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Modelling Business Communication as a Foundation for Business Process Redesign: A case of production logistics1 Victor E. van Reijswoud Nardo B.J. van der Rijst Department of Information Systems Delft University of Technology P.O.Box 356, 2600 AJ Delft, The Netherlands E-mail: {b.j.vanderrijst|[email protected]}

1Published in: J.F. Nunamaker, R.H. Sprague (Eds.), The proceedings of the 28th Annual Hawaii International Conference on System Sciences Vol. IV, IEEE Computer Society Press, Los Alamitos CA, 1995, pp 841-850.

Abstract This paper evaluates the suitability of a new modelling method called DEMO for the purpose of Business Process Redesign. On the basis of the theoretical evaluation two extensions are proposed; the Transaction Sequence Graph and the Transaction Process Model. DEMO and the two extensions are applied to a case study. From the case study it is concluded that a DEMO analysis together with the extensions are a suitable tool for Business Process Redesign.

1: Introduction The possibilities and promises of Business Process Redesign is attracting a growing interest within the information systems society. The common theme in these discussions is the more effective usage that could be made of information technology if the redesign and reengineering of a company's information management system would be performed together and in harmony with the redesign and reengineering of its business functions [5]. Major publications dealing with this subject are a.o. [2], [10], [11] and [16]. The notion Business Process Redesign lacks a commonly accepted definition but the underlying claim that organizational change is necessary to maintain flexibility and competitiveness of a business is clear [19]. The extent to which organizational change has to be performed differs greatly. Hammer and Champy [10] suggest a radical organizational change and a "start from scratch", while Venkatram [21] and Keen [11] propose considerably less radical changes to achieve and maintain flexibility and competitiveness of the business. In this paper we view Business Process Redesign (BPR) along the lines of the multi-level perspective for Information Technology-induced reconfiguration of an organization as described in [21]. Along the two basic dimensions, ‘Degree of business transformation’ and ‘Range of potential benefits’, Venkatram positions five levels of reconfiguration. In ascending order of impact on the actual organization, these levels are: 1. Localized exploitation 2. Internal integration 3. Business process redesign 4. Business network redesign 5. Business scope redefinition The levels 1 and 2 are called evolutionary levels, requiring relatively incremental changes in the existing organizational processes. The levels 3, 4, and 5 are

conceptualized as revolutionary levels, requiring fundamental changes in the nature of the business processes. When we, in the course of this paper, refer to BPR we aim at organizational changes at both the evolutionary and the revolutionary levels of reconfiguration. The majority of publications in the area of BPR have either a descriptive or a prescriptive nature. Case studies provide descriptions of real business redesign projects on the basis of which relevant aspects for BPR are determined. Surveys of performed business redesign projects provide procedures and protocols for new BPR missions. However, rarely does one find a discussion of the suitability of current analysis methods and techniques for their task, or a proposal for new methods and techniques. An exception in this context is the proposal of DEMO as a new method for BPR [6]. The main characteristics of a DEMO analysis that make it suitable for the purpose of BPR are a total independence from the IT-infrastructure and IT-applications, as well as a total independence from the organizational structure (this means the division of tasks and the assignment of tasks to individual persons). This independence is achieved by abstracting from the implementation or realization of information processes and information flows and in particularly by way of looking for the pragmatic purposes of these processes and flows. In doing so, a level of abstraction is reached at which the information flows and processes as such are eliminated. The resulting model is called an essential model of an organization and presents a definition of all transactions between actors in an organization, together constituting the business process [5]. The essential model is expressed in three partial models: the Communication Model, the Information Model and the Action Model. In this paper we consider the central Communication Model. In practice, however, two questions have not been addressed in the DEMO Communication Model up till now, which are important elements for applying BPR. In the first place, the Communication Model does not show the sequence and the relation in time between the individual transactions. This means that the logical order, in which transactions in most businesses take place, is lost in the model. This knowledge of the business process is necessary for BPR at the revolutionary level. Secondly, the Communication Model does not expand on the actual process structure of the individual transactions. In other words, in DEMO transactions are presented in a nonspecific and abstract way, by mentioning the type of transactions, the actors and if possible the behavioral rules. Knowledge of the process structure of the transaction is

necessary to perform BPR at the evolutionary level where incremental changes to the communication process of the business improves flexibility and competitiveness [21]. In the course of this paper we examine two strongly related models as extensions to DEMO. After an introduction to the modelling of organizations using DEMO, containing a condensed version of the theoretical principles, we start with the presentation of the Transaction Sequence Graph. This model presents a graphical representation of the sequence of transactions in a business process. The second question is answered by using the Transaction Process Model for analyzing individual transactions. This model defines all possible conversational steps in a transaction. Both models are discussed in section two of this paper. The applicability of the extensions is described in section 3. In this section we show the results of the analysis of a case study. Finally, section 4 presents the conclusions and some discussion on the outcomes of the research.

2: DEMO and its Extensions The DEMO Communication Model and its two extensions discussed here have a strong relationship. They are based on the concept of the transaction, which is discussed in the next section. The Communication Model is used for the representation of all essential transactions in organizations and forms the central part of the modelling method. The Transaction Sequence Graph describes the interdependencies between transactions and their occurrence in time. The third modelling tool, the Transaction Process Model, defines the structural characteristics of a transaction.

2.1: Modelling Organizations with DEMO "DEMO" is an acronym for "Dynamic Essential Modelling of Organizations". It is the name of a crossdisciplinary theory about the dynamics of organizations, as well as an analysis method based on that theory. The disciplines on which it draws are the philosophical branches of semantics and scientific ontology [1], and the social theory grounded in language philosophy [8,17]. Next to these it incorporates the discrete dynamic system theory as described in [3]. If informatics is understood to be the interdisciplinary field of science that deals with information and communication and their role in the functioning of dynamic systems, especially organizations, then the DEMO theory can most appropriately be called an informatical theory. In particular the theory does not draw on, and thus is independent of, any economic theory about organizational behavior, like the Value Chain Theory

[12], the Agency Theory [7] or the Transaction Cost Theory [22]. This independency makes DEMO most valuable for providing an original informatical contribution to BPR, next to and in harmony with contributions from other disciplines. Because a comprehensive description of DEMO in one paper or book is not yet available, we have to refer the reader to fragments of such a description. A relevant set of fragments is constituted by [3, 4, 5, 6, 14]. In this section we will only briefly mention the main aspects. A well-known distinction in levels of abstraction when studying organizations from the perspective of informatics is the distinction between the documental and the informational level. At the documental level an organization is viewed as a system of actors that produce, store, transport and destroy documents. At the informational level one abstracts from the substance and the syntactic aspect in order to focus on the semantic aspect of information. What one observes now is a system of actors that emit and receive messages (semantic meanings) to and from each other. This is the level where most current methods and techniques (like e.g. the DFD and the ER-model) aim to be helpful. In [5] these two levels are extended with a third level, called the essential level. As a consequence of abstracting from informational issues, all actions concerning reproduction and derivation are eliminated. What one observes when focusing on the pragmatic aspect is a system in which the actors carry on performative conversations: actagenic conversations, resulting in agreements about future actions and factagenic conversations, resulting in the establishment of facts. Because only in performative conversations, original new things are accomplished, we consider these conversations to represent the essence of an organization. Consequently, we call the actions that are agreed upon in actagenic conversations and the results of which are established in factagenic conversations, essential actions, and the conceptualization of the system observed the essential model of the organization. For any organization there exists at any moment one documental model, one informational model and one essential model. In principle though, one may conceive of a number of documental models, all realizing the same informational model and one may conceive of a number of informational models realizing the same essential model. This idea forms the basis for BPR. The core modelling concept in DEMO is the concept of the (essential) transaction. A transaction is considered to be the basic pattern of organizational behavior. It evolves in three phases: actagenic, action and factagenic. Figure 2.1 exhibits this pattern.

Actor A

Actor B

Actor B

Actor A

t1

t2

t3

t4

actagenic conversation

essential action

time

factagenic conversation

transaction

Figure 2.1 The pattern of a transaction

During the first phase agreement is reached between actor A and actor B about the future execution of an action by actor B. This phase consists of an actagenic conversation, initiated by actor A, starting at t1 and ending at t2. The result is an agendum (singular of agenda) for the execution of an essential action by actor B. During the action phase this essential action is executed by actor B, somewhere between t2 and t3. During the last phase actor A and actor B reach agreement about the facts that have been accomplished as a result of the execution by actor B. It consists of a factagenic conversation, starting at t3 and ending at t4. Actor A is called the initiator of the transaction and actor B the executor. The behavior of a business (or any organization) thus is conceived as consisting of carrying through transactions. Every (essential) action is embedded in a transaction and every established fact is the result of the successful carrying through of a transaction. This constitutes the DEMO transaction paradigm. The essential model of an organization is an integrated whole of several partial models, one of them being the Communication Model. The Communication Model (CM) of an organization is the specification of the interaction structure and the interstriction structure between actors. By interaction structure is understood the mutual influencing through being initiator or executor of transactions. By interstriction structure is understood the mutual influencing by means of created facts that play a role in the condition part of the behavioral rules that are executed in carrying through transactions. A CM can graphically be represented by means of a Communication Diagram. An actor is represented by a box. A transaction type is represented by a disk. The operational interpretation of a disk is a store for the statuses through which the transactions of that type pass in the course of time. Because of the transient character of this information, the disk symbol is called a transaction channel. The facts that are created as a result of the successful carrying through of a transaction, are considered to be represented by true propositions stored in a fact bank. A bank is represented by a diamond. To show that the facts are the result of carrying through transactions of a particular type, the

diamond symbol is drawn 'behind' the disk symbol of the transaction type. The combined symbol of a transaction channel and its corresponding fact bank is suited to represent internal fact types and boundary fact types. However, the actors in the system may also need to know external facts, i.e. facts created outside the system. The combined symbol is too specific to represent the external fact types, because the corresponding transaction types fall outside our scope of interest: they are not known. Therefore, the external fact types are arbitrarily put together in external banks, which are represented by only the diamond symbol. The actor who is the initiator of a transaction type is connected to the transaction channel by an initiator link. It is represented by a plain line. The actor who is the executor of a transaction type is connected to the transaction channel by an executor link. It is represented by a plain line with an arrow head at the side of the actor box, pointing to that box. Interstriction is represented by data links (dotted lines) between actors on the one side and fact banks and transaction channels on the other side. Figure 2.2 shows possible syntactic constructions in a Communication Diagram. E1

A0.1

T1

A1.1

T4

A0.2

T2

A1.2

T3

A1.3

Figure 2.2 Possible syntactic constructions in a Communication Diagram

The gray-colored rectangle represents the system boundary. The actors A0.1 an A0.2 are external actors, the actors A1.1, A1.2 and A1.3 are internal actors. The transaction types T1 and T2 are boundary transaction types, the transaction types T3 and T4 are internal transaction types. The bank E1 is an external bank. The external actor A0.1 is the initiator of transaction type T1; the internal actor A1.1 is the executor of this transaction type. In executing the transactions of this type and in carrying through the performative conversations, actor A1.1 uses data from the external bank E1. As a result of the execution of a transaction, it states one or more facts, which are stored in the bank of T1, and it initiates a transaction of type T4. Actor A1.3 is the executor of this transaction. In executing the transactions of type T4 and in carrying through the performative

conversations, it uses data from the channel of transaction type T3 (transaction statuses). This transaction type has the same actor (A1.2) as initiator and as executor. We call this self-activation of actor A1.2 (Note. This is the way to model periodic activities). In executing the transactions of this type and in carrying through the performative conversations, actor A1.2 uses elements of the contents of the bank of T1 and the channel of T4 as data. As a result of the execution of a transaction, it initiates a transaction of type T2. The executor of this transaction type is the external actor A0.2.

2.2 Extensions of DEMO In the previous section we have outlined the possibilities of the DEMO method for modelling the dynamics of organizations. In section 1 we have concluded in the first place that the DEMO CM does not show the actual process structure of individual transactions and in the second place that it does not show the relation between the individual transactions with respect to the whole of the primary process of an organization. Both problems have to be addressed when BPR activities are undertaken. This section presents two necessary extensions to the DEMO method which overcome the described shortcomings. The first extension that is presented is the Transaction Sequence Graph. This model describes the sequence and the interdependencies of the transactions. The second extension is the Transaction Process Model which describes the process structure of a transaction. After the theoretical introduction, the application of both models within a DEMO analysis will be demonstrated in section 3. 2.2.1: The Transaction Sequence Graph The CM presented in paragraph 2.1 shows all possible transactions that occur in an organization. Despite the fact that all transactions are represented in the model, it is not clear in what sequence these transactions occur. We still have to address the problem about the dependency between these transactions. For this reason the Transaction Sequence Graph (TSG) has been developed. The TSG presents the actual sequence between the transactions, defining the organizational processes. In the Communication Diagram each transaction is graphically represented with a disk, containing the transaction statuses, possibly combined with the diamond symbol representing facts created after execution of the transaction. In the TSG we use both the combined symbol and the two separate symbols from the Communication Diagram. Sometimes transactions will not be completed until other transactions are executed. Usually this means that facts created in other transactions or transaction statuses are

needed in order to execute the actions agreed upon in the actagenic conversation. These pending transactions are depicted in the TSG with the disk. A transaction is finished when one or more facts have been created. This situation is graphically represented with the diamond symbol. A typical situation is the example of a customer asking for the delivery of certain goods. The acceptance of this order delivery indicates the end of the actagenic phase. The delivery of the goods can only take place if the goods are available in stock or are produced. In the situation that the order has to be produced, other transactions have to be executed (like e.g. planning and production) before the actual delivery can take place. The creation of facts stating that the order is delivered will only occur when all the other transactions concerned with planning and production have been executed. The graphical representation of this example is shown in figure 2.3. The example shows that transaction T1 is pending while transactions T2 till T6 have to be executed, before the creation of the facts of T1.

T1

T2

T4

T5

T1 time

T3

T6

Figure 2.3 Possible Syntactic Constructions in the Transaction Sequence Graph

Furthermore, the TSG can have two dimensions. The first dimension shows the time axis running from left to right. The transactions on this axis are executed in a serial way. However, not all business processes are simply straightforward. For this reason a second dimension has been added. This dimension shows the transactions that are performed in parallel. E.g., transaction T3 is executed in parallel with the transaction T2 and denotes an AND relation. A different notation is used if transactions are executed conditionally. An example of the OR relation is depicted with transaction T5 and T6 in figure 2.3. Depending on the result of transaction T4, transaction T5 or T6 will be carried through. The same time dimension applies to the parallel transactions. Depending on the organizational structure the TSG can have a more or less complicated structure and is constructed as a single graph to describe the primary business process. The example described above already showed two different situations for an order delivery. Depending on the product range some products are only delivered from stock, while others are delivered after they are produced. These two situations can be represented in one TSG, together constituting the business process.

Fundamental changes in the business process can be performed by removing or adding transaction types in the CM. The impact of this activity is shown in the TSG. 2.2.2: The Transaction Process Model The Transaction Process Model is a speech act based model that provides a full characterization of action coordinating (or performative) communication between two actors when engaged in a transaction. The transaction process structure is expressed in speech acts. The model is a generic model applicable to performative communication in all kinds of organizations. The core of the model is formed by the transaction concept and Habermas' theory of communicative action [8,9]. Central to Habermas' theory is the distinction between instrumental, strategic and communicative action [8, pp. 285-286]. Given the nature of the organizational problems we consider, we only focus on strategic and communicative action. When we combine the action types with the transaction structure (see figure 2.1), we distinguish strategic and communicative oriented transactions. In communicative oriented transactions the actors coordinate their actions through acts of reaching mutual understanding of the situation in which they find themselves. This consensus is reached by negotiations about three validity claims raised in the exchange of any speech act in a transaction. In every exchange of speech acts the speaker claims, whether he is the initiator or the executor of the transaction, that what he states is true (claim to truth), that his utterance is right or appropriate in relation to a recognized normative context (claim to justice), and that his manifest expression of intentions is truthful (claim to sincerity). However, there is only one validity claim dominant at the time. An essential characteristic of communicative oriented transaction is that the hearer has always the possibility to agree or disagree on each of the raised claims and the speaker is bound to provide an account for the validity claim. Vital to communicative oriented transaction is also the possibility for starting a discourse. The purpose of a discourse is to develop or restore the background conditions by means of a critical debate and argumentation in which the immediate objectives of the participants are suspended [13]. In strategic oriented transactions the orientation of the actors is called empirical: they strive after their own private goals. The basic characteristic of the strategic oriented transaction is the desire of the participants to maximize their own profits and to minimize their own losses in a conversation based on a claim to power. In comparison to the communicative oriented transaction this means that we observe a limitation of the behavioral

alternatives because negotiations about validity claims with the aim to reach mutual agreement are eliminated. The Transaction Process Model is represented in a State Transition Diagram (STD). The modelling of speech acts by means of STD's has been proposed by [23] and [24], and has been optimized for the application in the transaction process model using the state diagram technique for dynamic modelling in [15]. The Transaction Process Model represents all possible states (circles) in a transaction that are identified on the basis of Habermas' communication theory (see figure 2.4). Between the stages 3a and 3b the requested action is performed by actor B. The heavy circles represent states of completion of a transaction. In state 5 a fact is created because the transaction is finished successfully as a consequence of the acceptance of the result of the action by the initiator. In states 8, 9, and 13 the transaction comes to an untimely end because the creation of a fact is canceled by actor A. The arrows (gray and black) in the TPM in figure 2.4 shows all the behavioral alternatives in a communicative oriented transaction. The gray colored arrows show the remaining behavioral alternatives of the strategic oriented transaction. The labeled arrows in the transaction process model represent individual speech acts as they are performed by the actors A and B in the transaction. The individual speech acts in the transaction process model are characterized by the following formula: Actor:Performative_verb|Validity_claim[Communication_type]| Speaker

Action-coordinating indicators

Proposition

The formula for the speech acts is composed of three elements: the speaker, the action-coordinating indicators and the proposition. The speech act in the transaction process can be uttered by two speakers: actor A, the initiator and actor B, the executor of the action. The action-coordinating indicators are formed by the performative_verb, the communication_type and the validity claim. The performative_verb together with the communication_type indicate the illocution of the speech act. The performative verb denotes whether the pragmatic meaning of the speech acts is directive, commissive, etc. This point is explained in great detail in [18] and [20]. The communication_type, on the other hand, denotes the total communicational alternatives [13]. The validity_claim, finally, only comes into play as action coordinating indicator when there is a negotiation about one or more claims. If the negotiation about the validity claim is centered around a claim to truth, this is represented by a T, if the claim to justice is at stake by a J and if the claim to sincerity is debated by a W.

The last element of the speech acts in the transaction is the proposition. The proposition is divided into a description of the action and a period_for_completion, both are vital. In one transaction the proposition stays stable, this means that the different speech acts in a single transaction have the same proposition and period_for_completion. Transaction types are grouped on the basis of their characteristics that are observed in the actual business situation. In the first place we identify simple and complex transactions. Simple transactions involve a minimum amount of communicational steps (transitions) necessary for the creation of a fact. In complex transactions negotiations about validity claims or discourses are B:Reformulate_request

A:Redo_completion

A:Request

B:Promise

1

2

3a

3b

B:Decline

B:State_completion

4

A:Accept_complete

VI II

III IV

B:State_ II completion

A:Request

V

5

Creation of the fact

A:Cancel

B:Decline I

6

observed, and thus involve many communicational steps. In the second place we identify transaction types with a repeating and a non-repeating character. In repeating transaction types we observe sequences of untimely ending transactions with identical actions but different periods_of_completion expressed in the proposition. In non-repeating transaction types these sequences are not observed. Both complex and repeating transaction are considered to be inefficient forms of business communication and are an important starting point for BPR.

7

V I

IV III

8

VI

A:Cancel A:Cancel

10

11

12

14

15

16

A:Cancel

VII VII

9

13 IX

IX

IX

18 Actagenic Discourse

X

X

19 Factagenic Discourse

X

VIII

VIII VIII

17 I = B:Counter|Truth| II = A:Counter|Truth| III = B:Counter|Justice| IV = A:Counter|Justice| V = B:Counter|Sincerity| VI = A:Counter|Sincerity| VII = A:Cancel VIII = B:Decline IX = A:Request_discourse X = B:Request_discourse

Figure 2.4 State transition network representing the transaction process structure.

The DEMO modelling method, combined with the Transaction Process Model and the Transaction Sequence Graph, can be applied to the modelling of the dynamics of organizations and for the purpose of BPR. Together they constitute a complete modelling tool. As an example we show such an analysis by means of a case study presented in the next section.

3: The Case Study The company under study is a medium size organization producing high quality aluminum window frames, called profiles. In recent years competition has become severe, as a result of a surplus in the production capacity in this part of Europe. While in the past these type of firms served only a regional market, we now see that the keen competition has led to a necessary expansion on the European market which also has been stimulated by the extremely low shipping prizes in Europe.

Potential customers are visited by one of the salesmen. After negotiating the product the salesman makes an offer based on the calculated costs of the project. This calculation task is performed by a costing-clerk. If a customer decides to place an order, a final calculation is made because of the possible negotiated changes of the design in this stage of the order process. Drawings of the project are made, which must be evaluated by the customer, after which the purchase department can place purchase orders at the suppliers of glass, profiles and accessories. At this time a rough planning is made taking into account the delivery date. This date also depends heavily on the progress made at the construction site. Each department in its turn, namely drawing, production and assembly, makes a detailed planning for the allocation of personnel and resources. If for any reason there is not enough personnel available, it is possible for the planners of the production and assembly department to hire personnel from an employment agency. The actual production process involves a number of steps. After the

T9 Deliver_Prod_Pers T10 Deliver_Assem_Pers T11 Payment_Personnel T12 Ship_Profile T13 Payment_Shipping T14 Check_Payments T15a Calc_Offer_ Costs T15b Calc_Order_ Costs T16 Plan_Order T17 Plan_Drawing T18 Plan_Production T19 Plan_Assemble T20 Draw T21 Produce T22 Assemble T23 Ship T24 Check_Stock

profiles have been delivered by the suppliers they are sent to an enamel company. The enameled profiles are sawn in the right length and put together. In the meanwhile glass will be ordered in the right size at the glass supplier. When production is finished the constructed profiles are shipped to the building site where they are assembled by a team from the company. Transaction

Initiator

Executor

T1 Offer T2 Deliver_Order T3 Evaluate_drawing T4 Payment_Customer T5 Payment_Supplier T6 Deliver_Goods T7 Enamel_Profiles T8 Payment_Enamel

A0.1 Potential-customer A0.2 Customer A1.8 Planning-drawing A1.6 Payment-check A0.3 Supplier A1.12 Purchase A1.12 Purchase A0.4 Enamel-company

A1.1 Sales A1.2 Order-acceptance A0.2 Customer A0.2 Customer A1.11 Purchase-payment A0.3 Supplier A0.4 Enamel-company A1.13 Payment-enamel

A0.1 Potent. Cust.

A0.2

T1

T2

A1.1 Sales

T15a

A1.2 Orderaccept.

A1.9 Planning-production A1.10 Planning-assembly A0.5 Employment agency A1.9 Planning-production A0.6 Shipping-company A1.6 Payment-check A1.1 Sales A1.2 Order-acceptance A1.4 Planning A1.8 Planning-drawing A1.9 Planning-production A1.10 Planning-assembly A1.8 Planning-drawing A1.9 Planning-production A1.10 Planning-assembly A1.9 Planning-production A1.12 Purchase

Table 3.1 Transaction table of the case study

A1.3a

A1.4

Calculation

Planning

Order Calcula

A0.6

A1.5 Payment shipping

A1.3b T15b

A0.5 Employment-agency A0.5 Employment-agency A1.7 Payment-personnel A0.6 Shipping-company A1.5 Payment-shipping A1.6 Payment-check A1.3a Offer-calculation A1.3b Order-calculation A1.4 Planning A1.8 Planning-drawing A1.9 Planning-production A1.10 Planning-assembly A1.14 Drawing A1.15 Production A1.16 Assembly A1.18 Shipping A1.12 Purchase

T13

T12

Shipping company

T16 A0.5

Customer

T3

T9 T17

T4

A0.3

T5

T18

T19

A1.6 Payment check

T10

T14

Employ. agency

A1.11 Purchase payment

A1.8

A1.9

A1.10

Planning drawing

Planning product.

Planning assembly

T20

T21

T22

A1.7 Payment personel

T11

Supplier

T6 A0.4

A1.12 Purchase

T24

T7

Enamelcompany

T8

A1.13

A1.14

A1.15

A1.16

Drawing

Product ion

Assembly

Payment enamel

A1.18 T23 T23

Shipping

Figure 3.1 Communication Diagram of the interaction structure of the case study

3.1: The DEMO Analysis of the Case Study A DEMO analysis starts with the identification of the system and its environment. All actors involved in the system and the environment are represented in a transaction table along with the transactions they are involved in. Table 3.1 shows all transactions and the actors involved. The transaction table describes the interaction structure of the organization. All transactions and their initiators and executors are graphically represented in a Communication Diagram. Figure 3.1 shows the complete diagram of the case study on the lowest level. Beside the interaction structure we also identify the interstriction. For example, the actor concerned with the planning task (A1.4) consults the transaction bank T15 from Calculation for the exact number of hours calculated for a specific project. The informative conversations are excluded from the Communication Diagram of figure 3.1

for easy reference. In a normal analysis this problem is solved using partial Communication Diagrams of single transactions including the actors involved and all informative conversations with other transaction banks and channels. Despite the fact that all transactions are defined in the CM it is not clear in what way they relate to each other in time. In order to perform BPR activities in this specific case study we had to show the dependency in time of the different transactions. For this reason a Transaction Sequence Graph is constructed to show the time based relationship between the transactions.

3.2: The TSG of the Case Study The sequence and interdependency of the transactions is depicted in figure 3.2. It defines the throughput of a single order. The transactions concerned with payments

originating from external actors have not been included in the graph of figure 3.2. T1

T15a

T6

T1

T18

T9

T2

T4

T7

T14

T21

T15

T23

T16

T17

T22

T20

T2

T24

T3

T14

T4

transactions and replace them by one transaction with the same result, performed by the actor A1.4:Planning. Above all, the responsibility of hiring personnel is redirected to one actor instead of two.

3.3: The TPM of the Case Study time

T12

T19

T10

Figure 3.2 Transaction Sequence Graph of the case study

The business process starts with an offer made by Sales (T1). Then a calculation is made for this specific project (T15a). Transaction T1 ends when the customer accepts the facts created as a result of the execution of transaction T1. The transactions T2 about the order delivery, the payment transaction T4, and the check payments transaction T14 will be pending, while a final calculation is made by means of transaction T15b and the rough planning is produced (T16). This planning is used for the planning of the drawers. After completion of T17 the drawings can be made (T20). These drawings are sent to the customer for approval. Only after this transaction (T3) is completed, the production process can start, but first the stock levels have to be checked (T24). After checking the stock levels (T24) materials will be ordered for the project (T6). The planning of the production and assembly are performed in parallel (T18 and T19). Depending on the project extra personnel for production and assembly can be deployed from the employment agency. These transactions (T9 and T10 respectively) are depicted as conditional elements in the TSG of figure 3.2. After the delivery of the required materials (T6), the profiles have to enameled in the customer specific color (T7). When the enameled profiles arrive at the company, the production process can take place (T21). The shipping of the produced profiles is a conditional transaction; small profiles can be shipped immediately (T23), but large ones have to be shipped by an external transport company (T12). After delivery of the profiles at the building, the profiles are assembled (T22). The process ends with the acceptance of the facts about the checked payments (T14) and the payment of the order delivery (T4). The impact of removing and adding of transaction types can be shown according to an example in the case study. In the CM of figure 3.1 the actors A1.9:Planningproduction and A1.10:Planning-Assembly are involved in hiring personnel from the employment agency. Much efficiency can be gained by removing these two

In this section we proceed with a further analysis of the transaction types in the case study. By analyzing the transactions with the Transaction Process Model we aim at detecting efficient and inefficient forms of business communication. In the case study we have identified 25 transaction types. Examples of transactions in the 25 transaction types have been analyzed with the transaction process model. Individual transactions of the identified transaction types have been analyzed on the basis of audio-taped interviews and observations. This basic material has been mapped onto the transaction process model. For the purpose of this mapping process the speech acts, part of a transaction, have been represented with the formula introduced in section 2.2.2. The mapping can be illustrated with the speech acts in the transaction T15a:Calculate_offer_costs between the actor A1.1 and the actor A1.3a. After the negotiations with the Potential-customer, the actor Sales requests actor A1.3a to prepare a calculation of the project. The actual request that is recorded is: “Please, prepare a cost calculation for project 2542. I will need this next Wednesday (18/05/94)” This speech act is represented as follows: Sales:Request[C] The speech acts were then grouped on the basis of the transaction type they belong to, the communication type and the proposition expressed. In section 2.2.2 we have identified simple, complex, nonrepeating, and repeating transaction types. In the analysis of the case study these different transaction types have been classified into these categories. Examples of these transaction types will be discussed and between brackets a reference is made to the states identified in the TPM (figure 2.4). The business communication in simple transaction types is characterized by the use of a minimum amount of speech acts to create a fact. A typical example of a simple transaction type in the case study is the transaction T20. In this transaction the Planning-drawing requests the actor Drawer to prepare a drawing for a particular project (1→2). When the planning of the drawing-office is correct, the actor Drawer will commit to draw the requested drawing (2→3a). After the actual the drawing action is performed (3a→3b), the drawer presents the result to the actor Planning-drawing (3b→4) who will accept the work

when it is conform the request (4→5). Different types of simple transaction types are self-activating transactions and highly standardized transactions. The self-activating transactions are initiated and executed by the same actor and due to this nature these transactions have a simple structure. Highly standardized transactions are determined by the use of stringent rules and forms. These transactions are designed to out rule discussions. Complex transaction types are characterized by the occurrence of many communicational steps before a fact is created or a transaction is canceled. Typical examples of complex transaction types are sales negotiations. In the case study we have observed these complex transactions in the transaction types T1 and T2. Negotiations about validity claims between the sales person and the customer form an essential part of these transaction types. These negotiations were centered around the claim to truth in the actagenic conversation (2→10 and 10→2) and the claim to justice in the actagenic conversation (2→11 and 11→2). Prices and conditions of payment were the most frequently observed topics of these negotiations. Another complex transaction type that was observed in the case study is T23:Ship. After the initial request to ship the profiles of a project on a date to the building site, we frequently observed discussions about the validity of these requests. For example (2→10): Planning-production:Counter|T[C]| Reason:“Profiles of the project 3425 are too large, use external shipping company”. or Planning-production:Counter|T[C]| Reason:“The request is issued too late to be included in tomorrows transport”. Repeating transaction types contain sequences of untimely ending transactions with identical actions but different periods_of_completions. In the case study we have encountered repeating transaction types most frequently when plannings were made (T16, T18 and T19). Due to problems with suppliers and delivery dates that were not met, the general planning (T16) and the planning for the production (T18) and assembly (T19) regarding a particular project had to be re-scheduled. In the minutes of the planning meetings in the case study we have observed speech acts which point at repeating transactions. For example in T18 (1→2): Planning-production:Request[C] Planning-production:Request[C] Beside the transaction types involving planning activities we have not encountered other repeating transaction types.

The other transaction types in the case study are nonrepeating. This means that no transaction sequences with identical actions and different periods_of_completion were observed. The findings resulting from the use of the TPM form a starting point for BPR. In the first place the complex transaction types were analyzed in detail. Not all complex transaction types could be labeled as an inefficient form of business communication. Complex communication structures in the transaction types T1 and T2 were considered essential. The only transaction type that needed to be transformed to a simple form was transaction type T23. This was achieved by initiating a discourse introducing standardization and stringent rules. In the second place the repeating transaction types were analyzed. In the case study these transaction types pointed at the more structural problem of unreliable arrangements with the suppliers. We have called attention to this point, but have not addressed it.

4: Conclusions The literature in the expanding field of BPR has been dominated by the search for useful guidelines. Most of these guidelines are established on the basis of case studies and surveys. In this article we have followed a different route and presented a theoretical and practical evaluation of a new business systems modelling method. The DEMO method has been described as a viable and effective concept for understanding the 'core' of the business, which is an essential precondition for BPR. In the theoretical examination we have isolated two problems that limit the usability of DEMO as a BPR tool. The first problem confronted with was that the sequence and dependency in time between transactions was not visible in the Communication Model of DEMO. The second problem concerned the structure of the transaction process. In response two extensions, the Transaction Sequence Graph and the Transaction Process Model, were introduced to overcome these problems. The Communication Model and the two extensions have been applied to a case of production logistics. From the analysis of the case study we conclude that DEMO and its extensions are a good starting point for BPR. The CM enabled to capture the core of the business, while the extensions made possible the actual BPR. The CM extended with the TSG allows BPR at the revolutionary level, i.e. removing and adding of transaction types. The CM extended with the TPM make possible BPR at the

evolutionary level, i.e. replacing inefficient transaction types with efficient ones.

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