Reengineering 35 Years Later: Don’t Automate, Obliterate
Thirty Five years ago, Michael Hammer published an article in Harvard Business Review that every AI consultant should be required to read. The title alone should give today’s automation gurus pause: “Reengineering Work: Don’t Automate, Obliterate.” (HBR, July-August 1990)
The article is filled with case studies, but one stands out as particularly relevant to our current AI automation frenzy.
The Ford Story Nobody Remembers
Ford’s accounts payable department was gearing up for a standard efficiency project. The goal: reduce staff by 20%. Not bad for a corporate initiative. Management was feeling pretty good about the plan.
Then someone looked at Mazda.
Ford’s accounts payable department had 500 people. They were planning to cut that to 400.
Mazda’s accounts payable department had 5 people.
Not 500. Not 400. Five.
That’s not a 20% improvement. That’s a 99% improvement. And it’s the difference between automating a process and obliterating it.
The Lesson We Keep Forgetting
Ford didn’t get to Mazda’s numbers by automating their existing process. They couldn’t. You can’t automate your way from 500 people to 5 people by making the same process faster.
As Bill Gates famously said: “Automation applied to an efficient operation will magnify the efficiency. Automation applied to an inefficient operation will magnify the inefficiency.”
Ford had to completely reimagine how accounts payable worked. They had to question every assumption. They had to throw out the old process and start from scratch.
The technology—databases, computers, networks—was the small player in this story. The big player was the willingness to obliterate the old way of doing things.
Why This Matters Now
We’re living through the AI automation hype cycle. Companies are being told that AI will revolutionize their operations, eliminate inefficiencies, and cut costs dramatically.
And they will—if you do the hard work of reengineering first.
But most companies are making the same mistake Ford almost made. They’re taking their existing, inefficient processes and trying to automate them with AI.
The result? Automated inefficiency. Faster dysfunction. More expensive complexity.
The Mazda Advantage
Why was Mazda’s accounts payable department so small? They didn’t have the baggage of “the way we’ve always done it.”
Much of the Japanese economy had to rebuild from scratch after World War II. There were no legacy processes to protect. No entrenched departments to defend. No politics around “but we’ve always done it this way.”
They could start with a clean sheet and ask: “What’s the simplest possible way to accomplish this goal?”
That freedom led to radically simpler processes that required far fewer people.
The Automation Fairy Tale
Today’s automation vendors would have you believe their technology is pixie dust. Just sprinkle AI on your problems and watch them disappear.
It won’t work.
If your process is broken, automating it just means you’ll produce wrong answers faster. If your workflow is overcomplicated, adding AI just creates overcomplicated AI workflows.
The vendors selling you automation don’t want you to obliterate your process. They want you to automate your existing one. Why? Because that’s a technology sale. Obliteration requires consulting, change management, and hard thinking. That’s messy and expensive.
Buying software is easier than rethinking your business.
What Obliteration Actually Looks Like
Before you automate with AI, ask:
1. If we started from zero today, how would we do this? Don’t ask “how can we make our current process faster?” Ask “do we need this process at all?”
2. What’s the simplest version that could work? Ford’s existing process had multiple checks, approvals, and verification steps. Mazda eliminated most of them by redesigning the upstream process so they weren’t needed.
3. What are we doing because ‘that’s how it’s always been done’? Legacy processes often exist because of constraints that no longer apply. The approval chain that made sense when everything was on paper might be ridiculous when everything is digital.
4. Can we eliminate this instead of accelerating it? The fastest process is the one you don’t have to do at all.
The Database Didn’t Save Ford
Here’s what’s crucial: Ford and Mazda both had access to the same database technology. The technology wasn’t Mazda’s advantage.
The advantage was that Mazda designed their process around what was possible with the technology, while Ford was trying to use the technology to speed up their old process.
Sound familiar?
Today, everyone has access to the same AI models. OpenAI, Anthropic, Google—they’ll sell to anyone. The technology isn’t your competitive advantage.
Your advantage is being willing to obliterate your process and redesign it around what AI makes possible.
You Can’t Just Keep Doing What You’re Doing
Thirty years later, Hammer’s message is more relevant than ever.
You can’t just keep doing what you’re doing, automate it with AI, and hope to survive. Your competitors who are willing to reimagine their processes from the ground up will destroy you.
Not because they have better AI. Because they have better processes that happen to use AI.
Where to Start
If you’re serious about AI transformation:
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Stop the automation projects. Pause any “let’s add AI to this process” initiatives.
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Start with obliteration. Pick one inefficient process and ask: “If we could start over, how would we do this?”
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Design for AI, don’t retrofit it. Build new processes that take advantage of what AI can do, rather than bolting AI onto old processes.
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Measure end-to-end outcomes. Ford measured people in their department. Mazda measured cost per transaction and error rate. One metric encourages efficiency. The other encourages obliteration.
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Be willing to throw everything out. The hardest part isn’t the technology. It’s having the courage to say “our current approach is fundamentally wrong.”
The Real Challenge
Thirty years ago, companies failed at reengineering not because they lacked technology. They failed because:
- They were unwilling to challenge sacred cows
- They protected departments and headcount
- They automated first, thought second
- They measured activity instead of outcomes
Today, companies are making the exact same mistakes with AI.
The question isn’t “how can we use AI to automate this process?”
The question is “what would this process look like if we designed it today with AI as a fundamental capability?”
One question gives you incremental improvement. The other gives you the Ford-to-Mazda leap.
Struggling to figure out where to start? I help companies identify which processes to obliterate and how to redesign them for AI-first operations. The goal isn’t just automation—it’s transformation that delivers measurable business results. Let’s talk about reimagining your processes before you automate them.
References
Hammer, M. (1990). “Reengineering Work: Don’t Automate, Obliterate.” Harvard Business Review, July-August 1990. https://hbr.org/1990/07/reengineering-work-dont-automate-obliterate
About the author: [Your name] helps companies implement AI automation that delivers measurable business value. With experience in business process reengineering and enterprise transformation, [he/she] specializes in identifying processes that should be obliterated, not automated.