Process Re-Engineering and Technology  Strategy

for Chairman, Plyglass plc (a building & transport component supplier)

March 1990 through May 1990 (Dates not precise)

Objective: to review technology strategy prior to upgrading/replacing computer

Plyglass plc realised that the replacement of their computer was a useful opportunity for a radical review of their technology strategy. To carry out this review, a second objective was agreed, to test whether the replacement was cost justified. Part of this test was whether it addressed the company’s fundamental needs and how technology could best support the company’s critical success factors.

Methodology / Analytics: Critical Success Factor identification and competitiveness benchmarking; transaction cycle process analysis and redesign; technology investment prioritisation and IT strategy.

Interviews were conducted on the key issues facing the company, and the competitive differentiators benchmarked, using the sales force and regular customers. The primary need was found to be that of reducing the transaction cycle time. Another profit opportunity was seen in an improvement in process yield. The order fulfilment and manufacturing process was therefore analysed, noting where delays were occurring due to lack of or incorrect information, questioning assumptions and developing alternative process and control methods. The technology support for each improvement was then costed, and the results used as a benchmark against which to measure the various IT strategies being offered by major computer suppliers.

Results: potential profit improvements identified with reduction in transaction cycle time, actual reduction agreed in cost of technology upgrade.

The benefits identified from the upgrade were so much greater than anticipated, that the IT strategy was clearly justified. The targets of 6 days’ cycle time reduction and £4.1m profit improvement were both agreed by management to be fully realistic.

In spite of this, the cost was reduced by 36% from the chosen supplier’s original proposal.

(The above project was carried by R Hirsch while at   A T Kearney Ltd)