Hammer-ing Home Reengineering
The gurus of a new management tool talk about its impact on corporations
MICHAEL HAMMER has been called the founder of a ''movement'' -- a popular way of looking at work, organizing work, and devising corporate strategies that is called ''reengineering.''
The former Massachusetts Institute of Technology professor co-wrote ''Reengineering the Corporation,'' a 1993 book that spent weeks atop national bestseller lists. Now a consultant, he has written a new book entitled ''The Reengineering Revolution: A Handbook'' (HarperBusiness). He wrote it with Steven Stanton, a colleague at Hammer and Company, in Cambridge, Mass.
The Monitor caught up with the two as they kicked off a nationwide publicity tour.
How do you define reengineering?
Hammer: [The] technical definition is: the radical redesign of business processes for dramatic improvement, which can be translated into plain language as starting over with a clean sheet of paper. It's rethinking how a business operates starting from scratch -- forgetting the past.... It says don't worry how you did things yesterday and try to make them better. Pretend we're starting the business today.
Could you differentiate between downsizing and reengineering.
Hammer: Downsizing is basically leaving the work as it is and eliminating people. Reengineering means rethinking and eliminating unnecessary work. Sometimes when you're done, you may need fewer people, but not necessarily.
How far along is corporate America in the reengineering ''revolution''?
Hammer: Reengineering is about 15 years old. I don't mean that chronologically. That's where we stand in the evolution. It's survived the traumas of infancy and childhood, but it still has a long way to go. Even companies that have done a lot have barely scratched the surface. And the few companies who have really reengineered everything are finding that they have to start over because the world has changed.
How does a company know when it has to reengineer?
Hammer: One is you're in trouble, and that's pretty easy to tell. You're losing money, your customers are unhappy, your competition is beating the pants off you. [Another reason is] you see change on the horizon. You can recognize that what you have now isn't going to help you in the future. Or you decide you just want to get ahead of everybody else. You're not in trouble, you want to make trouble.
What do successful reengineerings have in common?
Stanton: The first is that they've got strong leadership. They've clearly mobilized the organization to be prepared for change. Second is that they've taken a group of people who are the designers, and they've ... given them latitude and the scope to do that. And the third is that they've come up with an innovative way to implement those changes based on speed and early returns. And underlying all of that is paying a lot of attention to the ''people issues'' -- anticipating how different groups in the organization will react to the change, and communicating and allowing them to participate in the change.
You indicate that the hardest part of reengineering is anticipating and dealing with employees' reactions. How do you advise companies to deal with these problems?
Hammer: There are a couple key things. One is you have to empathize and anticipate. Managers have to learn to put themselves in the shoes of people in the company -- anticipate how they will ''feel.'' That's not a word that's used enough in businesses.... How will people feel when you tell them this news? What will their fears and concerns be? And the other very important thing that we've learned is what we call ''sense of inevitability.'' If you create the recognition that this train is already moving, people are not going to try to stop it.
You write that reengineering eliminates work but not jobs or people. How so?
Hammer: Reengineering doesn't necessarily eliminate jobs and people. Reengineering is an avenging sword that looks for unproductive work, and there's a lot of unproductive work in any organization....
What reengineering says is let's get rid of it, as much as possible. You end up with people who have more time to do the real work. If you're under pressure to reduce cost, then you may decide you can't afford all those people. In the long term though, by reengineering you create a better business which should allow you to grow.
Describe the role of management in the past and its role today.
Hammer: Companies that reengineer usually find they have about half the managerial jobs that they did before they started. And managers who remain require very different skills.... They're coaches and work designers.... Let me stress that we don't think middle managers are bad folks. They are victims of an old system, which used to be appropriate, but that system is now dysfunctional.
You've said a lot of people will never be able to find a job again because of reengineering. Could you comment?
Hammer: There are two categories of people who are going to have real problems: One is a lot of these old-style managers who think they're what counts rather than their contributions. And the other is someone who views a job as merely a way to earn a living .... After you do reengineering, jobs become richer, more meaningful, bigger, more important. It's the end of the narrowly focused worker. And everyone in the organization becomes a professional. A professional is someone who cares about the result, not just the activity.... The only catch is, that takes a certain kind of person.