Process First, Technology Second
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CIOs don't typically lead corporate transformation, but they're well positioned to help guide business process and improvement changes, says Michael Hammer, original champion of the business reengineering movement. Hammer labels the CIO the enterprise's c
I'm reminded of an article you wrote about a retailer that wanted to find out how many people who went into its store bought something. They just hired a bunch of kids to count the people who went in and then count the ones who came out with something.
HAMMER: Right. They were measuring the percentage of customers who actually bought something.
There is a temptation among people in the IT world to look for technological solutions before they're needed.
Look, I used to be a professor of computer science at MIT, so it's not as though I'm afraid of computers. But I know people who will use a computer to do something as long as it's not too much more awkward than doing it manually. So somehow using a computer is a virtue in itself.
A good rule of thumb—it's not always doable—is try to implement new processes without technology, and afterward bring in technology to boost them rather than make them dependent on technology out of the box.
Isn't that almost the reverse of what companies do today?
HAMMER: Yes, but the companies that take the approach I just described are often very successful with it because it gets clarity about their processes. Otherwise, you end up with what I call paving the cow path; you're overlaying new technology on a bad process.
Which companies are the best at process management? You've mentioned some, such as Air Products and Chemicals, in your work. Could you name a couple more?
HAMMER: There are quite a lot. Naming 20 would be easy. Naming just two or three is hard. A few, off the top of my head: Shell; PepsiCo, especially in Latin America; and Tetra Pak, a company based in Europe that makes packaging equipment.
What characteristics make them successful?
HAMMER: Overwhelmingly No. 1 is executive commitment. Second is "thoroughgoing"—in other words, they did it by the book and they addressed everything that needed to be addressed. They didn't leave stuff out. Those probably are the two most important things.