For the exclusive use of M. Wilcox, 2016.
Harvard Business School

9-996-005
September 8, 1995

Order Management Reengineering at Heatway
Allan Firestone, president of Heatway Corporation’s Industrial Products Division, sighed in frustration. Bob Hemphill, a vice president charged with designing and implementing a new process for selling and delivering Heatway products, had just left Firestone’s office in corporate headquarters, closing his door with more than the needed amount of force. They had finished an important meeting on implementation of the new process, called Proposal to Payment (PTP). PTP was a sweeping, radical change involving not only a new process, but also a new organizational structure, a new IT architecture, and even a new philosophy of business.
Hemphill left the meeting upset because he had requested $35 million for the 1995 implementation of PTP. He felt that this amount was necessary if Heatway was to meet its objective of full implementation of PTP by 1997. Firestone, however, had told Hemphill that he had only $15 million to spend on PTP in 1995.
Firestone wondered how he could get the money for PTP without sacrificing his profit objectives for the year. Could Corporate pay for the rest? Could some of the other international divisions that had expressed interest contribute? Though there was widespread support for the initiative, all the way up to Ralph Salada, Heatway’s chairman, Firestone doubted that the funds could easily be found.
Firestone himself believed that most of PTP was necessary, even though the original idea had not been his. The designs for the new process, organization, and technology environment were very exciting, but he occasionally questioned how urgent it was to implement PTP by 1997 and whether
Hemphill’s claim of organizational doom if the implementation was slower were a bit alarmist.
Pulling his 1995 budget file from