Reengineering is a system-wide change approach that focuses on fundamentally rethinking and redesigning core business processes to achieve dramatic improvements in performance measures like quality, cost, and speed. It involves identifying key processes, setting challenging goals, and designing new processes without constraints of past practices. The organization is then restructured around the new processes, shifting to cross-functional teams and empowered, results-focused roles. Third-wave organizations are flexible, creative, and innovative which allows them to adapt quickly to changes and make themselves obsolete through constant transformation.

1. Organization Development and Change
Thomas G. Cummings
Christopher G. Worley
Reengineering & Third Wave Organizations
Organizational Level OD Intervention

2. REENGINEERING
 Reengineering, or business process reengineering (BPR) as it is
sometimes called, is a system-wide change approach focusing on
the basic processes of an organization.
 Reengineering does not refer to minor modifications of current
practices. Instead it means rethinking existing processes to deliver
more value to the customer, identifying the way things can be done
best, and right now.
 Organizations that use reengineering do not look at existing
processes and search for ways to improve; they begin with a blank
sheet of paper. This gives them an opportunity to look at their
operations in totally new ways without the belongings of “this is
how we do it now.”

3. Steps in Reengineering
• The First step is to identify the key business
processes of a department or work team.
• The Second step is to identify performance
measures in terms of customer satisfaction and to
examine current processes to meet these measures.
• The customer does not care about internal rewards ;
the customer just wants the product or service done
right, and on time.

4. Steps in Reengineering
• The Third step is to reengineer the process,
organizing work around the process, not around
functions or departments. Work is simplified by
combining related tasks and eliminating any
elements that do not directly add customer value.
• Forth Step, the redesigned process is implemented,
and all activities are subjected to an ongoing
reevaluation. Work processes are continually
reexamined as technology, competitors, and
customers change

5. Application Stages in Reengineering
 1.Prepare the Organization.
Reengineering begins with clarification and
assessment of the organization’s context, including
its competitive environment, strategy, and
objectives.
This effort establishes and communicates the need
for reengineering and the strategic direction that the
process should follow.

6. Application Stages in Reengineering
 2. Fundamentally Rethink the Way Work Gets
Done. This step lies at the heart of reengineering and
involves these activities: identifying and analyzing
core business processes, defining their key
performance objectives, and designing new
processes.
 These tasks are the real work of reengineering and
typically are performed by a cross-functional design
team who is given considerable time and resources
to accomplish them.

7. Application Stages in Reengineering
 A. Identify and analyze core business processes.
Core processes are considered essential for strategic
success. They include activities that transform input
into valued outputs. Core processes typically are
assessed through development of a process map that
identifies the three to five activities required to
deliver an organization’s products or services

8. Application Stages in Reengineering
 B. Define performance objectives.
Challenging performance goals are set in this step.
The highest possible level of performance for any
particular process is identified, and dramatic goals
are set for speed, quality, cost, or other measures
of performance. These standards can derive from
customer requirements or from benchmarks of the
best practices of industry leaders.

9. Application Stages in Reengineering
 C. Design new processes.
This task involves designing new business processes to achieve
breakthrough goals. It often starts with a clean sheet of paper
and addresses the question “If we were starting this company
today, what is the most effective and efficient way to deliver
this product or service?” Each essential process is then designed
according to the following guidelines:
• Begin and end the process with the needs and wants of the
customer.
• Use the “best of what is” in the current process.
• Do not be constrained by past practice
• Identify the critical information required at each step in the
process.

10. Application Stages in Reengineering
 3. Restructure the Organization Around the New Business
Processes. This last step in reengineering involves changing the
organization’s structure to support the new business processes.
Reengineered organizations typically have the following characteristics:
 Work units change from functional departments to process
teams.
 Jobs change from simple tasks to multidimensional work.
 People’s roles change from controlled to empowered.
 The focus of performance measures and compensation shifts
from activities to results.
 Organization structures change from hierarchical to flat.

11. THE THIRD-WAVE ORGANIZATION
• The third-wave organization is a concept
originated by business futurist Alvin Toffler, who
foresaw a managerial third wave.
• The first-wave companies were built in the
agricultural age.
• Second-wave companies evolved in the industrial
age and emphasized mass production and growth.
• Third-wave companies are evolving in the
information age to meet changing times, to be able
to transform their products and organizations in
response to changes in economic and social needs

12. THE THIRD-WAVE ORGANIZATION
• Third-wave organizations developed for success in
the information age have such characteristics as
flexibility, creativity, and innovations. Internet
search engines like Google and Yahoo! are
examples of how a company can be the most
popular and then be quickly replaced by a
competitor.
• Third-wave organizations are able to transform
their products and organizations in response to fast
changes caused by the information age.

13. THE THIRD-WAVE ORGANIZATION
• Flexibility
The third-wave organization is flat, lean, and
flexible. Its culture provides immense flexibility to
reorganize. People expect its buildings, offices, and
people to change. Its structure has no Stability.

14. THE THIRD-WAVE ORGANIZATION
 Creativity
People are the lifeblood of the third-wave
organization. Third-wave people are motivated by
commitment to a vision or cause, the chance to be
personally involved in projects that can change the
world, and the opportunity for personal growth. The
third-wave organization uses the idea of “buy-in”
management—the idea that people actually influence
the long-term vision and buy in to the goals of the
organization.

15. THE THIRD-WAVE ORGANIZATION
 Innovation
The third-wave organization supports risk-taking and
innovation. The goal is to make yourself and your
product obsolete. The difference between the
traditional second wave company and a third-wave
organization requires a revolution in attitudes,
values, and behavior.