Enterprise Design Process:
Business Processes
Johan Strümpfer
Enterprise Design
Tool 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
STRUCTURE
PROCESS
REGULATION
FUNCTION
DEFINITION OF STRUCTURE
• Relationships that remain unchanged
• Duration of interest
• Stability and relative change
Process View
KNOWLEDGE HIERACHY
'WISDOM'
UNDERSTANDING
INSIGHT
Process View
INFORMATION
Process view: PURPOSE
INTRODUCES CONCEPT OF
ENTERPRISE AS SYSTEM AS
LINKED PROCESSES
 BROADENS SCOPE OF POSSIBLE
INTERVENTIONS
 STAGE 1 OF ENTERPRISE DESIGN

DEFINITION 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:

PROCESS VIEW OF SYSTEM
INPUT
 TRANSFORMATION
 OUTPUT

SYSTEM
I
T
O
CLASSIC ORGANISATIONAL
STRUCTURE
Lines of authority, responsibility, accountability
PROCESS ORGANISATIONAL
VIEW
“Manage the white spaces”
BASES 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
BASES OF
DIFFERENTIATION AND
INTEGRATION-2

Systemic
 Differentiation
& Specialisation
 Integration & Synthesis

System development
 Integrate
AND Differentiate
 All bases of division
or
and
PROCESS 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)
PROCESSES
Logically related tasks to achieved
defined business outcome
 Have customers, i.e. defined
business outcomes
 Cross organisational [functional]
boundaries


Davenport & Short (1990)
RE-ENGINEERING

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
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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-ENGINEERING

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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?
DISCUSSION

Relate your own experiences and
understanding of business reengineering
...OF BIRDS AND BEES...
Biomatrix
 Teleon
 Doublet
 Telentropy
 Sub-teleon
 Sub-doublet
 Endo, Exo, Centro-teleon
 .....

 Gyuri
Jaros & Anakrion Cloete
Woven mat of processes:
Sets of connected activities aimed at
purpose
 Interlinked and intersecting
processes
 Production processes
 Support processes

PROCESS CHARACTERISTICS
INPUT, TRANSFORMATION, OUTPUT
 HAS PURPOSE AND GOALS
 STRUCTURE
 REGULATED ACTIVITIES
 MEASURES OF PERFORMANCE
 TELENTROPY
 RIGIDITY, FLEXIBILITY &
REDUNDANCY

TELENTROPY

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

EXERCISE
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
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

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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
 STAKEHOLDER
VIEW
 OUTPUTS REQUIRED
 PROCESS DEFINITION
 PROCESS MODELLING
 COMPARISON
 ORDERING ACTIVITIES
PROCESS DESIGN
PROCESS
STAKEHOLDERS?
EXPECTATIONS?
OUTPUTS?
PROCESS ID &
DEFINITION
TRANSFORMATION
ACTIVITIES?
MONITORING &
CONTROL ?
COMPARISON
CATEGORISE
IT ROLE?
SOURCES

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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’s view of the enterprise
 Stakeholder’s logic, rationale and
value systems
 Stakeholder’s choice to be
stakeholder

STAKEHOLDERS
Who should be served?
 Who should (are) the stakeholders?
 Who should (are) the
clients/beneficiaries?

EXPECTATIONS
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 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 DEFINITION
Checklist
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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 MODEL


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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


Expand model to include monitoring and control of
process within process
Efficacy, efficiency and effectiveness:

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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?
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”:
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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
COMPARISON

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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

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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

CATEGORIES OF ACTIVITIES:
 Monitoring
and Auditing
 Co-ordinating activities
 Control activities
 Primary production activities.
 Support process activities
 Common, shared activities