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How To Reduce Costs and Improve Productivity With Reengineering

Posted by Rick Regole on December 11, 2017 | Updated on April 8, 2019

When a product doesn't meet requirements, reengineering provides an alternative solution. That’s because few things are more frustrating to an engineer than when one piece of an assembly throws off an entire project. This frustration is especially acute when a client complains that the piece they received from that company is subpar. It also hurts a product, and company reputation, when they get complaints from their customers about delays, poor quality or cost overruns.

The idea of reengineering the corporation is not new. The development of reengineering as a modern concept for business derived from an article written in 1990 by MIT professor Michael Hammer. The article appeared in the Harvard Business Review. In it, Dr. Hammer defines reengineering as “the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical measures of performance.” He argues a business should reduce and remove any business activities that do not actually work for the good of its customers. The terms process improvement, process excellence and process innovation all came from him. Sometimes the concept of Business Process Reengineering (BPR) is used.

By the early years of the 1990s, businesses around the United States were adopting reengineering as a useful improvement process. If you’re wondering how reengineering can help your business, let’s take a look. It starts by identifying opportunities to improve performance, which leads to reducing manufacturing processes, eliminating warranty claims and ultimately reducing overall costs.

The First Steps of a Reengineering Process

Reengineering cannot proceed without the full support of a company’s upper management. Once everyone agrees to proceed, those in charge must put together a very clear plan of review and a vision. That’s because one of the biggest criticisms of reengineering is that it can result in layoffs.

But the goal of a reengineering process is to leave the company in better shape. That’s why it’s critical that everyone involved with the process redesign is on board. You may need to convince some team members as to why making the change is essential for the company. If the company is not doing well, this shouldn’t be too hard.

Reengineering Your Products

Once your process analysis is complete it’s time to take a look at which of your products apply. If it’s a large scale improvement plan, you may need help from an outside consulting firm. In principle, Dr. Hammer said, a whole reengineering effort should take less than a year. But business process reengineering is no easy task.

When a product design reaches the reengineering stage, it’s clear that one or more factors have caused it to miss the mark. Whether driven by the lack of quality service and speed, or high costs, the same approach applies: to determine the client’s goals. What do they want to see in the reengineered design that’s missing from the initial design?

Remember that unless you challenge old assumptions and shed the old rules that made your business underperform in the first place, you’re just rearranging the deck chairs on the Titanic. You can’t achieve breakthroughs in performance by simply cutting fat or automating existing processes. This is about developing a new business process management plan. In reengineering, managers break loose from outmoded business processes and the design principles underlying them and create new ones.

The Reengineering Approach

Once the key design objectives are clear, the next step is to research and strategize new configurations. This requires a balance factor. While the core features and logic of the system are preserved, functionality/processes will need to either be added or modified.

Say, for instance, that technological advancements have led to optimized production methods for materials. This has made new alternative materials available, ones that could offer a significant cost advantage over past options. Manufacturers want to utilize these materials in their design, while keeping the rest of the configuration the same.

With a reengineering approach, manufacturers can efficiently improve product designs. Rather than having to undertake a total redesign — a process that can be costly and time-consuming — an existing template to work from is already in place. Think, using information technology to “upgrade” a horse with lighter horseshoes which make them faster, as opposed to just building a car. This helps improve cycle time and gets your products to the market in a timely manner, while ensuring the satisfaction of companies and customers alike.

By improving the existing processes through which these products are designed, manufacturers can further save time and costs. For example, incorporating advanced technology into manufacturing processes can help limit the degree of wasted materials and expedite the whole process.

Creating new rules tailored to the modern environment ultimately requires a new conceptualization of the business process. Considering the apathy of old processes and structures, the strain of implementing a reengineering plan can hardly be overestimated. And reengineering does not need to be done haphazardly.

iCONN Systems has become a leader in the reengineering sphere by gathering input from a client’s various departments to reengineer connectors and cable assemblies. From replicating and improving existing features to doing away with unnecessary components, iCONN engineers facilitate designs with increased throughput and robust performance.

The critical factors in a reengineering effort include:

  • Giving people a mission and a clear path for choosing appropriate actions.
  • Providing superb service.
  • Making change a way of life rather than a process.
  • Using information technology effectively.
  • Understanding that time is a limited resource.
  • Recognizing that reengineering is a huge job.
  • Approaching reengineering as a lifetime venture.

See how iCONN Systems used reengineering to help a self-contained breathing apparatus manufacturer by reading our case studyCompany Reduces Costs, Improves Processes Through Reengineering


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