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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

outline
Outline
  • 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?
slide7

7

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
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