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Reengineering work: don’t automate, obliterate. Sepehr Keyvan-Shokouhi Serima Nazarian Kourosh Yazdani R. Outline. Introduction Some legends; Ford and MBL The navigate of reengineering 7 disciplines of reengineering Leadership with real vision. Introduction | this era.

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Reengineering work don t automate obliterate

Reengineering work: don’t automate, obliterate

SepehrKeyvan-ShokouhiSerimaNazarianKourosh Yazdani R


  • Introduction

  • Some legends; Ford and MBL

  • The navigate of reengineering

  • 7 disciplines of reengineering

  • Leadership with real vision

Introduction this era
Introduction | this era

  • Time of rapidly changing technology

  • Age of the customer

  • Usual methods have not yielded dramatic improvements

  • IT vs. disappointing results

  • ‘reengineer’ the business; use IT to rapidly redesign business processes

  • Find imaginative new ways to accomplish work

  • Not meticulous planning – no small and cautious steps

  • All-or-nothing proposition with an uncertain result

Tale of ford s reengineering
Tale of Ford’s reengineering

  • ‘re-eng’ in accounts payable processes

  • Plan: rationalizing processes and installing new computer systems

  • Goal: reduce the head-count by 20%

  • Old procedure and situation; huge and disappointing

  • Changes;

    • Invoice-less processing

    • IT helps by using database

    • 14 data items to only 3 items

    • All matchings are done automatically

  • Results; 75% reduction in head-count and no mismatches and more accurate financial info

Case of mutual benefit life
Case of Mutual Benefit Life

  • ‘re-eng’ in insurance applications

  • Old way; 30-steps rigid sequential process involving 5 depts. and 19 people process an applicant in 24 hours

  • Goal: 60% improvement in productivity

  • Changes;

    • Shared databases and powerful PC-based networks and workstations

    • Expert systems

    • New position of ‘case manager’ instead of many job definitions

  • No more handoffs of files, no more shuffling of inquiries

  • Results: application completion in only 4 hours and elimination of 100 vain positions

The navigate of re eng
The navigate of ‘re-eng’

  • Don’t cut fat processes and don’t automate them

  • Challenge old underperforming assumptions and rules

  • Quality, innovation and service are now more important than cost, growth and control

  • Industrial Revolution and postwar period: specialization of labor! But delays, errors, bureaucracy and costs are occurred

  • Look at essential processes from a cross-functional view: What the process is really trying to do?

  • The ‘re-eng’ team must keep asking Why? and What if?


Disciplines of reengineering

Outcome based organizing
Outcome-based organizing

  • Sometimes one person can perform all the steps in a process

  • Design a job around an objective instead of a single task

  • The most refined example: MBL

  • Another example: an electronics company

  • Eliminate the assembly-line approach; compress responsibility for the various steps

Autonomous units
Autonomous units

  • Depts., units, and individuals who need the result of a process can do it themselves

  • Using expert systems and databases, depts. can make their own purchases without any purchasers

  • Some examples

  • Interfaces and liaisons can be eliminated

  • The problem of capacity planning for process performers is greatly reduced

Work and produce info simultaneously
Work and produce Info simultaneously

  • Why doesn’t an organization that produce information also process it?

  • Data is created in a dept and it will be collected and processed in other dept!

  • Remember the Ford’s case

Dispersed but centralized
Dispersed but centralized

  • Conflict between centralization and decentralization

  • Companies no longer have to make such trade-offs

  • They can use ‘re-eng’ by IT and standardized processing systems to get advantages of both of them

  • hp case: each of the more than 50 units had its own purchasing dept and a coordination unit getting harmony to them by using a shared database

  • 150% improvement in on-time delivery; 50% reduction in lead times and 75% reduction in failure rates

Link parallel activities
Link parallel activities

  • Sometimes separate units perform the same function or different activities that must eventually come together

  • Some examples: case of developing a photocopier

  • Forge links between parallel functions and coordinate them while their activities are in process rather than after they are completed

  • IT can brings the independent groups together

Decision making by doers
Decision making by doers

  • A tacit assumption: the doers have neither the time nor the willingness for controlling and have no knowledge for making decisions

  • But built-in controls and self decision makings are needed

  • Pyramidal layers compress and hierarchy disappears

  • MBL does it vertically (compress linear sequence) and horizontally (eliminate layers of managers).

  • Convert the controller to supporter

Get info firstly and once
Get Info firstly and once

  • Each depts. Or units has its own required information and forms but

  • Collect a piece of info once and store by IT

  • Sample case: insurance company

Leadership with real vision
Leadership with real vision

  • ‘re-eng’ is a tremendous effort that mandates change in many areas

  • Real vision is needed

  • Top managers must back the effort and then staff will take ‘re-eng’ seriously

  • Considering the inertia of old ways, implementing the ‘re-eng’ plan is hard

  • We have the tools to do what we need to do

  • If managers have the vision, ‘re-eng’ will provide a way