A business process method for virtualized enterprises - Research Paper Example

?A business process method for virtualized enterprises Introduction As the world transitions towards globalization, virtualization, synergy, unification, cross-integration, and ever-improving efficiency, many corporations are considering expecting business process improvement to remain competitive and to be ready for realities of the future. Though the future is commonly tagged as unpredictable, business management gives room to forecasting especially when it is based on principles and empirical theories. Expecting business process improvement to remain competitive or to be even improved is therefore nothing much to ask from businesses in today’s fast changing business environment. Several definitions have been given to the term ‘business process’. According to the Business Process Incubator (2011), business process is “a co-ordinated set of actions that produce a business result, either within a single organization or across several.” Search CIO (2011) also has it that “A business process is an activity or set of activities that will accomplish a specific organizational goal.” To implement these set of activities that lead to the realization of organizational goals however, there are a number of methods and supporting frameworks to follow. In this paper, we discuss a business process method and supporting framework, including concepts for business-to-business interaction and human resources: to obtain business process environment with rapid, flexible, straightforward, efficient, and precise operations. Undoubtedly, a similar framework will be widely implemented in the near future, and methods such as this one will be widely used. This future implementation will be directed towards achieving a more advanced system and form of business and organizational structure. As the world progresses and advances by the day, business process methods and frameworks that are instituted must meet the growing needs of businesses and society as a whole. Future implementation would therefore be a huge step for the humanity, similar to transition from postal mail to email, utilization of computer-aided design, and use of professional and general purpose social networks. Just as in a swift of human imagination these innovations came to take over the norm that previously existed, it is expected that future implementations would solve more complex problems of humanity and businesses. Virtual profiles system and electronic contract negotiation and formation To allow for a more comprehensive discussion of this session, the session shall begin with the definition and explanation of some the salient terms to be used. Virtual profiles system is more related to virtual systems management that is used in most corporations, organizations and businesses. Virtual systems management basically has to do with the allocation and distribution of resources. Expanding the explanation further, Tech Target (2007) explain that “virtual systems management (VSM), is the process of remotely managing the allocation and use of resources in conventional networks as well as in virtual area networks (VANs), virtual private networks (VPNs), virtual network computing (VNC) and virtual servers.” Virtual prolife systems therefore work best with all kinds of organizations and businesses as far as they have technological facilities for implementation. Electronic contract has greater linkage with virtual profile systems in the sense that electronic contracts helps in the achievement of the management and allocation of resources; especially data on the institution in question. To this effect, Morciniec et al (2002) explain that “an electronic contract is its reification in software that can be instantiated as a set of obligations that are fulfilled between parties, refused or waived as future events occur.” This explanation was given in relation to the meaning of an ordinary contract, which was explained by the writers to be “a statement of intent that regulates behavior among organizations and individuals” Morciniec et al (2002). This means that electronic contract works in much the same way as a contract works in every life. Virtual profiles of entities such as companies, governments, professionals, consortiums, teams, services, and business process segments comprised of those entities that are maintained in corporate databases, national databases, inter-company databases, and other databases such as specialized search engines. Those profiles specify information such as entity name, manual and automated contact information, specification of available services that can be provided when incorporated in a process as a business process element. Those service specifications include information about the provided service per se, input and output interface specification, and may include service statistics, utilized standards, qualifications, public rating, feedback, credential verification information, utilization history, service timeframes, pricing information including possible bidding declaration. Relating the kind of data that is stored in the virtual profiles to the definition given by Tech Target (2007), it could be inferred that the data mentioned above serve as resources for the companies and or organizations who utilize virtual systems management. Virtual profile systems could be used in both public and private sectors. D N A O S (2009) explain that “typical examples include private profile management, like in legal and medical profile applications to access and process personal information which often already reside in different and varied secure locations and formats.” Examples of these are given as “hospitals, clinics, doctor offices, legal system layers” (D N A O S, 2009). Before electronic contracts are instituted, there are several considerations and factors that are put in place. To this effect, potential contract parties are searched, evaluated, and ranked according to service definitions, utilization histories, qualifications, pricing, public and private rating systems, and other factors. When the available data is not sufficient to make a decision, legacy methods may be utilized, and virtual profile data can be updated to improve further decision-making based on the virtual profile. Local profile can be built or updated with no a priori restrictions, while public profile can be updated according to a standard protocol. Lightweight Directory Access Protocol (LDAP) protocol with entries in LDAP Data Interchange Format (LDIF) may be utilized for virtual profiles. Those standards provide a medium for the virtual profile system; an overlay standard should be developed for the virtual profile service for interoperability between concerned entities represented by virtual profiles. Morciniec et al (2002) identify three major phases in the electronic contract process. According to them, the phases to undergo to finally get an electronic contract implemented are contract drafting phase, contract formation phase and contract execution phase. Basically, the contract drafting phase constitutes a preparatory and planning process where templates for the entire contract is prepared or drafted. It also involves the assignment of contractual roles and other responsibilities. To get all these perfectly done, the services of a drafter is employed to facilitate the smooth implementation of the drafting phase. The contract formation phase is a step ahead of the drafting phase. The formation phase comprises the assumption of roles assigned during the drafting phase. More of the abstract plans become finalized and confirmed. To this effect, Morciniec et al (2002) state that “The negotiable variables of the contract (deadlines, order of actions) become fixed, and concrete business interactions are bound to the abstract ones defined in the template.” The final phase is the contract execution phase. As the name implies, it is the phase where the actual take off of the contract takes place. Because by this time actual delivery of contractual terms might have began, “Typically this phase constitutes service or goods delivery, invoicing, bill calculation, presentment and payment” (Morciniec et al, 2002). Workflow and business process management Workflow is rapidly becoming very common in organizations and businesses. Lilly (2010) explains that workflow “is software that automates business processes to a greater extent than conventional data processing by integrating additional features like email, word processing, imaging, alarms, audit trails, Internet technology etc.” this means that workflow and business process management are closely related. Workflow and business process management software, designed to with virtual profile databases, allows integration of the traditional product of such software with immediate implementation of this product. Once completed, workflow can be integrated into aspects of the business such as business case. Alexandrou (2011) explains that “a business case is part of a project's mandate, produced before a project is initiated. It includes the reasons for the project, the expected business benefits, the options considered the expected costs of the project, a GAP analysis and the expected risks.” To do all this, Lilly (2010) admonishes the use of workflow whereby “the business case is then input to a procedure for workflow approval to get the necessary authorization for financial and other resources to continue the project.” This actually exemplifies how easy workflow and business process management can make the running of a business. Electronic contract, much like workflow also comes with great benefits for businesses and organizations. In particular, electronic contract negotiation and electronic signature functionality is built in such software, although non-electronic forms of contracts are supported and facilitated. What has made the software gain much grounds and prominence happens to be the fact that electronic signatures have now have legal backing and are therefore highly encouraged among businesses and corporations in many parts of the world; especially the Unites States of America. Adam, Beaudoin, and Smith (2008) note that “in 2000, to encourage and facilitate the use of electronic records and signatures in interstate and foreign commerce, Congress passed the Electronic Signatures in Global and National Commerce Act (the "E-Sign Act").” The act was replicated in other parts of the world shortly. This has made electronic signature widely accepted and authenticated among businesses. Apart from its role in electronic signature, there are other sectors of organizational management that the software play prominent roles. For instance the software facilitates electronic job interviews and hiring, automated products and services procurement, and other actions with virtual profiles. As an additional example, if a work breakdown schedule (WBS) is utilized, once the WBS is developed and approved, the electronic WBS has immediate effect on the business processes involved. The Work Breakdown Structure blog (2011) quotes The Project Management Body of Knowledge (PMBOK) who defines the work breakdown structure as a “deliverable oriented hierarchical decomposition of the work to be executed by the project team.” This means that business process can be integrated into organizational structure to breakdown the distribution of work among members on any given team of the organization. Work breakdown structure can be utilized in all spheres of work including civil construction. The Work Breakdown Structure blog (2011) gives a diagrammatic representation of how work breakdown structure can be fitted into business process to get a house constructed. Partial part of the diagram is indicated below: Source: Work Breakdown Structure blog (2011) The process control management system is the framework and engine for actual workflow, therefore duplicate work involving updates to process control system after the work completion is minimized, and corresponding accuracy is achieved. Cost management Business process is not paramount only with the physical structures of an organization. It also works perfectly with the financial and cost management component of a business’ organization. Ryszard (2005) identifies financial resource as one of the most important components of organizational resources. In his view, financial resource is the catalyst that empowers the implementation of all the other resources. In a typical example, the human resource can hardly be motivated to work if there is the absence of enough funds to improve the rewards and remuneration of employees. Again, physical and information resources are also enhanced through financial allocations. It is for this great importance of financial resource that cost management should play an important in business process. With an effective cost management, managers are sure to have enhanced manipulation of their financial resource. This method is highly compatible with automated bottom-up cost estimation. During the business process computer-aided development, cost estimates are completed and updated on the fly, whenever possible. Cost data may be gathered from various sources, including business process workflow analysis, data from virtual profile directory information, automated bidding, published process segment information, requests for quotes using standardized cost estimate request messages with certain process development data shared via virtual profile interface, and manual estimate entries. Quality assurance After completion of each unit of work quality assurance and quality control is collected from the process element. For higher efficiency, if possible, that procedure is substantially automated. Utilization of neural networks for non-trivial quality analysis is envisioned. Quality scoring by subsequent process elements is also a critical part of quality assurance methodology. While dedicated manual quality assurance process elements may be used, the focus on efficient quality assurance on the spot is increased. Communication plan Communication is also integrated into the overall business process because of the immense importance communication plays in organizational management. Thomson (2007) posits that “communication is one of the basic functions of management in any organization and its importance can hardly be overemphasized.” To achieve the full benefit of communication in an organization’s set up however, it is important for the organization to have a structured plan that the communication channels of the organization operates on. Happily, business process plays this all important role of planning for communication in an organization. Communication plan is integrated in the business process as part of its messaging system with its rules and specifications. Routing of documents and data is automated, secure, and trackable. External input/output External input/output controller is used for interaction of process elements via legacy interfaces such as postal service (including optical character recognition for incoming mail), email, phone, and fax. It may be utilized for interaction with incompletely integrated process elements. External input and output are integral part of the communication structure of an organization. It is for this reason that since ages, much attention has been given to them. As the world processes on the wings of technology however, it is important that external input and output be given technological facelift to meet the growing demands of the world. Internal meta-input/output Evaluation and motoring is an important component every program and software. The same argument remains true for the business process. Internal meta-input/output controller is used for monitoring, coordination, and control of the business process. Internal meta-input/output has several aspects and components that make the whole duty of control and monitoring possible. To make the function of internal meta-input/output complete therefore, administrative instructions, orders, status updates, and coordination messages are disseminated using this interface. It gathers process control, quality assurance, cost management, payment substantiation, and other such data. Some of these components of control and monitoring are discussed into detail below. Business-to-business collaboration Details concerning various aspects and segments of business processes are assigned disclosure and other security properties. Business process elements may be restricted from participation in other business processes, which is particularly useful for exclusive utilization of an element by a company. Considering this, multiple companies may share the same business process space, and efficiently construct products and services procurement processes. In particular, existing supply chain management solutions may be easily emulated with high customization capability. Multiple companies may share some of their business processes between each other, forming a mutually accessible process pool. This provides for an arbitrary level of integration between no collaboration and a company merger. In addition, some business processes, especially those involving national interests, may be provided by the government or by another designated entity. For example, visa issuance for company employees may be this integrated and streamlined. Wide implementation of the system will improve efficiency of the economy as a result of improved efficiency of its components. It may be supposed that it will also have a stabilizing effect on the national and global economies. Specific Scenarios Case 1 A major government entity, after implementing the System for its contracts with suppliers, has further set up an automatic bidding platform by adding automated bidding declaration to its virtual profile. The corresponding supply chain solution eliminated the need for human involvement in procurement of 90% of supplies. Following the success of this change, L-Mart decided to implement a similar system. Case 2 After failure of company merger negotiations, it was pointed out that an excellent compromise can achieved by sharing a substantial number of business processes using the System. Costs of doing business were thus reduced while otherwise maintaining autonomy. Case 3 Local vendors of Middletown decided to implement the System for their business processes. They decided to implement an integrated online shopping service with 24-hour delivery. Further, they delegated the after-hours product breakouts to selected existing security guards, who are to do it only in presence of employees of a designated delivery team. With use of the System, the necessary business processes involving business-to-business and human resource relations proved to be much more efficient and secure than previously thought possible. Human resources Use of the System, and virtual profiles in particular, for employment purposes presents a cost-, time-, and possibly effort- efficient way, along with a number of substantial advantages, which has not been previously widely available. Use of independent contractors in a workflow can represent substantial cost reduction, while maintaining the necessary qualification and experience level for each business process element, especially if each role is used on less than with an equivalent of a full-time workload. The fixed costs of maintaining each workflow element can be effectively minimized. Use of open job position advertising and job search websites is not necessary, unless the virtual profile databases do not include acceptable virtual profiles. However, sufficiently wide implementation of this system is a strong motivation factor for professionals to include their information in such databases. In addition, companies utilizing this system may choose to enter information about their employees in these databases in order to facilitate the system implementation. We have noticed that the philosophy of this method is remarkably compatible with the concept of hyperspecialization, which seems to be a prospective development. Specific Scenarios Case 1 A professional, unless contractually restricted by the System, easily found work in processes managed by a number of different entities. Previously, this professional has been on a salaried position at one company, and was possibly de facto underemployed. Now this person works for two large businesses and for a few small businesses, which previously did not have job positions corresponding to his role due to high costs and complexities previously associated with this. Case 2 A large corporation has proven to be inefficient due to redundant and inefficient organization structure. The board of directors decides to radically restructure the organization structure on departmental level using the System. Multiple roles are distributed to each employee according to qualifications, skills, and experience. Interestingly, John, a previously underemployed software quality assurance manager, is found to be qualified to do art design work in conjunction to his primary role, which improves resource utilization efficiency and John’s satisfaction with his job. Document routing and decision-making are optimized. A 40% reduction in human resources costs, business processes are streamlined, and the challenge of reducing process backlogs is solved. Case 3 Michael starts a new marketing business, having limited resources. He decides that use of the System is the most efficient way to enter and compete in the market. After completing the company registration procedures, he constructs all necessary workflows using business process management software connected to a virtual profile directory. The whole organization chart is comprised of several dozens of highly-qualified managers and professionals, which are included in workflows via their virtual profiles as independent contractors. He distributes instructions to workflow elements, and maintains oversight of the processes. The fixed costs and overhead turn out to be minimal, and the company is good to go. Case 4 A medium-sized company considers implementing a new process, and the decision is to outsource the project due to lack of existing human resources within the company with required skills and experience. Alicia, the project manager responsible for the process, recommends utilization of the System in the project’s business processes. She finds that use of the system is the most cost-efficient way to outsource the project, as unnecessary overhead costs are minimized. After substantial success of the project, the project management office requires that all future projects utilize the System. Government use example Business process by its name makes a lot of people assume that the phenomenon concerns the running of corporate businesses alone. This assumption is however erroneous. Business process works perfectly in bigger organizations and in the running of bigger organizations such as governmental institutions. This is because governance as an institution entails the implementation of almost all the processes discussed in this paper so far. Below are scenarios of how governments utilize business process. Typical Scenario The government decided to improve the efficiency of passport issuance procedures. Existing government self-service kiosks and customers were included as entities in the business process via their virtual profiles. Upon successful completion of authentication procedure using biometric data stored in government version of personal virtual profiles, passports are instantly issued on-the-spot. Payments From the variety of possible methods of payment for work completion by process elements, we will highlight the payment upon completion of each basic task as one that possesses certain advantages when applied in this method. Possible losses in case of substandard quality are thus thoroughly limited. In some cases, it allows lower expenses on selection of process elements (in traditional terms, human resources, contracting, and etc.) and selection of process elements with inadequate track record documentation with subsequent retention of those achieving best quality control scores in the process. Conclusion Business process has been identified as a central part of corporate businesses, non-governmental organizations and even in governance. Business process integrates the modern invention of technology to make the running and administration of businesses generally easier. It is paramount that as the demands of the world continues to grow greater with more and more demand on technology, organizational managers and technological technicians are admonished to continue to seek for newer means of meeting the growing demands of business process. REFERENCE Adam M. ,Beaudoin W and Smith, P.A. Electronic signatures – Are they worth the paper they’re not printed on? http://wraltechwire.com/business/tech_wire/opinion/story/2964396/ June 4, 2008. Web. August 30, 2011 Alexandrou, M. Business Case Definition. Infolific. http://infolific.com/technology/definitions/pm-definitions/business-case/. 2011. Web. August 30, 2011. Business Process Incubator, Business Process. 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Importance of Communication in an Organization http://stephenthomson.articlesbase.com/business-articles/importance-of-communication-in-an-organization-97064.html 2007. Web. September 1, 2011. Work Breakdown Structure blog, What is a Work Breakdown Structure? http://workbreakdownstructure.com/. 2011. Web. September 3, 2011. Read More