[Abstract][Introduction] [Definition][Factors Hindering Success][Factors Aiding Success][Final Thoughts][References] [Author Notes] [How to cite]
As businesses reengineer their operations with the use of new information technology, consideration needs to be given to the human aspect of the changes. Managers must create a dynamic, robust environment that allows for successful reengineering. Issues that must be considered include:
During 1986, in an effort to upgrade the business practices of pork producers, I purchased an IBM XT and a fairly expensive software package for production record keeping. Fairly new to the world of computers myself, I embarked on close to an impossible mission. First, the mindset of the operation managers I was working with needed changing. Next, office help had to be trained to utilize the very unfriendly system. Then after considerable consternation, Control Data and I came to an understanding that in 1987, the production software would be upgraded with my input to improve the usefulness of the program. Little did I know the "hell" that awaited me. For nine months we struggled to get improvements completed while working out bugs and trying to produce accurate reports for the herd management. Tears were shed by secretaries in their stress and frustration. I used language that I thought I would never use. After a few days traveling, working with production managers, I would return to find upset personnel, a confused program, and inaccurate reports that required hours of work to correct. My normally congenial demeanor often was enraged during telephone discussions with the Minneapolis office. Although the end product of all the efforts was quite useful, the vividness of the awkward transition is still very clear after 10 years. Just writing this brief explanation causes my heart rate to increase and my muscles to tense up. I can still remember the tearful frustration of the two secretaries that quit their job during the process.
If a small organization had to reckon with such tremendous difficulties with the incorporation of information technology (IT), consider the effect on a larger company with hundreds of employees. Even today, companies embark on business process reengineering (BPR) with blinders on. Some manager hears about this wonderful process that can save time and/or money. Suddenly, IT becomes the wonderful solution to all problems. A project team is set up. Often working in isolation, the team comes up with a seemingly excellent program. Senior management is enamored by all the wonderful promises of increased efficiencies and cost savings. The company embarks on the BPR project. Then the bomb gets dropped. There is resistance and fear everywhere. Within months the project seems doomed to failure. While all the figures looked feasible, one very important set of factors was overlooked in the planning process. Those ever important human factors which can be the determining force of whether or not reengineering organizations with IT will succeed.
Over the years all kinds of organizational restructuring projects have fallen under the label of reengineering. Although reengineering in principle has been around for most of this century, it has become the buzzword of corporate America during the past decade. For the purposes of this paper, we will consider any projects involving dramatic change in business processes utilizing information technology as reengineering.
Ligus (1997) states that companies are finding radical change very difficult to implement. He continues to point out that an end must be put to the "we've always done it this way" argument. If a company's culture is entrenched in classical hierarchy, introducing complicated IT and making dramatic changes in processes can bring tremendous resistance, setting the reengineering project up for failure. Malhotra (1993) regards commonly preferred approaches such as goal theory, systems resource theory, and transaction costs theory inadequate in providing a "wholistic " perspective in organizational issues. Corrigan's (1997) research indicated a lack of attention by BPR to the human dimensions of organizing and structuring work. After all, even though employees believe that using technology is a great idea, that doesn't mean they will take to it naturally (Caudron, 1997)
Outdated cultures, ineffective management styles, bureaucratic red tape, or an out-of-date reward system create organizational inertia (Ligus, 1997). Human issues cannot be ignored if business process reengineering is to succeed. Hutchins (1996c) states that human issues involved in BPR have finally been recognized as vital to success. Too long have consultants and company teams focused on the technology and processes without paying attention to one important element that is key to making the reengineering project succeed. If managers do not have a clear understanding of the role IT will play in their business organization, they will be unprepared to make the appropriate decisions in the reengineering process for success to be emanate (Szewczak and Snodgrass, 1991).
Szewczak has found that while IT has improved organizational processes, in other respects it has proven threatening to successful organizational functioning. People easily become weary of coping when visions of brave, new processes aimed at providing the customer with more value. These concepts are often stymied with a wall of human resistance (Hutchins, 1996c).
Somewhere during this century, reengineering became synonymous with down sizing and worker layoffs. However, many of the early corporate projects did not include such drastic measures. Japanese companies were successful at reengineering with attrition being the chosen method of reducing employee numbers (Dean, 1996). When Ford went through their BPR, employees were assigned to other areas in the company. So why did this huge association with job loss become a prevalent weak point of BPR?
Unfortunately, when companies take on a project that will cost extremely large amounts of capital, senior management wants to see some hard evidence that there will be a huge savings some where. One of the easiest ways to provide a cost/benefit to a BPR project is cut the workforce. Many cases have shown this only reduces the available talent pool of an organization. Fear and anxiety fill the hearts of those workers remaining. Down sizing can profoundly affect the lives and productivity of individuals , whether they leave the organization or survive the down sizing (Halley, 1995).
Edwin Dean (1996) feels the big problem is that often American management uses BPR as an excuse to lay off people. However, these are usually the very people needed to provide quality for the customer and grow the enterprise in the future. Therefore, BPR drives fear into the organization and destroys the to entire social segment of the socio-technical system which produces the product or service. Davenport found that reengineering has become a synonym to cutbacks. Whether or not this rational or an actual linkage is irrelevant. Headcount reduction was the way BPR managers could justify the financial expenditure and strategic rationale.
Caudron's (1997) article shares the insights of Larry Rosen, a psychology professor and a partner in an IT consulting firm. He categories people into three categories; eager adopters, prove-its, and resisters. Only about 10 to 15 percent of people are considered eager adopters. These people like technology and are stimulated by learning how to use it. The other 85% probably don't have the skills for BPR with IT, but may not admit to it.
It wasn't all that long ago that managers had secretaries to do all their typing and correspondence. The basic skills of just typing on a keyboard, may not have been learned. In some cultures, like older established law firms in America, managers may feel typing beneath them. The same is very true in some Central Asian cultures like Uzbekistan.
No reengineering effort will succeed without first reeducating and retraining the people who will ultimately work with the new process (Weicher,Chu,Lin,Le,Yu, 1995). The focus needs to be on the people not on the processes.
Lack of management support
BPR became the method to wipe the slate clean and start over with business processes. However, far too often this was applied to employees and middle managers. Senior management sometimes felt it was not necessary for them to also change with IT. However, when employees found out the CEO has his secretary retrieve and send his E-mail, credibility for a new system project was lost (Caudron,1997). Management often allows money to be thrown around purchasing technology, but then overlook financing training of people necessary to infuse or utilize the IT (Davenport). Strong leadership is necessary if BPR projects are not to be ruined by psychological and political disruptions that accompany change (Corrigan, 1997).
Human passions and emotions react strongly when the prospect of change intrudes on their familiar working and living patterns (Hutchins, 1996c). Dean (1996) believes the necessary cooperation to achieve success will not occur unless people are assured they will not be working themselves out of a job. Corrigan (1997) quotes a senior manager as saying that seven years are required to change a culture completely. So why then do companies expect BPR to bring about rapid changes? I believe it is the constant infatuation with trying to reduce everything to timelines and dollars saved.
Technology is changing so rapidly, we have come to expect people and organizational structures to do the same. IT project teams that promise quick results are only setting themselves up for disappointment. If BPR is approached with inadequate skills in the employee base, very little training and support programs, and without input during the design stage by employees, change at a moderate pace is extremely difficult.
IT tends to flatten the hierarchical management structure of the past (Corrigan, 1997). "Climbing the corporate ladder" suddenly becomes more difficult. Middle managers with routine advancement in mind, see BPR as a threat to their career goals. This could be a motivation to resist BPR and IT. Bishop (1997) reveals research that has shown that stressful response in the workplace such as down sizing or dramatic changes are major factors behind illness, substance abuse, and low productivity. He feels that most employees today are ill-equipped to cope with extreme mental and emotional fluctuations that have a profound effect on job performance.
Human, cultural, and political considerations have emerged as major challenges to BPR over financial and technical issues (Corrigan, 1997). Fascination with IT must be balanced with a basic understanding of the internal processes people work through every day (Cryer, 1996a). As we look to make reengineering successful as we introduce IT into operations, the need to make the environment as stress-less as possible is important. Not only does additional stress bring about resistance to process changes, but it can increase unnoticed increased in costs due to health issues and absenteeism. Recently, several researchers have been addressing the need to consider the human factors of reengineering in making the workplace conducive to personal growth. Cryer offers the following insights from his presentation at the Business Process & Workflow Conference in February of 1996.
"The fantastic opportunities of IT coupled with a realistic look at workforce skills are causing high levels of stress and personal imbalance in employees. Reengineering must include the dramatic enhancement of our process in relation to people. Unmanaged reactions to stressful events create a chain reaction that inhibits learning and clouds perceptions."
Make sure the current culture will accept the changes.
One of the first methods to make sure the current company culture will be open to changes is to involve the people in the process. Involvement by employees is this the most efficient method of determining what processes need to be altered and revised. They will take more ownership of the process being developed. In addition, people then tend to be more willing to understand and accept changes that they were instrumental in determining. This is much more effective than just having a team come up with a new program and forcing it on the subordinates with no input. Ligus (1997) indicates outdated cultures, ineffective management styles, bureaucratic red tape, or an out-of-date reward system create organizational inertia.
People's responses to IT have had an influence the quality of work life and how managers must transform their work (Szewczak, 1997). The survival and growth of organizations in an increasingly turbulent environment would depend upon effective utilization of IT for aligning the organization's structure (Malhotra, 1993). Cultures of the past which breed commitment within a department or function area now must create symbiotic interorganizational structures as the former boundaries are becoming nonexistent. Managers must be capable of moving to a less structured work environment.
IT is influencing today's business organizations all the way from clerical workers to senior management. Production employees are finding that computer skills are requirements for employment or advancement. The more sophisticated IT becomes the greater the transformation of organizations. (Szewscak, 1996) In cases where BPR occurs in organizations within the concepts of total quality management, the social system necessary for survival tended to remain fairly strong (Dean, 1996)
Hutchins (1996b) feels that members of any BPR team can inject fun into the atmosphere when introducing a new project. However, it is critical that the executive sponsor and lead facilitator really establish the atmosphere that is open and inviting for fun. This may require some major change in past corporate culture. In the same article, Hutchins states that getting employees to laugh together, in whatever methods are used in a organization, will help build bonds that will be important during BPR. She provides some ideas on ways to increase organizational bonding.
Not only do employees have to make changes, but the company culture needs to change along with the BPR. The project will meet less resistance if introduced in phases instead of one big gigantic changeover (Caudron, 1997)
Determine employee skills required for the changes.
Some good old fashion research needs to be completed. Computer aptitude tests, short survey questionnaires, group discussions, etc. will help determine whether employees have the necessary skills for IT to carry out proposed process under the new reengineering program. Ligus (1997) indicates that barriers need to be broken down and lines of communication opened up. By doing so, managers will be more easily able to assess the skills needed in the process revisions. Remember that new technology can make people feel insecure, since they don't want to look stupid or inept (Caudron, 1997). Therefore, it may take some "detective" work to determine whether or not they possess the needed skills.
For example, a couple of weeks ago, I was in Uzbekistan. My husband is Director of Operations for a joint venture there. A secretary-translator had been hired for the company. She was handed a computer to use for her work. In prior conversations, she insisted she had computer knowledge. However, her skills were not anywhere near those of clerical assistants in western companies. I was asked to spend time with her for an afternoon, and help develop some of her skills. She was not able to communicate her shortcomings, as she had no idea of what was really expected. After some time at the computer together, I was able to discern her skill level and help with some templates and practice. While this may seem an extreme example, consider that many companies are now utilizing IT for multinational operations. We have to consider the skill base to be relative to the country involved and not necessarily by U.S. standards. People in former Soviet Republics are unwilling to admit they don't know or can't do something. When working with them, they must be allowed to "save face". People in all cultures want to be respected, and have difficulty communicating what their skill needs are. Keep this in mind when designing BPR.
Develop levels of training required to enhance skills in the reengineering process.
Provide non-threatening training programs for all levels of employees. Remember that senior managers are often overlooked in this process. Since successful reengineering depends on the commitment and example of the senior management, it is necessary they possess the skills needed to operate in the new corporate realm. I recently saw a news article on CNN that showed a special computer training retreat for CEOs. A company had put together week long retreat and training programs for older CEOs and senior managers. In short interviews, some successful managers admitted that they hadn't even know how to turn on a computer before. Often they had been embarrassed by grandchildren asking for the E-mail address in order to send them notes. After several days of hands-on training, they were no longer intimidated by the computer. If senior management needs to have training, make sure they get it.
Corrigan found that practitioners and academics felt that people skills and competencies should be developed first. Then focus can be placed on the processes, with the last emphasis on the systems. Train middle management to be sensitive and understand not only their own human motivations, but those of the subordinates with whom they work. Hutchins (1996a) found that the emotions and bonding of the project team can make or break a project. Companies need to transfer good team bonding to the managers as they learn the skills needed by both themselves and associates within their realm.
Caudron (1997) believes that employees should be involved from Day One in the training process. They should be asked how often they would like to meet for training, when, where, and what they need to know. The trainers need to use the technology itself in the training, meeting the users' needs. Researchers found successful solutions involve rethinking work processes and not just trying to make people's lives (and work processes) fit the job (Hammonds, 1997)
Bishop (1997) feels that building personal quality programs into training may help counteract the resistance and increased stress during BPR projects. Innovative organizations include highest quality education and training systems. These companies may well be the one's that gain a true competitive edge when adding IT to their BPR project.
Control the level of stress placed on the individuals impacted by the change.
Make sure to have stress release valves in place. Most of us are familiar with the television series "M.A.S.H.". The doctors in the series about a Mash unit in wartime Korea, reflects how necessary the release of stress can be. Hawkeye Pierce was one very excellent surgeon. However, to deal with the long hours of trying to repair war-ravaged bodies, it was necessary for him to resort to practical jokes and crazy antics. Had he not been able to release the frustration and anger through the laughter created in the midst of chaos, he quite possibly would have not been able to cope emotionally.
In the mid-1990's, I managed a branch office for a collection agency that specialized in retrieving extremely delinquent portfolios. The frustration and disappointment experienced after hours of making calls and dealing with obnoxious debtors, would rapidly take its toll on the employees under my management. To lighten their disheartened spirits, the three took to playing small practical jokes on one another. While it was necessary to keep such activities under control, the collectors' effectiveness and personal well-being was greatest after the short sessions of hilarity. This example relates to Hutchins (1996b) thoughts on how critical the powerful role of handling stress and building trust is to any organization undertaking BPR.
Even though change is inevitable in life, it is one thing most people resist most. Change is often extremely stressful. When people feel inadequate to meet the challenges of the changes, the stress is even greater. Hutchins (1996a) found that consultants can loose sight of the critical importance of just being there. If using a consultant for BPR, make sure you find one who believes in keeping a visible presence for employees in the change mode. Providing balance in the process for the employees to release frustration and deal with issues openly may be the biggest factor in getting the program to succeed. Allowing frustration and anxiety to build up over time will only result in greater resistance and potential failure. Hutchins (1996c) feels the one saving grace we can always turn to is our uniquely human ability to laugh not only at ourselves, but with and at others.
Shari Caudron's article set up a technology countdown that was adapted from material she reviewed. The items came from Larry Rosen and Michelle Weil of Byte Back Technology Consultation Service, Orange, California. The main focus of the 10 steps is on the employees.
10> Assess employees' needs, attitudes, skills, and behaviors.
9> Help alleviate employees' technological discomfort.
8> Help develop employees' motivation to use the new technology.
7> Involve employees in selecting new technology.
6> Increase employees' awareness of technology.
5>Pretest the new technology.
4> Design the training.
3> Conduct the training.
2> Research the technology's use and enhance the system.
1> Obtain employees' feedback.
Go for it!
This set of steps is a good guideline to follow when embarking on a BPR project. If such guidelines had been available in 1986, I am sure my approach to implementing IT into my organization would have gone much smoother. You may have the most powerful, up-to-date IT available. The impact on process efficiency and effectiveness may appear phenomenal. However, humans are the key to making it all come together and work. Making sure to address the human factors involved in BPR utilizing IT, is key to the potential of project success.
Davenport (1997) suggests that you ask this question, "Would I like this management approach applied to me and my job?" If you can answer that in a positive manner, then go ahead and do yourself first to set a great example. Plus, you might find out important aspects of its use when training others.
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Christine Schrage (mail to: email@example.com) graduated with her MBA from the University of Northern Iowa in December of 1997. Prior to returning to college for her degrees, she spent 20 years working in various management positions. In 1986, she founded a pork production management consulting firm which utilized IT in managing production of herds in the Midwest. The company continued in operation for nine years until Chris decided to make a career change.
Copyright (c) 1997 Christine Schrage
This page should be cited as:
Schrage, Christine R. The Human Factors of Reengineering Organizations with Information Technology. World Wide Web, http://www.uni.edu/~schrage.html, version 1.1, November 20, 1997.