Why Reengineer Office Processes?

Let's get to the point quickly. Most companies have wasteful cost-adding office processes that are fraught with quality problems and extend work processing times. These processes are held together by hard-working well-meaning employees who had little to do with the design of the process in the first place. The result is high cost, hassled customers, and stressed employees. Not a pretty picture so far! In fact, in many businesses the pain level gets high enough to do something about it! If this describes your business, read on! If you don't, ask a fellow worker for their opinion.

That's where office reengineering comes in. It is a strategy to achieve significant change in the way business is done in the "office". In my definition, the "office" is any activity that is not the typical shop floor manufacturing value-add work details. It could be engineering, accounting, order admin­istration, sales, purchasing, production control, shipping, receiving, human resources, and even the business plan­ning activity. Office reengineering potentially reaches all of these areas.

Beyond manufacturing, the REAL VALUE of Office Re-engineering is in the SERVICE SECTOR. With three out of every four jobs in service related industries vs. manufac­turing industries, the value of applying these concepts really lies in the banking, insurance, health care, govern­ment, and related industries. These are the environments that are ready for Office Reengineering objectives, ele­ments, and methodology to be applied.

The definition of reengineering is the fundamental re­thinking and radical redesign of business processes to achieve significant and dramatic improvement in the criti­cal measures of performance: cost, quality, flexibility, reliability, and innovation. The key words here are "radi­cal" and "dramatic". If you are looking for 5% to 10% reductions in waste and cost adding activities, stop now. If you want to know how to proceed with a program that will deliver 50% to 90% improvements, read on!

Objectives

For any improvement program to be successful, clear objectives must be established. Even though specific focus may be slightly different from one business to the next, there is generally one theme that is common: DELIGHT the customer. To this end, the three primary objectives in an Office Reengineering program are:

• Total Quality
• Short Cycles
• Adding Value

Total quality traditionally has been aimed at products more than services. The goods that companies produce received the focus and the administrative aspects were nottargeted for quality programs. In Office Reengineering, any and all office processes must be defect free and done right the first time. Statistics have shown that 30% to 40% of the work produced in office processes is either wrong or done over!

Short cycles involves having the smallest amount of time to conduct any office process. For example, from the time the customer gives us an order for product until the order is presented to production operations must be minimal. In many companies, this may be several days when it should actually only take a few hours or minutes! In an insurance business, the focus may be on the amount of time required to process a claim once it is received from the customer. Another example would be the time required for a purchase requisition to become an actual purchase order—a scenario that fits many businesses.

Adding value means doing fewer activities that strictly add cost. Some examples of cost adding activities include inspection, rework, checking documents, moving paper and information from one place to another, handling mate­rials unnecessarily, and using excessive amounts of space. A fun way to think about cost adding activities vs. value adding activities is from the customer perspective. What activities—if the customer knew they existed—would they be unwilling to pay for? These would clearly be cost adding activities. In an Office Reengineering program, everyone has an understanding of the difference between the two: cost and value. It is a major objective to do high value add work and eliminate the other!

To be Continued