تحول سازمانی مجهز به IT : یک مطالعه موردی از شکست BPR در TELECO

This case study describes a business process reengineering (BPR) initiative undertaken by a US telecommunications company (TELECO) in response to imminent survival-threatening competitive pressures in its traditionally monopolistic market. The case study, first, highlights some of the seldom talked-about problems faced during the redesigning of business processes such as: the lack of detailed knowledge about functional areas; hidden agendas of top management; lack of knowledge of (and over-reliance on) computer-based BPR tools; poor choice of metaphors in the organizational language; and the lack of communication. Thereafter, the case study identifies critical problems faced in implementing redesigned processes. These problems include: the difficulty in creating an atmosphere of open communication; pressures against selecting IT vendors on merit; lack of awareness of the lead times associated with IT; uncoordinated implementation of HR and IT strategies; and discontinuities in the leadership. While we hope that the reader will be sensitized to the issues highlighted in the narrative and will individually derive lessons for application in familiar contexts, we nevertheless provide a discussion on three issues that, in our opinion, significantly contributed to BPR “failure” at TELECO.

In 1993, TELECO was an independent telecommunications company with a work force of approximately 3500 employees based in a prominent US city. For over a century, it had provided telephone service to businesses and residences in the city and in the adjoining areas within a 50-mile radius of the downtown area. 1.1. The culture: monopolistic, technocentric, and territorial TELECO's culture was described by many organizational members as “monopolistic,” and many of the company's practices reflected its non-competitive environment as it served a captive market. TELECO was also clearly an “engineering-driven” organization, and a technocentric approach to operations was evident from the way TELECO's new products and services typically originated. For example, according to a sales manager, TELECO would acquire a switch from AT&T, “find out what it could do, and then try to force-feed an application to the user,” rather than find out what the customers needed and then implement a suitable technology. TELECO's priorities were greatly influenced by the regulatory environment (e.g. The Public Utilities Commission), which provided the telecommunications company with a guaranteed client-base, but required it to measure service levels using “standard” indicators, and demonstrate high performance on the indicators in areas such as directory assistance and response to customer complaints. The resulting service measurement orientation in the company encouraged a fragmented accountability system and quick-fixes to symptoms of larger systematic problems by “throwing people” at a problem to boost service levels. Another dysfunctional aspect of the organization was the existence of cross-functional barriers that encouraged territorial behaviors among the employees. For instance, a Vice President (VP) described difficulties arising in her area because of “finger-pointing” between the circuit designers and circuit testers. Similarly, another VP expressed concern over the “total lack of cooperation” between field-staff and the central-office staff. In his words: There was a political wall, you might say, between the ‘inside’ folks and the ‘outside’ folks. The people outside were not allowed to come into the central office and do the work required to provide the service… 1.2. Antiquated information systems A great deal of dissatisfaction also existed in the management ranks regarding TELECO's information systems. There were “islands of automation” in the company, and many computer systems were unable to communicate with each other. TELECO was struggling with its legacy systems, some of which were proving to be significant barriers to responding promptly to customer inquiries and needs. A sales manager, for example, complained about the inability of the billing system to provide a detailed itemized record for any sale: Our billing is severely limited…we could not tell you what serial numbers and which circuit pack was there on a PBX…we would have a single line on the bill that would say “Equipment” which downstream produced a huge problem…account reps spend 80% of their time answering questions about the bill. He added: In the telephone company, there was never… a huge perceived need to change any of the existing systems… COBOL based mainframe type of systems… we didn't keep up… why… because it always cost too much to keep up… alright, without us looking at the cost of not keeping up. 1.3. Changing context and anticipated organizational crisis As long as TELECO had the guaranteed customer-base and faced no competition, the problems outlined above merely irritated the managers, employees, and customers. However, several managers at TELECO were beginning to realize that the “irritants” would have more serious consequences in the future, especially if the anticipated regulatory changes opened up the telecommunications market. In early 1993, in light of the perceived inevitability of changes in the organization's external environment wherein TELECO would be forced to compete with utilities, cable companies and long-distance carriers for a large portion of its business, the company's President commissioned a five-member self-study team. This team was to take “a hard look” at the changing environment, evaluate TELECO's cost structures and market penetration, and provide recommendations to the President. Around the end of 1993, after several months of study and deliberation, the team came to the conclusion that: The whole telecommunications world is changing very rapidly… competitors will start to be numerous… the technology is changing in such a way that allows competitors to take away business without making gigantic investments. Our cost structures… we need to get those down to be competitive… we need to really make sure that our business is streamlined and efficient and focused on serving the customers… what we need to do is reengineer our entire company…1.4. The reengineering decision It was becoming apparent to the TELECO leadership that drastic changes had to be initiated and implemented with extreme urgency or else the very survival of TELECO would be in question. It was decided that an organization-wide radical change initiative was required during which the existing organization would be dissolved and all work processes would be restructured such that organizational performance in terms of speed, quality, and service (and thus, value for the customer) was significantly enhanced. Once the appropriate work processes were in place, a new organization would be built around them. Thus, the reengineering team-members at TELECO would have to redesign not only the business processes but also the organizational structures supporting the business processes. An internationally renowned consulting company was hired and entrusted with the responsibility of leading TELECO through the steps of reengineering, which included coaching the reengineering team and managing the schedule for activities and deliverables. Next, the top management selected 25 “privileged” individuals from different functional areas in TELECO as members of the reengineering team. These individuals were believed to have substantial expertise/experience in multiple functions within the organization at different levels. Soon after their selection, the reengineering team-members were relieved of their normal job responsibilities, and along with the consultants, relocated to the top floor of the company building, completely isolated from the other employees. The team was then entrusted with the goal of redesigning the entire company within one calendar year—all processes, all departments, and all personnel. 1.5. The redesign process The first step in the redesign phase was to divide TELECO into what appeared to be business processes and assign “process chunks” for detailed study to a sub-group in the reengineering team. As part of this information gathering effort, the reengineering team members interviewed over 1500 TELECO employees from different parts of the company within a period of one month. 1.6. The use of alienating forms of symbolism The next step was to conduct a “problem identification root cause analysis” where the fundamental cause of problems in each process area was identified. This step also led to the isolation of some problems that could be fixed immediately. A team-member explained: Some of the things that we found can be fixed immediately… I call it the hatchet in the head… if somebody has a hatchet in their head, pull it out… sometimes they are called quick-hits… low hanging fruit… It was around this time of root cause analysis that some backlash started. TELECO employees resented metaphors such as “low hanging fruit,” “hatchet in the head” and “quick-hits” that were diffusing into the reengineering initiative related language, and these terms had to be hastily withdrawn. A manager who was sensitive to such “soft” issues recalled: ‘Quick hits’ was our consultants’ lingo… our employees reacted very negatively because in some situations, what we were ‘hitting’ was… people. So the terminology was changed to… ‘immediate opportunities’. Also, the shroud of secrecy around the initiative was making TELECO employees suspicious of the intentions/agenda of the organizational leadership and the reengineering team. In the words of a reengineering team-member: Basically what they did is to set up a group of people (away) from the rest of the organization… and a lot of what we were working on was extremely confidential in terms of the goals we were trying to achieve… and other employees would ask us questions about things that we couldn't really answer… because of the insider-trading, confidentiality, and all the other things that went on… so then mistrust started developing… 1.7. Clean-sheet approach? With a growing sense of uneasiness, the reengineering team-members continued their analysis and consolidation of information gathered through interviewing—gaining a fairly detailed understanding of TELECO's current business processes and the problems with them. Interestingly, at this point, the process re-designers2 took a “clean sheet of paper” approach and started building the “process visions” from “scratch,” rather than working on the identified problems with the existing processes. A re-designer described how he envisioned order processing in TELECO: I guess you always start with what you know… OK… you envision someone sitting at the desk knowing everything about a customer… you envision them pointing and clicking and ordering a (telecommunications) service… and that order being placed does not have to touch anyone along the way… and the next thing you know is the happy customer at the other end because technicians are out there installing the service… 1.8. Designing IT-enabled processes without sufficiently understanding IT As the reengineering team started redesigning the company's processes, the potential of Information Technology (IT) in enabling more efficient work-processes became increasingly evident. Interestingly, all except one reengineering team-member had “no particular knowledge or deep understanding of IT,” and even that member (an IS Director who had the necessary expertise but was on the team as a re-designer and not as an IS consultant/advisor to other re-designers) felt uncomfortable in advising his teammates regarding the (in-) feasibility of their visions. Also, because of confidentiality issues, other IT experts could not be made available for advising the reengineering team. As a result, the team-members stated in simplistic terms what they wanted IT to accomplish in order to realize their vision. Sometimes, the role of IT was stated as plainly as: Boy, if we could just click from here to here to here, we could be done with this much quicker… Reflecting back on the process of redesign, a reengineering team-member said: I wish we could have had a technology team from day-one over there (with the reengineering team) that could have consulted with the people on the capability… (and) limitations (of IT) as they created the vision… that was one of my lessons. 1.9. The role of computer-based BPR tools—enabling or constraining? Members of TELECO's top management appeared to have much faith in the use of IT tools for supporting BPR activities, and on their recommendation, the reengineering team had made extensive use of IT tools for creating and representing the redesign. Most of the team-members seemed to have a positive disposition toward the computerized BPR tools. One of them said: We used Visio (a flowcharting software) to create all the process flowcharts… it was just fantastic… and Project (a project management software)… we really stretched its capabilities and used it to integrate plans across all the people involved… I would say that the design would not have been as effective without the use of tools. However, one of the team members almost exploded when prodded to reflect on his experience of using BPR tools to produce the redesign documents: The problem is, if you have a tool, you become a slave to that tool…we did more damn presentations to try and get a buy into what we were doing that we spent too much time producing those things. The business of producing and documenting was very cumbersome… we refined the hell out of this thing… and we toolsmithed it so many times, it was ridiculous!… (the plans) are only as good as how people follow them, because if there is no real dedication to plans… all the tools in the world won't help… 1.10. Top management focus: head-count reduction and self-preservation As the process visions started becoming more concrete, they were presented to members of TELECO's top management including the President, the VPs, and the Directors. The top management, in turn, asked the re-designers to make cosmetic as well as substantive changes to the redesigns. From the point-of-view of re-designers, much of the design modifications mandated by the top management seemed to reflect their hidden agenda of self-preservation and downsizing rather than the espoused objectives of process orientation or the organizational values of service, quality, speed, and value-addition. One reengineering team-member, who had spent considerable time and energy in redesigning TELECO's business processes, expressed his frustration in this regard: …talk about political… you come back with eight processes and they say no… you got to have twelve… why?… guess what… because there are twelve people (VPs) I see on the sheet who need (process-owner) jobs… The top management members also appeared to ignore completely the potential costs of IT and seemed obsessed with the savings from the head-count reduction expected3 to result from the implementation of proposed systems. One of the middle managers involved in the redesign provided a cynical account of the redesign process: the actual practice became… reduce headcount… we know going in we need to get to a certain number (headcount)… OK… if you came in with a reengineered process and you were not meeting the number, you were asked to go back and rethink the process to meet the number… so, in other words, we started with a number… and backed into that number, and called it reengineering…

We reiterate that managing a reengineering initiative is extremely complex and difficult, and there is (and can be) no guaranteed path to success (Sauer et al. 1997 and Galliers and Baets, 1998). An in-depth understanding of the process of IT-enabled radical change and important factors that influence the process can however help in anticipating problems and initiating action to mitigate or avoid them. We believe that this paper makes two significant contributions in this regard. First, it sensitizes readers to issues that can prove to be critical to the outcome of a BPR initiative, and this sensitivity is likely to help readers recognize problems arising from those issues in their own contexts, and take timely action. Second, the in-depth documentation of events at TELECO provides the BPR and IS communities with an opportunity to revisit, reevaluate, relearn, and reconsolidate knowledge regarding BPR and IT management. We have attempted to consolidate the knowledge on three key issues in the form of questions that organizations can use to examine their preparedness for undertaking BPR. While the diagnostic questions proposed are neither comprehensive nor universally applicable, they provide a useful set of pointers for organizations seeking to avert a disaster in their IT-enabled radical change initiatives similar to the one experienced at TELECO.