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In 1995, the Phoenix, Arizona, Water Services Department embarked on a reengineering process to change its organizational structure, improve work practices, and enhance its technology. The utility transformed the way it runs its business by instituting a changed culture of empowered and responsible employees, self-directed work teams, employee-developed work practices, enhanced technology, and a new model for cooperation among employees, union, and management. As a result of the reengineering process, the utility was able to reduce staff without any layoffs (and despite continued growth) and achieve first year savings of $3 million.