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eengineering was unquestionably the business idea of the first half of the 1990s. James Champy and Michael Hammer’s Reengineering the Corporation was the manifesto for a promised revolution, one that has – except in a few instances – largely failed to materialize. The claims made for reengineering and for Champy and Hammer’s book are large. ‘When people ask me what I do for a living, I tell them that what I really do is I’m reversing the Industrial Revolution,’ proclaims Hammer.
Indeed, the opening of the book positions it as the ready replacement for Adam Smith’s The Wealth of Nations. It has now sold over two million copies.
Cutting away the hype and hyperbole, the basic idea behind reengineering is that organizations need to identify their key processes and make them as lean and efficient as possible. Peripheral processes (and, therefore, peripheral people) need to be discarded. Champy and Hammer define reengineering as ‘the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical measures of performance such as cost, quality, service and speed’.
To Champy and Hammer, reengineering is more than dealing with mere processes. They eschew the popular phrase
‘business process reengineering’, regarding it as too limiting.
In their view the scope and scale of reengineering goes far beyond simply altering and refining processes. True reengineering is all-embracing.
In Reengineering the Corporation, Champy and Hammer advocate that companies equip themselves with a blank piece of paper and map out their processes. ‘It is time to stop paving the cow paths. Instead of imbedding outdated processes in silicon and software, we should obliterate them and start over,’
pronounced Hammer with characteristic fervor and idiosyncratic imagery in his Harvard Business Review article (Hammer, 1990) which set the reengineering bandwagon rolling. Having come up with a neatly engineered map of how
R
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their business should operate, companies can then attempt to translate the paper theory into concrete reality.
The concept is simple. (Indeed, critics of reengineering regard it as a contemporary version of Taylor’s The Principles of Scientific Management with its belief in measurement and optimal ways of completing particular tasks.) Making it happen has proved immensely more difficult. The first problem is that the blank piece of paper ignores the years, often decades, of cultural evolution which have led to an organization doing something in a certain way. Such preconceptions are not easily discarded. Indeed, discarding them may well amount to corporate suicide.
Champy and Hammer say that reengineering is concerned with ‘rejecting conventional wisdom and received assumptions of the past . . . it is about reversing the industrial revolution . . . tradition counts for nothing. Reengineering is a new beginning’. In Leaning into the Future (Binney and Williams, 1995), British academics Colin Williams and George Binney are dismissive of such talk: ‘The last time someone used language like this was Chairman Mao in the Cultural Revolution. Under the motto “Destroy to build”, he too insisted on sweeping away the past. Instead of such wanton destruction, successful organizations do not deny or attempt to destroy the inheritance of the past. They seek to build on it.
They try to understand in depth why they have been successful and they try to do more of it. They are respectful of the learning accumulated from experience and recognize that much of this learning is not made explicit at the top of the organization.’
Henry Mintzberg (1996) has also expressed his concern about reengineering. ‘There is no reengineering in the idea of reengineering,’ he says. ‘Just reification, just the same old notion that the new system will do the job. But because of the hype that goes with any new management fad, everyone has to run around reengineering everything. We are supposed to get superinnovation on demand just because it is deemed
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necessary by a manager in some distant office who has read a book. Why don’t we just stop reengineering and delayering and restructuring and decentralizing and instead start thinking?’
The second problem is that reengineering has become a synonym for redundancy. For this Champy and Hammer cannot be entirely blamed. Often, companies which claim to be reengineering are simply engaging in cost-cutting under the convenient guise of the fashionable theory. Downsizing appears more publicly palatable if it is presented as implementing a leading edge concept. In 1994, research covering 624 companies, published in The State of Reengineering, CSC Index found that on average 336 jobs were lost per reengineering project in the US and 760 in Europe.
The third obstacle which has emerged is that corporations are not natural or even willing revolutionaries. Instead of casting the reengineering net widely they tend to reengineer the most readily accessible process and then leave it at that.
Related to this, and the subject of Champy’s sequel, Reengineering Management, reengineering usually fails to impinge on management. Managers are all too willing to impose the rigors of a process-based view of the business on others, but often unwilling to inflict it upon themselves.
Champy (1994) has now concluded that it is ‘time to reengineer the manager’: ‘Senior managers have been reengineering business processes with a passion, tearing down corporate structures that no longer can support the organization. Yet the practice of management has largely escaped demolition. If their jobs and styles are left largely intact, managers will eventually undermine the very structure of their rebuilt enterprises.’ Champy suggests reengineering management should tackle three key areas: managerial roles, managerial styles and managerial systems.
It is the human side of reengineering which has proved the greatest stumbling block. ‘Most reengineering efforts will fail or fall short of the mark because of the absence of trust –
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meaning respect for the individual, his or her goodwill, intelligence and native, but long shackled, curiosity,’ observed Tom Peters (July 1993).
In his review of the book in the Financial Times, Christopher Lorenz (1993) noted: ‘They [Champy and Hammer] are . . . inconsistent about whether they think behavioral and cultural change . . . are an automatic result of the reengineering of business processes or whether such soft change needs to be launched in parallel or even beforehand.
Controversially much of the book suggests that soft follows hard automatically.’
Champy and Hammer would counter that true reengineering is actually built on trust, respect and people. By cutting away peripheral activities companies provide an environment which places a premium on the skills and potential of those it employs. This, as yet, has not been supported by corporate experience – though James Champy believes the best is yet to come. ‘There are at least another 10 years of genuine reengineering to run,’ he predicts.