Author's Note: This column is a non-technical extract from Chapter 1 of my next book, titled: Enterprise Architecture for Enterprise Integration: Methods and Technologies for Business Integration and Technology Integration. This book is due for electronic publication in early 2004, with hard-copy publication expected later in 2004.
This month's column is a change of pace. Earlier columns have separately addressed concepts of enterprise architecture and also of extensible markup language (XML) and Web services for enterprise integration. This month's column bridges these topics, but it is not technical. It discusses the use of enterprise architecture for business integration. It steps back from technology to reflect on the evolution of the 21st-century enterprise.
We are at a dramatic and historical point of convergence in technology and in business. The Internet and associated technologies today enable the customers, suppliers and business partners of an enterprise to all work together at electronic speeds. These technologies are transforming organizations. Processes that previously took days or weeks to complete using mail, fax and courier communication now take hours, minutes or even seconds. This is the direct consequence of technology.
However, technology alone is not the answer. To achieve any degree of success in enterprise integration, technology integration must be used within a coherent, integrated enterprise through business integration. Yet, in most enterprises, we still have a long way to go to realize business integration.
To appreciate what must still be achieved, we need to review what I call the "Process Engineering Bible." I describe the book in this way as it has had a dramatic effect on the way that organizations function. To consider its impact, we need to review its message. But first:
- What is its title?
- Who was the author?
- When was it published?
Perhaps we can identify the book by first considering its author.
- Was it Michael Hammer or James Champy of Reengineering the Corporation fame?1 No.
- Was it Ken Orr, Ed Yourdon or Tom DeMarco of software engineering fame?2,3,4 No, it was not them either.
- Was it Peter Drucker of Management and Strategic Planning fame?5,6 No, not him.
- Was it Edwards Deming of Quality Control fame? No.
- Was it Alfred Sloan or Henry Ford? No, the book I am referring to was published long before all of these eminent people.
Which book am I talking about? As soon as I give you the author and its title with its publication date its significance will become apparent. The book is Adam Smith's Wealth of Nations, published in 1776.7 This was one of the most influential books at the start of the industrial age. It described the evolution from the agricultural age to the industrial age. It was the foundation for most industrial enterprises in the late 18th century and into the 19th century.
Transition from the Agricultural Age to the Industrial Age
To understand the importance of Adam Smith's Wealth of Nations, we will review part of the first chapter. The sidebar provides an extract from Chapter 1 of book one. Its language is unusual today. I have included part of the initial paragraphs. To increase readability, I have added comments in parentheses to indicate the terminology we use today to describe the same concepts.
The principles that Adam Smith advocated broke complex processes into simpler process steps. By using technologies available in his day an illiterate workforce he showed that people could be trained to carry out each step in the process repetitively. In this way, they were able to achieve much higher levels of productivity than if one worker carried out each step in turn. Smith showed that component steps could also be combined in different ways for new, improved processes. These are the same concepts that we still use today for reusability using object-oriented methods.
Adam Smith's breakthrough was the foundation for late 18th-century/early 19th-century industrial enterprises. With the focus mainly on manufacturing physical items as products (rather than today's focus on customers), this period also saw the same concepts applied to knowledge-based processes for bank loans and insurance policy applications. Instead of manufacturing steps, a loan application or a policy application approval process was broken down into discrete steps to be carried out by different people. The people performing each step were skilled in assessing an aspect of the relevant application. Each process step was carried out in a defined sequence: the step was completed before the next step in the sequence was started. The result was the definition of serial processes.
As the application form was routed to each person in the approval process, details of the relevant applicant and the current status of the process were recorded in handwritten ledgers called the applicant or customer ledgers. Each person involved in carrying out a process step kept an individual record of every applicant or customer that worker had processed and the stage the applicant had reached in the approval process.
The 20th century saw an improvement in these process steps with the introduction of the assembly-line method of automobile manufacture by Henry Ford. With this method, the vehicle being built physically moved along each section of the assembly line, where different components were added in each step of the assembly process.
This period also saw the introduction of parallel processes: two or more processes could be carried out concurrently, with each process step executed independently of other process steps. An example is the parallel construction of the body of the automobile while the engine is being constructed. Each parallel process path is thus independent of the other parallel paths until they need to converge. Only when the automobile is driven off the assembly line must the engine be fitted into the car.
Extract from Adam Smith's Wealth of Nations
EXTRACT FROM BOOK ONE: "Of the Causes of Improvement In the Productive Powers of Labour, and of the Order According to which its Produce is Naturally Distributed Among the Different Ranks of the People."
CHAPTER 1: "Of the Division of Labour"
"... To take an example, therefore, from a very trifling manufacture; but one in which the division of labour has been very often taken notice of, the trade of the pin-maker ... a workman ... could scarce ... make one pin in a day, and certainly could not make twenty. (In today's terminology, he is referring to serial operation.)
But in the way in which this business is now carried on, not only the whole work is a peculiar trade, but it is divided into a number of branches, of which the greater part are likewise peculiar trades. (In today's terminology this refers to object-oriented methods.)
One man draws out the wire, another straights it, a third cuts it, a fourth points it, a fifth grinds it at the top for receiving the head; to make the head requires two or three distinct operations (object- oriented encapsulation); to put it on is a peculiar business, to whiten the pins is another; it is even a trade by itself to put them into the paper; and the important business of making a pin is ... divided into about eighteen distinct operations ... (i.e., object-oriented methods).
I have seen a small manufactory of this kind where ten men only were employed ... they could, when they exerted themselves, make among them about twelve pounds of pins in a day ... upwards of forty-eight thousand pins in a day. Each person, therefore ... might be considered as making four thousand eight hundred pins in a day (i.e., object-oriented reusability).
But if they had all wrought separately and independently... they certainly could not each of them have made twenty, perhaps not one pin in a day (serial operation) ... ; that is, certainly, not ... the four thousand eight hundredth part of what they are at present capable of performing, in consequence of a proper division and combination of their different operations (i.e., object-oriented reusability) ..."
By the middle of the 20th century, the industrial enterprise had evolved into a complex series of manual processes. The pace of progress had seen most enterprises evolve to use increasingly complex business processes with rapidly growing transaction volumes to be manually processed. What was the result? These enterprises found they were operating in a continual state of manual chaos!
Then, in the second half of the 20th century, the computer came on the scene. My next column will continue with the transition to the information age. Some very interesting observations emerge.
1. Hammer, Michael and James Champy. Reengineering the Corporation. London: Nicholas Brealey, 1993.
2. Orr, Ken. Structured Systems Development. New York: Yourdon Press, 1977.
3. Yourdon, Ed and Larry Constantine. Structured Design: Fundamentals of a Discipline of Computer Program and Systems Design. Englewood Cliffs: Prentice-Hall, 1978.
4. DeMarco, Tom. Software Systems Development. New York: Yourdon Press, 1982.
5. Drucker, Peter. Management: Tasks, Responsibilities, Practices. New York: Harper & Row, 1974.
6. Drucker, Peter. Management: Challenges for the 21st Century. New York: HarperCollins, 1999.
7. Smith, Adam. An Inquiry into the Nature and Causes of the Wealth Of Nations. (1776). Often called just "Wealth of Nations." The text of Book One is available at: http://arts.adelaide.edu.au/person/DHart/ETexts/Liberalism/Adam S mith/WealthOfNations1776/Book1.html
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