Cross-Functional Operations Modeling as a Nexus of Commitments: A New Approach for Improving Business Performance and Value-Creation

Abstract

Business processes have played a central role in improving enterprise performance. These improvements have taken place through the implementation of maturing processes with enterprise resource planning systems and the redesign of operations by using business process management methods. However, even in those organizations that have benefited from these practices, performance problems still persist. In particular, operations that go across the enterprise are a cause of bottlenecks. While this topic has been the target of models and consulting methods, performance shortfalls still persist, thus showing that organizations have not dealt with this integration challenge successfully. In this paper we introduce the notion of a Business Value Subject (BVS) endowed with a partially ordered set of Commitments as the modeling basis to establish a crossorganizational "contract" to be agreed upon by responsible role players as being essential in pursuit of sought business outcomes. We also introduce the notion of Nexus of Commitments across a family of BVSs as a governance mechanism for ensuring visibility and value-creation.This model of the enterprise operations departs fundamentally from workflows, cases, and other behavior-centric modeling principles. We also relate this model to other practical contributions in the context of the broad lean six-sigma techniques such as value-stream mapping (VSM) and SIPOC, as well as the fields of business process management and the resource-based view of organizations.In this paper, we address the foundational principles, formal definitions, and some examples. We introduce the main model by using a real-world example and also, present a rigorous formalization under the form of a metamodel. In addition, we present an Information System realization of the model with the goal of providing business visibility and performance management instrumentation.