“Is Reengineering and Strategy Implementation Just Another Management Fad or Does It Offer Something of Lasting Value?”

Topics: Management, Business process reengineering, Process management Pages: 21 (6029 words) Published: April 25, 2010
1.0 Introduction
Implementation is the challenge that comes at the end of all new (and old) methods for improving organizations. Strategic planning, architecture development, change management, total quality management, new information systems technologies, and re-engineering, are some of the concepts that are being advocated to effect a radical improvement organizational performance. Advocates of each concept, however, struggle when questioned about successful implementation (Deshpande and Parasuraman, 1986). Strategic planning literature abounds on how to develop a plan, but there is comparatively little said about how to implement a strategic plan once it is developed. Reengineering is a radical rethinking of an organization and its cross-functional, end-to-end processes (Hammer, 1993). After it’s introduction reengineering had taken corporations by storm. In a survey of over 500 chief information officers (CIOs), the average CIO is involved in 4.4 re-engineering projects (Moad, 1993). Walmart (example 1) is seen as one of the successful executers of reengineering. Despite the excitement over reengineering, however, the rate of failure for re-engineered projects is over 50 per cent (Stewart, 1993). Hammer and Champy (1993) estimate as much as a 70 per cent failure rate. Luthfansa AG (example 2) is one such company. Such is the position that reengineering is labelled as a “management fad”. This paper looks to explore the facets of strategy implementation, reegineering that and analyze the label of “fad” is a worthy one or does the two offer a lasting value.

2.0 Literature Review

2.1 The evolution of reengineering

The concept of reengineering was first presented in two articles published simultaneously by Hammer (1990) and Davenport and Short (1990). Reengineering is a totally new approach with regard to the ideas and models used for improving business Hammer and Champy (1993). The reengineering approach is a result of the combination of concepts from different schools, including strategic IT systems, quality, systems thinking, industrial engineering, and technological innovation. The increasing power of customers, competitors and today’s constantly changing business environment, forced many organisations to recognise the need to move away from focusing on individual tasks and functions to focusing on more communicated, integrated and co-ordinated ways of work by looking at operations in terms of business processes (Davenport, 1993).

2.2 Defining reengineering

Several researchers and practitioners have defined reengineering in different ways with different emphases. The following are some of those definitions:

… the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service and speed (Hammer and Champy, 1993, p. 32).

… a methodical process that uses information technology to radically overhaul business process and thereby attain major business goals (Alter, 1990, p. 32). The fundamental rethinking and redesign of operating processes and organisational structure, focused on the organisation’s core competencies, to achieve dramatic improvements in organisational performance (Lowenthal, 1994, p. 62).

During the last decade, many authors have produced ideas regarding what reengineering really is. And thus, to conclude that there is only a single theoretical proposition underpinning reengineering remains debatable. The following table shows that there are three recognisable perspectives to reengineering as suggested by Tinnila (1995), i.e. strategic, operational and organisational perspectives.

Figure 1: Summary of definition of reengineering
(Khong and Richardson, 2003)

Despite the differences in definitions, and terminology, the emphasis in all these definitions and in the reengineering -related literature, is on redesigning business processes using a radical...

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