Reengineering means (according to Michael Hammer) 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. In a word, reengineering is about focusing on processes. But what lies behind this concept? A process is defined as a continuous and regular human activity or a sequence of consecutive actions taken in a specific way and leading to a certain result. In short, a process involves a certain input of work and resources as well as an output, and it constitutes a series of consecutive stages during which these inputs are transformed into a specific result.
This can be easily illustrated with the example of order fulfillment. It is a process that produces value in the form of goods delivered to the customer. It includes a large number of tasks, such as receiving an order from a customer, entering it into the system, checking the customer’s credit, production scheduling, inventory allocation, selecting a shipping method, picking and packing the goods, loading, and shipping. None of these elementary tasks creates value for the customer. These tasks cannot be performed in any order, as goods cannot be shipped before they are produced, etc. Only after summing up the individual work activities does their value emerge. The problems of modern organizations are mainly related to processes. The delivery of goods to a customer may be delayed not only because tasks are performed too slowly. The fundamental reason, however, is that some employees perform tasks that are not necessary to achieve the given result. People do not understand their superiors’ instructions and misinterpret information from them. Employees are inflexible because they do not understand the importance of individual tasks that make up the final result. It took managers a very long time to fully understand this problem. Although processes have always been of great importance to business, most managers were not even aware of their existence. Organizations made changes, but never thought about how to improve processes. Their organizational structures were based not on processes, but on tasks.
The article comes from the magazine “Logistyka” 6/2004.