Operations Notes – Re-Engineering

ABOUT THIS CONTENT

Notes from core MBA Operations class, these focused on re-engineering.
Subject: Operations

process – taking a set of inputs and producing a value added output

Re-engineering

  • is about operational excellence
  • must be led by someone who is oriented toward operations and who appreciates the relationship between operational performance and financial results
  • centers on managing businesses around their processes
  • calls for radical, major changes vs. incremental changes
  • must be driven “top-down”

Underlying problem that re-engineering tackles is fragmentation of work (“Humpty Dumpty” school of org. design)

Typical businesses without re-engineering are characterized by:

  • simple tasks
  • easy/fast to learn tasks
  • lower skill level required by workers
  • workforce satisfaction is low

A simple process needs substantial tasks. Simple tasks require a complex process

Benefits of Using Case Teams

  • One worker (or a few) take care of all customer needs
  • Fewer handoffs ⇒ few errors
  • More accountability
  • Waiting time between stages is eliminated
  • Greater customer satisfaction

Problems with Using Case Teams

  • Waiting is shifted to pre-process
  • ROFT not likely to improve and likely will be worse

Steps Needed to Re-engineer

  • build a strong case for action
    • why do we do it
    • do we need it
  • get top management support
  • assemble a re-engineering team
  • diagram (design) the clean slate process
  • pilot test
  • roll-out (implement)

Criticisms of Re-engineering

  • panders to nationalistic sentiments
  • not clear how much of the success of cited firms is due to re-engineering
  • no concrete tools; not a science
  • ignores organizational (resources, culture, people, etc.) constraints and realities
  • not much new in terms of substance
  • often says what to do or not to do but not HOW to do it
  • very disruptive
  • ignores value of specialization

Re-engineering vs. Total Quality Movement (TQM)

Re-engineering::

  • radical, major improvements
  • no tools
  • disruptive
  • asks why

Total Quality Movement:

  • incremental improvements
  • recipe
  • sustainable
  • doesn’t ask why, just how

Take-aways:

  • Technology should be an enabler not a work determiner
  • Re-engineering should be periodic, and quality improvements continuous; they complement each other
  • Emphasis on re-engineering should not ignore capability

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1 Comment

  1. This is very true, if you do not re-engineer and keep up to date with technology, then you will be left behind whilst other businesses flourish.

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