Faster Cheaper Better: The 9 Levers for Transforming How Work Gets Done [Deckle Edge] [Hardcover]

Michael Hammer (Author), Lisa Hershman (Author)

Book Description

Release date: December 28, 2010

A bold and revolutionary thinker’s legacy for how business can meet the greatest economic challenge in decades...
 
It’s no secret: everyone knows that the way most companies do things is screwed up. Surprisingly, though, herein lays the biggest opportunity for improving growth and profitability in a world in which consumers are tapped out and competition is coming from the devastating combination of low-wage countries with high skills.
 
For more than a decade, following his landmark Reengineering the Corporation, Michael Hammer did “deep dives” into the processes of companies in every imaginable business—from oil refineries to software developers, factories, retailers, and hospitals—to understand the nuts and bolts of how they do their work, and then to advise them how to do it differently to become faster, cheaper, better. The results were the right product, at the right time, with the right price and quality—businesses that not only ate the competitions’ lunch but their breakfast and dinner, too.
 
The research and passion Dr. Hammer brought to this book have been ably carried on, following his tragic and unexpected death in 2008, by his colleague, Lisa Hershman, now the CEO of Hammer and Company. Looking at a company's operations not in terms of piecemeal fragments of work performed in a slew of isolated functional departments but as large-scale holistic work units transformed many companies, enabling them to meet the unique challenges of our time.
 
The late DR. MICHAEL HAMMER was the coauthor of Reengineering the Corporation and the author of The Agenda. LISA W. HERSHMAN is the CEO of Hammer and Company.

Editorial Reviews

From Publishers Weekly

When Hammer (coauthor of Reengineering the Corporation) died in 2008, he had nearly completed a first draft of a new treatise on business transformation. Finished by Hershman, CEO of Hammer and Company, this timely book focuses on the revolutionary potential of process improvement in an era of increasingly intense competition. Hershman presents seven essential principles (identifying and fine-tuning such factors as "who does the work," "where the work is done," etc.) and a tool kit of nine "levers," or changes, for how actual work streams can be organized and executed more effectively in companies across industries and across the globe. Case studies in the final section show how these end-to-end process re-engineerings have been applied in real enterprises, including Tetrapak, a packaging equipment company; Gamesa, a Mexico-based leader in cookie production; and Hattaway, a specialty metals-forming business. Easy to read, down-to-earth, and filled with nuggets of practical business wisdom, this eye-opening work is imminently applicable for business owners, leaders, and managers at all levels. (Dec.) (c)
Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.

Review

“Easy to read, down-to-earth, and filled with nuggets of practical business wisdom, this eye-opening work is imminently applicable for business owners, leaders, and managers at all levels.” 
—Publishers Weekly

“[Faster Cheaper Better is] quintessential Hammer.”
—StrategyandBusiness.com

See all Editorial Reviews

Product Details

• Hardcover: 320 pages
• Publisher: Crown Business; 1 edition (December 28, 2010)
• Language: English
• ISBN-10: 0307453790
• ISBN-13: 978-0307453792
• Product Dimensions: 5.9 x 1.2 x 9.4 inches
• Shipping Weight: 1.2 pounds (View shipping rates and policies)
• Average Customer Review: 4.3 out of 5 stars  See all reviews (9 customer reviews)
• Amazon Best Sellers Rank: #396,342 in Books (See Top 100 in Books)

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Most Helpful Customer Reviews

18 of 18 people found the following review helpful

5.0 out of 5 stars How to create a more logical and more efficient network of processes for getting work done December 28, 2010

By Robert Morris HALL OF FAMETOP 100 REVIEWERVINE™ VOICE

Format:Hardcover

Those who have read any of Michael Hammer's previous books (notably Reengineering the Corporation co-authored with James Champy and The Agenda) already know how clearly he thought and how eloquently he wrote when sharing his thoughts about how any organization (regardless of its size and nature) can develop processes by which to produce work faster and cheaper. His premature death two years ago at age 60 was a tragic loss to his family members, friends, and associates; it was also a significant loss to thought leadership of the very highest quality. Credit Lisa Hershman with helping to ensure that Hammer's draft was eventually published. Sadly, it proves to be his last book and, in my opinion, his most important work.

Questions are much easier to ask than to answer. For example, why is it so difficult for most companies that have all the resources they need (including talented, skilled, intelligent, and energetic people) to achieve and then sustain continuous improvement of performance? According to Hershman, here is what Hammer's research has revealed. "It's simply the way companies today are organized and operated makes it impossible for them to get the dramatic performance improvements they need even if they were staffed by supermen and superwomen. The only option is deep and fundamental change to how they do the work. Providing the road map to doing so is the mission of this book."

More specifically, what Hammer and Hershman offer in this book are five process enablers (i.e. the process design, appropriate metrics, performers who do the work, a process owner, and an effective infrastructure) that comprise the aforementioned road map for "transforming a process and creating breakthrough performance...." However, important as this map is, it is insufficient because so many companies seem to know what to do but just can't get it done. In many instances, their leaders have developed what Jeffrey Pfeffer and Robert Sutton characterize as a "knowing-doing gap." Companies that have been able to follow Hammer's road map "did so because they have four enterprise capabilities in place - overarching characteristics that equipped them to undertake fundamental transformation: leadership; culture; governance; and expertise."

Readers will appreciate Hammer and Hershman's brilliant use of various devices, notably checklists such as those that identify Do's and Don'ts at the end of each of the first six chapters that comprise Part I:

Design (Pages 63-65)
Metrics (96)
Process Ownership (120)
Performers and Infrastructure (150-151)
Leadership and Culture (178-179)
Governance and Expertise (214)

There are dozens of other checklists throughout the narrative that also summarize key points. Reader-friendly devices such as these facilitate, indeed expedite periodic review of them.

Then in Part II, Hammer and Hershman help their reader to "pull it all together" (Chapter 7) before shifting their attention to five mini-case studies: Tetra Pak in Sweden (Chapter 8) and Gemesa in Mexico (Chapter 9) followed by three "of companies we're calling Four Aces, Hattaway, Inc., and Acme Specialties" that demonstrate what can happen when various mistakes "undermine the benefits that flow from a well-honed process organization." Although valuable lesson can be learned from what achieves success in a process, even more valuable lessons can be learned from what prevents it.

To me, the most valuable material in the book is provided in the final chapter but only because Hammer and Hershman have used the previous chapters to create a context, a frame-of-reference, for the Process and Enterprise Maturity Model (PEMM) based on the nine critical high-level organizing principles "that can transform a mediocre company into a high-performance organization." It is important to keep in mind that PEMM does not specify what any particular process should look like. Those involving the improvement of cycle time or first-pass yield, for example, will differ - sometimes significantly -- from one company to the next; indeed, they can differ - sometimes significantly - in the same company from one department to the next.
Hammer and Hershman explain, PEMM identifies the characteristics that any company should have to succeed in implementing process transformation." A company can apply PEMM to all its processes and can develop processes unique to its own needs...It is a model designed to measure how well the organization is adopting the nine principles of process. " After working their way through the book to the final chapter, readers may ask, "How mature are the processes in my organization?" Hammer and Hershman conclude their book with a five-page detailed audit by which each reader can answer that question. The grid lists the nine organizing principles vertically and four levels of maturity horizontally. Annotations illuminate the evaluation process.

Those who share my high regard for this book are urged to check out Hammer's previously published books (notably the two aforementioned, Reengineering the Corporation co-authored with James Champy and The Agenda) and Enterprise Architecture as Strategy co-authored by Jeanne W. Ross, Peter Weill, and David Robertson as well as Dean Spitzer's Transforming Performance Measurement. Read more ›

4 of 4 people found the following review helpful

5.0 out of 5 stars Excellent Structured Approach to Improvement January 18, 2011

By Loyd E. Eskildson HALL OF FAME

Format:Hardcover

An ever increasing proportion of complex American manufacturing and service processes are being outsourced. The 'good news' is that the late Michael Hammer's advice on process design is well encapsulated in his posthumous "Faster, Cheaper, Better," written and finished with the assistance of his colleague Lisa Hersman. For those interested in the origination of the material, much of it originated with "The Toyota Production System" (TPS) by Taiichi Ohno, former V.P. at Toyota. His 'Seven Deadly Sins' (my label) and definition of 'added-value work' form the basis of Hammer's very useful book, the bulk of which is taken up with describing principles for designing work. Done properly, one can simultaneously and significantly reduce lead (response) times, errors, and costs through process improvement.

1)The first addresses whether and under what circumstances something needs to be done. This question is especially important if the step under consideration is costly or time-consuming. (A common error in my prior experience was wasting money automating something that wasn't worth doing at all.) Hammer advises readers to consider doing something only if it is 'value-added' from the customer's point of view, or at least enables value-added work. An example of what NOT to to is create balance billings if the amount remaining is less than the cost of billing. Another Hammer example is not inspecting broken windshields (the most common auto insurance claim) when long-time customers are involved who've never filed a claim.

2)Hammer's second suggestion is to carefully consider how precisely to perform a step.... For example, don't itemize hospital bills for items less than $25 - these represent a large fraction of items on such bills, require a large amount of expensive staff documentation and data-entry time, provoke endless arguments with insurance firms and patients, and can be easily approximated instead through an average amount incorporated in the basic room rate. Another example, per Hammer, involved mortgage insurers that formerly analyzed individual borrowers before quoting a rate. By instead using the information already gathered by the bank and reflected into its mortgage rate, the insurer could both shorten lead response times and avoid useless work. A third was to have suppliers replenish supermarket shelves directly based on actual availability and use rates, rather than forecasts from grocery warehouses and other expensive, time-consuming intermediaries.

3)Hammer's third point involves 'when' to perform a task. His example involves a hospital losing cardiac referrals because it waited to confirm availability until a bed was open and ready. Instead, recognizing that this could be accomplished while patients traveled to the hospital allowed much faster responses and higher referrals. Probably more important, however, was that the hospital also recognized that these patients usually ended up needlessly occupying a bed while completing tests that could have been conducted on an outpatient basis, while also increasing their risk of contracting a hospital-acquired infection. Thus, the hospital also increased the availability of outpatient preoperative cardiac testing.

4)'Who' should perform a task is another issue that Hammer says needs attention. His example involves trouble calls at a phone company - formerly three people were involved, call-taker, diagnoser, and fixer. Now a single person takes the call, determines the solution, and 74% of the time fixes the problem via a computer. (A fixer is still sent for the remaining 26%.) This greatly reduces response times. Another example (mine) involves Arizona Dept. of Transportation sending out a supervisor to identify and mark those trees near roadways needing trimming - instead, a trained trimmer could both identify and trim those trees. More complex situations may require establishing a team, says Hammer. One of the problems with multiple specialists taking care of hospitalized patients is that communication between those specialists is usually incomplete - thus, replacing them with a hospitalist (referred to as 'intensivist' in ICU units) can again be faster and less prone to errors. Another example provided by Hammer involved replacing an E.D. triage nurse with a more expensive triage E.D. physician - faster, less likely for adverse outcomes due to treatment delays.

5)'Where' to perform production also merits Hammer's attention. Should it occur in the U.S. (expensive, but fast response), Europe (less expensive, but somewhat slower response), or Asia (least expensive, and slowest response). Hammer's example involves H-P producing printers at a centralized location, then shipping them to regional distribution centers where appropriate power cords and manuals are added.

6)Hammer suggests process design reviewers be particularly alert to 'provincialism' where existing division of responsibilities ('functional silos') and hand-offs are preserved. This almost guarantees in-process inventory waiting times, and hand-offs that often require the new worker to acquaint him/her-self with the current state of the work-in-process. Re-designers may want to broaden a specific worker's (or team's) responsibilities. (See #3. Another example involves combining various hospital tasks - eg. nursing, respiratory therapy, basic physical therapy, etc. - 'patient-focused care.') Pursuing a similar line of thought, Hammer also later emphasizes the importance of assigning a 'process owner' to the process concerned - that individual should be the only individual authorized to change the process, and also be charged with monitoring performance via key metrics. Hammer adds that for complex organizations there may be one 'head process-owner' and several local process-owners.

'Attaching' yourself to an order or product and following it is a good way to understand a process; identifying major contributors of waiting time, errors, inspection, rework, and transportation delays via flow-chart or other documentation is another Hammer suggestion.

Monitoring process metrics by the process-owner is essential to assuring improved performance is attained and sustained. Again, Hammer cautions against provincial measures that emphasize performance within a silo (eg. minimizing in-department time), while ignoring overall outcomes (total processing time), or measures that focus on a department or individual (waiting time AFTER RECIEPT of order in the factory) instead of the customer (waiting time AFTER PLACING order with marketing). Hammer further warns against measurements that include factors outside workers' control - eg. company profits. (Hear that G.M. - UAW workers are not responsible for declining profits dumb designs!) Another excellent suggestion from the book is to include suppliers in the metrics - eg. trucking firms can have a major impact on a factory's customer satisfaction.

Continuing, Hammer addresses the topic of goal-setting. His recommendation - using benchmarking of competitors' performance and/or customer requirements to set demanding and meaningful goals. He also emphasizes the importance of providing feedback (again borrowed from the TPS).

Finally, we get to the topic of leadership. Process improvement demands real leaders that insist on sustained, 'real' progress, and focus on those processes that are most important to customers. (Many earlier-generation TQM improvement projects wasted time and money doing things that made managers and the teams happy, but didn't do much for customers.) Those leaders will also educate staff on the need for change - providing a critical foundation, as well setting an example themselves with regular follow-up.

Ending, Hammer provides a useful diagnostic model for assessing the quality of one's existing processes.

Bottom-Line: American managers must insure that their processes are made as efficient as reasonably possible. Toyota's TPS nearly destroyed American manufacturing earlier; it still sets annual improvement goals derived from study of existing processes, competitors, and customers. Failure by American managers to do so will only help current or potential competitors - especially in Asia. (Note: China is now providing 'process-reengineering services' to foreign firms.) Following Hammer's "Faster, Cheaper, Better," along with Ohno's "The Toyota Production System" (overlook his struggles with English), and Bossidy's "Execution" make success almost inevitable. Read more ›

2 of 2 people found the following review helpful

5.0 out of 5 stars Supplements great training January 26, 2011

By L. Perrault

Format:Hardcover

I am new at "process design" but my company is going down this road, which is going to be exciting, and I am eagerly along for the ride. My background is English so the analytical business processes is a tough topic for me to fully absorb. And books are harder to absorb than in-person training (Esp. cause Lisa is an exceptional speaker) but this book is great!
There are so many great real-world examples that it makes the process ideas feasible and easy to understand. Its hard to take such a general business idea and transfer it into applicable ideas and specific changes. Especially when every business is unique and can't be given a "quick fix" though that is what they all want. :)
I would recommend this book but even more I would recommend the Hammer training if you (or your business) are serious about changing how the business is run.

1 of 1 people found the following review helpful

5.0 out of 5 stars Delivers the Goods March 12, 2011

By tulipmania

Format:Hardcover|Amazon Verified Purchase

This may be the single best (and most readable) exposition of business process analysis and design out there. Faster, Cheaper, Better, does a great job of communicating both the why and the how of improving your operations. The book makes very effective use of evidence and anecdotes to help the reader put the principles into practice and, importantly, teach and convince others. (We're not all bosses out there!) The information in the first two chapters of the book that deal with design and measurement alone are worth more than the price of the book. Highly recommended.

1 of 1 people found the following review helpful

3.0 out of 5 stars Process March 12, 2011

By Stephen T. Hopkins VINE™ VOICE

Format:Hardcover

When Mike Hammer died in 2008, he had completed the first draft of a new book. Lisa Hershman, CEO of Hammer and Company, has completed the book titled, Faster Cheaper Better: The 9 Levers for Transforming How Work Gets Done. This is required reading for any manager involved in process redesign. This work sounds simple but can be extremely challenging to implement. The clear examples and positive and negative case studies are useful, as are the dos and don'ts at the end of each chapter. Managers who hate process can find this book a way to understand what this topic is all about.

Rating: Three-star (Recommended)