbcom
1 lnLroducLlon
2 Cld Wlne ln new 8oLLles?
3 ls 88 a Culck llx?
4 1he rlce of Lxperlence
3 1he 8ole of Lhe Leader and Manager
6 8eenglneerlng Lhe Puman 8esource
7 Puman 8eenglneerlng Case SLudy 1he Conquerlng ower of Lhe Small
8 88 laces Lhe CusLomer aL Lhe CenLer by 8reaklng uown
CrganlzaLlonal 8arrlers
9 ls lnformaLlon 1echnology an Lnabler or a 8oLLleneck?
10 AlLernaLlves Lo 8eenglneerlng
11 8eenglneerlng 8ecommendaLlons
12 8lbllography

lnLroducLlon
1he [umplng off polnL for Lhls paper ls 8eenglneerlng Lhe CorporaLlon by Mlchael
Pammer and !ames Champy 1he paper goes on Lo revlew Lhe llLeraLure on 88 lL
explores Lhe prlnclples and assumpLlons behlnd reenglneerlng looks for common
facLors behlnd lLs successes or fallures examlnes case sLudles and presenLs
alLernaLlves Lo classlcal reenglneerlng Lheory 1he paper pays parLlcular aLLenLlon
Lo Lhe role of lnformaLlon Lechnology ln 88 ln concluslon Lhe paper offers some
speclflc recommendaLlons regardlng reenglneerlng

Cld Wlne ln new 8oLLles 1he concepL of reenglneerlng Lraces lLs orlglns back Lo managemenL Lheorles
developed as early as Lhe nlneLeenLh cenLury 1he purpose of reenglneerlng ls Lo
make all your processes Lhe besLlnclass lrederlck 1aylor suggesLed ln Lhe 1880s
LhaL managers use process reenglneerlng meLhods Lo dlscover Lhe besL processes for
performlng work and LhaL Lhese processes be reenglneered Lo opLlmlze producLlvlLy
88 echoes Lhe classlcal bellef LhaL Lhere ls one besL way Lo conducL Lasks ln
1aylors Llme Lechnology dld noL allow large companles Lo deslgn processes ln a
cross funcLlonal or crossdeparLmenLal manner SpeclallzaLlon was Lhe sLaLeofLhearL meLhod Lo
lmprove efflclency glven Lhe Lechnology of Lhe Llme 17
ln Lhe early 1900s Penrl layol orlglnaLed Lhe concepL of reenglneerlng 1o conducL
Lhe underLaklng Loward lLs ob[ecLlves by seeklng Lo derlve opLlmum advanLage from
all avallable resources 17 AlLhough Lhe Lechnologlcal resources of our era have
changed Lhe concepL sLlll holds AbouL Lhe same Llme anoLher buslness englneer
Lyndall urwlck sLaLed lL ls noL enough Lo hold people accounLable for cerLaln
acLlvlLles lL ls also essenLlal Lo delegaLe Lo Lhem Lhe necessary auLhorlLy Lo dlscharge
LhaL responslblllLy 17 1hls admonlLlon foreshadows Lhe ldea of worker
empowermenL whlch ls cenLral Lo reenglneerlng
AlLhough Pammer and Champy are eager Lo declare LhaL classlcal organlzaLlon
Lheory ls obsoleLe classlcal ldeas such as dlvlslon of labor have had an endurlng
power and appllcablllLy LhaL reenglneerlng has so far falled Lo demonsLraLe 88 does
noL appear Lo quallfy as a sclenLlflc Lheory because among oLher Lhlngs lL ls noL
dupllcaLe and lL has llmlLed scope 1he appllcablllLy of classlcal managemenL
Lheorles such as dlvlslon of labor were wldely dupllcable and porLable 1hese ldeas
sLlmulaLed lncreases ln producLlvlLy ouLpuL and lncome LhaL led Lo Lhe creaLlon of
Lhe mlddle class
lf 88 ls noL a Lheory buL a Lechnlque Pammer and Champy are surprlslngly vague
abouL Lhe deLalls 1hls paper aLLempLs Lo flll ln Lhe blanks uesplLe Lhelr vagueness
Pammer and Champy are clear abouL who Lo blame when reenglneerlng aLLempLs
fall lL ls Lhe faulL of Lhe lndlvldual company 1o Lhe sLeerlng commlLLee Lhls sounds
llke a varlaLlon of blamlng Lhe vlcLlm
CyerL and March among oLhers polnL ouL LhaL confllcL ls ofLen a drlvlng force ln
organlzaLlonal behavlor 88 clalms Lo sLress Leamwork yeL paradoxlcally lL musL be
drlven by a leader who ls prepared Lo be ruLhless Cne execuLlve wlLh 88
experlence warns noL Lo assume you can slmply lssue dlrecLlves from Lhe cenLer and
expecL lL Lo happen 4
Accordlng Lo 1homas uavenporL classlcal reenglneerlng repeaLs Lhe same mlsLakes
as Lhe classlcal approach Lo managemenL by separaLlng Lhe deslgn of work from lLs
execuLlon 1yplcally a small reenglneerlng Leam ofLen from ouLslde Lhe company
deslgns work for Lhe many 1he Leam ls fueled by assumpLlons such as 1here ls one
besL way Lo organlze work l can easlly undersLand how you do your work Loday l
can deslgn your work beLLer Lhan you can 1here ls llLLle abouL your work now LhaL ls
worLh savlng ?ou wlll do your work Lhe way l speclfy 3 uavenporL suggesLs LhaL
Lhe englneerlng model/analogy LhaL 88 ls based upon ls flawed boLh ln Lerms of
process deslgn and lnformaLlon Lechnology Pe proposes an eLhnographlc approach
Lo process deslgn and an ecologlcal approach Lo lnformaLlon sysLems called
parLlclpaLlve buslness makeovers whlch ls dlscussed laLer ln Lhls paper
lS 88 a Culck llx?
88 ls ofLen used by companles on Lhe brlnk of dlsasLer Lo cuL cosLs and reLurn Lo
proflLablllLy 1he danger ls LhaL durlng Lhls process Lhe company may slash lLs
capaclLy for fuLure growLh 1he example of SLar vaulL lnc a mldslzed
enLerLalnmenL company lllusLraLes Lhls conundrum 1 AfLer 88 SLar vaulL
reLurned Lo shorLLerm proflLablllLy by sacrlflclng lLs lnLernal producLlon capablllLy Lo
creaLe new producLs
Senlor managemenL soon dlscovered LhaL Lhe companys llbrary was becomlng
overexposed and compeLlLlon for Lhe mosL aLLracLlve producL acqulslLlons more
lnLense SLar vaulL was forced Lo reevaluaLe lLs sLraLeglc dlrecLlon lL opLed Lo focus
on nlche markeLs lnsLead of slmply lmprovlng Lhe processes Lhe company
ellmlnaLed nonvalue added expenses and evaluaLed whlch organlzaLlonal elemenLs
were relevanL Lo Lhe sLraLegy As a resulL Lhe company now has Lhe opporLunlLy Lo
susLaln and lncrease lLs markeL share 1
1o reap lasLlng beneflLs companles musL be wllllng Lo examlne how sLraLegy and
reenglneerlng complemenL each oLher by learnlng Lo quanLlfy sLraLegy (ln Lerms of
cosL mllesLones LlmeLables) by accepLlng ownershlp of Lhe sLraLegy LhroughouL Lhe
organlzaLlon by assesslng Lhe organlzaLlons currenL capablllLles and processes
reallsLlcally and by llnklng sLraLegy Lo Lhe budgeLlng process CLherwlse 88 ls only
a shorL Lerm efflclency exerclse 1
Cne of Lhe hazards of 88 ls LhaL Lhe company becomes so wrapped up ln flghLlng
lLs own demons LhaL lL falls Lo keep up wlLh lLs compeLlLors ln offerlng new producLs
or servlces Whlle Amerlcan Lxpress Lackled a comprehenslve reenglneerlng of Lhe
credlL card buslness MasLerCard and vlsa lnLroduced a new producL Lhe corporaLe
procuremenL card Amerlcan Lxpress lagged a full year behlnd before offerlng lLs
cusLomers Lhe same servlce 3 AnoLher wrlLer urges consulLanLs noL Lo presenL 88
as a qulck flx program slnce lL may help you save money Lomorrow buL wlll leave
you ln a worse poslLlon nexL monLh or nexL year 16

1he rlce of Lxperlence
Why are so many companles sLlll eager Lo experlmenL wlLh reenglneerlng even when
Lhey have experlenced prevlous fallures Lhemselves? Companles such as Amerlcan
Lxpress and Amoco were able Lo learn from earller reenglneerlng fallures and
succeed on laLer aLLempLs lL seems LhaL experlence more Lhan Lhe possesslon of
Lhe rlghL approach or meLhodology ls Lhe key Lo reenglneerlng Lrlumph 3 1hls
acknowledgemenL may help explaln Lhe lncreaslng lnLeresL ln reenglneerlng desplLe
Lhe hlgh fallure raLe
WheaLley on Lhe oLher hand descrlbes Lhe appeal of reenglneerlng as a slgn of
collecLlve desperaLlon She noLes when a sLar ls ln lLs deaLh sLage abouL Lo
collapse on lLself lL burns aL lLs brlghLesL wlLh Lremendous energy and fury 8eenglneerlng ls Lhe
supernova of our old approaches Lo organlzaLlonal change Lhe
lasL gasp of efforLs LhaL have conslsLenLly falled 2

1he 8ole of Lhe Leader and Lhe Manager
Many arLlcles polnL LhaL 88 musL have Lhe full supporL of Lop managemenL Lo
succeed lf reslsLance ls encounLered Lhe leader musL be wllllng Lo drlve change
even Lo Lhe polnL of ruLhlessness Cne arLlcle exhorLs Lhe leader Lo emulaLe a prlvaLe
deLecLlve such as hlllp Marlowe who adheres Lo Lhe followlng herolc quallLles
8elenLless adherence Lo whaL ls rlghL Courage moral as well as physlcal
8ecognlLlon LhaL surface appearance ls ofLen an llluslon A dogged deLermlnaLlon Lo
geL aL Lhe deeper LruLh 10 Managers ln a company undergolng reorganlzaLlon
musL work Lo quell Lhe fears of employees and reslsLance Lo change (desplLe Lhe facL
LhaL Lhey may have Lhelr own apprehenslons)
Accordlng Lo one execuLlve wlLh 88 experlence Cnce Lhe reenglneerlng plan ls ln
place youve goL Lo pull ouL Lhe sLops and execuLe lL ?ou cannoL llve ln llmbo
beLween whaL you used Lo do and whaL youre golng Lo do CLherwlse Lhe dramaLlc
resulLs are sacrlflced people lose Lhelr focus and reenglneerlng sllps lnLo process
lmprovemenL 4 Lmployees may be enLhuslasLlc abouL reenglneerlng durlng Lhe
lnlLlal phases lf Lhey vlew lL as a wln wln slLuaLlon Some companles experlence
reslsLance ln laLer sLages when employees begln Lo harbor doubLs abouL Lhe lmpacL
of reenglneerlng and managers are forced Lo adopL a more lnslsLenL pollcy 4
CSC lndex polnLs Lo poverLy of amblLlon as a reason why 88 pro[ecLs fall
Companles LhaL [usL fllrL wlLh reenglneerlng suffer Lhe palns wlLhouL Lhe galns
6 8eenglneerlng advocaLes urge managemenL Lo pull ouL all Lhe sLops and
lmplemenL change on a grand scale Managers ln Lhe organlzaLlons afLer
reenglneerlng are compared Lo coaches 1hey do noL order Lhey gulde 1hey do noL
dlrecL Lhe work of oLhers Lhey coordlnaLe faclllLaLe and empower

8eenglneerlng Lhe Puman 8esource
Pammer and Champy recognlze Lhe lmporLance of Lhe human resource when Lhey
sLaLe companles are noL asseL porLfollos buL people worklng LogeLher Lo lnvenL sell
and provlde servlce 9 Powever Lhey fall Lo demonsLraLe how Lo reenglneer Lhe
human resource ln con[uncLlon wlLh reenglneerlng processes Cf Lhe four cases
presenLed ln 8eenglneerlng Lhe CorporaLlon only Lhe case of CaplLal Poldlng
addresses Lhls area CaplLal Poldlng performed a culLural audlL whlch revealed LhaL
Lhe unwrlLLen code of conducL encouraged lnformaLlon hoardlng and barely
acknowledged Lhe cusLomer ln order Lo combaL Lhese Lendencles senlor
managemenL provlded a consLanL flow of lnformaLlon LhroughouL Lhe company
regardlng reenglneerlng expecLaLlons and successes and revlsed Lhe performance
appralsal sysLem Lo emphaslze Lhe new values of Leam work and cooperaLlon
AlLhough Pammer and Champy provlde a long llsL of why reenglneerlng falls
nowhere do Lhey lnclude Lhe prerequlslLe LhaL no reenglneerlng efforL wlll succeed wlLhouL flrsL
reeducaLlng and reLralnlng Lhe people who wlll ulLlmaLely work wlLh Lhe
new process Accordlng Lo Meg WheaLley lf youre golng Lo move lnformaLlon and
responslblllLy down Lo Lhe local level Lhen Lhe key quesLlon ls how can you be sure
LhaL people wlll behave approprlaLely? ?ou need Lo make sure LhaL everyone ls
playlng by Lhe same rule book 2
CSC lndex ldenLlfles Lwo prlnclple obsLacles Lo 88 are fear among employees LhaL
Lhelr [obs are endangered and LhaL years of experlence wlll accounL for noLhlng 1o
overcome Lhese apprehenslons managers musL consLanLly communlcaLe Lhelr plans
and expecLaLlons 6
AlLhough companles whlch are seeklng Lo reenglneer may work on revamplng Lhe
performance appralsal sysLem Lo supporL new values Lhls can be problemaLlc When
bonuses are llnked Lo proflLs or even Lhe performance of a Leam Lhls may lead Lo a
slLuaLlon where Lhe lndlvldual ls [udged on facLors beyond hls or her conLrol

Puman 8eenglneerlng Case SLudy 1he Conquerlng ower of Lhe Small
C1C lnc ls a small company whlch manufacLures auLomaLlc gaLe openers based ln
1allahassee llorlda When Lhe founder dled suddenly Lhe company was ln Lhe Lype
of dlre sLralLs LhaL would appear Lo have made lL an ldeal candldaLe for
reenglneerlng C1C was loslng money on a monLhly basls lL lacked a llne of credlL
and suppllers shlpped only on a CCu basls Lmployees were requlred Lo work 24
hour shlfLs Lo flll lmporLanL orders and Lhe salesmen were reduced Lo wrlLlng up
mlnuscule orders Lo supplemenL Lhelr lncomes 1he new CLC Chuck MlLchell
adopLed a sLraLegy made up of small gesLures raLher Lhan sweeplng moves 11
1hese gesLures conslsLed of creaLlng an aLmosphere of LrusL and opLlmlsm among
C1Cs harassed employees by llsLenlng Lo and adopLlng Lhelr suggesLlons lmprovlng
Lhelr healLh and dlsablllLy lnsurance and when Lhlngs sLarLed Lo Lurn around
lncreaslng Lhelr pay and dlsLrlbuLlng bonuses from a proflL sharlng plan 1he
salesman were puL on salary wlLh wlLh lncenLlves AcLs such as flxlng Lhe leaky roof
allowlng Len mlnuLe breaks and keeplng Lhe coffee machlne sLocked convlnced Lhe
employees LhaL LhaL MlLchell was genulne 1he followlng year C1C wlLnessed a
culLural and company Lurnaround neL proflLs moved from belng ln Lhe red Lo nearly
$300000 1hls was accompllshed by a 9 lncrease ln gross sales along wlLh a 33
decrease ln LoLal operaLlng and admlnlsLraLlve cosLs Lmployee Lurnover decreased
equally dramaLlcally As employees began Lo seek ouLslde educaLlon and were
promoLed from wlLhln Lhe number of reLurned goods fell 11
C1Cs dramaLlc Lurnaround was a resulL of many small sLeps whlch could be sald Lo
fosLer preclsely Lhe culLure of lncremenLallsm LhaL Pammer and Champy warn
agalnsL 1he focus was on human resources raLher Lhan on processes

88 laces Lhe CusLomer aL Lhe CenLer by 8reaklng uown CrganlzaLlonal
8arrlers Servlce organlzaLlons can puL Lhelr professed commlLmenL Lo cusLomer saLlsfacLlon
lnLo acLlon by placlng Lhe cusLomer aL Lhe cenLer of Lhe reenglneerlng process
Servlce workers are ofLen unable Lo saLlsfy Lhe cusLomer because Lhey musL follow
sLrlcLly deflned rules and Lhey lack Lhe auLhorlLy Lo make excepLlons or Lhe
resources Lo compleLe a LransacLlon
8oberL !anson polnLs Lo Lhree baslc prlnclple LhaL provlde Lhe foundaLlon for servlce
organlzaLlons seeklng Lo reenglneer
- Make Lhe cusLomer Lhe sLarLlng polnL for change by ldenLlfylng cusLomer
wanLs and creaLlng Lhe lnfrasLrucLure Lo supporL Lhese expecLaLlons
- ueslgn work processes ln llghL of organlzaLlonal goals
- 8esLrucLure Lo supporL fronLllne performance 12
When l8M sLarLed reenglneerlng ln 1992 Lhe guldlng prlnclple was Lo become more
cusLomercenLered 1welve cusLomer relaLlonshlp processes were ldenLlfled and used
as a basls for Lhe reenglneerlng pro[ecL Cne example ls soluLlons dellvery a
conLracL beLween l8M and Lhe cusLomer for a compleLe l1 sysLem lncludlng
hardware sofLware Lechnlcal supporL consulLlng servlces and Lhlrd parLy producLs
1he redeslgned process moved Lhe responslblllLy for prlclng Lo Lhe case Leam who
used prlclng Lool sofLware 1hls ellmlnaLed a nearly Lwo monLh delay LhaL formerly
occurred when prlclng was referred Lo l8M headquarLers 13

ls lnformaLlon 1echnology an Lnabler or a 8oLLleneck?
Accordlng Lo a roundLable of execuLlves wlLh exLenslve 88 experlence alLhough
lnformaLlon Lechnology plays a cenLral role ln reenglneerlng Lhe lS organlzaLlon ln
many companles ls unable Lo play 1hls lneffecLualness may be due Lo Lhe hlsLorlc
lnablllLy of lS Lo do anyLhlng blg qulckly Lhe breedlng ouL of rlskLaklng or Lhe
lack of advanced Lechnology groups 4
AnoLher danger ls LhaL slnce Lhe l1 group ls noL percelved as belng parL of Lhe
buslness process Lhey are excluded from Lhe reenglneerlng Leam AeLna Lrled Lo
combaL Lhls dlsengagemenL by presenLlng workshops on Lhe cllenLs buslness Lo Lhe
l1 group 4
Senlor managemenL may be skepLlcal abouL Lhe effecLlveness of l1 as a whole due Lo
Lhe lacklusLer performance of many lnformaLlon sysLems ln Lhe pasL decades ln
facL lL can be argued LhaL Lhe huge lnvesLmenL ln l1 has had llLLle lmpacL on
producLlvlLy AlLhough 83 of l1 spendlng ln Lhe 1980s was ln Lhe servlce secLor
producLlvlLy ln Lhls secLor lncreased only 19 whlle producLlvlLy ln Lhe
manufacLurlng secLor rose 44 13 8ased on Lhls record lL ls noL unreasonable Lo
vlew l1 as a dlsabler whlch ls never used Lo challenge why Lhlngs are done ln a
company buL lnsLead [usLlfy Lhe way Lhey are done SysLems ln Lhe servlce secLor
have been used Lo generaLe more unneeded reporLs speed up superfluous work
sLeps generaLe unnecessary lnformaLlon encourage shoddy Lhlnklng and mlsdlrecL
aLLenLlon Lo spurlous deLalls 13 Cne (anonymous) company falled repeaLedly Lo reenglneer because lL
spenL a loL of
Llme bulldlng casLles ln Lhe alr regardlng process redeslgn wlLhouL paylng aLLenLlon
Lo lnformaLlon Lechnology 3 Cn Lhe oLher hand CnLarlo Pydro found LhaL Lhe
greaLesL lmprovemenL came when Lhey gave Lhe l1 group Lhe Lools Lhe
lnformaLlon and Lhe auLhorlLy Lo lmplemenL change raLher Lhan by core process
reenglneerlng 1he l1 group was able Lo lmplemenL cllenL server appllcaLlons
relaLlvely early because lndlvlduals Look ownershlp responslblllLy and
accounLablllLy wlLhouL Lhe company even asklng for lL 4
MosL analysLs vlew reenglneerlng and lnformaLlon Lechnology as lrrevocably llnked
WalmarL for example would noL have been able Lo reenglneer Lhe processes used Lo
procures and dlsLrlbuLe massmarkeL reLall goods wlLhouL l1 lord was able Lo
decrease lLs headcounL ln Lhe procuremenL deparLmenL by 73 by uslng l1 ln
con[uncLlon wlLh 88 ln anoLher well known example
uesplLe sLudles LhaL lndlcaLe over half of all reenglneerlng efforLs are lnlLlaLed
because of a percelved lnformaLlon Lechnology opporLunlLyLhe acLual Lechnologlcal
soluLlon ls far less lmporLanL Lhan educaLlng employees Lo use l1 as boLh a sLraLeglc
lnlLlaLlve and as a Lool ln Lhe reenglneerlng process 4
8ased on Lhe above flndlngs some lnslsL LhaL when developlng a reenglneerlng
sLraLegy Lhe besL companles lgnore lnformaLlon Lechnology Cnly afLer Lhe
sLraLegy ls compleLe should lnnovaLlve l1 appllcaLlons be benchmarked slnce
lnnovaLlve appllcaLlons ofLen sLem from a comblnaLlon of breakLhrough ldeas and
from modlfylng several besL pracLlces 7
l1 can prove useful ln Lhe reenglneerlng analysls and deslgn process Craphlcs
sofLware and CASL Lools can produce process maps spreadsheeLs and cosLlng
sofLware allow for acLlvlLybased cosL analysls daLabases can Lrack cusLomer
saLlsfacLlon and complalnLs bllnd e mall bulleLln boards can be used Lo capLure
employee suggesLlons ln addlLlon emall and groupware can faclllLaLe
communlcaLlon and coordlnaLlon across geographlcal and organlzaLlonal barrlers 7
uurlng Lhe lmplemenLaLlon sLage companles should follow Lhese baslc rules
- 8ecognlze LhaL l1 ls only parL of Lhe soluLlon lL allows managers Lo collecL
sLore analyze and communlcaLe and dlsLrlbuLe lnformaLlon beLLer
- CuL and pasLe Lhe l1 Lools needed
- 8rlng ln lnLernal or exLernal l1 experLs Lhelr knowledge skllls acumen and
experlence are lnvaluable
- AfLer lmplemenLaLlon conLlnually monlLor l1 performance and keep up wlLh
new l1 developmenLs 7
Cn Lhe oLher hand some companles have found lL useful Lo deslgn a Lechnology
sLraLegy before reenglneerlng When SLar Maker lnc an
enLerLalnmenL/communlcaLlons company experlenced a downLurn Lhe ClC of Lhe
company convlnced senlor managemenL Lo make addresslng Lhe role of l1 Lhe flrsL
lLem on Lhe agenda SLar Maker deslgned a plan Lo use Lechnology Lo place Lhe
company ln Lhe forefronL of Lhe lndusLry wlLh servlces such as elecLronlc producL
caLalogues cusLomer lnLerface sLandards sophlsLlcaLed elecLronlc daLa llnks
cusLomer and markeL daLabases and dlglLal vldeo 1he new Lechnology needed Lo
drlve growLh was Lhen pald for by Lhe cosL savlngs from 88 1 uavenporL proposes an ecologlcal
model when redeslgnlng lnformaLlon sysLems up
Lo Lhe presenL Lhe domlnanL model of l1 has been LhaL daLa sLreams can be
delgned archlLecLurally and englneered1hls approach lnvolves deLalled modellng
of lnformaLlon requlremenLs and flows and Lhelr relaLlon Lo buslness acLlvlLles and
processes 3 1he LradlLlonal approach runs lnLo dlfflculLles when confronLlng
envlronmenLs LhaL are fluld dynamlc or characLerlzed by dlssenL uavenporL argues
LhaL Lhe basls of l1 redeslgn musL be Lhe lndlvldual who uses Lhe lnformaLlon uaLa
Lurns lnLo lnformaLlon when lL ls placed ln a human behavloral conLexL
quoLLlke Lhe more famlllar form of ecology lnformaLlon ecology lnvolves
esLabllshlng a conLexL for analysls an undersLandlng of Lhe lnLerrelaLedness of a
number of dlfferenL facLors Lhe need for acuLe observaLlon and descrlpLlon (lnsLead
of modellng and predlcLlon)Lhe valulng of dlverslLy and Lhe recognlLlon of conLlnual
flux and evoluLlon 3
WheaLley also expresses mlsglvlngs abouL Lhe domlnanL sclenLlflc model for l1 She
suggesLs LhaL Lhe naLural sclences may be a more approprlaLe model She descrlbes
organlzaLlons as llvlng sysLems whlch ln order Lo be healLhy need access Lo lLs
own lnLelllgence where condlLlons supporL Lhe use of LhaL lnLelllgence She polnLs
Lo Lhe example of Lhe uS Army whlch ls lnLenL on movlng lnformaLlon everywhere
ln Lhelr organlzaLlons wlLhouL knowlng ahead of Llme who wlll need whaL 2
1he democraLlzaLlon of l1 from Lhe malnframe Lo Lhe C ls breaklng down Lhe
communlcaLlons barrlers beLween corporaLe funcLlons suppllers and even
cusLomers 7 Pammer and Champy call Lhls Lhe dlsrupLlve power of l1 1hls
ablllLy for lnformaLlon Lo be aL many places aL Lhe same Llme whlch allows
companles Lo reap Lhe beneflLs of boLh cenLrallzaLlon and decenLrallzaLlon ls aL Lhe
hearL of 88

AlLernaLlves Lo 88
8eenglneerlng works wlLh exlsLlng buslness pracLlces 1hls lmpalrs Lhe enLlre
reenglneerlng process as lL sLlfles lnnovaLlon ln flndlng new ways Lo compeLe 88
falls shorL when deallng wlLh new producLs or servlces slnce any sLraLeglc
ob[ecLlves achleved are slmply Lhe by producL of lmproved producLlvlLy 13
SLraLeglc reenglneerlng addresses Lhls shorLcomlng by focuslng on deslgnlng Lhe
organlzaLlon Lo compeLe 1hls ls accompllshed by underLaklng sLraLeglc lnlLlaLlves aL
Lhe sLarL of Lhe reenglneerlng process 1hese lnlLlaLlves seek Lo provlde
undersLandlng of Lhe markeLs compeLlLors and Lhe poslLlon of Lhe organlzaLlon
wlLhln Lhe lndusLry CrlLlcal success facLors requlred Lo compeLe are ldenLlfled and
prlorlLlzed Cnly Lhen are lndlvldual buslness processes addressed 13
arLlclpaLlve buslness makeovers re[ecL Lhe Lop down approach Lo reenglneerlng ln
favor of a mlddle ground where Lhe managers and workers come LogeLher Lo
redeslgn buslness processes uavenporL proposes LhaL Lhe 88 Leam be spllL lnLo Lwo
parLs a deslgn Leam made up of senlor mangers and an execuLlon Leam composed
of people who wlll acLually do Lhe work Whlle Pammer and Champy speclflcally warn
agalnsL spendlng Loo much Llme sLudylng Lhe currenL process Lhls meLhod advocaLes
an eLhnographlc approach where Lhe deslgner sLudles and parLlclpaLes ln Lhe
process Lo be redeslgned 1hls provldes a deeper undersLandlng of Lhe process and demonsLraLes Lhe
Leams commlLmenL Lo Lhe workers 1he Leam musL be wllllng Lo
sell a new process as Lhough lL were a process expecL and LoleraLe modlflcaLlons Lo
Lhe process and change Lhe reward sysLem Lo moLlvaLe change 3
CrlLlcs of 88 argue LhaL lL ls ofLen used as a euphemlsm for denomlnaLor
reducLlon Cne may vlew producLlvlLy as a funcLlon of revenue or sales dlvlded by
Lhe number of people requlred Lo generaLe Lhe revenue 88 lncreases producLlvlLy
by cuLLlng cosLs buL does noLhlng Lo lncrease Lhe revenues or sales 88 ls ofLen
underLaken by flrms playlng caLch up Lo avold dlsasLer buL lL does noLhlng Lo
regeneraLe core sLraLegles whlch can lead Lo a real growLh ln revenues 9 lor
example 8rlLalns manufacLurlng ouLpuL (Lhe numeraLor) lncreased abouL Len percenL
beLween 1969 and 1991 whlle Lhe number of employees (Lhe denomlnaLor) was cuL
ln half AlLhough producLlvlLy skyrockeLed 8rlLaln surrendered global markeL share
Cne almosL expecLed Lo plck up Lhe llnanclal 1lmes and flnd LhaL 8rlLaln had flnally
maLched !apans manufacLurlng producLlvlLy and Lhe lasL remalnlng person aL
work ln 8rlLlsh manufacLurlng was Lhe mosL producLlve son of a gun on Lhe planeL
l
CLher crlLlcs warn LhaL alLhough 88 may lead Lo a compeLlLlve advanLage lL ls
desLlned Lo be very shorL llved When one company lowers lLs cosLs of dolng
buslness oLher companles wlll lmmedlaLely follow and Lhe compeLlLlve advanLage ls
losL Cne wrlLer warns LhaL Lhe reason why reenglneers are so dangerous ls LhaL due
Lo Lhe obsesslon wlLh benchmarklng all flrms ln an lndusLry sLarL converglng on a
polnL of no dlfference and Lhus of no proflL 14
uurlng Lhe pasL decades Lhe uS along wlLh Lhe resL of Lhe world has had Lo
reassess Lhe ldea of compeLlLlve advanLage 1he ldea LhaL compeLlLlve advanLage lles
ln a naLlons naLural resources has been abandoned 88 lf lefL unchecked seems Lo
offer Lhe dlsmal prospecL LhaL compeLlLlve advanLage lles ln consLanL cosL
mlnlmlzaLlon 1he sLeerlng commlLLee agrees wlLh 8oberL 8elch and oLhers who
propose LhaL compeLlLlve advanLage for Lhe nexL cenLury lles ln a naLlons workforce
and lnfrasLrucLure of a naLlon and Lhe ablllLy Lo creaLe and dellver new producLs and
servlces ln Lhe global markeLplace

8eenglneerlng 8ecommendaLlons
- 88 musL be accompanled by sLraLeglc plannlng whlch musL address
leveraglng l1 as a compeLlLlve Lool
- lace Lhe cusLomer aL Lhe cenLer of Lhe reenglneerlng efforL concenLraLe on
reenglneerlng fragmenLed processes LhaL lead Lo delays or oLher negaLlve
lmpacLs on cusLomer servlce
- 88 musL be owned LhroughouL Lhe organlzaLlon noL drlven by a group of
ouLslde consulLanLs
- Case Leams musL be comprlsed of boLh managers as well as Lhose wlll
acLually do Lhe work
- 1he l1 group should be an lnLegral parL of Lhe reenglneerlng Leam from Lhe
sLarL
- 88 musL be sponsored by Lop execuLlves who are noL abouL Lo leave or
reLlre - 88 pro[ecLs musL have a LlmeLable ldeally beLween Lhree Lo slx monLhs so
LhaL Lhe organlzaLlon ls noL ln a sLaLe of llmbo
- 88 musL noL lgnore corporaLe culLure and musL emphaslze consLanL
communlcaLlon and feedback

8eenglneerlng 8lbllography
1 8erman Saul SLraLeglc ulrecLlon uonL 8eenglneer WlLhouL lL Scannlng
Lhe Porlzon for 1urbulence lannlng 8evlew november 1994 g 18
2 8rown 1om ueenglneerlng Lhe CorporaLlon lndusLry Week Aprll 18
1994 g 18
3 Cafasso 8osemary 8eLhlnklng 8eenglneerlng CompuLerworld March 13
1993 g 102
4 Caldwell 8ruce MlssLeps Mlscues 8uslness 8eenglneerlng lallures
lnformaLlonWeek !une 20 1994 g 30
3 Chew Angle Pow lnsurance llrms Can 8eenglneer for Success 8uslness
1lmes !une 20 1994 g 11
6 Cone Ldward 1echnology Chlef of Lhe ?ear All Lhe 8lghL Moves 1om
1ralner of 8eebok lnLernaLlonal Successfully 1eamed 8uslness
8eenglneerlng wlLh lnformaLlon 1echnology lnformaLlonWeek uecember
26 1994 g 33
7 uavenporL 1homas P Wlll arLlclpaLlve Makeovers of 8uslness rocesses
Succeed Where 8eenglneerlng lalled? lannlng 8evlew !anuary 1993 g
24
8 LconomlsL newspaper Croup 8eenglneerlng 8evlewed 1he LconomlsL
!une 1994 g 24
9 LLLorre 8arbara 8eenglneerlng 1ales from Lhe lronL ManagemenL
8evlew !anuary 1993 g 13
10 lurey 1lm 8 and CarllLz !ennlfer L and kelleher Mlchael L Applylng
lnformaLlon 1echnology Lo 8eenglneerlng lannlng 8evlew november
1993 g 22
11 Pamel Cary and rahalad Ck CompeLlng for Lhe luLure Parvard
8uslness 8evlew !ulyAugusL 1994 g 122
12 PyaLL !oshua 8ealWorld 8eenglneerlng lnc Aprll 1993 g 42
13 !anson 8oberL Pow 8eenglneerlng 1ransforms CrganlzaLlons Lo SaLlsfy
CusLomers naLlonal roducLlvlLy 8evlew uecember 22 1992 g 43
14 kavanagh !ohn Challenge for Company CulLure 8uslness
8eenglneerlng 1he need for 1oLally new 1hlnklng 1he llnanclal 1lmes
March 23 1993 Survey of lnformaLlon and CommunlcaLlons 1echnology
(19) g lx
13 kehoe Loulse uown ln Lhe ulrL Lo Clean up l8M/ Loulse kehoe Cffers a
ConLrasLlng vlew of 8uslness rocess 8e englneerlng llnanclal 1lmes
uecember 3 1994 g 8
16 LeLh SLeven A CrlLlcal Success lacLors for 8eenglneerlng 8uslness
rocesses naLlonal roducLlvlLy 8evlew SepLember 22 1994 g 337 17 Lloyd 1om ClanL wlLh leeL
of Clay/ 1om Lloyd Cffers a ConLrasLlng vlew
of 8uslness rocess 8eenglneerlng llnanclal 1lmes uecember 3 1994
g 8
18 Lorenz ChrlsLopher 8eenglneerlng ln Small uoses Cnly 1he llnanclal
1lmes !uly 1 1994 g 14
19 May 1hornLon noLSoSuccessful 8eenglneerlng 8yLe uecember 1994
g 43
20 Moad !eff AfLer 8eenglneerlng 1aklng Care of 8uslness uaLamaLlon
CcLober 13 1994 g 40
21 Moad !eff uoes 8eenglneerlng 8eally Work? uaLamaLlon AugusL 1
1993 g 22
22 SchnlLL uavld L 8eenglneerlng Lhe CorporaLlon uslng lnformaLlon
1echnology !ournal of SysLems ManagemenL !anuary 1993 g 14
23 SLrassman aul A 1he 8ap on 8eenglneerlng CompuLerworld
SepLember 26 1994 g 119
24 1aylor 8llly L keeplng 88 from 8elng 1CMed LnLerprlse
8eenglneerlng !an 1993 g 3
23 WhlLlng !ohn 1 8eenglneerlng Lhe CorporaLlon (book revlew) lndusLrlal
ManagemenL november 1994 g 14