Enterprise Complexity Model VE

Syncho Research 2008 ECM

What is an Enterprise ComplexityWhat is an Enterprise Complexity Model

Raul EspejoRaul Espejo

March 2008


Whats an enterprise complexity model?model?

it is an ingenious form of deploying resources to bridge the complexity gap between enterprise and environment. It is an extension pof the VSM and provides a heuristic to develop dynamic capabilities It is based ondevelop dynamic capabilities. It is based on variety engineering (see paper Enterprise C l it M d l)Complexity Model).

K i


Key issues

Explaining what is variety, Law of Requisite Variety and Residual Variety (Module 1)y y ( )

Introduction to complexity management; revision of VSM as discussed in Module 2revision of VSM as discussed in Module 2

Viplan Method; revision of 5 steps as discussed in Module 3

Enterprise Complexity Model as discussed in Enterprise Complexity Model as discussed in this Module (Module 4).

Methodological Issues


Methodological Issues

S t i f di ti i hi i ti t i i System in focus: distinguishing organisation, enterprise, primary enterprise, network, cluster, extended cluster and institution.

Network is a group of aligned enterprises driven by a primary t i ( Nik ) hi h i it lf i tienterprise (e.g. Nike), which is itself an organisation.

Cluster is group enabled by institution or enterprise, but members do not necessarily have alignment of their transformations (e.g. S i P k)Science Park)

Structural models are focused both on the organisations transformation and the enterprises transformation.

Variety engineering: variety operators and best practice (communications, transducers and performance)

Dynamic capabilitiesy p

Variety engineering


Variety engineering

h f ll i lid fi d l f i In the following slides we find examples of variety operators for enterprises in the network

( lifi tt t deconomy (amplifiers, attenuators and transducers)

The definition of variety operators depends on the transformation (named system) and

f i i (h i i hperformance criteria (how stringent is these criteria)

Enterprise Complexity ModelAmplifiers of Ent. variety Attenuators of Env variety Variety Balance

Syncho Research 2008ECM

Internal to enterprise In Operational Environment Enterprise

Org structure; pushing down t

Internet platform to support i ti b t

Lead enterprise interacting ith l b l k t th hautonomy

Resource centralisation, functional decentralisation

communications between customers and suppliers to work out e.g. equipment specifications

with global market through Regional Industrial Cluster (the Organisation)

specifications

External to enterprise External to enterprise Transformation

Subcontracting manufacturing globallyDistribution network

Bar coding customers behaviours to support sales.Blogging, market research

producing quality textiles for retail markets

In Operational Environment Internal to enterprise Performance

Internet systems to enable customers perform

Operational standardsDecoding suppliers and

KPI for supply chain management

enterprises transactions customers performance

1 A lifi f V i t th t


1. Amplifiers of Variety that are Internal to Primary EnterpriseInternal to Primary Enterprise

Strengthening the Enterprises Variety

Increasing the resolution of the

Creating new variety for the

Making the Enterprises variety

Enterprises Variety Enterprise time independent

Website linking Use of Web2 to R&D, future Use internalcustomers, suppliers and distributors.

target customers individually with a focused message

groups..

Developing

communicationsystems to respondqueries globally.

Marketing and communications

ff

(e.g. Amazon)

Regional and local ff f

Dynamic Capabilities

offices sorting offices for postage and parcels

OrganisationStructure

2. Amplifiers of Variety that are Syncho Research 2008 ECM

External to Primary EnterpriseStrengthening the Increasing the Creating new Making the g gEnterprises Variety

gresolution of the Enterprises Variety

gvariety for the Enterprise

gEnterprises variety time independent

Marketing companies supporting

Information technology companies dealing

Distribution centres

Enterprises

Call Centres ,Customer ServicesInternet operations,pp g

enterprise,

Outsourcing

p gwith enterprises transactions (e.g.banks, shares

pcontributing to network /cluster

p ,operating 24 hoursa day, 7 days a week. g

Post Office Branches

management )Global publicity

Banks paying social services benefits (amplifying socialservices)

3 A lifi f V i t ithi th


3. Amplifiers of Variety within the Operational Env. of Primary EnterpriseOperational Env. of Primary Enterprise

Strengthening the Enterprises Variety

Increasing the resolution of the

Creating new variety for the

Making the Enterprises variety

Enterprises Variety Enterprise time independent

Franchising: Regional Manufacturing Customers use of Regional enterprises selling locally the primary

enterprises adjusting the enterprises

outlets in cheap countries doing theenterprises

blogs creating public opinion about enterprise

enterprises offerings

offerings to local requirements

designs.

4. Attenuators of Variety within4. Attenuators of Variety within Operational Env. of Primary EnterpriseWeakening thestrength of theenvironmental

Reducing theresolution of relevant

Chopping off partsof theenvironmental

Makingenvironmentalvariety time

Atenuadored de environmentalvariety

relevantenvironmentalvariety

environmentalvariety

variety time dependant

Self organisation of Media managing Media selecting Rythmun ofSelf-organisation of agents in theenvironment: more variety absorption at

Media managinginformation in real time and byexception

Media selecting stories and constructing them

Rythmun of publications and reporting

variety absorption at the local level, lessresidual variety

exception

Government regulations: reducing restrictions, lifting , gconstraints

5. Attenuators of Variety that are5. Attenuators of Variety that are External to Primary Enterprise

Weakening thestrength of theenvironmental

Reducing theresolution of theenvironmental







Blogging Screening agenciesfor personnel hiring

Blogging Media highlighting stakeholders and

Automatic check-inof passengers in air terminal

for personnel hiring

Market researchagency doing

stakeholders and customers views about enterprise for a short timeterminal agency doing

research forenterprise

a short time

6. Attenuators of Variety that are l hInternal to the Primary Enterprise

Weakening thestrength of theenvironmental

Reducing theresolution of theenvironmental







Internal review of blogs and other

Clusteringenvironmental

Defining purpose for enterprise

Reducing contact periods withblogs and other

forms of stakeholders views

environmentalagents in categories.

market research

for enterprise

Model of Organisational

periods with customers and suppliers to opening hoursmarket research

done internallyOrganisational structure

Enterprise

opening hours

Enterprise complexity model

Operational model pof customers, suppliers and competitors

Enterprise Complexity Model VE

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