Professional Documents
Culture Documents
net/publication/225229234
CITATIONS READS
9 401
1 author:
Ronald E. Giachetti
Naval Postgraduate School
74 PUBLICATIONS 1,414 CITATIONS
SEE PROFILE
All content following this page was uploaded by Ronald E. Giachetti on 18 July 2014.
Ronald E. Giachetti
1 Introduction
An enterprise system is an organized collection of interdependent subsystems that
must coordinate their activities in order to achieve common enterprise goals. The
decomposition of the enterprise into subsystems is a natural strategy to deal with the
size and complexity of enterprise systems. There are several ways in which to
decompose the enterprise [1]; one of the more common decompositions is functional.
The benefits of the decomposition are derived from the differentiation of each
subsystem to develop unique knowledge, information, and systems to optimally
address local problems. However, the decomposition must be countered with
appropriate levels of integration so that the decisions and actions of each subsystem
contribute effectively and efficiently to the overall enterprise goals. The need for
integration arises due to the interconnectedness between the subsystems. The
subsystems are interdependent because of the business processes that cross subsystem
boundaries [2]. Not only is the enterprise decomposed from an organizational
perspective but also from a technical perspective. The information technologies and
related systems that support each organizational unit are specified, designed, and
J. Eder, S. Dustdar et al. (Eds.): BPM 2006 Workshops, LNCS 4103, pp. 257 – 268, 2006.
© Springer-Verlag Berlin Heidelberg 2006
258 R.E. Giachetti
One of the classical management writers, Fayol [16], listed coordination as one of the
critical elements of management. He pointed to the necessity of "harmonizing the
separate activities and departments into a single whole". Coordination work is neces-
sary to manage the interdependencies in the enterprise. It was Thompson [17] who in
his action theory of organizations paid a great deal of attention to the different types
of interdependence existing within organizations and to methods for achieving high
levels of cooperation and coordination. Interdependence is “when actions taken by
one referent system affect the actions or outcomes of another referent system” [18].
Interdependence relationships can be direct when Unit A requires an action by Unit B
(e.g. delivery of materials) or indirect when Unit A requires an action of Unit B con-
tingent on A’s own action (e.g. delivery of materials according to a production sched-
ule generated by A) [19]. Interdependence occurs based on the flow of work between
organizational units, based on the organizational hierarchy and procedures for deci-
sion making, as well as on the social needs and goals of the employees [20].
There are three distinct approaches toward conceptualizing and measuring
interdependence. The first approach to measure interdependence is to use the flows
(material, information, control) and characterize the difficulty of managing the flows
[7], [14], [20], [22]. Thompson proposed a simple ordinal measure scale. In his
conceptualization the lowest level of interdependence is pooled resources, then
sequential relationships, followed by reciprocal relationships that are the most
difficult to coordinate. This basic hierarchy of interdependence types continues to be
utilized by researchers today. The approach of modelling and measuring
interdependence through studying the work flow patterns assumes the
interdependencies arise between tasks – in fact Malone and [7] succinctly define
coordination as the management of dependencies. Their work is atypical of much of
the other work. They define a taxonomy of dependency types and provide guidelines
on how to coordinate each dependency types. The second approach is to
conceptualize different types of exchanges between the organization units [18], [19].
In this work, the emphasis is on interdependence in the organizational structure and
not the process. The third approach is to develop action theory of organizations, paid
a great deal of attention to the different types of interdependence existing within
organizations and to methods for achieving high levels of cooperation and
coordination. Interdependence is “when actions taken by one referent system affect
the actions or outcomes of another referent system” [18]. Interdependence
relationships can be direct when Unit A requires an action by Unit B (e.g. delivery of
materials) or indirect when Unit A requires an action of Unit B contingent on
260 R.E. Giachetti
2 Model Development
Interdependence is the degree to which the actions or outcome of one task affects the
actions or outcome of a second task. In this definition, interdependence is viewed as
occurring between tasks, which then creates interdependence between the organiza-
tional units that are responsible for the tasks. It is important to view interdependence
as arising between tasks and not organizational units because the tasks can be decoup-
led from the organizational unit responsible for its completion. For example, a task
requires a certain set of capabilities in order to execute the task. Any actor or organi-
zation unit that possesses those capabilities may execute the task. Consequently, man-
agement has the flexibility to reassign roles and responsibilities as long as it adheres
to the task capability constraints. Any reassignment would change interdependence
between organizational units; however the interdependence between tasks would
remain unaltered. So, any model must represent both process constructs and organiza-
tion constructs.
Understanding Interdependence in Enterprise Systems 261
The empirical relationships between the objects are derived from the literature.
First, Thompson [17] and many succeeding research state that pooled resources,
sequential tasks, and reciprocal tasks are ordered from lowest to highest in terms of
interdependence. We add a refinement to the interdependence types to distinguish
between two types of sequential interdependence. There is sequential interdependence
due to the control flow of activities and a sequential interdependence due to the in-
formation flow. In an enterprise, the control flow or sequence of work tasks is not
necessarily the same as the information flow. We call the later type an information
sequential interdependence.
The introduction of a fourth type disrupts the ordering of interdependence types
because it is not clear the ordering of control sequential versus information sequential.
We argue that a control sequential interdependence is stronger or at least the same
strength interdependence relationship as an information sequential interdependence.
The reason is that control flow is like a rely race in which the runner cannot run until
he receives the baton. Likewise, in a control flow the succeeding task cannot start
until the previous task completes. In an information sequential interdependence the
succeeding task frequently has alternative courses of action if the information is de-
layed or otherwise interfered with. The introduction of this logic leads to a complete
ordering of the interdependence types. However, the comparison between control
versus information sequential interdependence must be tested and empirically
validated.
The current understanding of interdependence is an ordinal scale of the above-
mentioned interdependence types. There is insufficient empirical justification to
make any stronger claims concerning the relative strength of one interdependence
type compared to another type. For example, does a strong sequential relationship
equal a weak reciprocal relationship? For this reason we consider the interdepend-
ence types separately until more empirical evidence can provide guidance on other
courses of action.
A second empirical relationship is reported in [23]. They show that interdepend-
ence attributes of frequency, importance, and delay have significant impact on process
participants’ perception of interdependence. These interdependence characteristics
can provide an ordering within each of the four types defined above.
A final observation is interdependence is an asymmetric relationship. For example,
task B can be strongly dependent on task A but the reverse may not be true; i.e. task A
is only weakly dependent on task B. When discussing relationships in general the
term interdependence is preferred since any notion of direction is ambiguous. How-
ever, when discussing specific task relationships the term dependent is preferred be-
cause it conveys the direction.
There is a significant body of literature on enterprise modelling (See [2] for a review).
A prevalent research approach is the development of enterprise reference architectures
that describe the enterprise from many different viewpoints in order to deal with the
complexity of the enterprise system. In this work we choose Event Driven Process
262 R.E. Giachetti
Chains (EPC), which are one of the central components of ARIS [25]. EPCs unite the
organization, information, and function views defined by ARIS into a single diagram
showing the process flow. We choose EPCs because in a single diagram we can
represent the primary objects of interest for studying interdependence: control flows,
information flows, organizational responsibility, and attributes of these flows. EPC
come the closest to representing all of these elements – although in a later section we
annotate the EPC to represent the attributes of frequency, importance, and delay of the
information flows.
Resource
1 CONTROL SEQUENTIAL
Function 2
Event A
POOLED RESOURCES
V
Resource
Funciton 1 1
Function 1 Function 2
Resource
2
Resource
1
V
Function 2
Event B
Table1. These mappings have been empirically validated [23]. The information flow
attributes are used to characterize the strength of pooled resource, information
sequential and reciprocal interdependencies.
As previously stated each interdependence type is handled separately.
Interdependence between the functions is collected in an n × n matrix M where each
element mij is the interdependency measure. Each function in a row is dependent on
the function in the column to the degree mij. A separate matrix is made for each
interdependence type. In the information sequence interdependence matrix the values
of <fI, sI, dI> are used to derive mij, which is normalized to be between 0 and 1. In the
control sequential matrix the values of <sC, dC> are used to derive mij and are also
normalized between 0 and 1.
3 Illustrative Application
1
Scores 2 and 4 are intermediate between described values.
264 R.E. Giachetti
prepaid process. The data collected was incorporated into the model. The model was
presented to the company’s managers for validation.
Some notable aspects of the process are the telecommunications company acts as a
“coordinator” for the entire process. The cards are printed by an outside vendor, they
are distributed by an outside distributor who also collects the payments, capacity on
the network to carry the calls is negotiated with a network provider, and customer
service is partially outsourced. The only actual task, aside from coordination, con-
ducted by the company is marketing of the prepaid calling cards. Otherwise, the
company operates as a virtual enterprise that coordinates the activities of specialized
providers so as to deliver the service to the customer.
Fig. 2 shows part of the overall EPC diagram for the entire prepaid card process.
In order to abridge the diagram the organization units are not shown. Instead, in each
task the organization responsible is designated with the abbreviations: D = distributor,
S = sales, M = marketing, PM = prepaid manager, and P = printer.
In Fig. 2 the triple characterizing frequency, importance, and delay is depicted on
each information flow arc leaving an information resource. For example, the arc from
resource PO entering the function Generate Prototype Card is (1, 3, 5). The interpre-
tation is the PO is received quarterly or less, it is difficult but possible to generate the
prototype card without the PO, and the PO can be delayed by a day before the func-
tion is negatively affected.
The information sequential interdependencies between functions are shown in
Table 2. The measures can be used to understand which functions are critical to the
overall workflow. For example, the table shows that function 6, Generate order de-
tails is a critical function in the overall workflow since other functions have a high
dependence on it. This suggests the information output of this function, the Order
Details, is important and appropriate use of IT to ensure its accuracy and timely deliv-
ery can add to a well coordinated process. Also, function 11, Print Cards has a high
interdependence on other functions, specifically functions 7 and 10. These two func-
tions provide the CD-ROM with PINs and the Printing Order. The reason for the high
interdependence is the importance of these information resources and the low toler-
ance for delay. Taking this into consideration managers can examine how the infor-
mation flows to improve overall efficiency of the process.
The information sequential interdependence can be transferred to the organiza-
tional units responsible for each task. These measures can be used to reduce interde-
pendence by modifying each organization unit’s task assignments assuming task
capability constraints are met, by tracing the sources of the interdependence and en-
acting means to reduce the interdependence, or by enacting coordination mechanisms
to manage the interdependence.
In a business process it is expected that the predominant interdependency
type would be sequential. Process designers would try to minimize reciprocal inter-
dependencies – understanding they take more coordination effort. In this extract of
the entire prepaid calling card process there are no pooled resource or reciprocal in-
terdependence types – however in the entire process there were several reciprocal
interdependence types found.
Understanding Interdependence in Enterprise Systems 265
START
V Sales
Sales Analysis
Information
(2,2,3)
Generate Generate
Inventory
Supply Inventory (2,4,4)
Report
Request : D Report : D
Supply
Request Sent
(4,5)
Review Supply Inventory
Supply
(1,4,5) Supply XOR Request Report
Request
Request : S Accepted Generated
(5,7) Supply
Supply V (1,1,3)
(2,3) Request
Request
Rejected
V PO
PO Sent
(3,5)
V
Prototype Order Details
Requested
Order Details (1,5,6)
(4,5) (1,3,5)
(1,3,5)
(1,4,5)
Create CD- Generate
CD-ROM with
ROM with Prototype
PINs
PINs : PM Card : P
Prototype
(3,5) Prototype
Card for
Card Ready
CD-ROM with Validation
PINs created (5,7)
Validate
(5,6) Prototype (1,5,6)
Card : M
(1,5,6)
V
Prototype
Card
Validated
(5,6)
Print Cards : Order Details
Printing Order (1,4,6)
P V
PO
(4,6) (1,5,6)
Generate (1,3,5)
Activation/ Printing Order
Printing Order
Deactivaion Generated
:M Printing Order
FUNCTION 1 2 3 4 5 6 7 8 9 10 11
Generate supply request 1 0.00
generate inventory report 2 0.00
review supply request 3 0.75 0.75
generate PIN order 4 0.67 0.67
generate PO 5 0.33 0.33
Generate order details / prototype 6 0.67 0.67
create CD-ROM with PINs 7 0.67 0.92 1.58
Generate prototype card 8 0.67 0.83 1.50
validate prototype card 9 0.92 0.92
generate printing order 10 0.67 0.92 1.58
print cards 11 0.92 0.83 1.75
1.75 0.00 0.00 1.33 1.33 2.67 0.92 0.92 0.00 0.83 0.00
266 R.E. Giachetti
FUNCTION 1 2 3 4 5 6 7 8 9 10 11
Generate supply request 1 0.00
generate inventory report 2 0.00
review supply request 3 0.75 0.75
generate PIN order 4 0.42 1 1.42
generate PO 5 0.42 1 1.42
Generate order details / prototype 6 0.42 0.42
create CD-ROM with PINs 7 0.67 0.67 1.33
Generate prototype card 8 0.75 0.75
validate prototype card 9 1 1.00
generate printing order 10 0.83 0.83
print cards 11 0.92 0.92 1.83
0.75 0.83 2.00 0.67 0.42 0.75 0.92 1.00 1.50 0.92 0.00
D S M PM P
Distributor D
Sales S 1.17
Marketing M 0.42 1.00 1.00
Prepaid Manager PM 0.67 0.67
Printer P 1.67 0.92
4 Conclusion
This paper developed a formal model and measurement framework to define and
understand the interdependence in an enterprise system. The three interdependence
types of pooled resources, sequential, and reciprocal were extended by distinguishing
between information sequential and control sequential interdependence. Moreover, in
order to measure differences within an interdependence type we introduced attribute
measures of frequency, importance, and delay. The inclusion of the interdependence
attributes adds a significant refinement to the comparisons that can be made between
interdependence types.
Understanding Interdependence in Enterprise Systems 267
The paper formalized and augmented event process chains in order to model the
interdependence types. The model enables the analysis of both ‘as-is’ systems as well
as ‘to-be’ systems. Moreover, the formalization in the model allows the making of a
clear distinction between the interdependence types. An advantage of the model we
present is it provides for the overlapping of tasks to different degrees. In most process
models if tasks are shown sequentially – the assumption is the second task cannot
start until the first task completes. Through the use of the control flow attributes, the
model presented here allows for tasks that might overlap slightly so that the strict
precedence is not mandated. One potential omission that remains in the model (and in
most formal modelling efforts) is that there may be many informal communications
that take place and would not be immediately apparent to the modeller. To mitigate
this possibility the modeller needs to interview process actors and observe the actual
process tasks. This suggests that maybe the model should include an additional set of
arcs for informal communications. This is a possible future research that needs to be
examined.
The study limited itself to interdependence types and characteristics that have been
proven through long use and validation in empirical research studies. The exception
is we argued that control sequential interdependence is at least equal to or stronger
than an information sequential interdependence. This assumption was done in order
to maintain the representation condition of measurement theory that requires a weak
ordering that is transitive and complete. The relationship between these two types of
interdependencies needs to be empirically examined to confirm or reject our hypothe-
sis, and is reserved for future work.
References
1. M. Harris and A. Raviv, "Organization design," Management Science, vol. 48, pp. 852-
866, 2002.
2. F. D. Vernadat, Enterprise modeling and integration. London, UK: Chapman and Hall,
1996.
3. H. A. Simon, "Complex systems: The interplay of organizations and markets in contempo-
rary society," Computational & Mathematical Organization Theory, vol. 7, pp. 79-85,
2001.
4. J. Sutherland and W. J. van den Heuval, "Enterprise application integration and complex
adaptive systems," Communications of the ACM, vol. 45, pp. 59-64, 2000.
5. T. W. Malone, J. Yates, and R. I. Benjamin, "Electronic markets and electronic hierar-
chies," Communications of the ACM, vol. 30, pp. 484-497, 1987.
6. J. F. Rockart and J. E. Short, "IT in the 1990s: Managing Organizational Interdependence,"
Sloan Management Review, vol. 30, pp. 7-18, 1989.
7. T. W. Malone and K. Crowston, "The interdisciplinary study of coordination," ACM Com-
puting Surveys, vol. 26, pp. 87-119, 1994.
8. R. Giachetti, "Enterprise Integration: An information integration perspective," Interna-
tional Journal of Production Research, vol. 42, pp. 1147-1166, 2004.
9. S. B. Brunnermeier and S. A. Martin, "Interoperability costs in the US automotive supply
chain," Supply Chain Management: An International Journal, vol. 7, pp. 71-82, 2002.
10. M. T. Frohlich and R. Westbrook, "Arcs of integration: an international study of supply
chain strategies," Journal of Operations Management, vol. 19, pp. 185-200, 2001.
268 R.E. Giachetti
11. K. Kumar and J. Van Hillesgersberg, "ERP: Experiences and evolution," Communications
of the ACM, vol. 43, pp. 23-26, 2000.
12. B. Sulon, "Pennsylvania-based Hersey Foods' distribution problems to continue," in
Knight-Ridder/Tribune Business News, 1999.
13. A. Osterland, "Blaming ERP," CFO Magazine, vol. January, 2000.
14. V. Albino, P. Pontrandolfo, and B. Scozzi, "Analysis of information flows to enhance the
coordination of production processes," International Journal of Production Economics, vol.
75, pp. 7-19, 2002.
15. A. Van de Ven, A. L. Delbecq, and R. Koenig, "Determinants of coordination modes
within organizations," American Sociological Review, vol. 41, pp. 32-338, 1976.
16. H. Fayol, General and Industrial Management. London: Pitman, 1949.
17. J. D. Thompson, Organizations in Action. New York: McGraw-Hill, 1967.
18. J. E. McCann and D. L. Ferry, "An approach to assessing and managing inter-unit interde-
pendence," Academy of Management Review, vol. 4, pp. 113-119, 1979.
19. B. Victor and R. S. Blackburn, "Interdependence: An alternative conceptualization," Acad-
emy of Management Review, vol. 12, pp. 486-498, 1987.
20. F. Sahin and E. P. Robinson, "Flow coordination and information sharing in supply chains:
Review, implications, and directions for further research," Decision Sciences, vol. 33, pp.
505-536, 2002.
21. K. Crowston, "A coordination theory approach to organizational process design," Organ-
izational Science, vol. 8, pp. 157-175, 1997.
22. L. Kunz, Jin, "The Virtual Design Team: A Computational Simulation Model of Project
Organizations," Simulation, vol. 64, pp. 160-174, 1995.
23. M. Wybo and D. Goodhue, "Using interdependence as a predictor of data standards: theo-
retical and measurement issues," Information & Management, vol. 29, pp. 317-329, 1995.
24. J. W. Dean and S. A. Snell, "Integrated manufacturing and job design: moderating effects
of organizational inertia," Academy of Management Journal, vol. 34, pp. 776-804, 1991.
25. A. W. Scheer, Business process engineering. Reference models for industrial enterprises.
Berlin: Springer-Verlag, 1995.