Enterprise Modeling: WorleyParsons by PERA - Case Study Example

Modeling WorleyParsons by PERA Background on Worley Parsons (WP) Worley Parsons is a leading EPCM company that is based in Australia and it provides technical, project and operational support services to customers in mineral and metals, hydrocarbons, power and infrastructure sectors. The company offers services to some of the largest energy companies in the world due to its prominence having 118 offices in 38 countries and employees in the tune of 31000(Chattopadhyay S. and Mo J.P.T.,2010). With the growth of resource projects both in terms of complexity and size, WP is seen to be amongst the few companies operating worldwide that has resources, technical capabilities as well as systems that is able to hand large scale projects. With its headquarters in the country of origin of Australia, the company has had its revenue grow from A$ 0.5 billion to A$3.5 billion in a span of five years. About 50%of of WP’s dealings relate to contract alliances, which typically involves long term alliances with global energy providers (Chattopadhyay S. and Mo J.P.T.,2010) . For WP to have an enterprise system that facilitates its employees working together on some projects on various parts of the world is important. In this paper PERA is applied in modeling WP so as to establish whether the methodology can sufficiently perform the modeling task to a satisfactory level. There is also a highlight on how Purdue Enterprise Reference Architecture (PERA) is used to model Fluor Daniel which is very similar to WP in terms of the services being offered. Architecture Figure 1 shows application of PERA methodology to WP while in figure 2 shows the application of the original PERA model to Flour Daniel (FD).FD is an engineering , procurement and construction company that gives its services to clients in all categories of industries with process and discrete manufacturing companies being included. In the FD case study, the model is applied to a manufacturing facility where there is construction of piping, instrumentation then control equipment, etc which is a representative of a typical process control system development project in the stages of construction and commissioning. FD is also involved in manufacturing and has several manufacturing facility distributed worldwide. As a result FD model is seen to have all set of three column architecture that have defined cycle processes of Information systems, Manufacturing Equipment functions and Human Organization. On the other hand for the case of WP the PERA model lacks the production equipment column. FD upstream and downstream projects in hydrocarbons are dealt with from the time of inception to the point when the projects are commissioned in conformation with the terms of the contracts between them and the clients. By virtue of WP being a EPCM company its business is to provide to the contractors the required management and technical services at the time the projects are in the construction stage. WP lack manufacturing facilities of their own, neither are they in possession of any machines and production equipment for use in construction activities. The construction process is undertaken by sub-contractors who own engineering, technical as well as management supervision independently. Figure 1 Figure 2 Life cycle concept The PERA model has basis in having a project organization being divided into phases. Several years ago where there was no internet and no email communication, engineering team had to look for means to overcome the challenge of communication and work synchronization. In dealing with a phase divided project, there is provision of certainty and detection of risk. In the current world there are many softwares in the market such as SAP, MRP, MYOB and ERP which can be used in enterprises of any size. With the adoption of web 2.0 as the business IT support of the 21st century, compression of enterprise tasks into much shorter times has been made possible (Chattopadhyay S. and Mo J.P.T.,2010). On the other hand where there is application of the traditional manufacturing methods there is conformation to sequential processing like in the case where computer integrated manufacturing (CIM) is being applied. The enterprise architectures managed by CIM, process control and automation which in nature follow a step by step format is found not to be applicable when there is application of new information technologies that makes it possible for sequential processes to be done simultaneously (Ortiz,A. ,1999). This is an indication that sequential phase division in the life cycle is not appropriate when it comes to addressing a modern enterprise with its high complexity. The modern setting in which WP belong may need a flatter organization design. Role of human With WP lacking manufacturing facilities, the manufacturing equipment architecture becomes irrelevant. When there is a comparison to a standardized PERA model, the humanization and automation boundaries are supposed to be strictly human roles when applied to WP model. This means that the human system design in the case of WP would be expected to commence at the onset of the enterprise life cycle, but this not what is meant to happen PERA methodology until implementation stage is reached. In modern day enterprise, there is exposure to a global business environment which is harsh and unpredictable. The factors that are fueling such a scenario to be experienced are numerous and of high complexity which include economic situation, high level of globalization, and exchange rate fluctuation among others. This puts enterprises under very high level of vulnerability to unfriendly business environment currently and there is high likelihood of the condition prevailing in the near future. ICT is playing a major role currently in further facilitation of human undertakings and this is a trend that is believed to continue in future owing to the fact that revolution in this area is the undertaking by human for the benefit of human. This scenario creates a preface of the classical debate about humanization and automation. Automation is likely to be adopted where the tasks involved are repetitive in nature having cost leverage but does not stand a chance of eroding the fundamental need of human. There is going to be reduction in manual tasks in future times but achieving 100% level of automation is impossibility. This means that dreaming of 100% automation in all the social-economic lifecycle is not feasible if not absurd. The hybrid mixture scenario will always remain where there is degree of variation in the mix, this being dependent on the need at hand, area of application and economy of scale. Flexibility and continuity Global enterprises exhibit very high level of flexibility. This calls for an integrated enterprise architecture that is capable of coping with a business environment that is fast changing where the needs and relations with customer and boundaries are constantly changing. There is a paradigm shift such that there is increased collaboration and resource sharing. With high growth being seen in e-Enterprises, SMEs, micro-enterprises, risk and security issues haunted by competition that is on constant increase and the global economy displaying high volatility , businesses are being forces to be more flexible, to be more adoptive and zero latent. The PERA model has more focus on technicalities in system development and process engineering, but fails to address the increased level of complexity in business that have been seen in the recent times, including risk level, procurement economics, quality assurance, customer relations management, and other parallel business processes. In the WP modeling, it is clearly seen that the business being a typical EPCM business 0f the 21st century, there is need for high level flexibility to be adopted in the enterprise architecture so as to be able handle the myriad expectations from the customers. It is necessary for the system to have substantial certainty with regards to continuity, in operations as well as interconnections in its business environment. There is need for these characteristics to be incorporated in the operating system of the company when the company is designed from enterprise architecture. Integration with revenue and cost models Costs for skilled labour, resources and time play a critical role when it comes to enterprises which are service oriented where customers are billed against man-hours (Sridharan and Berry, 1990). The bottom line in any business being sustainable and be able to survive is having a cash flow through making transactions in goods and services. Any project or any job may be viewed as being the result of a number of tasks being well coordinated and synchronized with the need to keep a time frame in its accomplishment (schedule). For any task and the time that is available for it to be completed is the determining factor with regards to the levels and variety of skills and the resources that would be required. In assessing of cost of a task that contributes to production of goods and services skills, resources and time are seen as to be determinant factors. The cost of producing a unit of goods or a service to a great extent determines the profit margin an enterprise can make. This therefore, makes revenue and cost models to be very important when choosing enterprise architecture. Unfortunately this element is missing in the WP-PERA model. Requirements of a new enterprise architecture The PERE methodology with its routes in CIM brings several issues when it is applied in modeling of WP. The deficiencies are pronounced when the model is considered the current modes of operation where ICT is prominently applied in engineering and service enterprises. Khoury and Simoff (2004) observes that an enterprise architecture needs a method with effectiveness in development of a single and coherent model of an enterprise, and allowing one to be able to guide how the enterprise will develop in the future with no arbitrary internal boundaries being created. There is need for an enterprise architecture methodology to be designed such that it can produce specified and predictable outcomes. The enterprise need to specify the “What to do” in addition (most important) “How to do it” and the reason to why it should be done so. In addition it should be on the basis of some set principles which theoretically, logically and empirically are able to establish a guideline of coming up with an aligned, integrated, responsive and flexible architecture which may be utilized in engineering, manufacturing and implementation of an enterprise. A methodology that is not in alignment with these may as well be considered to be a waste of time and money. Conclusion PERA being what may be considered as traditional enterprise architecture has a lot of focus in manufacturing and has high level of rigidity when it comes to adapting to new enterprise modeling needs. In mean time there has been a drastic change in global business arena that has been fueled by various factors including recession, high level of completion, mass customization social-economic factors, political and climatic change among others. This makes current enterprises to be more complex with worldwide dispersed supply chain, with increased collaboration and resource sharing. References Chattopadhyay S. and Mo J.P.T.(2010) Modelling a Global EPCM (Engineering, Procurement and Construction Management) Enterprise International Journal of Engineering Business Management, Vol. 2, No., pp. 001-008 RMIT University, Australia. Khoury, G. R., Simoff, S. J. (2004). Enterprise architecture modelling using elastic metaphors. In Proceedings of the First Asian-Pacific Conference on Conceptual Modelling - Volume 31 Ortiz,A., Lario,F., Ros, L. (1999). Enterprise Integration –Business Processes Integrated Management: aproposal for a methodology to develop Enterprise Integration Programs. Computers in Industry, 40:155–171 Rathwell, G.A., Williams, T.J. (1996). Use of the Purdue Enterprise Reference Architecture and methodology in industry (the Fluor Daniel example), Modelling and Methodologies for Enterprise Integration, pub. Chapman and Hall, London, pp.12–44. Sridharan, V., Berry, W.L. (1990) Master production scheduling make-to-stock products: a framework for analysis. International Journal of Production Research. 28(3):541-559 Zachman, J. A. and J. Sowa (1992). Extending and formalizing the framework for information systems architecture. IBM Systems Journal, 31(3):590-616. Read More

FD upstream and downstream projects in hydrocarbons are dealt with from the time of inception to the point when the projects are commissioned in conformation with the terms of the contracts between them and the clients. By virtue of WP being a EPCM company its business is to provide to the contractors the required management and technical services at the time the projects are in the construction stage. WP lack manufacturing facilities of their own, neither are they in possession of any machines and production equipment for use in construction activities.

The construction process is undertaken by sub-contractors who own engineering, technical as well as management supervision independently. Figure 1 Figure 2 Life cycle concept The PERA model has basis in having a project organization being divided into phases. Several years ago where there was no internet and no email communication, engineering team had to look for means to overcome the challenge of communication and work synchronization. In dealing with a phase divided project, there is provision of certainty and detection of risk.

In the current world there are many softwares in the market such as SAP, MRP, MYOB and ERP which can be used in enterprises of any size. With the adoption of web 2.0 as the business IT support of the 21st century, compression of enterprise tasks into much shorter times has been made possible (Chattopadhyay S. and Mo J.P.T.,2010). On the other hand where there is application of the traditional manufacturing methods there is conformation to sequential processing like in the case where computer integrated manufacturing (CIM) is being applied.

The enterprise architectures managed by CIM, process control and automation which in nature follow a step by step format is found not to be applicable when there is application of new information technologies that makes it possible for sequential processes to be done simultaneously (Ortiz,A. ,1999). This is an indication that sequential phase division in the life cycle is not appropriate when it comes to addressing a modern enterprise with its high complexity. The modern setting in which WP belong may need a flatter organization design.

Role of human With WP lacking manufacturing facilities, the manufacturing equipment architecture becomes irrelevant. When there is a comparison to a standardized PERA model, the humanization and automation boundaries are supposed to be strictly human roles when applied to WP model. This means that the human system design in the case of WP would be expected to commence at the onset of the enterprise life cycle, but this not what is meant to happen PERA methodology until implementation stage is reached.

In modern day enterprise, there is exposure to a global business environment which is harsh and unpredictable. The factors that are fueling such a scenario to be experienced are numerous and of high complexity which include economic situation, high level of globalization, and exchange rate fluctuation among others. This puts enterprises under very high level of vulnerability to unfriendly business environment currently and there is high likelihood of the condition prevailing in the near future.

ICT is playing a major role currently in further facilitation of human undertakings and this is a trend that is believed to continue in future owing to the fact that revolution in this area is the undertaking by human for the benefit of human. This scenario creates a preface of the classical debate about humanization and automation. Automation is likely to be adopted where the tasks involved are repetitive in nature having cost leverage but does not stand a chance of eroding the fundamental need of human.

There is going to be reduction in manual tasks in future times but achieving 100% level of automation is impossibility. This means that dreaming of 100% automation in all the social-economic lifecycle is not feasible if not absurd. The hybrid mixture scenario will always remain where there is degree of variation in the mix, this being dependent on the need at hand, area of application and economy of scale.

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