Reengineering the Corporation: A Manifesto for Business Revolution

The title might suggest that this one would be a bit of a sleeper. Not so. Somehow the authors managed to make it an enjoyable read. It's surprisingly straightforward. It starts out explaining a problem - i.e. companies are not designed properly. Decades ago, efficiency was achieved through the division of labor -by thin-slicing tasks into meaningless activities. Bloated bureaucracies were required to manage all the disparate parts/functions. It worked fine back then, but not any more. The customer has more say now, competition is stiffer, and change is rampant. In order to thrive today, businesses must organize around process not around functional silos. The answer? Reengineering. It's not about making gradual improvements - like six sigma or TQM. Rather, it's about "tossing aside old systems and starting over." It's about dismantling the obsolete structures and redesigning processes to achieve dramatic improvements. The book goes into a fair amount of detail explaining how to undertake a reengineering project. Examples of companies that have achieved successful reengineering efforts are provided to assist. Very helpful. This is an important read for anyone that works in corporate America - from the CEO to the front-line employee. All can benefit. -- Nick McCormick, Author, "Lead Well and Prosper: 15 Successful Strategies for Becoming a Good Manager"

Authors and reengineering consultants Michael Hammer and James Champy begin their book rather defensively by insisting that reengineering is not merely a forgotten fad of the 1990s. And they may be right, particularly given their insistence that companies must be totally, absolutely willing to discard the old and replace it with the new. The authors make dramatic claims for the potential of reengineering, and highlight interesting victories - such as Kodak, a company rarely cited as an example of success. The book presents reengineering as a simple, straightforward way to view business processes, figure out how to make them more rational and economical, and then implement necessary changes. The authors made a splash by labeling this approach as reengineering in the 1990s. The term became a euphemism for firing people in droves, then fell into discredit. This update may be intended to rescue the concept from its bad image, but it doesn't quite succeed. In the new millennium, companies deal with complex, costly processes by outsourcing them, yet the word "outsourcing" does not yet appear in this book's index. Such time lags aside, we find this business landmark well worth reading. After all, it's the management Bible of the '90s. Many of its hoary old verities still have the ring of truth.

This is a thought stimulating book, and a true forerunner to the Six Sigma craze. The authors discuss breaking the rules, and I mean RADICALLY breaking them. Six Sigma (originally Motorola's internal TQM program) by contrast, repackages tools used for 50 years and presents them as a "breakthrough strategy". For anyone who is into Six Sigma now, the Hammer and Champy book is a must read. I believe your Six Sigma (or TQM or whatever) efforts return 5-fold after introducing the thinking from "Reengineering" into the endeavor.

These days, reengineering, best practices and continuous improvement are still popular business buzz words, and each one has a place in trying to improve activities. They are the equivalent of picking the low hanging fruit. A few companies can point to increased growth, profits and market share, but alas, many have little to show. Part of the reason is that by the time they achieve what they set out to do, others have surpassed them. These companies will need a cherry-picker to get to the top. I have come to believe that it is harder to improve slowly, or from the current process, to grow at 5 to 10 percent a year, than it is to find a totally new and different way to reach a geometric increase in whatever you do, and, it is usually less expensive. One of the best processes to reach a new plateau and then jump up again to the next is explained in THE 2,000 PERCENT SOLUTION. 1) Understand the importance of measuring 2) Measure everything that can be measured about your key activities to make sure you identify root causes of gaining or losing 3) Identify the future best practice for your industry 4) Go beyond today's best practices to implement the future best practices now 5) Figure out the ideal best practices (without resource, money, time or people constraints) and 6) Begin to approach that 7) Match the people, incentives and tasks, and 8) Repeat the process for even better ideas. You should read REENGINEERING THE CORPORATION to understand the popular ideas. Then you should read THE 2,000 PERCENT SOLUTION to multiply the benefits you thought possible. (Resolving and issue is a 100% solution. Achieving 20 times that benefit or getting there 20 times as fast, is 100X20, or 2000 percent.)

This book's subject is the popularized version of the business concept of management process design. Making that concept more accessible is a very useful contribution. The downside of this book is that many people have assumed that it teaches you everything you need to know to do management process design, or to reengineer key processes. That, alas, is not true. If you find the subject of process design or reengineering to be of interest, I suggest that you first read James Champy's excellent book, REEENGINEERING MANAGEMENT. That book is a good template for how to make any beneficial change in an organization, including reengineering. Then, if you want to get fired up to make major changes, use REENGINEERING THE CORPORATION as a way to create passion about the subject for yourself. But do remember, you may not even have all the processes you need, so reengineering is not the only answer. For example, what is the management process that your company uses to improve its stock market valuation? If you are like most, you do not even have an effective process for stock price enhancement. So be sure to see if you have processes where they will do you the most good.