Article

Reengineering and the Insanity of Right-Sizing

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Abstract

This article examines the degree to which reengineering is a new management concept and the promise it holds as an effective productivity-enhancing strategy. This examination is not simply an output-over-input analysis; it considers the systemic, cultural, and human resource aspects in organizational dynamics. The authors contend that organizational dynamics are messy and must be dealt with as such. Simple solutions that may produce immediate results may also generate long-term side-effects that are harmful to an organization. Reengineering is analyzed with regard to factors such as the need for organizational changes, human resistance to change, climates that support continuous improvement, work design, the human value of work, and the effects of such action on an organization's culture. The importance of fairness and job security to effective performance improvement is questioned and discussed.

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Downsizing, the planned elimination of positions or jobs, is a phenomenon that has affected hundreds of companies and millions of workers since the late 1980s. While there is no shortage of articles on "How To" or "How Not To" downsize, the current article attempts to synthesize what is known in terms of the economic and organizational consequences of downsizing. We argue that in many firms anticipated economic benefits fail to materialize, for example, lower expense ratios, higher profits, increased return-on-investment, and boosted stock prices. Likewise, many anticipated organizational benefits do not develop, such as lower overhead, smoother communications, greater entrepreneurship, and increases in productivity. To a large extent, this is a result of a failure to break out of the traditional approach to organization design and management--an approach founded on the principles of command, control, and compartmentalization. For long-term, sustained improvements in efficiency, reductions in headcount need to be viewed as part of a process of continuous improvement that includes organization redesign, along with broad, systemic changes designed to eliminate redundancies, waste, and inefficiency.
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Introduction1. The Crisis That Will Not Go Away2. Reengineering-The Path to Change3. Rethinking Business Processes4. The New World of Work5. The Enabling Role of Information Technology6. Who Will Reengineer?7. The Hunt for Reengineering Opportunities8. The Experience of Process Redesign9. Embarking on Reengineering10. One Company's Experience-Hallmark11. One Company's Experience-Taco Bell12. One Company's Experience-Capital Holding13. One Company's Experience-Bell Atlantic14. Succeeding at Reengineering15. Questions that Readers Ask the MostEpilogueIndex
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