Enterprise Engineering

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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. IE880I. Text - PowerPoint PPT Presentation

Text of Enterprise Engineering

Enterprise EngineeringIE880I
The Great Transition : Using the Seven Disciplines of Enterprise Engineering to Align People, Technology, and Strategy
by James Martin
AMACOM; ISBN: 0814403158
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
... a system engineered to accomplish organizational goals.
Only their thing is the enterprise
Design things!
Verndat Chapter 1
How can we automate
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
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
“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
Enterprise Engineering
Key concept
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
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 human-technological 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.”
What do Enterprise Engineers do?
Identify and Integrate best and most successful ways to change an enterprise
Enterprise Engineering
Two aspects
New Corporate Architectures must be understood
Understand methods that can change an enterprise
Enterprise Engineering
What should the enterprise be?
How do we get there from here?
Enterprise Engineering
TQM, Kaizen
If it aint broke don’t fix it!
Enterprise Engineering
Procedure Redesign
Quick hit
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
Simplify (work flow, etc.)
“Doing your best is not enough.”
W. Edwards Deming
There are numerous examples of organizations who resist change. They refused to believe that their customers would desert them. They either had a blind faith in the loyalty of the customer or a strong conviction that the customer had no other alternative.
In these cases, organizations refused to recognize the impact of the change. Their formula was to have everyone work harder, maybe even reduce benefits.
Under these conditions, people doing their very best is not going to be enough. And, unfortunately, it is usually too late before we recognize the problem.
Enterprise Engineering
Throughout this series on developing a vision and strategy, we will follow the generic process for developing any plan.
When the process is used by some business enterprise and is concerned with those decisions which are difficult to reverse, the process results in a “strategic plan.” But the same process is just as applicable to an operational plan, a problem-solving plan, or for that matter, a personal plan.
Today’s discussion focuses on defining the purpose of the organization and understanding the environment in which it operates. This is the “thinking phase of planning.” During this phase we try to get a realistic picture of our environment and lay the foundation upon which the plan will be built.
Enterprise Engineering
Understanding the environment turns out to be an iterative process. The vision is formulated based on an understanding of the customer. It is refined and reinforced by a commitment from management. As we develop a better assessment of the environment, we refine the vision.
Enterprise Engineering
Complaints about inability to contribute
Losing customers
Use of “We” and “They”
Excessive risk avoidance
There are common warning signs of the need for a new purpose.
Frequent arguments over which market, product, technology, or customer has priority.
Frequent complaints because people feel that they cannot make a difference, are not learning, or are not having fun.
Failure to retain customers, or attract new ones.
The organization is not familiar with the latest technological or socioeconomic developments.
The organization is split between “us” and “them”. There is a lack of pride in the company.
People stay within narrowly defined job descriptions, unwilling to become accountable for their responsibilities.
Leadership cannot define how the company is improving or are unwilling to speak about the future.
Information through the rumor mill is more accurate than from formal channels.
Enterprise Engineering
The “vision” is what the organization aspires to become.
The “mission” defines or describes how the organization will achieve the vision.
“Values” guide, direct and limit what and how the organization does to achieve the vision.
Each affect the other and must be constantly evaluated and reviewed in the context of the changing external environment.
Enterprise Engineering
What do you want said?
Humanity is grateful that someone who so adored their species lived among them
Stephen Covey
Enterprise Engineering
The vision is an articulation of the outcome an organization desires. It should be so succinctly stated that every employee can see it with clarity and it describes a future that is realistic, credible and attractive.
A vision is formulated by a team of management personnel and shared with everyone in the company. It defines:
What the organization aspires to become
Who we want to be,
Where we want to go."
"It identifies clearly for all concerned- employees, customers and suppliers- exactly what the organization stands for and precisely why they should support it." (Belasco, James, Teaching the Elephant to Dance, Crown Publishers, Inc., NY, 1990, pg 11.)
Powerful vision statements tend to have special properties:
Are appropriate for the organization in terms of history, culture and values
Visions are consistent with the organizations present situation and provide a realistic and informed assessment of what is attainable in the future.
Clarify purpose and direction
Visions are persuasive and credible in defining what the organization wants to make happen, and therefore, what are legitimate aspirations for people in the organization.
Inspire enthusiasm and encourage commitment
Are well articulated and easily understood
Visions are unambiguous enough to be internalized by those whose efforts are needed to convert the mission into reality.
Reflect the uniqueness of the organization, its distinctive competence, what it stands for and what it is able to achieve
Focus the business on what the customer perceives as value
Are ambitious
Visions represent progress and expand the organization’s horizons. Often, they call for sacrifice and emotional investment by individuals within the organization’s.
Enterprise Engineering
Vision Statement
A vision statement can be used as a marketing tool as well as an inspiration to employees:
Ford's vision:
The mission reflects the broadest strategic planning choice. It defines the scope and direction of the business along with the value the organization provides to society.
A mission is not quantifiable or measurable. It describes the unique position the organization holds in an industry or institutional structure.
A mission statement describes what the organization does in order to fulfill its vision.
It establishes what it takes for success.
Broadest strategic planning choices of what the organization should do
In developing a mission, start with the business you are currently in. Compare that to the business you should be in. This may not be what you would like to do, or what you want to do. Remember FRIEDEN adding machines? They wanted to be the industry leader in mechanical calculators. They should have been the leader in desk top calculators - or personal calculators. They failed to recognize the impact technology was having on their product.
When developing a mission consider:
The type of products and services offered
The type of customers served
Geographical markets served
“Maintaining an international viewpoint, we are dedicated to supplying products of the highest efficiency yet at a reasonable price for worldwide customer satisfaction." Honda
“To be known as a world class applied research institute where innovative ideas, concepts and philosophies are applied to solve important problems for customers” ARRI
“We provide specialized, focused, management and technical assistance by facilitating the integration and improvement of plans, culture, processes, and technology necessary to promote economic development.” SIME
Enterprise Engineering
Values form an enduring set of beliefs or parameters against which ongoing decisions can be tested. They also encourage certain modes of behavior toward people, customers, suppliers and community.
Customer Needs - We value the customers needs as our own. Fulfill every promise and meet every requirement. Have each person connected to the final product. {Promptness, Efficiency, Precision}
Employees - We value responsible, team oriented people that are committed to One Stop Printing for the long term. Innovative, Committed, Honest, Loyal.
Cultural - We value an environment where people are respected and encouraged to meet their potential.
Provide context for decision making
Not a slogan
The values statement is not something to only be written and signed. If employees do not think you are sincere, the contract will be broken.
Values statement:
Commitment is made to those who are responsible
Suggests how the organization ought to behave toward its own people, it customers, suppliers and community
Guides thought and conduct
Establishes context within which day-to-day operating decisions are made
Bounds strategic options
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
For more examples of vision statements. (Belasco, James, Teaching the Elephant to Dance, Crown Publishers, Inc., NY, 1990, pg 105-112).
Sample Vision Statements
"..to be perceived as a unique, high-spirited, entrepreneurial enterprise ... known around the world for its unmatched level of excellence." General Electric
"Encircle Caterpillar" Komatsu
"Quality is job 1" Ford
"Securing Tomorrow Today" Interturbine Dallas
"Santech is committed to an ethical and professional work environment where individuals are empowered to make their own decisions and improvements.
"Our focus is to be the leader in Sealing Technology by recognizing current and future customer needs." Santech Industries
"Put a man on the moon by the end of the decade." John F. Kennedy
Enterprise Engineering
1. Management’s primary responsibility is to examine the _____________ and provide _____________ for the company. A statement of purpose for the company can be used to provide guidance.
2. A statement of purpose consists of the _______, ________, and _______.
Enterprise Engineering
A Discipline?
Industrial Engineering Research Conference
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
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World View
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
Supporting disciplines must be discovered and assessed not merely adopted.
Allows other researchers to follow the links for the grounding of theories
Practices - methodologies, models, procedures, and theories used to apply knowledge
Theory - sound principles
Professional Society - ISEE
IEs now penetrate offices
How can business processes be transformed using IT?
IT Capabilities
BP Redesign
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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
Develop Business Vision and Process Objectives
ID Processes to be Redesigned
Understand and Measure the Existing Process
ID IT Levers
Enterprise Engineering
Processes and Organization
Continuous Process Improvement
facilitating communication
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
intra-enterprise integration
inter-enterprise integration
Virtual Enterprise - Extended enterprise on a temporary basis.
Hetarchical organization - autonomy
ex. Dedicated interface
two systems contribute to a common task
two systems share the definition of items exchanged
Enterprise Engineering
technologically dependant
really business process coordination
skilled people
Enterprise Engineering
Next Week
World View
firmly established.
reference disciplines has been
practices is emerging.