Published in: I. Dumitrache, A.M. Stanescu, M. Pallot (Eds.): Preprints of the First International Symposium on Concurrent Enterprising, ISoCE’98, 4-6 June 1998, Sinaia, Romania, 1998, pp. 23-34.
SUPPORTING DECISION MAKING AND COMMUNICATION IN A CONCURRENT ENGINEERING ENVIRONMENT: INFORMATION TECHNOLOGY AND SOCIAL ASPECTS Klaus-Dieter Thoben, Frithjof Weber University of Bremen and Bremen Institute of Industrial Technology and Applied Work Science (BIBA) at the University of Bremen Hochschulring 20, D-28359 Bremen, Germany Tel: +49 421 218 5536, Fax: +49 421 218 5510, E-Mail:
[email protected]
1
Abstract and Goal of the Paper
For the last years companies learned that information plays the key role in product development and thus it should be considered as a main production factor as well as material, work and equipment. Accordingly, from an information technology point of view, only the appropriate availability of information is seen as crucial for product development in the Concurrent Enterprise. But making a decision in an efficient, effective and holistic way is not only about information technology, its about people as well. By reasoning about both, information technology and related social aspects, this paper will give a short insight into the problem of how to support communication and decision making in the Concurrent Enterprise. Starting point of the paper is an analysis of the key challenges in the early phases of product development. Based on this, new ways of entrepreneurial co-operation, the related increase of requirements on engineering and the problems of decision making in inter organisational environments will be described. Typical, technology based concepts for supporting decision making and communication as well as the social dimensions of decision making and communication will be discussed in detail.
2
Key Challenges in Early Phases of Product Development and the Problem of Decision Making
Over the last years the long term success of many industrial companies has been determined by their ability to bring new innovative products onto the market at regular intervals. As this was done reasonably well, a number of deficiencies in the organisational and managerial effectiveness were tolerated in the past. This situation has changed recently. Today the criteria for competitiveness in the marketplace is constantly changing and the factors associated with this have become more complex: increasing levels of product complexity, the ever changing market demands, the increasing level of globalisation of markets and the raised level of consumer awareness. These days, the changing business and competitive environment requires firms to introduce new products more frequently and in shorter time: organisations dealing with product development have to be lean and agile as well as responsive to the changing needs of customers. The specific conditions in product development are described in more detail in (Thoben, Weber, 1996). At least all these factors have imposed a considerable pres-
sure on product design managers. Compared to former periods, today, product development has to be seen as a very complex amalgam of information processing and decision making activities. The "availability" of information Actually, as a basic fact, information in product development tends to be incomplete, not available or not accessible, of low quality or even inconsistent because the product is yet under construction. Thus the product development process is impeded and decision making is hindered and based on vague assumptions. The inefficiencies within the context of product design and development can be illustrated by the following numbers: according to Gascoigne designers often spend as little as 20% time designing and for the remaining period they are searching for information and similarly design mangers spend some 50% of their time searching for information in order to effectively manage design projects (Gascoigne, 1995). Oehlmann has specified the phenomenon "availability" of information by integrating various dimensions such as completeness, compatibility, earliness, quality, reliability, adequacy and feed back (Oehlmann, 1996). To summarise it can be stated that the availability of information (according to the definition of Oehlmann) is critical for design teams as well as for design managers to be able to operate and to take decisions effectively. Decision making in product development Although the objective of any project is to fix the product specification at an early stage, changes in product specification which have not been foreseen or which offer new and beneficial opportunities for the company, are requested continuously throughout the project. Changes are of heterogeneous nature and can be initiated by various sources, e.g.: • Marketing department due to market forces or resolving appearance issues • Development department due to resolving problems following testing of the product • Design department due to component design limitations • Assembly area due to production line or building implications • Purchasing department due to supplier limitations Before making a decision whether to accept any change or to refuse it, it is important to assess and analyse the consequences of a change. Based on a 'what-if' analysis potential consequences of a decision and a possible course of action have to be anticipated. The impact on key characteristics has to be considered, e.g. • Overall project lead time, key activities and lead times, key milestones • Costs: project, product, material and labour cost, investments in tooling and infrastructures • Release of prototypes, pre series and first production • Product return/margin, volumes by month, payback period. Consequently, from a decision making point of view there is a need for an environment that can be used to input the various parameters of any change to the specification and for the output to show the consequences of the change in time, costs, performance etc. The need is to be
able to get a quick and highly visual response to the decision makers as to the effects of the proposed change.
3
New Ways of Entrepreneurial Co-operation and the Increase of Requirements on Decision Making in Engineering
The increasing level of globalisation of markets, the ever changing market demands as well as the increasing level of global competition are the driving forces for companies to shift from the traditional, single site orientation to a more global orientation. Performing that shift requires a complete reorientation of the engineering organisation (see. fig. 1) and decision making is becoming a far more complex activity. Yesterday Dimension
Today
Traditional Engineering Concurrent Engineering (CE)
Tomorrow CE in the Concurrent Enterprise
Space and structure
intraorganisational
intra- and interorganisational
interorganisational (globally distributed)
Order-processing
sequential
parallel
parallel / networking
Product- / projectLead-time
long
medium
short ("just-in-Time")
Time to make decisions
long
short
short
Pressure for Innovations
low
moderate
"extreme"
Application of methods and tools
conventional
conventional and/or "Up to Date"
pure "Up to Date" methods and tools
Stability of partnerships
stable (fixed groups continuously changing of colleagues) partnerships
Networking abilities of low (no interdependencies with others) the organisation
highly dynamic changing partnerships
moderate (adaptable / partly interconnected)
„plug and play“ („High speed Engineering Networks“)
Interdependency of engineering process
low
complex
highly complex
Interweaving with other disciplines
isolated, engineering centred
"product development as an interdisciplinary process“
"Engineering as Facilitator/ moderator of product development"
Interweaving with other cultures
regional
interregional/ international
global / multicultural
Nearness / contact to the customer
suppliers market ("customer as disruptive factor“)
buyer's market (Customer Focus, „customer driven“)
customerintegration („customer as part of the network“)
fig. 1: Yesterday's, today's and tomorrow's characteristics of engineering
Based on the concept of the Extended Enterprise as defined by (Browne, Jagdev 1996) the Concurrent Enterprise can be seen as a distributed, temporary alliance of independent, cooperating manufacturers, customers and suppliers using systematic approaches, methods and advanced technologies for increasing efficiency in the design and manufacturing of products (and services) by means of parallelity, integration, team work, etc. for achieving common goals on global markets. In the following, the most relevant engineering characteristics of the Concurrent Enterprise and their influence on the decision making process will be discussed. 3.1
Distributed Work Environment
The major characteristic of the Concurrent Enterprise is that it is acting in a distributed environment. Companies working together in global partnerships are situated all around the world. This implies specific consequences for co-operation with respect to social and technical aspects, as shown with the following three examples: Limited face-to-face communication: While playing an important part in daily work, informal and face-to-face communication is significantly impeded or prevented in a distributed environment. Limited personal responsibility and reliability: Adding to the lack in social relationships (and also following from that), people being situated in different places tend to feel a lower responsibility for their individual contribution to the overall task. This can be measured, for example, in longer response times, lower work quality, or, as described in (Hutchings, Knox, 1995) creeping drop-off of team members. Increased information access and data transfer: The access to information in a geographically dispersed environment is a major difficulty for information logistics in the Concurrent Enterprise. Typical problems that arise are redundant data storage at different locations or long access times. 3.2
Division of Labour and Working in Parallel
Today production of complex products is only possible if carried out in division of labour. The Concurrent Enterprise is based right on this circumstance by dividing the work not only between different people or functions, but between several companies acting in a collaborative partnership. Product development, however, puts the high degree of interdependency between different tasks as a specific constraint on division of labour. Tasks do not only depend on other tasks in terms of time related predecessor - successor relationships, but especially by mutual information needs and content related input-output relationships. This results in the important need for co-operation and co-ordination between the different tasks. While this can be regarded as a disadvantage, however, division of labour opens on the other hand the possibility to work in parallel, which is seen as the key characteristic of a Concurrent Enterprise and which enables significant lead time reduction. 3.3
Project Work and Changing Partnerships
Product development not only in one-of-a-kind production, but also in serial and mass production is carried out in a project oriented manner (Oehlmann, 1996). People from different departments are gathered in a project for a limited time frame for carrying out a specific task.
After the project aim has been reached, i.e. after the product development is finished, the group is resolved and the members are assigned to new projects. As a result, the project members have to adjust to new people and new processes in every project (Turino 1994). The level of resemblance varies depending on the project content. In principle, a new project starts in a newly configured, untested working environment. This situation is amplified in a Concurrent Enterprise environment with changing partnerships and increases the level of newness in project co-operation. 3.4
Complex Process Interdependencies
Processes in a Concurrent Enterprise are exceptionally complex. They are interdependent not only because of the division of labour (see above), but also with respect to the embodiment of processes in an overall inter and intra enterprise relationship. 3.5
New Technologies and High Productivity
Companies interacting on a global level are typically companies which are open to new technologies. They are forced to apply up-to-date technologies in order to remain competitive in global markets. As a result, the life-cycle of machines and techniques used for production is short, implying the following sub consequences: • Continuous confrontation with novelties: The employees have to adjust to new systems and are confronted with continuos qualification and training needs. • Frequent changes between systems: Shifting to new techniques after short time cycle causes significant restructuring and implementation effort. However, not all company partners have the same level of newness. Especially smaller, traditional suppliers shrink back from investments in high technology and still run old systems which may cause additional communication problems due to the need for interfacing. To summarise, for engineering organisations, acting in a concurrent enterprise requires both, the design and application of appropriate IT and CT tools and infrastructures as well as the design and implementation of co-operating structures of people and organisations to consider the technological and the social dimension of decision making and communication at the same time.
4
Typical Concepts for Supporting Decision Making and Communication
The above chapters showed, that the availability of appropriate information is a central prerequisite for decision making. Consequently, many approaches for supporting decision making are based on the implementation of specific information and communication technology (ICT) and the rationale of information as the essential object of actions in product development. The approaches range from 'passive' systems, which only present information (e.g. by displaying contents of a database), towards 'active' systems, which also process or forecast information (e.g. by analysis or simulation) [Wiederhold 1997]. Besides this concentration on information technology, which received continuous attraction in product development since early seventies, the focus on process design is a second main area
where solution concepts are generated. This domain gained strong popularity over all sectors since the early nineties, initiated e.g. by the work of Hammer and Champy on business process reengineering [Hammer, Champy 1993] or Tenner and DeToro on continuous improvement [Tenner, DeToro 1992]. An overview about the contributions which both domains provide for decision making in product development is given in the following sections. 4.1
Information and Communication Technology
The overview comprises 4 areas: it will outline active decision support and passive decision support. It will provide an extra section on the importance of visual information for engineering decision making and will finalise by describing how information is communicated. Passive Decision Support Data which is generated in product development, is stored in databases for usage in succeeding tasks or for later reuse in follow-up projects. The databases are rather different with respect to scale and usage scenarios, and typically many of them exist all over the company. Engineering data management systems (EDMS), for example, capture technical product data and documents throughout the complete product life cycle. Product models or work breakdown structures are used for structuring the data. For these passive information systems, the level of decision support can be measured by the amount of available information. If all information is available, no decisions have to be made, but results/forecasts can be simply extracted from the information, i.e. the problem is solved already. The less information is available, the more decisions, assumptions, or analyses have to be made. Approaches towards the set up of a corporate memory emphasise this aspect by collecting experience (decision cases) in a formal way. [Gregorzik 1998] proposes to use Data Warehouses for collecting central product and project information from operational databases and to use this reduced set of information, and especially its history, as a basis for decision making. Combined with Data Mining, this approach could overcome the difficulties of reduced predictability of information needs. Active Decision Support If data is not available in a way that it can be used for decision making, i.e. if it does not provide relevant information for the decision problem, it has to be processed in some way to support the decision. This processing is an active (often interactive) form of decision support, which can be carried out by different means. Decision support systems (DSS) provide different functions like e.g. simulation, statistical analysis, what-if analysis, scenarios, or simple value analyses. Increasing importance is given to the usage of concepts from artificial intelligence such as case-based reasoning (CBR) and knowledge-based systems (expert systems). The specific advantage of these tools is that they support a systematic, methodical approach to decision making. The relevant criteria for the decision problem are documented and thus transferred from the implicit to the explicit. This enables decision makers to analyse a decision problem from different angles, to take a step back from intuition and to make a more ob-
jective decision. DSS can improve the decision makers’ effectiveness – but not necessarily their efficiency. However, a number of studies showed that managers make limited use of the advice provided to them. This may arise from a difficulty in integration of the advice with the subjective opinion [Lawrence, O'Connor 1997]. Managing Visual Information Visualising information has a specific importance for the decision making of engineers and managers and thus it shall be emphasised in this extra section. It can play a passive or active role in the decision process. Geometrical product information is usually represented in 2D and 3D drawings and computer aided design (CAD) is a central tool for engineers. Time and cost issues or technical findings can be visualised with graphs, for showing tendencies and results of calculations or measurements. The large area of computer aided engineering (CAE) systems typically provide their output both in textual and visual form. However, experience from practice has shown that the usability of CAD in team work suffers from limitations. CAD is a typical one person tool, but not appropriate for co-operative design and problem solving. Several approaches for implementing co-operative CAD environments, had to face strong usability problems. As soon as it comes to face-to-face communication, the classical drawing board has significant advantages [Frech, Müller, 1995]. Transforming the importance of visualisation towards the 'real world' (i.e. the materialised world), brings up technologies like rapid prototyping where geometric models are transferred into physical models. The rationale for this is that the decision problem is too complex for being pictured mentally, but has to be analysed with multiple senses, especially vision and tactility. For example, a customer's ability for spatial thinking could be limited (compared to that of the designer) and thus a physical model, which can be touched, is used for discussing design options instead of using a CAD model. Communication Support Information which is needed for decision making has been often created by others and thus has to be communicated. Especially in a Concurrent Engineering environment, where interdependent tasks are carried out in parallel, information has to be exchanged between tasks. This includes a task's information output which is used by a following task as input, but also the feedback of information to predecessing tasks. In the last 20 years, many new communication means came into being and are now used in product development. The classical media telephone, internal postal service, and letter are still in use, but have been complemented with fax, email, different forms of electronic data exchange, video conferencing, application sharing, etc. With respect to decision making, media are either used for asynchronous push and pull of information (sending or retrieving information) or synchronous interaction (discussion). This corresponds to the difference of active and passive usage of information in decision making. Recently, Intranets gained increasing attention as communication means within companies and Extended Enterprises. Their high flexibility, scalability and interoperabilty provide deci-
sive advantages for setting up efficient information and communication environments [Ströbel, Wurst, Maßow 1998]. Besides the technical media, face-to-face communication has to be considered as another communication means with utmost relevance for decision making. It enables the highest level of interaction, and thus has a central role for group problem solving. 4.2
Continuous Improvement and Business Process Reengineering
Process design is an approach to organise the (here: product development) process in order to increase efficiency and to resolve the mutual interdependencies between different tasks. With respect to decision making, process design contributes by defining how, when, and by whom decisions are made. Recent trends in organisation and process design have an impact on the decision making process: The flattening of organisational hierarchies and the reduction of middle management results in increased decision responsibilities. The integration of suppliers into the development process involves them also in decision processes, at least in a passive way as information sources, but increasingly also in an active way by outsourcing decisions. Changes in process design may result in different consequences. Taking job enlargement as an example [Wiendahl 1989], it can be seen that these can be positive and negative with respect to decision making: When a task becomes more comprehensive, the decision maker has better access to the parameters which influence the decision. This may be positive for decision making. However, the decision problem may become more complex because more parameters have to be considered - this may be negative. For example, if a designer is not only responsible for the technical quality of a product component, but also for its financial ‘quality’, this may give him more decision power, but also more decision parameters.
5
Social Dimensions of Decision Making and Communication
Implementing these 'technological' solution concepts1, however, the social dimensions of decision making and communication in an organisation are often forgotten. [Gregorzik 1998] analyses this neglected dimension and describes the limitations of approaches which are reduced to formal aspects. He emphasises that decision making and communication in product development has to be seen in an organisational context where social interaction influences the relationships between the actors. Decision Making in the Organisation Decisions are not only based on rationale reasoning and choice in a goal oriented environment, but also on organisational traditions and habits and personal liking. Organisations are a 1
Here we understand process design - intentionally - as a 'technological' discipline. This is a very harsh reducement of a process to few key parameters like e.g. tasks, inputs, outputs, actors, means, etc. which leaves out any social aspects. However, this is exactly what happens in many reengineering or improvement projects, and thus the authors dare to take this (very) simplistic perspective for their line of argumentation.
living organism in which people do not only work but also spend much of their day time, personnel engagement and peculiarities. This common history and individual involvement has implicit and explicit effects on the decisions made. For example, the way how information is interpreted for a decision depends not only on the content of the information, but also on its source and how it is transmitted. Oral information, e.g. may appear to be less definitive, but on the other hand is very valuable because of its social context. Written, non personalised information on the other hand seems to be more objective, but has less context. An information given by person A may be taken for sure, but if the same information comes from person B it must be scrutinised [Frech, Müller 1995]. This indicates that not all relevant information can be saved and processed in an information system. Further, decision making in the organisation has an effect of sheltering and revealing. If an individual is insecure about how to decide, the situation may be resolved quickly if a team member with common attitudes invigorates the existing decision tendencies. Especially, if the decision problem is complex, i.e. interdependencies are high and the impact is significant, the mutual backing up supports the process. Communication in the Organisation Communication is the central means by which the influence of informal relationships on decision making takes place. Communication does not only exchange information, but also sets up social relationships among the members of an organisation. Especially informal communication has the purpose to initiate and maintain social contacts in the organisation. On the other hand, these social relationships again have a direct impact on communication in that they support or hinder it. For example, asked why he does not use relevant data for his decision making, which is available in a public database in another department, a product manager answered „it is their data“. It becomes obvious that in this situation, it is not the availability of information nor the usage of ICT which impedes decision making. Considering the issues of globalisation and the transition to extended or virtual enterprises as outlined in chapter 2, the social aspects of communication reach a new dimension. Many developments in communication technology take place with the objective to increase bandwith of human interaction in distributed environments. The line of history of communication means shows how the aim is to incorporate all human senses in communication: letter, telephone, video conferencing, multimedia, virtual reality. However, even if future communication systems were able to transmit the complete scope of communication, they could not transmit the social context of an organisation. This is a severe constraint for decision making in temporary partnerships and virtual teams. Members of a distributed team can never understand each other as good as co-located teams because they do not have the same social context [Gregorzik 1998]. This constraint is proportional to the level of cultural differences and conversely proportional to the duration of the co-operation. For example, a German salesman may easily misinterpret in his first contacts the Chinese aversion to say ‘no’ [Fuchs 1998].
Reactions The knowledge that organisations are a living organism may make the organisation members feel insecure with respect to their own acting in this environment, because it contradicts the mechanistic understanding of a goal oriented, productive organisation which carries out tasks for business [Gregorzik 1998]. Concerning process design and usage of ICT, this misapprehension may result in • Over-complication: Overincreasing complexity by defining comprehensive rules which create confusion and intransparency instead of guiding the organisation • Over-control: Overdefinition of control structures, hierarchical relationships and formal interaction, e.g. by replacing personal communication by formal reports • Over-stabilisation: Freezing structures and processes and neglecting the need for changes and flexibility, e.g. by fixing processes in ICT Consequently, organisations have to be extremely careful when addressing these issues and when implementing new approaches, rules, processes, etc. [Schneider 1990] describes a situation in which a manger in his department, after returning from a time management training, fixes exactly dates and times of meetings and formalises their content. This may save him some time, but as a consequence deteriorates corporate culture and closes informal information sources which provide background information for his decision making.
6
Conclusion and Challenges
By reasoning about information technology and social issues, this paper gave a short insight into the problem of how to support communication and decision making in a CE environment. The authors experienced that on one hand industrial companies are well aware of the social dimension of organisations and the importance of human relationships. However, on the other hand, the social dimension is continuously disregarded when it comes to concrete measures. Companies are quick in implementing new software systems (and nowadays also in redesigning processes), but idle in improving social interaction. If this dimension is supported, it addresses mainly the management level, where training is carried out for increasing skills in e.g. leadership, negotiation, or motivating people. On the operational level, however, measures like team building or conflict resolution appear only to a small degree. This is especially the case for small and medium companies, whereas larger companies tend to pay more attention to systematic human resource management. What is the reason for this? The authors believe that the reason can be found in the areas of competence of engineers and managers: Information and communication technology and processes are more easy to design and implement from the engineering viewpoint and thus are preferred as the central object of change. Both areas can be regarded from a technical viewpoint. This is a reduction of the complex problem because the knowledge about appropriate measures on the social area is little. Up to now, engineering education has not imparted social aspects, but was limited to technology. Thus, today’s engineers and managers in product de-
velopment have only few competence in the social aspects. Only now this area receives increasing attention in education. Concluding from this, the challenge is to create awareness about the relevance of social measures and to provide the competence needed: companies have to understand that it is not enough to emphasise the importance of social interaction (which they already do), but that this has to be followed with appropriate actions for supporting social interaction in an organisation. These actions may range from the simple set-up of a coffee machine (as a focal point of informal communication) to the employment of an organisation psychologist (as a means for actively remedying organisational defects).
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References
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