Abstract.

A strategic factor for any company is its capacity to adapt rapidly to changing market conditions. Although the current approach  of  Organizational  Change   Management  represents  a  step  forward  with  respect  to  Business  Process Reengineering  [1]  [2]  and  Knowledge  Management  [3],  it  does  however  suffer  from  the  same  problems  as  its predecessors. This study illustrates work on a new way of looking at companies which makes it possible to manage the process of re-engineering in an innovative fashion. All the classic methods are based on the idea that the company and its behaviours may be compared to a machine whose evolution and functioning need to be followed; our studies by contrast see companies as being more similar to adaptive organisms of a complex type which, in order to survive, must modify themselves and their behaviour in response to the promptings of the environment or market.  On the basis of this new approach an industrial research project has been launched  whose aim is to define a new business  model  in  company consultancy  to  capitalize  on  the  experience  gained  in  other  projects;  indeed,  utilizing  the  similarities  with  living organisms, it is possible to identify the Key elements which make it possible to describe the company - in other words to define its Corporate DNA.  The project sets up an infrastructure  which  allows the consultation and use of models

(company DNA), expressed in terms of Key Elements. In such a system, the consultant is able to make use of a repository of models which constitute his or her company knowledge. He or she will be able to ”clone” this knowledge in new but similar contexts, improving the quality of the re-engineering since this is based on consolidated models already in use in similar organizations.   

KEYWORDS

Business Process Reengineering, Corporate DNA 

1. INTRODUCTION AND BACKGROUND

With the advent and the affirmation of new Information and Communication technologies, companies must adapt their working processes to the changing requirements of an increasingly competitive market. Both companies  and  public bodies are obliged to continuously modify and reinvent their organization via expensive BPR projects. Furthermore, they must be able to design, implement and manage organizational change in terms of time to market.

In order to face up to these new demands it  is  necessary to identify and adopt technological, methodological and organizational solutions able to cope with all the variables at stake.

Business Process Reengineering  (BPR)  is  being eclipsed by new methodological approaches to the requirements of continuous change in whatever type of organization. A need is clearly emerging for approaches such as Knowledge Management,  Knowledge  Exchange  (which  uses  Knowledge  Management  as  a  basis)  and  Organization  Change Management [4][5] to be included in a single methodology, a new way of operating that is indispensable for the planning and management of change and to which Knowledge Exchange leads.

 

Currently the consultancy firms which operate in the field of company reorganization carry out interviews and produce, in most cases, reports or models of an organizational nature in paper form. Only in a few cases, considered as pilot cases, are graphic systems or design support tools used which prove to be useful for the management of design activities. These are not able however to capitalize on the knowledge generated by the project and to distribute it to all the personnel who will have to work with the new organizational model.

The current preference is for an approach able to integrate all aspects; in this sense, Business Process Reengineering and Knowledge Management represent the evolution of the classic approach, while Organization Change Management can be considered a more truly innovative approach. It enables companies to design their own organization in response to the market  or more generally to the context where they operate, according to a continuous  cycle which has the aim of designing evolutionary organizational models while managing the organizational model currently in use.

Although all these approaches introduce innovations, they are based on the idea that the company and its behaviours are comparable to those of a machine whose evolution and functioning need to be followed.

In contrast, the new approach described in this paper views companies as being more similar to adaptive organisms of a complex type which, in order to survive, must modify themselves and their behaviour in response to the promptings of the environment or market. This vision is reinforced by the fact that all organizations are composed not only of people, tools,  hardware,  software,  but  also  of  emotions,  intuitions,  ideas,  and  design,  managerial  and  productive  skills.  If companies  are  like  living  organisms  then  we  may  suppose that they can be described with reference to fundamental elements (Corporate DNA) which characterize their behaviour and unambiguously identify their characteristics.

Two definitions of Corporate DNA are available  in the literature: in the view of Ken Baskin [6] Corporate DNA is a database of information on procedures and structures necessary for people in an organization in order to work in a self- organizing way that is also compatible with their organizational identity. In this definition Corporate DNA is none other that  a  container  in  which  all  the  information  necessary  for  the  management  and  evolution  of  the  organization  is memorized. Another point of view is supplied by Gary F. Bargatze [7] according to whom organizations are, to all intents and  purposes, living things which follow their own biological cycle. For Bargatze Corporate DNA contains all the variables responsible for the evolution of the state of health of the organization. Positing a similarity between the human and organizational genome, the fundamental unit of company DNA is the structural  and  functional  component  which must contain one or more persons who form an organization. Bargatze puts the emphasis on human resources  and consequently, it is these that must be monitored in order to check the health of the organization, revealing any “trouble” and what caused it.

Using  this  new  vision  of  the company, an industrial research project is currently in progress in collaboration with the QUality Innovation Management SpA company in Rome and the Department of Innovation Engineering of the University of Lecce, whose objective is to set up a range of products  and services via the adoption  and creation of systems  and methodologies for managing a small to medium-sized company, treating this as a living organism, enabling the evolution, specialization and reproduction of its “genetic heritage”, called “Corporate DNA”.  

1.1  Net Consulting Enterprise  

The project, called “QUality Innovation Management NET” seeks to design a Net Consulting Enterprise Business and Organization Model. That is, it aims to define a new model of business in company consultancy which makes it possible to capitalize on the experience gained in other similar projects. Currently the activities of consultants and consultancy firms in general are closely correlated with the experience gained and with the company knowledge available; using the new approach, which makes it possible to define via the concept of Corporate DNA a company model as a composition of Key elements, it is possible to set up an infrastructure which enables the consultation and the use of models already being applied in similar organizations. In other words, it  will  be  possible  to  ”clone the Corporate DNA”  in new company situations. In such a system of services, the consultant will use the available models, choose the one which best suits his or her requirements, adapt it to the new context, evaluate  its  effectiveness  and place the new improved system at the disposal of other consultants. The consultant will thus operate in a virtual on-line company laboratory in which he or she will utilize the fundamental elements and combine them to obtain new composites/organizations.

The project is subdivided into four phases:

    Identify a new approach for “process and knowledge modelling” via a model for the representation, in a number of inter-correlated contexts, of the relations between the elements that make up the  strategies  and  the  company’s operational features. The “stratified vision” makes it possible to define and identify the fundamental components of the company (“genetic heritage”), enabling these to evolve and to be manipulated and re-engineered in subsequent re- use in contexts of different origin or contexts modified due to changing market conditions. In this phase it is necessary to identify not only the fundamental elements but also the rules and the limits which characterize them, as well as the relations between them in various contexts such as Business, Structures, Processes and Knowledge.

    Identify a graphic  language  able  to  provide  an adequate representation of the concepts and the modelling being applied. Such a language will enable the formalization of company models, at the same time ensuring comprehension on the part of all the players involved.

    Develop a tool in support of the new approach; thanks to the formalism identified in the preceding phase, this will make it possible to support the designer in all the phases of the process of re-engineering. Such a tool must enable not only the design of the project but must also be able to capitalize on the knowledge produced and the  various organizational  models,  via  an  appropriate  repository. In this way the models produced will be reutilised and re- combined in order to model similar or more complex processes, improving them and subsequently reinserting them in the repository. Thanks to this process of continuous improvement it will be possible to bring about the evolution of the processes contained in the repository; indeed each process will be used in different environments and will change so as to better adapt itself to the new context.

    Design the “Distribution Model” which enables the sharing of the models produced and which provides support to the organization. Such a model will be used to share and evaluate the knowledge present in the repository to provide on-line organizational consultancy and manage change inside the company, rapidly disseminating the organizational changes  and reducing the gap between design and actual application. Such a model thus defines the rules and the contexts of cooperation between the various players.

On completion of the project a system of process modelling and re-engineering will be available which make it possible to re-use the models, described via a UML-like language and available in a shared repository.  

2. PROCESS AND KNOWLEDGE MODELLING  

Currently the project, of two years' duration, is in the first phase; thus the foundations are being laid for the development of a new approach with the aim of improving and facilitating the evolution of organizations.

Going back to Bargatze’s characterization of Corporate DNA, if this is combined with the informational elements of Baskin’s definition, it is possible to obtain a definition which takes account not only of the fundamental elements - be these organic (human resources) or inorganic (technologies and instruments) - which make up the DNA, but also of the methodology (procedures) adopted for the management of the organization itself.

Therefore,  Corporate  DNA  can  be  seen  as  the  combination  of  the  fundamental  elements  with  a  software  for  the memorization and management of the data, information and instructions necessary for the construction of organizations considered as complex systems of an adaptive type.

On the basis of the definition given, and in accordance with the objectives of the first phase, it is possible to proceed with the identification of the elements and the relations which will make up the Corporate DNA. Properly combined, these will make it possible to describe the entire organization. Keeping in mind the possible analogies between the organizations seen  as  complex  systems  of  an  adaptive  type  and  living  organisms,  these  elements  correspond  to  the  role  of chromosomes.

In order to identify these elements, which must be generic and valid for all levels of the organization, it is necessary to obtain the best possible representation of all aspects of the organizational situation, from the strategy to the processes needed to achieve the organizational objectives that have been set and from which the common elements are derived.

In this sense, the first step taken has produced a stratified vision (in levels) of the organization which distinguishes objectives, tasks, resources and structures into levels and makes it possible to obtain schemata which highlight, for each level, the entities present and the relations between them. 

 

The levels present in figure 1 are:

    the strategic level, which makes it possible to identify the operational objectives of the company, that is to say the aims  that  the  organization  will  pursue  via its organizational procedures, and how these will be achieved. We are typically concerned here with primary tasks which must be performed inside an organization, and specific objectives which  set the strategy for day-to-day decisions and activities within the organizational units or departments. The objectives are correlated with the processes, which are activated by events since these are the means by which they are reached. Reaching the objectives may involve various areas of business and to achieve an objective in one area, a number of processes in sequence may be necessary. The processes directly triggered by the events are called “entry processes”. On the strategic level we also find a list of Co-makers which describes the relations, that is the existing links between the organization in question and the players with which it interacts.

    the operational  level,  which  is closely linked to the strategic; it is enough for an event to happen to switch to operational mode. On this level the  operational  side  of  the organization is described: the sub-processes, whose activities are composites, the organizational positions (who does what) involved in the activities and the skills that these must possess to be able to carry out their tasks correctly.

    the management level, which makes it possible to represent the organizational structure by modelling the business. The model obtained contains the organizational units or departments needed to achieve the organizational objectives. The organizational units, which play specific roles, identify who is in charge in the organization and are responsible for the processes. The difference between role and organizational  position  is that the former represents the role assigned within the company, the latter is the sum of the tasks carried out within the processes (the organizational positions are, in fact, connected to the processes).

Starting with the “functional” schema of the organization described in figure 1, it is possible to construct a representation, organized into levels, of the key entities identified and which also shows the relations between them.  

2.1 Corporate DNA  

The general schema of the Corporate DNA can be subdivided into three sections which identify the types of entity which will “generate” the entire organization.

 

The three types of entity are:

    Knowledge entity: the “super-entity” from which it is possible to derive all the other entities. It  is  possible  to characterize it by assigning it given attributes. The knowledge entity contains the properties and rules which define the functions and the roles of the other entities derived from it which are called conceptual entities.

    Conceptual entity:  the result of the characterization of the knowledge entity type.  The conceptual entity, which inherits  properties  and  rules from its parent entity, is defined within a certain context which identifies an area containing other entities and behaviours and inside which specific attributes are activated.

    Physical entity: this inherits all the properties of conceptual entity from which it derives. The physical entity is none other than an instance of the conceptual entity and is used to hold the real values. The presence of the conceptual entity is justified by the fact that the same conceptual entity can be used a number of times and in different contexts. Taking as an example the process of opening a bank account, the number of times that this is replicated is equal to the number of clients who request this service. It is also possible that the same process  is  used in different branches belonging to the same organization. This means that it will be characterized by real values that vary according to the different contexts in which it is used. In each case the physical entity will possess physical attributes which will confer its true identity (real values and data) in a given use environment.

In this paper it is not possible to describe the schema of the Corporate DNA in detail, given that this is composed of 170 elements including entities and relations between them. As an example, figure 3 shows part of the detailed schema of the knowledge entity type, its specializations and the attributes which may characterize it once the context in which it must operate has been defined. Given that the second phase of the project includes the choice of a graphic language  to represent the Corporate DNA, the formalism used has not been studied in detail, and should  thus  be  understood  as provisional.

 

  

The Knowledge entity type is a parametric object, that is, it will be necessary to select those attributes that are needed to describe the specific entity in the context being considered; thus the Knowledge Entity type can be specialized in various categories of entity (scenario, goal, pattern, object base, event type, connector, organizational context, document, etc..).

3. FUTURE STEPS 

After defining the Corporate DNA, it is necessary to proceed with the next phases of the project. The second phase is currently  being  planned  and  an ontological approach [8] is being considered to obtain a thorough description of the objects of the Corporate DNA.

The  conceptual  schema  obtained  constitutes  an excellent starting point for the formulation of an ontology. After the description of the concepts via the modelling of the entity selected, these need to be codified in formal language via the semantic networks. Specifically, the KL ONE [9] networks have been chosen. These make it possible to use an effective graphic formalism, and to organize the concepts in a hierarchical structure. Using these properties it has been possible to translate the conceptual schema into a semantic network; from the semantic  network  it  will  be  possible  to  obtain  a description in an ontological formalism.