Enterprise Engineering
Larry Whitman
whitman@imfge.twsu.edu
(316) 691-5907
(316) fax
Industrial & Manufacturing Enterprise Department
The Wichita State University
http://www.mrc.twsu.edu/enteng
Enterprise Engineering
IE880I
Text
 The Great Transition : Using the Seven Disciplines
of Enterprise Engineering to Align People,
Technology, and Strategy
 by James Martin
 Hardcover - 503 pages (September 1995)
 AMACOM; ISBN: 0814403158
 Also, significant outside articles will be assigned.
Enterprise Engineering
IE880I - Topics
 Overview of Enterprise Engineering (3 weeks)
 Basic overview of what is enterprise engineering and its benefits.
Students will learn the advantages of EntEng and associated
terminology and philosophy.
 IE880I - Exam 1 - February 5, 1999.
 Test will be closed book/notes - fill in the blank/essay
format.
 One hour long, then we begin the next topic.
 We will have class Feb 26, 1999
 Dr. Mahlzahn will be guest speaker on Activity Based
Costing
Enterprise Engineering
What is an Enterprise?
An Enterprise is a complex system
of cultural, process, and technology components ...
Enterprise
... a system engineered to accomplish organizational
goals.
Enterprise Engineering
What do Engineers do?
Design things!
Same as other engineers, Enterprise Engineers design
things.
Only their thing is the enterprise
Enterprise Engineering
Systems Approach
Environment
System
Enterprise
Goals
input
External
Suppliers
Your
Supplier
output
Your
Process
feedback
feedback
People
Tools
Machines
Enterprise Engineering
Your
Customer
External
Customers
Today
 Martin Chapter 3-5
 IE and IT Article by Davenport and Short
 EntEng: A Discipline? Article by Liles, et al.
 Verndat Chapter 1
Enterprise Engineering
Wrong use of Automation (Chap 3)
Design
How can we automate
what already exists?
Replace to make
fundamentally better
Enterprise Engineering
Wrong use of Automation (Chap 3)
System must fit the users and not the reverse?
Not always, frequently the users must change
their ways in order to maximize profits
from automation
Enterprise Engineering
Redesign, then automate!
 Little change, little payoff
 Big change, big payoff
 A small change with some payoff may mean it is
much more difficult to make the right change later.
Enterprise Engineering
Russell Ackoff
 “If each part of a system, considered
separately, is made to operate as efficiently
as possible, the system as a whole will not
operate as effectively as possible.
Enterprise Engineering
Martin
 “It is appalling how many authorities on
“business process reengineering” advocate
modeling and modifying an existing
business process when the right thing to do
is scrap the process and take an integrated
approach to building cyber-crop value
streams (discussed later)
 Raise questions about … overall
architecture, culture, and IT
Enterprise Engineering
Electronic Organism (chap 4)
 As systems become more complex, the design of
these systems must be automated.
 Automation of Automation
 Reaction times shrink, complexity
increases, decisions become less
intuitive.
Enterprise Engineering
Key concept
 JOINT creativity of business and
computer people
Enterprise Engineering
Architecture - Martin
 “The architecture of an enterprise is the basic
overall organization within which work takes
place.
 Note how this compares with later definitions
Enterprise Engineering
EntEng Definition (Martin) (Chap 5)
 … an integrated set of disciplines for building or
changing an enterprise, its processes, and systems.
It integrates the most powerful change methods
and makes them succeed. The goal is a humantechnological partnership of maximum efficiency
in which learning takes place at every level.
(Martin)
Enterprise Engineering
Goal of the Enterprise Engineer
 “Identify and integrate the most valuable and
successful ways to change an enterprise, and to
take them into a professional discipline with a
teachable methodology and measures of
effectiveness.”
Enterprise Engineering
What do Enterprise Engineers do?
Identify and
Integrate best and
most successful
ways to change an
enterprise
Enterprise Engineering
What do Enterprise Engineers do?
 Two aspects
 Understand new mechanisms
 New ways of organizing work
 New Corporate Architectures must be
understood
 Understand methods that can change an
enterprise
Enterprise Engineering
Two questions Enterprise Engineers always ask
 What should the enterprise be?
 How do we get there from here?
Enterprise Engineering
Seven Components of Enterprise
Engineering
Enterprise Engineering
TQM, Kaizen
 Continuous change applied across an enterprise
 Kaizen - Japanese term for continuous
improvement
 Everybody improves everything all the time
If it aint broke don’t fix it!
Enterprise Engineering
Procedure Redesign
 Discontinuous reinvention of existing processes
 Quick hit
 Low lying fruit
Enterprise Engineering
Value Stream Reinvention
 Discontinuous
reinvention of “end to
end” streams
 Breakthrough
improvement for the
CUSTOMER
Enterprise Engineering
Enterprise Redesign
 Discontinuous redesign
 Holistic change to a new world architecture,
sometimes accomplished by building new business
units of subsidiaries.
Enterprise Engineering
All for changing processes
 Simplifying work
 Improving results
Enterprise Engineering
Simplification of Work (note order)
 Eliminate (bureaucracy and non-value added)
 Simplify (work flow, etc.)
 Work Smarter
 Reduce Middlemen (eliminate)
 Refine IIS
 Automate
 Automate Automation
Enterprise Engineering
Strategic Visioning
 What is a vision?
Enterprise Engineering
Strategic Visioning
Enterprise Engineering
Resisting the Tide of Change
“Doing your best is not enough.”
W. Edwards
Deming
You must know what to do, how to do it and be
willing to pay the price to do it.
Enterprise Engineering
A Disciplined Planning Process
Define
Purpose
Vision, Values, Mission
Understand
Environment
Issues, Concerns, Assumptions
Determine
Outcomes
Goals
Identify
Risk
Obstacles
Plan
Act
Do
Check
Enterprise Engineering
Evaluate
Alternatives
Assign
Actions
Strategies
Objectives
An Iterative Process
Strategic
Purpose
Environmental
Assessment
Management
Commitment
Focus on the customer
Enterprise Engineering
A Disciplined Planning Process
Define
Purpose
Vision, Values, Mission
Understand
Environment
Issues, Concerns, Assumptions
Determine
Outcomes
Goals
Identify
Risk
Obstacles
Plan
Act
Do
Check
Enterprise Engineering
Evaluate
Alternatives
Assign
Actions
Strategies
Objectives
Do You Need a New Purpose?
 Confusion about where organization is going
 Complaints about inability to contribute
 Losing customers
 Not current on the latest developments
 Use of “We” and “They”
 Excessive risk avoidance
 Difficulty in describing improvement
 Hyperactive rumor mill
Enterprise Engineering
Purpose
Values
Customer
Expectations
Mission
Vision
Activity
Output/
Outcome
A Process
Input
Enterprise Engineering
Vision
RIP
Humanity is
grateful that
someone who so
adored their
species lived
among them
RIP
I would
rather be
here than in
Philadelphia
What do you want said?
Enterprise Engineering
Vision
What the organization
ASPIRES
to become
Enterprise Engineering
Vision Statement
 Appropriate
 Inspiring
 Directing
 Focusing
 Guiding
 Unique
Enterprise Engineering
Vision Statement
A vision statement can be used as a marketing
tool as well as an inspiration to employees:
Ford's vision:
Quality is job 1.
ADM's vision:
Supermarket to the world
If the vision motivates employees, it will
influence customers.
Enterprise Engineering
Mission
What the
organization
SHOULD
be doing
Enterprise Engineering
Mission Statement
Broadest strategic planning choices of
what the organization should do
• Products/services
• Markets
• Customers
• Competitors
Enterprise Engineering
Values
Guides the
organization’s
BEHAVIOR
Enterprise Engineering
Values
 Communicates what is and what is not right
 Provide context for decision making
 Enduring
 Widely shared
Enterprise Engineering
Values Statement
 Based on values of organization
 Commits resources to achieve vision
 Not a slogan
 Lived everyday
 Drives behavior of employees at all levels
Enterprise Engineering
Statement of Purpose
"We will create a corporation in which all people, particularly
technical employees, are respected and are able to work to
the best of their ability."
"We will not imitate the products of our competitors, but will try
to create goods that have never existed in our market before."
"We will focus on the consumer market and apply the most
advanced technology to the consumer products area."
Sony Corporation, 1946
Total Assets: $500
I know those guys!
Enterprise Engineering
Assignment
For your own (pretend) company, develop
 Vision
 Mission
 Values
Enterprise Engineering
A Discipline?
 Article by Liles, Johnson, and Meade 1996
 Industrial Engineering
Conference
Enterprise Engineering
Research
Characteristics of a Discipline
Education
&
Professionalism
Principles
&
Practices
Focus of
Study
Enterprise Engineering
Active
Research
Agenda
World
View
Reference
Disciplines
Focus of Study
 Unique fundamental question
 Must be meaningful as technology changes
 Enterprise Engineering - “how to design and and
improve all elements associated with the total
enterprise through the use of engineering and
analysis methods and tools to more effectively
achieve its goals and objectives
Enterprise Engineering
World View
 Paradigm
 Guides the discipline through research and
practice
 Enterprise Engineering
 Enterprise can be viewed as a complex system
 Enterprise is to be viewed as a system of processes
that can be engineered both individually and
holistically
 Engineering rigor is required in transforming an
enterprise
 Enterprise CAN be engineered
Enterprise Engineering
Reference Disciplines
 Supporting disciplines must be discovered and
assessed not merely adopted.
 Allows other researchers to follow the links for the
grounding of theories
Industrial Engineering
Systems Engineering/Systems Theory
Information Systems
Information Technology
Business Process Reengineering
Organizational Design/Human Systems
Enterprise Engineering
Principles and Practices
 Principles - Define philosophical approach to
problem solving
 Practices - methodologies, models, procedures, and
theories used to apply knowledge
 Theory - sound principles
 Abstraction - modeling or representation
 Design - synthesis - iterative generation and
evaluation of alternatives
 Implementation
Enterprise Engineering
Active Research Agenda
 Hypothesis generated and tested
 Multiple subquestions
 Examples:




Enterprise Transformation Methodology
Strategic Justification Methodology
Ontology Development
Virtual Enterprise Architecture
Enterprise Engineering
Education and Professionalism
 Conferences - ISEE Conferences
 Journals - IIE Transactions, Special Issues
 Curricula - UTA, Toronto, Edinburgh, Australia
 Professional Society - ISEE
Enterprise Engineering
Disciplines - Summary
Enterprise Engineering Discipline
Focus of Study
A well defined and unique
focus of study is established.
World View
A world view or paradigm is
firmly established.
Reference
Disciplines
A solid, but narrow set of
reference disciplines has been
identified.
Principles &
Practices
A set of principles and
practices is emerging.
Active Research
Agenda
A cumulative research
tradition must be established.
Education &
Professionalism
Specific journals, university
programs and local chapters
are needed.
Enterprise Engineering
The New Industrial Engineering
 Article by Davenport and Short
 Sloan Mgmt Review Summer 1990
Enterprise Engineering
IT and BPR
 IEs use IT in Manufacturing
 IEs now penetrate offices
Enterprise Engineering
The New IE
 Recursive View of IT and BPR
How can IT support Business Processes?
IT Capabilities
BP Redesign
How can business processes be transformed using IT?
Enterprise Engineering
What are Business Processes?
 … a set of logically related tasks performed to
achieve a defined business outcome
 A set of processes forms a business system
 Characteristics of business processes
 Customers - recipients of outcomes
 Cross organizational boundaries
Enterprise Engineering
Redesign with IT - Five Steps
 Develop Business Vision and Process Objectives
 ID Processes to be Redesigned
 Understand and Measure the Existing Process
 ID IT Levers
 Design and Build a Prototype of the New Design
Enterprise Engineering
Types of Processes
Process Dimension &
Type
Entities
Typical Example
Typical IT Role
Interorganizational
Order from a supplier
Interfunctional
Develop a new product
Interpersonal
Approve a bank loan
Lower transaction costs;
eliminate intermediaries
Work across geography;
greater simultaneity
Role and task integration
Objects
Physical
Mfg a product
Informational
Create a proposal
Increased outcome
flexibility
Activities
Operational
Fill order
Managerial
Develop a budget
Enterprise Engineering
Reduce time and costs;
increase output quality
Improve analysis; increase
participation
Management Issues
 Management Roles - commitment even through
across functional boundaries
 Processes and Organization
 Skills - new ones required
 Continual Organization Improvement
 IT Organization in Enterprise may change
 Continuous Process Improvement
Enterprise Engineering
Vernadat - Text - Definitions
 CIM - integrates man and machine by:
 facilitating communication
 cooperation
 coordination
 across departments
 JIT - reduce procurement delays and stock
 assumes good integration of info and good logistics
 Lean manufacturing - minimize product
devlopment costs by elim NVA, outsourcing, org
changes
 Concurrent Engineering - integrating all
departments to make things better, faster, cheaper
Enterprise Engineering
Vernadat - Text - Definitions (cont.)
 Enterprise - within the bounds of the company
 intra-enterprise integration
 Extended Enterprise - beyond the bounds of the
company
 inter-enterprise integration
 Agility -adapt quickly (able to respond to
unanticipated change)
 Virtual Enterprise - Extended enterprise on a
temporary basis.
 Hetarchical organization - autonomy
Enterprise Engineering
Reasons for CIM Failures
•Top Down Approach
•One massive project
•Too Complex
•Bottom Up Approach
•Integrating Piece-by Piece
•Islands of Automation
•Failed to consider people
Enterprise Engineering
Loose Integration vs Full Integration
 Loose
 simple exchange of info
 no guarantee of same interpretation
 ex. Dedicated interface
 Full
 specificities are known only the the one system
 two systems contribute to a common task
 two systems share the definition of items
exchanged
Enterprise Engineering
Horizontal vs Vertical Integration
 Business viewpoint
 Horizontal - from “dock to stock”
 technologically dependant
 Vertical - various mgmt levels
 decision flow
Enterprise Engineering
System/Application/Business Int
Enterprise Engineering
Model What?






Products
Resources
Information
Organization (and decisions)
Business Processes
Human (effects)
Enterprise Engineering
Role of EM
 Prereq for enterprise integration
 History
 integration of data and info
 really business process coordination
 integrating infrastructure
 enterprise model - semantic unification
Enterprise Engineering
Problems with EI/EE
 Cost (unclear)
 project size and duration
 complexity
 management support - does not clearly relate to
strategy
 skilled people
Enterprise Engineering
Next Week
 BPR
 Hammer and Champy Book
 Article by Meyer, deWitte
Enterprise Engineering