[1] Parts of this manuscript are published in a Harvard Business School Teaching Case Study, N9-195-097, the Publishing Division, Harvard Business School, Boston, MA 02163.

[2]Hammer and Champy (1993) define reengineering as "the fundamental rethinking and redesign of business processes to achieve dramatic improvements in critical contemporary measures of performance such as cost, quality, service, and speed" (p. 32). Davenport (1993) uses the term "process innovation" and defines it as: "Stepping back from a process to inquire as to its overall business objective, and then effecting creative and radical change to realize orders-of-magnitude improvements in the way that objective is accomplished (p. 10). Earl (1994) describes reengineering as strategic change projects.

[3]This case study is part of a longitudinal research project on managing change in business process reengineering (Jarvenpaa and Stoddard, 1993). CIGNA is one of seven companies participating in an18-month study where participating companies receive site visits every three to five months in addition to 30 to 60-minute phone conferences with the project manager or project leader on a regular basis. The data for the case study on CIGNA was collected primarily through five separate site visits between March 1993 and May 1994 involving one to 1.5 hour semistructured interviews (see the Appendix for the types of questions asked) with various stakeholders from eengineering initiatives discussed in the paper. In addition to interviews with corporate senior management, the research team interviewed the projects' executive sponsors and champions, project managers, project team members, and customer representatives. A short questionnaire on reengineering was also completed by the project champions or sponsors on three of the efforts (CIGNA Reinsurance, CIGNA International, and CIGNA Technology Services) . The research team was also provided with company documentation on the reengineering efforts (e.g., comparions of new versus old processes, design principles for new processes, internal newsletters on reengineering projects).

[4] At CIGNA,the divisional IS groups and operations report to the CIO. The division IS groups have responsibility for both applications development and managing the interface to operations. CIGNA Technology Services (CTS) manages CIGNA's data centers, and voice and data communications networks, and provides technological support to the divisions. Corporate Systems support corporate-wide functions.

[5] Venkatraman (1994) identifies five levels of information technology-based transformation:

• Level 1: localized exploitation of technology to existing business processes.
• Level 2: internal integration of information technology (IT) capabilities across an entire existing business process.
• Level 3: use of IT as a lever for designing an organization's core business processes.
• Level 4: exploitation of IT to redesign processes extending beyond one organization to a network of organizations.
• Level 5: use of IT to redefine the organization's business scope.

The initial conceptualization of reengineering (Davenport and Short, 1990; Hammer, 1990) most closely resembles Level 3. The "second wave" reengineering practiced at CIGNA is most characteristic of Level 5. The "second wave" puts the strategic thread back to reengineering, which, as Earl (1994) notes, has been largely missing both in practice as well as in the popular writings on reengineering (Davenport, 1993; Hammer, 1990; Hammer and Champy, 1993). A noted exception is Short and Venkatraman(1992).

[6]The brown paper used for the process maps was the type used in butcher shops.