Centre for Strategic Manufacturing Simulation of e-business processes Pável Albores Peter D. Ball Jillian MacBryde

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Agenda l Project Aims/Plan l Project Framework l Levels of BPS l Case Studies l Results so far l Conclusions and Future Work

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Project aims l To investigate the suitability of simulation as a technique to analyse the effects that e-business has on the business processes of manufacturing companies. l To look at the differences between traditional and e-business processes for different e-business scenarios in the manufacturing sector. l To develop the methodology for the use of these tools and techniques.

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Research questions l Is simulation suitable as a tool to analyse the effect of e-business implementation in the business processes of manufacturing companies. l Can differences be identified between traditional business process models (e.g. Childe et al) and electronic business processes? l If there are differences, can reusable simulation templates be derived from these differences? l What are the limitations, scope and range of applicability of these templates? l What methodology must be followed when using simulation in this context?

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Research Approach l Research Methodology è Case Study è Action Research è Survey l Modelling methodology è Simulation (General purpose tool) è Interviews è ERP system data

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Contributions l Use of simulation in a new context l Description of e-process dynamics l Methods and procedures for integration of tools and techniques

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January Conceptual Business process simulation 1 Levels of BPS application 2 2.Manufacturing systems simulation 3 3.Process Specific simulation 4 4.Enterprise-wide simulation 5 5.Supply-chain-wide Simulation

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Generic Business Process models Mineral Water Co. Label Co. Operate Processes

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Label Case Study l Label Manufacturer l Make to Order l Approx. 65 employees l The interest of the company in e- business is in looking for a way to reduce the lead time for enquiry/order processing. è The objective is to reduce it from a current maximum of 9 days to a maximum of 3 day

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Label Process Map

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Benefits identified l If full e-business implementation is carried out, a reduction of 15 % in processing time in the first part of the process could be achieved.

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Results so far… l Not what expected: è Business process structure does not change è Change in the how, not the what. è Little questioning about the why. l but è Change in dynamics (<time, <human involvement, < redundancy) è Change in performance metrics (>reliability, > quality of information)

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Conclusions l At this level of detail the generic process configuration remains unchanged. l However, the process behaviour will change. Simulation captures this. l Simulation proved to be useful for the analysis of e-business implementation – highlighting potential benefits/problems. l Level of detail is important to derive generic e-business processes.

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Future Work l E-business survey è Has the implementation of e-business changed the structure of your business processes? l In-depth interviews è Which (and how) business processes have been affected by e-business implementation? l Theoretical templates development l Further case studies

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Questions? Pavel Albores

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 E-process templates

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Evaluated Simulation Tools l General Purpose è Arena è Witness è Simul8 è Extend è ServiceModel è Ithink l Business process è Work Flow Modeler è Simprocess è Process Charter è Igrafx è Processmodel è Showflow

Centre for Strategic Manufacturing © Pavel Albores 2003 RPD 24 January 2003 Performance Measurement l “...is the process of quantifying purposeful action where the process of quantification is measurement and purposeful action equates with performance”. Neely et al (1996) l Quantification and comparison  simulation model. l Finding the "purposeful actions"  business process management.