Is
Reengineering Back?

by Jeff Antos

One of our clients recently sent me an article published in the MIT Sloan Management Review entitled “Process Management and the Future of Six Sigma.” Oddly enough, the article was written by Michael Hammer, the father of Reengineering. In his article, Hammer describes the fundamentals of process improvement including: identification, ownership, and redesign.

Although in many pharma and biotech companies, reengineering is not regarded favorably, many firms are analyzing their processes, looking for improvements. There are a variety of reasons for this trend:

There are Still Gains to Be Made:

Although much work has been done to improve the development process, most believe that their processes could be streamlined. Many executives are interested in getting back to the basics: minimization of redundant steps, improved communication, better leadership, elimination of critical path delays, better planning, and parallel work streams. Few are regarding technological solutions as a panacea for increasing efficiency.

The Pipelines Are Half-Empty (or Half-Full):

There is a dearth of blockbuster drugs on the horizon. When it becomes more difficult to increase revenue, diminishing expenses provides a means to increase earnings per share.

Continuous Improvement Has Been Neglected:

Continuous improvement dominated the 80s. In the boom of the 90s, however, throughput became the objective and continuous improvement was neglected. Hence, improvement opportunities are abundant now.

The Economy is Stagnant:

The lackluster economy is forcing companies to look internally for gains.

Organizational transformation should be a holistic process. When making a process improvement, one must consider its impact on the organization structure, human resources, information technology, and performance tracking.

Antos’ Four Tenets of Process Improvement:

1. Focus on the Customer
   
2. Build consistency into products and systems.
   
3. Simplify processes, organization structure, systems, etc.
   
4. Provide employees with authority, accounting and availability of resources
   

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