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Business Process Reengineering: The Turbo Organization

Driving a turbo-powered sports car is an 40-50% of total time. Some of the time is
exciting experience. Step on the gas lost in travel, some is lost in the
pedal zero to sixty in a few seconds. processing backlog, and some may be lost
Maneuvering through traffic.... diverting it to a credit department for
downshift, accelerate past others, release. If the nonvalue-added time in
upshift....gone. Curves coming the cycle can be identified, ways to
up?....downshift...corner..... eliminate the causes can be devised.An
accelerate. You notice the responsiveness Engine RedesignMost organizations today
of this finely engineered product. You are designed to compensate for
expect this; this precision machine was circumstances that could go wrong,
designed for this, and it is performing particularly on the shop floor. The
to spec.Wouldn't it be great if you could causes are found in the way parts are
do this with your business? That manufactured, with delays, queues,
is...quickly respond to market demand by missing parts, pirated parts, bad parts,
accelerating new product introduction, . and part shortages.Within the factory,
. . .or quickly change your product velocity can be induced by physically
mix,... ...or maneuver orders through the clustering successive operations into
organization quickly,...or move parts cells and reducing operation cycles and
across the factory floor with velocity, set-up times. Deep organizational changes
....or handling the unforeseen, the cannot be effective until key problems in
"curves,"..or quickly moving decisions factory flow and cycle times are
through the organization? This is removedAdding Some AerodynamicsFostering
maneuverability and turbo power. This is innovation, among other things, requires
enterprise agility. It can't be done good organization of information. Our
today because the organization wasn't current systems and procedures have been
designed for this. The way we have developed at length to control an
organized ourselves over decades works unwieldy information channel. When we get
against us.Our current organizational past the stifling paper flow, disparate
structure is stifling. Functional computer systems, and functional
departments result in colloquial thinking organizational walls, the homogeneity of
and narrow points of view. Natural and ideas will begin to generate
functional conflicts create internal quickly.Organizing for ease of sharing
adversarial relationships that prevent information for innovation is a first
sharing of ideas. Classes in the business step. The information chain must be
environment cause an "us and them" streamlined and electronically linked, so
syndrome. Politics that the flow is direct. Removing useless
prevail.Worse,..operations are physically and redundant data existing on screens
separated from headquarters, component and reports from the job stream increases
plants from assembly, assembly from the the value of the information provided.
market. The factory floor is organized by Reducing business cycle times to the time
process, creating poor product flow. In it actually takes to efficiently process
the office people are separated by information supports fast movement of
departments and physical walls creating physical parts.The Turbo
poor communications and information flow. OrganizationHaving the ability to produce
What happens when we step on the gas? The spontaneously upon demand requires short
engine floods.The Grand PrixWhy is all lines of communication and velocity
this important? Competing has taken on throughout the work chain. To reduce
new proportions. A global resegmentation business cycle times, fast communications
of markets emerging is changing the world and decisions are required throughout the
economy. U.S. manufacturers face stiff organization. This means reducing numbers
offshore competition in most markets. of vertical and horizontal management
Companies failing to respond to the layers. Physical walls have to come down.
challenge will find themselves left Organizing around business cycles, and
behind in the dust.The U.S. in ReverseIn physically clustering people in cells for
15 years, the U.S. lost significant world fast, effective communications is one way
market share in key industries: to do it.A Faster, Lighter
wide-bodied aircraft, semi-conductors, VehicleInducing velocity throughout a
automobiles, and steel. There is almost business has a profound effect on time
no production of VCR's, camcorders, tape and cost. The need for nonvalue-adding
players and recorders, radios, functions disappears, and the functions
phonographs, or compact disc players in designed to accommodate exceptional
the U.S. Imports in other industries circumstances fall out. The organization
continue to increase. Industries under chart becomes flatter. Following this is
intense foreign competition include farm a dramatic reduction of overhead.The
machinery, lawn and garden equipment, Winner's CircleYou have to ask yourself
machine tools, bicycles, and process what it could do for you if you could
controls. Foreign competitors deliver respond to a dynamic market with velocity
high quality products with one pass in delivery and new product introduction,
through the factory, while U.S. and manufacture high quality products at
production is consumed in fixing low cost. Chances are, when you're able
mistakes.Back to the Drawing to do this, you will be in the winner's
BoardOrganizations need to be fast and circle, and the trophy will be the new
flexible to change with market dynamics. results on the "bottom
All physical and logical events must be line."BIOGRAPHYRichard G. Ligus is
enacted swiftly, accurately, and President of Rockford Consulting Group,
effectively to compete in the next Ltd., located in Rockford, IL., with over
century. The faster that parts, 30 years experience in manufacturing,
information, and decisions flow through procurement, transportation and
an organization, the faster the response distribution. He specializes in
to customer needs. The keys are flow and developing and implementing supply chain
time.Every business has basic cycles that strategies. Rich is an author and a
govern the way that paper is processed, speaker, and has developed seminars with
parts are manufactured, and decisions are the American Management Association. He
made: customer order, product is certified by both the Institute of
development, production, procurement, Management Consultants and the The
etc. Examining the flow of documents National Bureau of Certified
within the cycles and the time consumed Consultants.Rich has a bachelor of
can be revealing. A customer order cycle science degree in mechanical engineering
begins with the placement of an order. It from the New Jersey Institute of
ends with the payment for goods or Technology, and a master of business
services rendered. There are activities administration degree from Rutgers
in between the two events that consume University. He is a member of CASA/SME,
time. Some add value, such as packing and and has been listed in Jane's Who's Who
shipping, and some are nonvalue- adding in Aviation and Aerospace. He has been a
and delay time, such as moving the order speaker at IMTS, USCTI, APFA, NEPMA,
around the building from mailbox to MCAA, Hand Tools Institute, CASA/SME, and
mailbox, or repeating motions.When a others. He has appeared several times on
cycle ends, a lot of nonvalue-adding time WREX-TV, Mid-Morning Magazine.
has been consumed that may constitute




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