A study of reengineering projects in over 100 companies reveals how difficult these projects are to plan and implement and, more important, how often they fail to achieve real business-unit impact. The study identified two factors - breadth and depth - that are critical in translating short-term, narrow-focus process improvements into long-term profits. Successful projects at Banca di America e di Italia, Siemens Nixdorf Service, and AT&T demonstrate how companies can appropriately make their reengineering projects broader and deeper. Such efforts, however, if poorly managed, provoke organizational resistance. But such opposition can be overcome if committed managers approach reengineering as a painful but necessary disruption of the status quo.

In all too many companies, reengineering has been simultaneously a great success and a great failure. After months, even years, of careful redesign, these companies achieve dramatic improvements in individual processes only to watch overall results decline. By now, paradoxical outcomes of this kind have become almost commonplace. A computer company reengineers its finance department, reducing process costs by 34 percent, yet operating income stalls. An insurer cuts claims-process time by 44 percent, yet profits drop. Managers proclaim a 20 percent cost...