Enterprise Design Process:
Business ProcessesBusiness Processes
Johan Strümpfer
Enterprise DesignEnterprise Design
Tool 1/ View 1Tool 1/ View 1
ENTERPRISE
• PARTS INTERACTING AROUND AN OVERARCHING BUSINESS PURPOSE
• NOT A CONGLOMERATE
• NOT NECESSARILY A GROUP WITH PARTS MORE OR LESS IN THE SAME BUSINESS
• NOT A FINANCIAL HOLDING
• A SYSTEM
ENTERPRISE DESIGN
• THE DELIBERATE ARRANGEMENT OF FACTORS INTO A SYSTEM
• THE INTEGRATION OF INTERACTIONS INTO A REGULATED WHOLE
SYSTEM
• A regulated set of relationships
• Interacting and interrelated parts
• Parts organised for a purpose
• a Whole with novel features
SYSTEM FACETS
FUNCTION
STRUCTURE
PROCESS
REGULATION
DEFINITION OF STRUCTURE
• Relationships that remain unchanged
• Duration of interest
• Stability and relative change
Process ViewProcess View
KNOWLEDGE HIERACHY
INFORMATION
INSIGHT
UNDERSTANDING
'WISDOM'
Process View
Process view: PURPOSEProcess view: PURPOSE
INTRODUCES CONCEPT OF ENTERPRISE AS SYSTEM AS LINKED PROCESSES
BROADENS SCOPE OF POSSIBLE INTERVENTIONS
STAGE 1 OF ENTERPRISE DESIGN
DEFINITION OF PROCESSDEFINITION OF PROCESS
Altering or changing of relationships
Time frame of interest Flows and transformations of
Matter, Energy & Information (MEI) Internal to systems boundary, Input
& Output Structure: static; Process: Dynamic
PROCESS VIEW OF SYSTEMPROCESS VIEW OF SYSTEM
INPUT TRANSFORMATION OUTPUT
I T O
SYSTEM
CLASSIC ORGANISATIONAL STRUCTURECLASSIC ORGANISATIONAL STRUCTURE
Lines of authority, responsibility, accountability
PROCESS ORGANISATIONALVIEWPROCESS ORGANISATIONALVIEW
“Manage the white spaces”
BASES OF DIFFERENTIATION AND INTEGRATIONBASES OF DIFFERENTIATION AND INTEGRATION
Classical Functional division The whole is integrated at the top Optimisation of the parts yields optimisation
of the whole Process
Process division The whole is integrated at the bottom Optimisation of the whole is different from
optimisation of the parts
Systemic Differentiation & Specialisation Integration & Synthesis
System development Integrate AND Differentiate All bases of division
BASES OF DIFFERENTIATION AND
INTEGRATION-2
andor
PROCESS REDESIGNPROCESS REDESIGN
Develop Process Objectives Identify Processes to be Redesigned Understand and Measure Existing
Processes Identify IT levers Design and Build Prototype Process
Davenport & Short (1990)
PROCESSESPROCESSES
Logically related tasks to achieved defined business outcome
Have customers, i.e. defined business outcomes
Cross organisational [functional] boundaries
Davenport & Short (1990)
RE-ENGINEERINGRE-ENGINEERING
Organise around outcomes, not tasks Let output consumers produce output Integrate information processing with real work
producing the information Place decision making where work is performed
and build control into process Treat geographically dispersed resources as
centralised Link parallel activities instead of integrating results Capture information once and at source
M Hammer, HBR ,1990
CHARACTERISTICS OF BUSINESS RE-ENGINEERINGCHARACTERISTICS OF BUSINESS RE-ENGINEERING
Re-work the transformation, not the output. Singular (insular) view (process) of the
organisational structure Substitution of one basis for organisation for
another Heavy dependence on IT perspective Patchwork of (some good) concepts; lacks rigour Design orientation Transcends current boundaries Promotes questioning --- What framework? Stretches value chain thinking
DISCUSSIONDISCUSSION
Relate your own experiences and understanding of business re-engineering
Biomatrix Teleon Doublet Telentropy Sub-teleon Sub-doublet Endo, Exo, Centro-teleon .....
Gyuri Jaros & Anakrion Cloete
...OF BIRDS AND BEES......OF BIRDS AND BEES...
Woven mat of processes:Woven mat of processes:
Sets of connected activities aimed at purpose
Interlinked and intersecting processes
Production processes Support processes
PROCESS CHARACTERISTICSPROCESS CHARACTERISTICS
INPUT, TRANSFORMATION, OUTPUT HAS PURPOSE AND GOALS STRUCTURE REGULATED ACTIVITIES MEASURES OF PERFORMANCE TELENTROPY RIGIDITY, FLEXIBILITY & REDUNDANCY
TELENTROPYTELENTROPY
INVERSE OF LIKELIHOOD OF ACHIEVING ITS GOAL
Low telentropy = good chance of achieving goal
High telentropy = low chance of achieving goal
TELENTROPY “=“ STRESS TELENTROPY TRANSFERABLE
EXERCISEEXERCISE
List 2-3 major processes in your personal life
List 3-5 major processes in your organisation
USE PROCESS CHARACTERISTICS CHECKLIST TO DEFINE PROCESSES
PURPOSE OF DESIGN PROCESSPURPOSE OF DESIGN PROCESS
DESIGN A DESIGN: Model of what ought to be
CRITICAL REFLECTION: Template for questioning design and reality
ALIGNMENT: Building up SHARED model of how business works
PARTICIPATION: Framework for participative design
PROCESS VIEW DESIGN PRINCIPLES
PROCESS VIEW DESIGN PRINCIPLES
Outward - Inwards design, not reactive: Holistic Actively searches out multiple viewpoints Structures and supports a group learning
process: Participative Uses a formal systems model as design
template Uses a systems approach to structure design
process Integrated with overall enterprise design
process
DESIGN PROCESSDESIGN PROCESS
STAKEHOLDER VIEW OUTPUTS REQUIRED PROCESS DEFINITION PROCESS MODELLING COMPARISON ORDERING ACTIVITIES
PROCESS DESIGN PROCESS
PROCESS DESIGN PROCESS
STAKEHOLDERS?
EXPECTATIONS?
OUTPUTS?
PROCESS ID &DEFINITION
TRANSFORMATIONACTIVITIES?
MONITORING & CONTROL ?
IT ROLE?
COMPARISON
CATEGORISE
SOURCESSOURCES
ACKOFF: Redesigning the Future & Creating the Corporate Future
Gharajedaghi: Towards a Systems Theory of Organization & Unpublished material
Mason & Mitroff: Various on Stakeholders Churchman: Design of Inquiring Systems,
Systems Approach and Its Enemies Checkland et al: Soft Systems
Methodology
STAKEHOLDER*STAKEHOLDER*
Stakeholder’s view of the enterprise Stakeholder’s logic, rationale and
value systems Stakeholder’s choice to be
stakeholder
STAKEHOLDERSSTAKEHOLDERS
Who should be served? Who should (are) the stakeholders? Who should (are) the
clients/beneficiaries?
EXPECTATIONSEXPECTATIONS
What should the purpose be, from the client’s (beneficiary’s) perspective?
What should (are) the client’s measures of performance?
What are the underlying worldview assumptions that makes this meaningful to the client?
WHAT ARE THE OUTPUT GOALS?
WHAT ARE THE OUTPUT GOALS?
What should be produced to satisfy the expectations of the particular client/stakeholder?
What are the tangible and intangible deliverables?
What are time related requirements to satisfy the expectations?
PROCESS DEFINITIONChecklist
PROCESS DEFINITIONChecklist
What is the input, output and transformation? Who is the client/customer? Who are the actors in the transformation? Who are the owners of the transformation? Who are the decision makers of the process? Why is this transformation assumed to be meaningful? What is the purpose of this transformation? What are its measures of performance? What environmental factors impact directly on this
transformation?
PROCESS ACTIVITY MODELPROCESS ACTIVITY MODEL
One process definition and model per output
Set of logically linked activities required to perform the transformation
Elements of model are verb phrases: Activities
ONLY activities that can be related to definition may be included
5-12 activities per model
MONITORING AND CONTROL ACTIVITIES
MONITORING AND CONTROL ACTIVITIES
Expand model to include monitoring and control of process within process
Efficacy, efficiency and effectiveness: Efficacy: Does the process achieve its goals (output, time)?
Telentropy: Likelihood of achieving goals Efficiency: Resources used per production unit. Effectiveness: Do the goals satisfy the (longer term)
purpose and expectations?
What should be measured for efficacy monitoring? What should be measured for efficiency monitoring? What should be monitored for effectiveness? Required reporting (including telentropy) and control
activities?
ROLE OF INFORMATION TECHNOLOGY AND SYSTEMS?
ROLE OF INFORMATION TECHNOLOGY AND SYSTEMS?
What should be done differently because of enabling technologies?
How should activities be done making use of IT/IS? Specialist input required Refer guidelines
IT/IS GUIDELINES FOR “INFORMATIONALISING”:IT/IS GUIDELINES FOR “INFORMATIONALISING”:
Mass customisation Rapid, real time response Manufacture at point of delivery Shrinking Overhead, Inventory, Working Capital Direct customer access & service levels Interlinking organisations Logistics and globalisation
Stan Davis & Bill Davidson: Vision 2020, Future Perfect
COMPARISONCOMPARISON
Activity models reflects designed ideal Reflect on requirements for rigidity vs.
redundancy and flexibility Use models as basis for critical reflection on
what is and should be implemented Cultural issues, value changes Human dimension (training, competencies) Political feasibility Impact dynamics
Group debate and design of implementation: Interaction
ORDERING OF ACTIVITIES ACROSS ALL
PROCESSES
ORDERING OF ACTIVITIES ACROSS ALL
PROCESSES
CATEGORIES OF ACTIVITIES: Monitoring and Auditing Co-ordinating activities Control activities Primary production activities. Support process activities Common, shared activities