Anne Maurand-Valet and Lucile Pedra (2007)
THE ORGANISATIONAL CONSEQUENCES OF PROCESS FLOW ANALYSIS : a comparative approach of ERP and ISO 9000, FULL TEXT,
In: International Management Control Conference, ESCP EAP, ESCP Paris.
THE ORGANISATIONAL CONSEQUENCES
OF PROCESS FLOW ANALYSIS :
A COMPARATIVE APPROACH OF ERP AND ISO 9000
Anne MAURAND-VALET, anne.maurand-valet@univ-avignon.fr
Maître de Conférences, PRATIC, Avignon University
Site Agroparc B.P. 1207, 84911 Avignon Cedex 9
Lucile PEDRA, lucile.pedra@free.fr
PhD Student, CREGOR, Montpellier University II
Place Eugène Bataillon, 34095 Montpellier Cedex 5
Abstract
The theoretical hypothesis of an organisational clarification and integration dimension further to the realization of a process analysis is established at first. The process analysis is then considered, by a practical point of view, through the implementation of an ERP and through the preliminary documents to the obtaining of the ISO 9000 certification in organisations of different sizes and varied activities. The organisational consequences are then approached. They confirm the hypothesis of a better clarification and integration of the organisation and show, at the same time, the appearance of an alternative between pressure or learning as the case may be.
Key words
ERP, ISO, Clarification, Integration.
Many authors have tried to build an analysis method for the organisation. Some authors have treated the problem rather on an individualistic approach trying to place the individuals according to the place of the others (Crozier, 1992 ; Mintzberg, 2003), while others have done an analysis considering the organisation as a set of flows (Imaï, 1994 ; Lorino, 1998). Similarly, in the case of a river, we can use banks and islands which mark out it to define it with its structure and its stable elements or, we can point out the movement and insist on the continuous streams, the flows and the currents which can exist there. For an organisation, we can choose an analysis based on the organisation chart, or choose an analysis based on flows, that are processes.
The organisational process can be defined as the series of operations which lead from an input (data, raw materials, products) to an output (piece of information, product or service). In this way, the processes can include various sequences of tasks and require to determine their beginning and their end. Simon (1983) gives us some elements to decide by comparing the notion of process to that of purpose. He said there are no fundamental differences between "purpose" and "process"; it is only a question of degree. A process is an activity which the immediate purpose is situated at the bottom of the means-purpose hierarchy, whereas a purpose commands a series of activities which correspond to a value or to a high goal in the means-purpose hierarchy. Imaï (1994) says, besides, that the approach based on processes is less spontaneous for the western spirit than the approach based on results (unlike the Asian spirit). Thus, its growing place is new in the managerial speech.
At present, the organisational analysis needs are oriented towards the approach based on processes in order to satisfy the demand of new management tools. Among these, we can find ABC method, the construction of Balanced Scorecards, ERP or ISO 9000 standard. For our study, we shall retain the last two tools because the process analysis, which is associated to them, has a particularly important impact on organisation, while ABC method and construction of Balanced Scorecards use this type of analysis only to describe the existing and measure its performance. ERP and ISO 9000 generate issues about organisational flows. These two management tools indeed require an analysis in terms of flow for two reasons:
- to allow the implementation of the management tool,
- and to reduce the risk of failure of this application due to the lack of relevant analysis of both the concerned organisation and its specificities (Besson, 1999).
In such conditions, we can ask ourselves what is the contribution of the organisational representation based on processes in an approach of organisational clarification and integration. It is indeed a question of clarifying the organisation in order to know how to set up management tools in an effective way (ERP or ISO 9000 standard in our empirical case) and simultaneously, to favour the organisational integration in order to facilitate the objective of control linked to these tools. Thus, the concept of organisational integration is translated here by the will to integrate every element of the organisation in a system of generalised control, i.e. to build links between elements of the organisation so that firstly a management demand could be transmitted without distortion to the lower levels and secondly information of the base can go back up with the least possible decrease and distortion.
Our analysis is therefore linked to the wider problem of the organisational control theory because the process analysis tries to give a better representation of the organisation functioning in order to improve the control of this one (Hatchuel, 2002). We will first perform a theoretical analysis of the expected outcome linked to the realisation of a process analysis within the organisation. This will be followed by the demonstration that the process analysis is an essential step in implementing an ERP and in obtaining the ISO 9000 certification for an organisation. Finally, we will show the organisational consequences observed empirically in six case studies following to the process analysis.
1. THE PROCESS ANALYSIS AS AN ATTEMPT OF ORGANISATIONAL CLARIFICATION AND INTEGRATION
The process analysis gives a specific representation of the organisation which feeds the control possibility of this one. As any representation, it translates an attempt of reduction of complexity. This point will be first treated. Then, the steps of construction of the process representation will be presented.
1.1. An attempt of reduction of complexity
Girin (2002) proposes two categories of complexity in the field of the organisation management. The first category is a complexity in a technical sense, i.e. when it is difficult to anticipate the behavior of the studied object. According to Girin, two approaches exist for explaining it, the chaos theory and the algorithmic logic. The second category is a complexity linked to the actors' behavior. It concerns the coordination and the profusion of the symbolic resources within the organisation.
Girin thus emphasises on the coordination complexity which comes from the variety of the purposes pursued by each actor in the organisation. This difference between purposes can be such important that the actors do not succeed in congruing to a common representation of the organisation purposes. The process analysis can serve as support of discussion and, through the description of the processes, helps developing so many processes as it is considered useful for the conciliation of the individual representations. Finally, we obtain a processual representation of the company who allows to value the different steps of the activity. So the process analysis can help to reduce the coordination complexity in an organisation.
According to Girin, there is also a coordination complexity when all the actors wish to reach a common goal have only partial information on the means to reach it. Here, the complexity is linked to the uncertainty which increases the organisational dissensions. The process analysis can help to reduce the uncertainty feeling by reminding the priority objectives of the company and by strengthening its identity. The representation can serve as an anchorpoint in an uncertain situation.
Next to the complexity linked to the actors' behavior, Girin shows a complexity linked to the symbolic resources. For him, these last ones are made of by all the documents which circulate in the organisation (reports, plans, accounting data…). A symbolic resource is generally initially created with the aim of a definite use (for example, accounting has been created to save and memory operations realised with company partners). But in the time, other users are interested in the information carried by this symbolic resource and try to influence the content to increase it in the direction which interests them. The abundance of symbolic resources can then exceed the cognitive means of the users so that the operators have to create their own document in order to note what seems to them the most important or the most useful. With its visual simplicity, the process analysis can be a vector to link all these circulating documents in a global pilot system. As integrating system, the process analysis tries to structure a coherent and simple representation of the organisational functioning.
Finally, the process analysis presents the advantages and the inconveniences of any attempt of complex reality representation. It has to be rather simple to still stay understandable and interpretable by all the people, while it has to be a point of convergence for all the actors of the organisation. The processual representation tries to reconcile the existing individual representations within the organisation in order to lead the action of the various actors to the common objective. It structures at the same time the information circulation in the organisation. In reason of its complexity reducer character, the process analysis represents a headway to the organisation clarification and integration.
1.2. An application based on the Cartesian analytical principle
The process analysis and the representation of the processes are an attempt to organise the multitude of the tasks realised in an organisation in a coherent succession and a logical articulation of steps : it allows to represent the realised work or the work which has to be realised. So the process map of the organisation constitutes a mock-up of the company. It tends to obtain a symbolic value : the company would be a set of flows, but neither a group of persons nor a black box if we summary two classic images of the organisation. It answers to the demand of processual awareness which Boutinet (1993) presents as very important in our society. This processual representation can be done either by mapping the management process of the flows, or by mapping the flows themselves (Lorino, 1998).
Two approaches are possible in order to translate activities in processes as we adopt a bottom-up or a top-down method.
Bottom-up method
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Top-down method
Plan 1. Modalities of process division
In the bottom-up method, we start from observed activities, we describe them and organise them at the lowest detail level. Then they are aggregated into higher level. This step can be repeated as many times as necessary until sufficient simplification is obtained. In the top-down method, on the contrary, we start from the highest level and we decompose the system into subsystems of lower level. We construct the diagram of this level and we decompose again every subsystem into subsystems of lower level, and so on.
Globally, none of these methods is better than the other (Vernadat, 1999). In practice, the choice between both depends on the problem which the engineer has to resolve (Vernadat insists on the fact that it is a question of engineer technique). If we have not enough information at first, the top-down method will be easier. Mutually, if we have all the information which we wish and if we know well the ground, then the second method is better to spare time. In every case, both methods will be necessary for one step or another. The number of intermediate levels in the analysis will depend on the importance of the organisation.
However, Duymedjian (1996) stresses that when the process analysis is realised from top to bottom, it tends to adopt a top-down approach. Therefore, the committee, which has to realise the activities analysis in terms of processes, is constituted by the person in charge of the project and by people in charge of each department or service. It results tensions between people in charge, and a delegation of the procedures drafting to the experts of every department. Then the approach is that of the best practices. The persons speak about the work tasks they wish to do or to see doing, and not from real work tasks. On the other hand, Duymedjian considers that a bottom-up method is better to keep procedures drafting close to real work tasks.
Finally, the choice of the process analysis method (top-down or bottom-up) can increase or decrease the clarifying and integrating effects of this analysis. This implies to make a sensible choice according to the context and to organise in every case a minimal participation of all the actors to the analysis. The process analysis so becomes a tool of collective cognition: it helps the distributed cognition process (Hutchin, 1995), that is the construction of a common representation when there is no actor who possesses a complete representation.
The process analysis method linked to company activities allows finally to move closer the purposes and the means and so supplies a better organisational integration.
2. THE PROCESS ANALYSIS, A NECESSARY STEP TOWARDS THE IMPLEMENTATION OF AN ERP AND TO THE ISO 9000 ACCREDITATION IN THE ORGANISATION
The process analysis is requited in the implementation of an ERP because it organises the installation of the computer integrated system. It constitutes the conception plan. In the case of the ISO 9000 accreditation of the organisation, it allows the creation of a workflow map which is the skeleton on which will be set the performance indicators linked to the risky interfaces or to the objectives fixed by the strategy quality.
2.1. The process analysis, a prerequisite step in the ERP implementation
The ERP concept (for Enterprise Resource Planning) is used to qualify the software packages which cover the complete management of a company and which leave little room for the development of specific programs, so that the solution ERP remains justified (Reix, 2002). These software packages are conceived by a publisher to satisfy the needs of diverse companies. These systems particularly justify the adjective "integrated" for two reasons. They cover a wide part of the information system of the company (purchases, production, products nomenclatures, inventory control, customer databases, accounting, human resources). They aim at managing in a coordinated and interdependent way all the company resources. ERP have modular architecture allowing to compose, at your choice, a management system (Meyssonnier & Pourtier, 2004). They lean on a relational data base and on a process base. This base of processes is adapted to the specificities of the country (language, rules). It is adaptable, in theory, by parameter setting to the company, to its professions and to its ways of functioning.
The ERP implementation results mainly from the will to simplify and to standardise the systems and to restructure the company organisation (Canonne & Damret, 2002). ERP facilitates indeed the organisational change but constitutes, at the same time, a support for the organisation. In this way, according to Giard (2003), the reengineering arrived, at the very beginning of the years ninety, with the will to transform radically the processes by leaning on the new information and communication technologies. The reengineering suggests reinventing in a radical way the organisational function model (Hammer & Champy, 1993) and thus choosing the best way for working today, by re-entering the tasks around coherent operational processes.
ERP system can be considered as a support for the organisation because, once the operational and functional processes of the organisation put in evidence, this management tool allows to automate and federate them. In terms of Business Process, the process re-conception, before the implementation and the parameter setting of ERP (Besson, 1999 ; Llorca, 2000), allows to keep the company spirit, while considering the architecture and the functional rules imposed by the software package (Mourlon & Neyer, 2002). The ERP introduction within the organisation contributes to modify the way of taking into consideration the tasks realisation within the organisation. According to Tort (2003), it constitutes a real opportunity to rethink the flow organisation and the company services functioning. ERP system indeed obliges the actors to formalise the way they work and the way they set the system in the whole organisation. Consequently, this tool introduces the processes into the organisation and imposes to adopt an approach based on processes. ERP system obliges henceforth the stakeholders to think in terms of processes and not in terms of organisational units, such as services, divisions and groups.
2.2. The process analysis, a support in the implementation of the standard ISO 9000
The implementation of the ISO 9000 standard proceeds of a particular model of acting (Hatchuel & Weill, 1997), here the total quality. It appears in the all-embracing systematic plan of the company functioning supplied by the model of the ISO standard. Every dysfunction must be followed by a corrective action. For that purpose, it is previously necessary to have realised the following operations :
- the transverse analysis of the company to bring to light the processes and the interactions between,
- the organisation of the documentary management,
- and the setting up of internal audits in order of a continuous improvement.
A definition of the ISO 9000 standard, precise enough for our work and with no useless details for our study, could thus be this one : the ISO 9000 standard is a management tool trying to develop a processual analysis of the organisation in order to bring to light the organisational functioning risks. These risks will be reduced by the formalisation of some activities and the by setting up written memory of the company. Thanks to this memory, a system of continuous improvement is setting up on the basis of the internal audits (controls made by internal actors of the organisation in order to verify the application of the functioning principles fixed during the accreditation).
The application of the ISO 9000 standard leads to reconsider the establishment, the circulation, the filling in and the updating of all the documents within the organisation. It allows not only to get rid of the existing redundancy, but also to verify that the interfaces presenting most risk within the organisation are clearly recorded on documents in order to limit the risks.
The standard so proposes a transverse organisational representation. It insists on this process analysis which is, according to companies, either very simple (as in the case of a mark vehicle shop with a stable activity at the organisational level and a division which distinguishes the sale of new vehicles, the sale of second-hand vehicles, the sale of spare parts and the service after sale), or more complex (for example, an airport which the activities are diverse : putting at disposal of airline companies the necessary equipments, management of the temporary car parks, organisation of the reception and the display, promotion of the airport, economic development of the area given to the airport).
This transverse organisational representation, thanks to the processes, allows the implementation of systems of continuous improvement which are the base of total quality systems. Self evaluation of the organisation realised by internal auditors is based on this representation. It allows to indicate clearly dysfunctions and to make certain an improvement of the organisational efficiency in the pursuit of the purposes fixed to each process. So the process map is easier to modify in the case of the ISO 9000 implementation than in the case of the ERP setting-up. It indeed remains a simple cognitive support for the implementation of quality indicators and is not integrated into the organisational global computer system. It so remains accessible to make changes.
3. THE ORGANISATIONAL CONSEQUENCES OF A PROCESS ANALYSIS
Our empirical approach is based on several case studies, some concerning setting-up of an ERP, others ISO 9000 implementation. Their selection was made on the principle of a biggest possible variety of the research. Thus we retained companies with different strength and activities sector. Case studies were supplied by documentary studies and interviews realised with main actors (controllers and responsibles of function in the case of the ERP; people in charge of quality and pilots of process for the ISO 9000 standard).
ERP | ISO 9000 | ||
Types of enterprise | Number of employees | Types of enterprise | Number of employees |
Food-processing industrial company | 1 400 |
Airport company | 100 |
Energy transmission and distribution company | 350 |
Construction company | 900 |
Regional daily press company | 1 500 | Food-processing interprofessional organisation | 25 |
Tableau 1. Presentation of case studies
Our study allowed us to obtain some elements of answers as regards to our hypothesis of organisational clarification and integration linked to the process analysis. Other additional results were established which differentiate the organisational consequences of the application of both studied tools.
3.1. The confirmation of the hypothesis of an organisational clarification and integration
If the final impact of the process analysis is different between the implementation of an ERP or the implementation of ISO 9000 standard (respectively changes in the organisation at the human level and in the global computer system, and changes in the working customs), we notice however that the hypothesis of a better organisational clarification and integration is verified.
Concerning the hypothesis of clarification on one hand, it seems necessary to remind that the setting-up of an ERP requires beforehand a specific process analysis of the organisation. However, the objective is to stick as much as possible on the processes proposed in the software package, processes which are considered as the best practices of the sector and to avoid as much as possible specific developments. So the installation of an ERP generates radical transformations in the organisation and questions the professions. Thus this process analysis engenders a redefining of office and professions. But, due to a unique plan, this process analysis can contribute to a better understanding and representation of the role of each in the contribution to the company objectives. Besides, the various interviews realised, with people working in a company which proposes a complete range of solutions for the energy transmission and distribution, allowed to bring to light a clarification of the organisational functioning after the implementation of the ERP. This system facilitates henceforth an immediate and real-time accessibility (according to the authorisations to access) to the data of the system as well as to all the administrative documents (estimate, invoice, delivery order…) digitised and stored in the tool. This functioning spares time for everybody.
In the case of the ISO 9000 standard, the construction of the workflow map does not present particular difficulties according to our observations. It is the occasion to confront the representations which each has from the organisation and to find a common representation. As a support for the implementation of indicators (it is in relation to the workflow map that we decide of the number, the nature and the location of indicators on flows), it generates a working surplus to update the documents of the quality system. However, the counterpart is an integrated documentary management. This characteristic is particularly well illustrated by the observation of a construction company case where the portal of the documentary intranet is constituted by the process map (you have just to click a step in a process to obtain the documents which are associated with it : contracts, estimate, etc…). The map summarises here the plan of the life cycle of a business.
Concerning the hypothesis of integration of all the documents circulating in the company into a global piloting system, it is important to bring to light that with the ERP, the data are collected closer to their source (place of production, realisation and signing of a transaction). The integrated character of the tool, as well as its unique data base, normally assure a uniqueness of the information in the system, even if sometimes it is possible that two or several data bases coexist, as it was observed in an industrial company. The ERP use should normally avoid double capture of data. If the interest of the implementation of an ERP is mainly based on the homogenisation of the processes and of the data within the company in general (Beretta, 2002), the same representation of both of these can facilitate a real-time control of the company activities. The support of an integrated management system can so contribute to a better control afterward. Due to the integrated character of the tool, the head office can have almost immediately a vision of the company functioning. The features proposed in the ERP can so allow the head office to assure a better piloting of the organisation. But we notice at the same time in certain cases, the informal development of specific tools or the purchase of additional tools allowing the processing of the raw data supplied by the ERP (example: Business Object) and mitigating the rigidity of these systems.
In the case of the ISO 9000 standard, the information supplied by the quality system structured around the process map feeds all the decision-making. In particular, this information is used as base for the management meetings which are planned by the standard and have to take place at least once a year. In the case of an interprofessional wine-producing technical service which we studied, this annual meeting allows the balance sheet of the past actions and the fixation of the objectives for the future according to the needs expressed by the customers. All this information results from the structuralisation of the data imposed by the standard. It allows to defend the strategic positions of the technical service in front to the general assembly of elected representatives and to the multiple partners, and to obtain the necessary means for a good functioning. According to the person in charge of quality of this service, the informative efficiency of the integrated representation which supplies the process analysis is a big help to give her a strong coherence and legitimise the activity of the technical service.
3.2. The appearance of an alternative between pressure and learning
From the study of the introduction of the process analysis in the case of the implementation of an ERP Chung & Snyder, 1999 ; Al-Mashari & al., 2003) and in that of the implementation of the ISO 9000 standard, several observations appear outside of our hypothesis of organisational clarification and integration.
First of all, while the process analysis is presented as an intermediate step to the implementation of an ERP, it is, for the ISO 9000 standard, not a simple obligatory stage, but the result of the implementation of the standard. The workflow map, which ensues from, is a fundamental tool of the quality management system. Thus the process analysis is for the first one only a preparation for the computing integration of the organisation (a means), while for the second one it is a management tool of the organisational risks, that is, an instrument of fight against the dysfunctions (an end). So it is the process analysis and the interactions between the processes that is going to bring to light the stages presenting risks (losses of information generating consequences in term of profitability at short or long term as in the case of the airport company which manages very diverse activities: reception and information of the passengers, rent of spaces to the various businesses and companies, security service etc...).
We also notice, in the case of the ERP, an intense dialogue between the pre-existent plan of the processes and that of the best practises proposed by the suppliers of ERP. The organisation tries to save its specificity whereas the suppliers praise the performance of the models which they propose, asserting that they are already adapted to every type of activities and sectors. The operational character of the ERP makes it very coercive. In the case of the ISO standard, on the contrary, the pre-existent plan of the processes is confronted with a meta-model, which appears as construction map principles that must be respected specifically and as styructural division in four poles (management, supports, production, measures). The model is very global and abstract. It allows a flexible interpretation and respects the organisation identity. We so notice that the process maps established for obtaining the ISO 9000 accreditation are very different according to companies and according to what seems essential for the actors.
Another difference between the process analysis of an ERP and of the ISO 9000 standard is linked to the pursued objectives. While in the first case, the will is to make the organisation adaptable to the ERP, in the second, the purpose is to make the organisation transparent and to give it the capacity to auto-improve. We feel here, as above, that the exercise of process analysis is more oriented toward the outside in the case of the ERP and thus may manhandle more the identity of the organisation than in the case of the ISO 9000 standard. We note, in the first case, an instrumental approach of the process analysis : it is a tool to allow the implementation of the ERP. In the second case, we note a more constructivist approach : the process analysis is perceived as an emergent phenomenon which generates an identity process (who are the customers of the company ? Who are its suppliers ? What are the main activities? What are the essential interfaces ?) and a control process (harmonisation of the individual representations, the determination of pilots and indicators). We can summarise these facts by saying that the processes are introduced into the organisation in the case of an ERP whereas they emerge in the case of the ISO 9000 standard.
It follows from it a last difference that touchs organisational disruptions. They can be deep in the case of the ERP when an operation of reengineering is realised before the computer system integration. On the other hand, many few disruptions result from the process analysis in the case of the ISO 9000 standard. The observed changes concern the standardisation of the work methods, the modification of the tasks lists of some people in the organisation in order to assure the quality system management, pilots' appointment for each process. No loss of strength in the studied cases was mentioned to us.
Finally, the observations show that the process analysis in the case of an ERP constitutes a restricting mould because of the existence of pre-established detailed models (Slooten & Yap, 1999) into which certain actors try to force to enter the organisation (Bancroft & al., 1998). On the other hand, the process analysis for the ISO 9000 accreditation is the application of a very general and abstract model, which allows every organisation to realise its specific adaptation. It is the occasion to confront the individual representations of the organisation without the existence of heavy stakes because the certifiers ask simply for the application of a logic, that of the standard. No precise detail is to be respected. The differences between the implementation of the ERP and of the ISO 9000 standard show that, as Normann (1994) has already underlined it, the cognitive artefact which constitutes the process map do not present only an informative dimension but also a strategic dimension. The designers of ERP systems try to keep the control of this strategic dimension in order to impose their software, while in the case of the ISO 9000 this control stays in the internal actors' hands.
To conclude, it is important to remind the important cost (Poston & Grabski, 2001) of these two management tools implementation that are the ERP and the ISO 9000 standard. For that reason, if the search for a better clarification and integration of the organisation can be pursued through the work of preliminary process analysis in the setting-up of both of these tools, it is sensible to give oneself all the chances of success by leading the process analysis to an approach positioned more to learning than to pressure, quite particularly in the case of the ERP where some actors try to influence other people to accept the pre-established model. It implies the necessity of actors participation which can be translated for the ERP by a participation in the prototyping and for the ISO 9000 standard by a process pilots' choice which favour person who are out of quality function in order to facilitate the assimilation of the quality system by most actors' possible within the organisation. This study is the occasion to observe once again that the rigidity of the model raises problem for the respect for the organisation identity. The model can, according to the cases, crush the organisation or on the contrary allow its evolution. To go further, we could also ask if the preliminary implementation of the ISO 9000 standard, more turned toward learning than pressure, facilitates the setting-up of an ERP and increases its efficiency. It would be so interesting to study if ISO 9000 standard constitutes an effective prerequisite in the success of the ERP implementation.
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