Friday, June 14, 2013

1. Design products and services for Education



Business Process 

1 Design Products and Services 

Strategy target customers from the education sector ie citizens by geography ideally we have one model for international views, a national view merely changes the geography range to more granular, then down to county, then down to district and then to a school.  One model with copies for re-use based on needs of the subscriber.  The key, no actual private data is released rather the metrics associated with the users demographic and social variables.

Corporate Strategy-Social Responsibility

1. To increase participation of students to curb the drop out ratio.
  • We can insert information from census and education systems to monitor before and after simulations
  • We can change variables to understand a complex problem 
The diagram supplies the following;
  • As an example the top graphic supplies the stock and flow diagram for an audience by milestone or group of students in a school district with associated variables that may cause a change in the student outcomes measured. 
The second part of the graph a party management capability defined in detail.



Outcome: Measure and analyze your target audience


The two are parts of the story which helps us to understand we DO NOT need to have citizens lose their economic, public and private life and have a way to protect their physical and social life in the process. 

Business Case ABM Process

ABM - Gap Analysis



Ahsan covered the subjects well with his identification of various capabilities at level 3 
My contributions to the same thread would be Level 2 in a model where we are using generic concepts to benchmark and baseline every company in any part of the world.  

1. Design Strategy and Vision 
1.1. Define the business concept and long term vision-not evident
1.2. Develop business strategy
1.3.Manage Strategic Initiatives
  • Converge the create, update, change and read of any of the (3) Management Capabilities
    • Party
    • Item
    • Financial Account (chart of accounts and P&L)
 
         
APQC Business Process Framework Level 3 from L2 1 Design Strategy and Vision




Level 3 Below 1. Design Strategy and Vision
No evidence of ay of the above processes



Level 4 Below 1. Design Strategy ad Vision
No evidence of the above processes

Ideally, the client could be working on these process task in the prescribed order and map all current processes up to process 2-5 of the APQC business process framework in order to align with both Ahsan and my original suggestion. 

Saturday, June 8, 2013

Theory of Constraints applied in a generic Enterprise and Business Architecture

The APQC Business Process Framework and promoting the adoption for sustainability.  

Materials adapted in support of the alignment between Enterprise and Business Architecture with the business process.  

1. Design Strategy and Vision 


Row 2  Business Process Inventory and Motivation

Ensure an organizational design with sustainable and resilient business models at the highest points allowing lower level flexibility.
Enable sustainable product and service development, to the customers ideal of quality.
Enable Innovation with all the various degrees of complexity, segregated from the core and advanced product release business models.  
Enable resources access to robust Research and Development tools and systems.  
Enable the highest confidentiality with a limited audience entitled to R&D work.

Enable Resource skills at macro level to allow agility as the market changes.  

Prezi - Open Source Presentation Tool 

Principle process approach 

Prezi template for a small business owner or coach to guide a small business owner.

Principle of systems for management decisions

Understanding management cybernetics rule number 5 


Principle of Fact Based Decisions

Enabling innovation, advanced and core as three distinct business models.
ie, applied Theory of Constraints
Each of the three types of offers have various revenue recognition limitations.


Innovation 

We apply the highest complexity factor against this type due to thenew offer.
Got to Market spans the longest period of time.
Requires far more checks and balances before maturing to First Customer Ship.
No invoices may be recognized until post FCS.  

During Development we are in the southbound direction working closely with our suppliers.
We are in the slow lane.
We work best with the highest skilled resources.
We can impede or insert more effort on low touch processes if we are not segregated.



Advanced

There are many use cases for the middle lane.   The primary purpose allows slower deals to merge away from the fast lane allowing  a consistent rate of speed.

The following must be considered for the customer experinence.



Management Cybernetics Principle 5 aligned to TQM Principles Process Approach and Management by System

Management Cybernetics

According to Stafford Beer cybernetics represents the science of an effective organization.

A one page reference on the business strategy outcomes


5. Hierarchy Principle: Complex natural phenomena are organized in hierarchies with each level made up of several integral systems.  

Management Cybernetics 

People centered design 

We begin the process with a core set of variables that a user must have supplied from different IT service providers, yet the dependencies when sequenced appropriately enables strong access management.  

Resilience test scenarios and issues caused by change will be far less disruptive with a uniform set of services bundled and sequenced to ensure the least opportunity for threats.  The recovery time objective test performed as a task in any SDLC release must follow the same sequence and test a super user and user from each function.  


In the above graphic we can note the two rows following the first which acquire the fact records from the ERP Master for party, financial account and offers.  The outcome of the two rows is part of the first process.  

1. Design strategy and vision 

Corporate Strategy, will be planned and the outcomes result in a business strategy

We implement the business strategy to enable execution of the operational strategy using two transaction sub-systems which intersect with the business process system.  

Organizational Hierarchy and Profit and Loss Hierarchy must begin with the CEO at Level 2
Each officer reporting into the CEO Level 3-each officer has an associated business process and functional users within the process who's performance defines the officers Profit and Loss and Management performance.

Levels 4 and 5 are shared and granted visibility across each business process and visibility and approvals typically on all financial transactions performed during execution of the operational strategy.    

The Human Resources and Corporate Finance users at Level 4
All supporting resources reporting directly into any Officer Level 5



To help in creating a mental model think of a highway, every highway goes in two directions.  Most have 3 lanes with  motor vehicle and trucks or motorcycles.

The great thing about this concept is we are not going to dictate the type of transportation nor define the make and model.  

Every company will have different suppliers who provide the make and model as an expense which you will sell to a customer based on the customer's preference.  

Bottom line; your expenses are the results of working in a mutually rewarding supplier relationship.  The work you do with the customer is based on a deduction made with the customers order offset by fully loaded cost.  

The profit and loss hierarchy has the same structure with different values associated rather than the people in an organization hierarchy.  Each officer has a group of department codes which will correspond with a company, an a location.  These are fixed values in the P&L hierarchy the changes may be to a persons relationship with a given set of codes.  

The transaction sub-systems will be pushed to the P&L hierarchy as either an income or an expense.
  
The planned resource or headcount budget enables the process or acquiring talent and managing resource expenses, while the records produce the performance measure allowing HR a higher position in the hierarchy systematically ensures visibility for all people request.

The same is true for corporate finance, who must ensure the planned expense and income are consistent with the forecast.  

Create, update, and archive of Master Records 

A user group accountable for the setup or create of a new employee, supplier and customer record in the master records must be monitored for both procedural and system events.  Quarterly Sox 404 assurance must coincide and validate the accuracy for the accountable executive providing their personal assurance for the companies reported performance.  


End Business Management System and Business Strategy implementation



Wicked Mess Type - Subjective Performance Reporting

People generally avoid using strong normal hierarchies in doing so most object to and have completely abandoned using such core practices in every way.  Summary views and consistency suggest a lack of governance on financial transactions fact based records.  Example; if you are not using canned reports from ERP it might imply you are not using the designed features and have introduced an opportunity for in-efficiencies and lower effectiveness.  


Looking at the graphic above we can look either horizontal or vertical and systems or sub-systems are represented in different chevron's or green or blue chevron's across the top and the bottom of the function cheveron's.  

If we conclude that the top row in the graphic above represents the business management system components which must be controlled by corporate policy and procedures followed without offline or backend batch processing, we have enabled strategy by well defined structures to aggregate users within the organization across various technology domains.  

The following graphic allows the infrastructure or IaaS view into the design.  Again keep the mental model of the chevron's in this case the storage containers are represented as spheres with corresponding triangles.  The primary or shown graphic transfers the before graphic by grouping of the process inputs with user relevance by process and functional accounting for cost and support becomes less of a mystery and more aligned to the natural order of the operational lifecycle and user information transitioning across the boundaries of the organization.  




The outcomes of the implemented business strategy must summarize into the five capabilities to ensure all regulatory and corporate liabilities are managed and contained with the highest confidentiality and zero data loss.  

The benefit and business value acquired by carving out the legal and financial threats allows an organization to quickly ensure sustainability has been met with governance by design.  Effective design of key controls.  

Enabling systems with the appropriate dependencies and integration points ensures a limited scope for core business management which aligns to the objective outside in or Real World requirement without disruption to the Fit for Purpose dynamic organizations each company has made part of their DNA or defines the culture within each company.   



The primary structure of the data at rest in ERP master records must be of the highest quality.  Nulls are not acceptable in most cases, the field must be de-activited rather than open to non-authorized process variances.  

Financial transactions are critical to the companies sustainability and the records capturing the point in time events must be retained for as few as 7 and beyond in some cases.  

Row 1 Executive Perspective with Revenue

Executives Row 1 in Zachman Framework

They want to run the organization in a way that enables the company to respond to market changes a sustainable product development lifecycle.


Myth 

Every company has a new or unique set of customers.
Every contact is a potential customer.
Every deal should be considered for additional discounts.

Fact

Every company in the world is one of many that many companies will consider a supplier when you sell to a customer.
You are expected to meet the standards the other suppliers they work have and you are measured for the ease of doing business.
A commitment made at the time the end user from the customer agreed to issue a purchase order, the information they exchanged with sales "CUSTOMER EXPECTATIONS" are the terms of the agreement.

Opportunity Management 


The beginning of the revenue transaction capability.

A ship to location of the customers choice must enable accurate pricing and tax or shipping fees.  State and Zip Code should return the same customers branches associated with the customer and within the geography of the user making the request.

The tax and pricing for any orders must be factored even if they are not presented to the customer or even without presenting them to the sales person.



The parallel work to be done by transformation and change management teams would be the decommissioning of legacy applications.

  • 1st priority enables a cloud customer solution
  • Rx - Turn off the data fields in your countless number of applications and acquire from a trusted cloud source.  


Every company will expand their customer base from a list of customers that may be shared by hundreds and tagged for the revenue transaction capability in your instance of a hosted cloud or public cloud solution.



Every company can behave in predictable ways, small and medium are regional and aspire to go beyond the geographical area they may cover, however response and business regulations often are not a good return for the smaller and medium customer.

Consumer or commercial model


Every company or Enterprise type customer will have 1000 employees or more, orders are few but largest in revenue and often the most complex.  Every customer of this type has the luxury of being unique.



50% or more of these types of customers are headquartered in the US.

  • Many of these customer types are located in Silicon Valley, Los Angeles, Portland and Seattle.
  • All of these types of customers do business with US companies. 
  • Therefore they are subject to Sarbanes Oxley regulations. 
  • The same type customer has a unique set of negotiated terms.
  • The same type customer may be a supplier for your organization with 1 or more purchase orders issued to your organization.

In the same day you may issue 1 or more purchase orders to the customers in a role of a supplier.

REVENUE TRANSACTION CAPABILITY

If true, then we would gain the most value if we re-use the opportunity 14 data points into each of the downstream record headers.  The stakeholders who must approve have the header and warning of the expected commitment and they are in a pro-active position to meet the demand.



Re-use Business Service



14 data points to all other records and process stakeholders.

If we have one or regional list of all legal entities with associated legal terms negotiated in advance.  We must honor those terms on every transaction.

Example; user login's to a cloud application based on the users role and location a new opportunity would return a callers content id and the contact name and phone they are calling from.  The number should be cross referenced against the company the caller is representing or prompt a buyer agent from the customer to join the call.




Thursday, June 6, 2013

Observation with Stock and Flow Expense and Revenue with Feedback loops for continuous improvement

Observation

Discreet or Indiscreet observation

Design thinking begins with "Understanding" your clients "current state".

You must then "Observe", in my mind we begin with the end in mind, quality management systems are the first to come to mind.

How about framing the reason as such, ethical practices as a competitive advantage.


Total Quality or ISO Principles 1- 8



The measurement according to systems rather than individual parts enables a mature organization to respond to market changes. 

Measuring performance for top down purposes

Outside in and real world expectations are crafted in the Corporate Business Policies.  In large organizations and agencies including branches and central support agency, as an example the Treasury. 

Measuring performance from a bottom up perspective

Inside Out or Fit for Purpose view of the organization.  We have functional views into the way the business runs, this layer allows the functional flexibility. 

Involving employees in the decision making and continuous improvement requires a thorough and consistent way to measure employees competencies. 

Principle of Continuous Improvement

Continuous Improvement applies to most types and infers growth over time.

In many systems thinking scenarios the feedback loop allows for ongoing flexibility.

What you do not have in this scenario?
  • Not Kaizen
  • Not Zero defect (TQM)
Using a feedback loop in the case of an indirect defect makes sense and would not be in conflict with decisions management can influence.

See insight maker

How do we measure and monitor for Continuous Improvement?

I remain in the principles levels in order to allow greater flexibility. If you monitor discreetly, you can remain macro for the executives and fine grain by region or function.


Feedback Loop - A way to ensure measurements without bias, enable feedback loops at leverage points. In many system thinking circles a feedback loop should be used sparingly.

This prescription agrees with those experts.



A feedback loop at a leverage point would suggest an opportunity at a macro level versus fine grain monitoring. Another way to enable or elect to be more diligent with fine grain feedback loops in various pre-defined areas. le the executive layer with discreet monitoring while the business managers may this might be to consider discreet monitoring.



Design Thinking Phase 1 - Understand Sustainability

Understand

People - Stakeholders 

Stakeholder Matrix

Party Management Capability
People Centered Design

Our design strategy incorporates an external or the real world reuquirement. Many employees are not aware that the executives are legally responsible for the activities whether intended or unintentional a threat of jail and fines may be imposed on the executives.  

Protect the economic life of the executive who may not find employment after a public scandal and especially if serving any jail time.


Using an analogy;
  • If we look at most situations, we can see an outcome model or the current state which is a spaghetti bowl of different goals and objectives.  
Let's dive into a way to consistently apply Total Quality at the highest levels of an organization to benchmark and provide an unbiased view of the whole before performing analysis on the parts.

Principle 1 Customer Focus

A revenue transaction dependency traveling North on a highway we must understand the behaviors and expect the fast lane to be rather systematic and rapid or speed and agility appropriately apply the fast lane.  
  • Understanding customer focus from an external or unbiased perspective.  
    • Perform observational studies on sales with all supporting staff in the revenue transaction life cycle.   

Customer Types 

Legal Entity Binding Agreement

Any legal entity may enter into a commerce agreement in exchange of goods or services.

The seller must show a burden of proof that due diligence was performed to warrant a reported income with all associated cost applied in an expense (reduction of the income) and the income resulting from the revenue event record.

The incurred period in which the expense and revenue occur must be accurate and all due diligence met to report as GAAP revenue.

A legal entity must be validated with a standard due diligence process inclusive of each of the procedures and each stakeholder involved must have a chance to contribute to the process before an authorization may be granted to create or update a customer for credit allowing a shipment without Prepayment.

Small and Medium - Fast Lane 

Your partners and resale channel have been assured the business for these customers, with no true value for your company to manage the legal and operational expenses incurred for low dollar and frequent ordering process.  

Recommendation: Public Clouds

  • In all other situations we are promoting hosted cloud solutions with the same criteria as stated in an enterprise size company.  
    • The small and medium business models are not advised to invest in the internal support model until the companies reached its first stages of a progressive startup.

Typical events 

  • Buy through resale or managed/hosted channels
    • low or small dollar 
    • within region 
    • high volume
    • immediate response

Avoid Double Counting these transactions 

3rd party merchants ie financial management dependency 

Point of Sale or EDI credit card payments are the exclusions from due diligence, for this reason the master record process must be managed via retail sector ERP systems.

The FTC recently approved merchants the authority to charge a known customers credit card without forcing a human to perform an ethical decision on the validity of the authorization.

See use case

Enterprise 

Recommendation; Private, Hybrid and Public Cloud 

  • All other tools promote a private cloud solution or hybrid clouds as we notice a very well integrated network amongst the these larger organizations    
  • 1000 employees or more
    • An Enterprise size company often has both on premise and private clouds.  The output to their B2B and partners may be in public clouds.   

Government Sponsored 

Recommendation; Private, Hybrid and Public Cloud

  • All tools meeting the criteria for higher security and strictly promoting a single source for every person where the federal oversight will be managed by region using virtual servers.  

Financial Management Investment 

Recommendation; Private and Public Clouds


We can look at above graphic as an operational strategy one page map.  Ideal for a sustainable organization.

A business strategy map

A CEO and Board of Director dependency map according to regulatory and brand protection with risk and legal liabilities.

Process - How we do things?

Understand the Real World from an external stakeholder perspective inclusive of any legal liabilities.
  • We will highlight the criteria for any scenarios we use a high, medium and low complexity classification and derive any design patterns based on the class. 
  • We also measure the frequency of each class as a qualifying data point for the rule or an exclusion. 
  • The goals we plan to target a minimal set of data points to ensure consistency across various functions and applicable to any industry in any part of the world.  
Understand the minimum criteria from the seller to the buyer up to the point of the seller legal liability.

Corporate Strategy as it transfers into the implementation phase of the process.

Who creates, updates and authorizes the representative in structured content or grant entitlement to a subscription for other technical purposes.

Party - Employee, Supplier and Customer excludes; the contact and  entities with no direct legal evidence of the arrangement.
Offer- Items of hardware, software or service types irrespective of the pricing and when bundled with an offer.
Financial Account-any chart of accounts and journal entry segmentation or grouping of the accounts, company codes, location codes, department codes, sub-account codes and project codes.

Technology (Sub-Systems) -Transaction Capabilities 

  1. Expense transactions - Traveling South with your employees and your suppliers.  
  2. Revenue transactions - Traveling North with your employees and your customers.  

Effective Key Controls for Expense and Revenue transaction capability

A map of a capability


Expense Transaction Capability

Every expense transaction includes a sequenced set of task with a required segregation of duties between those who create, update or authorize access to acquire and read any master record.  

The spirit of the law infers the requirement to be inclusive of the ERP system and any external use of the information used within the ERP system.  

All event records must be retained in their original form with a documented change request process supporting any and all adjustments without destroying the original record.  All dates and time stamps must be controlled to prevent any alterations of the expense activities.  

3 management capabilities Fact Based Decision Making

Isolate and test the setup of customers, suppliers, and employee master records-any pricing and discounts or cost and payroll must be protected and no person can create a transaction who has authorization to make changes to a master record.

  • Principles of customer focus
  • Principles of employee involvement
  • Principles of leadership
  • Principles of mutually rewarding supplier relationships

A key control must be in place to ensure ongoing monitoring of all event records in both revenue and expense transaction types.  

The records which contribute to the price of an offer, whether the item is shown to the customer or not a cost is incurred and must be factored against the cost of goods.  

A segregation of duties between IT and Business, then a sub-group of entitled users who have administrator rights excluding "delete" rights.  No person in any situation has the right to delete a financial record in any ERP system.  

Fact Expense and Revenue are Records 

Archive strategies must be in place with zero data loss and zero down time expectations.  

Record Retention Schedule requires most companies to retain the records in original form for as little as 7 years.  

An expense transaction capability recognizes the super system (income and loss statement system) within the sub-system (transaction system).  The behaviors associated with an expense or cost of doing business must be accurate when reported inclusive of any planned, committed or expected cost.  These are accrued from one period and reported in the next in companies with strong operational efficiencies in practice. 

An expense transaction may be initiated by any function and any agent within a function.  Only a manager who must be an employee by legal definition AND with authorization to approve an expenditure can authorize the purchase order record.  Typically, a financial analyst and purchasing agent must also review each request.  
  • We must prove and monitor the operational design in a way to prevent threats against the un-authorized expense transactions.
    • We must ensure the design correctly reports the period in which the planned (corporate strategy implementation into the business strategy) expense becomes a committed expenditure.  
    • We must ensure the design correctly informs and acquires the authorization to pay a supplier invoice for the same expense in the correct reporting period.  
    • We must ensure the design controls the integration between the various stages of maturity as the records have different names and different stages in the process may be managed by a different functional sub-groups.  
  • Expense Transaction dependencies over time (typical)
    • Planned Investment>
    • Budget allocation (journal entry or adjustment)>
    • Planned expense request>
    • Purchase Requisition>
    • Purchase Order>
    • Supplier Packing Slip (Receipt for Goods or Services)>
    • Drop ship invoice or supplier invoice>
    • Supplier Payment Authorization>
    • Accounts Payable Check or EDI reference ID
  • Validity of the expense event record 
    • The master records which acquire a supplier on a planned investment may be based on a preferred supplier list by company code, location code and general ledger account code
      • The users associated department and span of control must match the dimensions of the planned expense.
        • If not, an override option may be offered but considered an exception with the authorized P&L owner accepting the override request.  
        • Expense processing and authorizations are the responsibility of the P&L owner and only the person in this position has the authority to grant exceptions.
    • The executives (CEO and CFO) must approve all financial reporting requirements are true and correct on Sarbanes Oxley 404 assurances.  
      • The earlier position on this requirement was allowing an executive to give a better assurance or granting to the executives' knowledge.  
        • The Enron scandal proved the earlier position on validity was subjective rather than objective and without accountability on the part of the executives.   
The before mentioned highlights the spirit of the law, beyond the SOD known to IT.
    We promote a 5 capability model and expect all your current state maps into the functional sub-systems as shown below;

    • Supplier performance may be impacted when detect alone produces a failure in the expense transaction capability execution.  
    • Customer expectations will threaten your customer loyalty on revenue transaction capabilities.  

Identity and Access Management

A source for your management capabilities must be made available to the software supplying the expense and revenue transaction capabilities.  

Expenses must be planned and therefore the process which informs the direct reports of the annual investment must be a leverage point.

Chevron's identify the typical functional dependencies


Expense Transaction capability

A sub-capability Discretionary Expense Management

  • Top Green Chevron represents the known "business service" to every function and users are allowed to request expenses in the very basic types as follows;
    • Employees authorized to spend under x dollars with a managers approval.  
      • Office supplies
      • Mobile technology and accessories
      • Every people manager has a planned headcount approved in the Corporate strategy, enabled in the tools as part of implementation of the Business Strategy and recorded as an expense actual in the operational strategy.  
    • Employees with expense reporting types of authorization 
      • Office Parties
      • Team Meetings
      • Recruiting new candidates
      • Customer meetings

Human Resource Investment Management 

A sub-capability people management

    • Managing the current run rate with known resource expenses;  
      • New Hires and all cost associated with recruiting, hiring, and bringing a new hire on board.  
      • Supplement an existing employee during a temporary or long term leave.  
      • Compliment a certain skill gap you don't have within your organization with an expert on a consulting engagement.  

Authorization from an authorized expense approver

  • Any request above 3k must be pre-approved by an authorized person, before an purchase order can be created and issued to a supplier.  
    • Sarbanes Oxley requires proof and verifies the validity of the monitoring using a number of methods to test the report.  
      • Most IT people are unaware of the requirement scope and simply create a report which proves to be ineffective each audit period.  
    • All purchases must be approved by a person who has budget authority.  
      • Plus authorization to approve the invoice upon receipt from the supplier in order to issue payment for the invoice. 
      • Some larger companies have an exception process.
    • Burden of proof that no person has the ability to issue a reuquest and then authorize the purchase order, then approve the reciept for payment.   
      • A segregation of duties must be proven in the spirit of the law.  
    • Governed by a Corporate policy.     
      • Only an employee with a management title or an exception list may be used to manage special circumstances.  
    • Any person with a consultant or temporary role has no legal authority to purchase nor authorize payments.
      • An agent has the authority to make a request.  
    • Delegation of these duties cannot be granted to a person who has less authorization to approve than the person granting delegate rights.
    • Delegate rights are intended for a period of time not to extend more than a few months.  

Authorization from a financial analyst managing the budget 

A financial analyst manages several budget managers on an ongoing basis.
The fact that a budget allocation was planned and accurately reports on the close reports is the responsibility of the financial analyst.
Each request must be authorized by the FA

Authorization from a purchasing agent or buyer



All transactions must be monitored and measured ideally to prevent a threat on any transaction.  

Revenue transaction capability




Principle Systems Approach to Management

Principle A systems approach to management

Synthesis of the Problem before Analysis

Understanding the System with sub-systems or the collection of all parts in a whole to better understand  with various parts connecting together for a greater purpose.

Corporate Strategy - Execution of the Strategy to enable Business Strategy

Architecture must align the many parts of the organization to meet the corporate strategy.  The execution of the operational strategy is considered a performance measure and external stakeholders require the organization to be audited by an external audit company.

Maturity of an organization or agency

If we measure an organization or agency for their maturity, we look to understand the effectiveness of the organization or agencies ability to meet the estimated or investment plans.

The strategy looks at the various parts as they relate to the whole enterprise.

The people, offers and how we segment the cost and benefits first must segment the workers, suppliers and customers based on known and knowable situations.  

Party Management Capability a people system

In a people centered design strategy we focus on the interactions between people.

Competency Tiers

An employer to the workers and competencies each role must have within the business function according to the complexity of work we need the person to perform.
a) Basic or Entry level up to a 1st level certification
b) Advanced level acquires a 1st level certification and a 2nd level advanced certification
c) Expert level acquires both 1st and 2nd level certifications and recognition amongst industry professionals.

Each tier represent a place to measure leverage points throughput and effectiveness of your execution of the strategy.

The feedback loops enable continuous improvement of your leadership based on employee performance and workers sentiment.  

Measuring Capabilities as sub-systems within a system - Re-use as a leverage point

We execute the business strategy and want to understand the "throughput" in three different levels of complexity.  The volume and speed changes as we observe and understand design patterns in relationship with complexity or maturity of an offer. 

Level 2 in the Business Process Hierarchy

The common points in a process is shown below in the diagram from Process 1 to all other Processes at level 2.  

Level 2 to Level 3 in Business Process Hierarchy 

A business process incorporates a series of activities, organized as task in a pre-defined process by using feedback loops at each point between two swim lanes. 


1. Design Strategy and Vision with Expense Transaction Capability

Private Sector

Applies to all business leaders with people or budget management responsibility
Enables an organization to measure the performance of cost against the plan (investment to execute strategy)

Public Sector

Applies to all leaders within any branch of government or any agency, assume the process in which an estimate is supplied to an accountable agency (typically the Treasury). 
An estimated cost and benefit request is reviewed by the treasury agency and may include a service to assist the branch resources with preparing to submit a request to the cabinet or congress.

Measuring Leadership Competencies



A feedback loop enables leadership measures based on the ability for leaders to the meet the estimated cost according to the plan. 

Others may refer to this feedback loop a measurement used to evaluate your management competencies.  An organizations value is measured by the competencies of their leadership capabilities.  

In business language the opportunity we introduce using systems enables the organization or agency to effectively and consistently measure management competencies by the leaders ability to forecast and execute the strategy.  


Offer Management Capability a service management strategy

Estimating the cost of a portfolio

A portfolio would best describe a business group in the private sector.
A portfolio would best describe a branch of the government in public sector. 

A portfolio consist of different programs or consider a program a part of a whole. 

One approach which aligns well to international and emerging standards from an Enterprise Architecture and Enterprise as a System we can see sub-system patterns amongst the systems. 

Programs may have a series of projects executed in parallel to each other or others in a program which is a sub-part of a portfolio. 
  1. Basic or general complexity
  2. Advanced complexity
  3. Serious complexity
The names used by each complexity tier, isn't going to align well.   The behaviors we can expect help us to align our expectations and plan based on known or knowable situations.  

Estimation of cost for a project

A project has a begin date and planned end date. 

Effectiveness of the project team to meet the goals of the project within budget and on-time often will be better if your project team has more experience.  Human dynamics and the ability for the team to interact well together is going to play a part in the projects success.   

Exepense Transaction Capabilities for IT and Business

An expense transaction capability ensures the Financial Management process for IT, while enabling the same concept for business users.  A universally significant business service. 

Every branch of the government will estimate cost to supply services through a branch who either contracts to a service provider or serves the citizens directly. 

As the corporate strategy is revisited each year we conclude the efforts with an implementation. A post planning task performed to enable business strategy.

The quality management system is the most common name associated with the audit report and findings.  Many people are unaware that investors and shareholders use the audit report as a way to measure the effectiveness of the Executives.

Business Strategy - Execution of the Strategy to enable Operational Strategy

A Task Level View 

Entry of the agreed Budget allocations or Estimated Portfolio/Project cost. 
The task output must include an event record. 

An outcome of the capability

The following diagram indicates the architecture and sub-system views for storage and record retention for recovery time objectives for the financial management component within a service management strategy. 







 

 

 

 

 

Private Sector - General Cost Accounting

An ERP journal entry represents the activity or event record during execution of the operational task.

Public Sector - Estimation of Cost

An ERP journal entry represents the activity or event record during execution of the operational task.  
 

Output - Corporate Strategy transitions to Business Strategy Implementation 

A decision from swimlane 1 Design Strategy and Vision at Level 2 to swimlane(s) 2-5






During the design strategy and vision we experience the request from various business function leaders.  Typically, the Profit and Loss owner begins with the prior years investment amounts allocated within their functional hierarchy. 

a) Resource cost - current resource expense, fully loaded cost associated with a full time workers.  Fully loaded for a consultant or contractor.  Fully loaded temporary workers. 
b) Resource cost - Planned future hires by quarter, known consulting recurring cost to initiate a new product or service and strategy. 
will adjust a positive value into a general ledger code then segment by department account code, with a company code. 
 
Segmentation of financials must use natural hierarchies.  Strong hierarchies are another way to describe well defined data structured to organize in a consistent manner.

The chart of accounts and sales journal typically ensure the following segmentation systematically as canned reports from your ERP system.

  1. Company Code
  2. Location Code
  3. General Ledger Account Code
  4. Sub-Account Code 
  5. Project Code 
  6. Department Code 

Ideally, the user defaults the values with an override variables within the range of the user span of control.

If a user supports more than one department, the range of the departments must be approved up to the P&L owner.  A standard operating procedure may be introduced to default this authority when defined and authorized as a business policy.

Principle A process approach

1. Design Strategy and Vision 

Executives working closely with Human Resources and Corporate Finance manage the business leaders inputs to the annual planning process.

Inclusive of this process would be the investments in people and plan to acquire new people with new or existing skills.

Services offered to all functional organizations and leaders across an organization are authorized by the Design Strategy and Vision process.  An annual process enabling all private sector business functions and all public sector branches or agencies. 

Private Sector -

2. Develop Products and Services

Product development plans with associated budgets by types of offers.  Another way to manage the complexity would be to isolate and protect your innovation and advanced offers into three different business models.

People skills and wisdom are vital to the success of an innovation product versus the core or advanced skills.  Ideally, advanced has a higher skill than Core.

Each has various degrees of complexity especially when your organizational design has not segregated the different business needs.

Example; each product development life cycle has a process known as Research and Development.  The Core offers are light in R&D, Advanced has greater R&D and Innovation may be primarily R&D.

3. Market and Sell Products and Services

The market and sell products and services process is downstream to the Develop Products and Services

4. Deliver Products and Services


5. Manage Products and Services