Modelling Business Process

PORTSMOUTH BUSINESS SCHOOL
MASTER OF BUSINESS ADMINISTRATION

(INTERNATIONAL)
Title MODELLING BUSINESS PROCESS:

An Integrated Approach
Author Binoy P. Perumpalath
Tutor Prof. Ashraf W. Labib
Year of submission 2005
Signed statement of originality

This project is submitted in partial fulfilment of the requirements for the degree of MBA.
I, the undersigned, declare that this project report is my own work. Where I have taken
ideas and or wording from another source, this is explicitly referenced in the text.
Signed
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Title MODELLING BUSINESS PROCESS: An Integrated Approach
Author Binoy P. Perumpalath
Date December 2005
Abstract
The aim of this research was to analyse the business processes of a manufacturing unit
(Thermo) of Huhtamaki (UK) Ltd. by means of process modelling as well as assist the
senior management in the appraisal and selection of strategic alternatives. The objectives
of the research were to find out, how process modelling can aid process improvement and
strategic decision-making; the benefits of process modelling and ways to realise them;
Selection of appropriate process modelling techniques required for achieving the aims of
the project.
An action research based approach was used to conduct the research. The primary data
was collected through observer as participant method, semi structured interviews and
questionnaires. Secondary data in the form of company reports, manuals, drawings,
process layouts and plant layouts were also used. The research had four main phases, such
as Process modelling; Plant layout design; Obtaining budget costs and Timescales; and
Decision analysis. A mixture of hard, soft, qualitative and quantitative modelling
techniques such as IDEF0, Soft Systems Methodology (SSM), Value stream mapping,
Workflow mapping, Activity relationship diagram, Gantt chart and Analytical Hierarchy
Process (AHP) etc. were applied.
The As-Is process information was captured via IDEF0 modelling. Then SSM and IDEF0
was used to analyse the As-Is process and develop the To-Be processes. A set of potential
process changes was formulated as a result of SSM model comparison with the As-Is
IDEF0 models. A distinctive hybrid (soft & hard) method namely Soft IDEF0 is
presented. It can be applied to any process modelling, analysis, improvement and change
initiatives. The Process charts identified processes to be automated such as packing,
palletising and pallet transportation. Workflow maps identified machine layout and
material flow problems. The activity relationship diagrams helped to develop new plant
layouts. The decision analysis using AHP, incorporating stakeholder preferences showed
that Automation was the most suitable option for the Thermo plant. The AHP analysis
was validated using sensitivity analysis. Significant reduction in decision time, ease of
achieving consensus and documentation was achieved by using AHP. The proposed
methodology is generally applicable to any strategic options/ projects selection problem.
Process modelling and the resulting process models have distinctive benefits. The former
encourages process thinking while the latter documents the process information. Together
they facilitate explicit analysis of business processes. The purpose and perspectives of the
modelling exercise is extremely important in the selection of modelling techniques. It
may be necessary to integrate different techniques, e.g. Soft IDEF0 to achieve the
modelling objectives. It is important to plan the modelling process effectively. The
participation of firm members in the modelling process is vital as it will prevent the Not
invented here problem. Further research is required to analyse the application and
benefits of process modelling in general and Soft IDEF0 approach in particular in
implementing process change. The Soft IDEF0 approach may be further developed by
using IDEF0 models as SSM concept models.
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Table of Contents
Chapters Page
A C K N O W L E D G E M E N T S ...........................................................................................................IV
L I S T O F F I G U R E S .......................................................................................................................... V
L I S T O F T A B L E S .......................................................................................................................... VII
1. I N T R O D U C T I O N ..................................................................................................................... 1
1.1 RESEARCH OBJECTIVES........................................................................................................ 1

1.2 BACKGROUND ...................................................................................................................... 1
2. L I T E R A T U R E R E V I E W ..................................................................................................... 4
2.1 WHAT IS A BUSINESS PROCESS?........................................................................................... 4

2.2 BUSINESS PROCESS MODELLING/ MAPPING: WHAT ARE THEY? .......................................... 5
2.3 NEED AND SIGNIFICANCE OF PROCESS MODELLING ............................................................. 6
2.4 USES / BENEFITS OF MODELLING BUSINESS PROCESSES........................................................ 9
2.5 PROCESS MODELLING TOOLS ,TECHNIQUES AND METHODOLOGIES .................................... 9
2.6 CONCLUSIONS FROM LITERATURE REVIEW ........................................................................ 23
3. M E T H O D O L O G Y ................................................................................................................... 26
3.1 PROCESS MODELLING ......................................................................................................... 28

3.2 SOFT-IDEF0 APPROACH .................................................................................................. 28
3.3 IDEF0 PROCESS ACTIVITY MAPPING................................................................................. 29
3.4 SOFT SYSTEMS METHODOLOGY (SSM) ............................................................................. 32
3.5 VALUE STREAM MAPPING ............................................................................................... 34
3.6 WORKFLOW MAPPING ........................................................................................................ 35
3.7 PLANT LAYOUT DESIGN ...................................................................................................... 35
3.8 FEASIBILITY AND BUDGET COSTS ....................................................................................... 38
3.9 DECISION ANALYSIS USING ANALYTIC HIERARCHY PROCESS (AHP) ................................ 39
4. S O F T - I D E F 0 A P P R O A C H .............................................................................................. 45
4.1 IDEF0 PROCESS ACTIVITY MAPPING................................................................................. 45

4.2 SOFT SYSTEMS METHODOLOGY (SSM) ............................................................................. 58
5. P L A N T L A Y O U T D E S I G N A N D A U T O M A T I O N ........................................... 77
5.1 PLANT LAYOUT DESIGN ..................................................................................................... 77

5.2 AUTOMATION OF THERMO ................................................................................................. 87
5.3 BUDGET COSTS AND TIMESCALES OF PROJECTS ................................................................. 91
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6. D E C I S I O N A N A L Y S I S ...................................................................................................... 92
6.1 ILLUSTRATION OF AHP ANALYSIS ..................................................................................... 92

6.1.1 Pair-wise comparisons ...................................................................................................... 92
6.1.2 Dealing with inconsistency............................................................................................... 96
6.1.3 Sensitivity analysis ............................................................................................................ 96
6.1.4 Cost-Benefit Analysis ....................................................................................................... 98
7. C O N C L U S I O N S ...................................................................................................................... 99
8. R E C O M M E N D A T I O N S .................................................................................................... 103
R E F E R E N C E S .................................................................................................................................. 104
A P P E N D I C E S .................................................................................................................................... 111
GLOSSARY 112
WORKING PAPER 1 (ABSTRACT).............................................................................................................. 112
WORKING PAPER 2 (ABSTRACT).............................................................................................................. 113
THE SEVEN STAGES OF SOFT SYSTEM METHODOLOGY ........................................................................... 115
THEORY OF THE ANALYTIC HIERARCHY PROCESS ............................................................................... 117
SSM COMPARISON TABLES..................................................................................................................... 118
PROCESS CHARTS .................................................................................................................................... 131
WORKFLOW MAPPING.............................................................................................................................. 141
PROJECT PLAN OF THE RESEARCH ........................................................................................................... 145
BENEFITS OF DISSERTATION TO COMPANY.............................................................................................. 147
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Acknowledgements
Many people have contributed directly or indirectly to the development of this
dissertation. I would like specifically to thank the following for their support,
encouragement and assistance during the conduct of this research:
Ms.Roni Lee, Personnel Manager (retd.) of Huthamaki (UK) Ltd
Mr.Colin Pardoe, Operations Manager of Huthamaki (UK) Ltd.
Prof. Ashraf Labib, Project Supervisor, Portsmouth Business School
Mr.David Smith, Director of MBA programme, Portsmouth Business School
Various members of staff from Huhtamaki (UK) Ltd, who took the time and trouble to
participate in the interview sessions and provide me with valuable primary research.
Staff and colleagues of the MBA programme.
Family and friends
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List of Figures
FIGURE 2.1 FOUR INTERLINKED PERSPECTIVES ON BUSINESS PROCESSES ............................................... 5
FIGURE 2.2 CLASSIFICATION OF MODELLING TECHNIQUES BASED ON FOUR BUSINESS PROCESS
PERSPECTIVES ....................................................................................................................................... 10
FIGURE 2.3 FRAMEWORK FOR SELECTION OF MODELLING TECHNIQUES ............................................... 11

FIGURE 2.4 A CLASSIFICATION OF MODELLING METHODS AND TECHNIQUES ........................................ 12
FIGURE 2.5 ANSI MAPPING SYMBOLS .................................................................................................. 13
FIGURE 2.6 EXAMPLE OF ASME MAPPING ........................................................................................... 13
FIGURE 2.7 BASIC IDEF0 PROCESS MAP TEMPLATE ............................................................................. 15
FIGURE 2.8 IDEF0 ACTIVITY MAP DECOMPOSITION ............................................................................ 15
FIGURE 2.9 EXAMPLE IDEF3 PROCESS FLOW DIAGRAM ....................................................................... 17
FIGURE 2.10 THE CLASSIC 7-STAGE MODEL OF SSM .............................................................................. 18
FIGURE 2.11 GENERAL GUIDELINES FOR CONSTRUCTING A HIERARCHY ................................................. 21
FIGURE 3.1 RESEARCH METHODOLOGY: FLOW-CHART ........................................................................ 27
FIGURE 3.2 CORE CONCEPT OF SOFT-IDEF0 APPROACH....................................................................... 28
FIGURE 3.5 A MACRO IDEF0 MODEL OF THERMO OPERATIONS ........................................................ 32
FIGURE 3.6 FORMAT OF THE PROCESS CHART USED .............................................................................. 34
FIGURE 3.8 REPRESENTATION OF A SINGLE BLOCK ............................................................................... 37
FIGURE 3.9 COST ANALYSIS HIERARCHY .............................................................................................. 39
FIGURE 3.10 BENEFIT ANALYSIS HIERARCHY ......................................................................................... 40
FIGURE 3.11 EXAMPLE OF 1-9 SCALE QUESTIONNAIRE USED TO RECORD RELATIVE IMPORTANCE ......... 42
FIGURE 3.12 PERFORMANCE SENSITIVITY-GRAPH FOR BEST CAR SELECTION ...................................... 43
FIGURE 3.13 PERFORMANCE SENSITIVITY-GRAPH FOR BEST CAR SELECTION -II........................... 44
FIGURE 4.1 TOP LEVEL AS-IS MODEL OF THERMO OPERATIONS......................................................... 47
FIGURE 4.2 DECOMPOSITION OF MANAGE SUPPLY ACTIVITY ........................................................... 47
FIGURE 4.3 DECOMPOSITION OF THE AS-IS ACTIVITY PRODUCE GOODS ........................................ 48
FIGURE 4.4 DECOMPOSITION OF THE AS-IS ACTIVITY MANAGE PRODUCTION ............................... 50
FIGURE 4.4 DECOMPOSITION OF THE AS-IS ACTIVITY MANAGE PRODUCTION ............................... 50
FIGURE 4. 5 DECOMPOSITION OF THE ACTIVITY CONTROL PRODUCTION ........................................... 50
FIGURE 4. 6 DECOMPOSITION OF THE ACTIVITY OPERATE PRODUCTION LINES ................................. 51
FIGURE 4. 7 DECOMPOSITION OF THE ACTIVITY PACK FINISHED PRODUCTS...................................... 53
FIGURE 4.8 DECOMPOSITION OF THE ACTIVITY PROCESS ENGINEERING ........................................... 53
FIGURE 4.9 DECOMPOSITION OF THE ACTIVITY MANAGE MECHANICAL PROCESSES ......................... 54
FIGURE 4.10 DECOMPOSITION OF THE ACTIVITY MANAGE ELECTRICAL PROCESSES .......................... 55
FIGURE 4.11 DECOMPOSITION OF THE ACTIVITY MAINTAIN PLANT & MACHINERY ........................... 56
FIGURE 4.12 DECOMPOSITION OF THE ACTIVITY MANAGE ENGINEERING STORE................................ 57
FIGURE 4.13 REAL PICTURE DEVELOPED AFTER INITIAL INTERVIEWS .................................................... 59
FIGURE 4.14 CONCEPT MODEL 1 CM1 ................................................................................................ 63
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FIGURE 4.19 TO BE TRAINING ............................................................................................................. 74
FIGURE 4.20 TO-BE ENGINEERING STORE MANAGEMENT ................................................................... 75
FIGURE 4.21 TO-BE MAINTENANCE MANAGEMENT ............................................................................. 76
FIGURE 5.1 CURRENT LAYOUT OF THERMO .......................................................................................... 77
FIGURE 5.2 FINISHED GOODS FLOW PATH ............................................................................................. 78
FIGURE 5.3 TOOL FLOW PATH .............................................................................................................. 79
FIGURE 5.4 ACTIVITY RELATIONSHIP DIAGRAM OF THERMO................................................................ 80
FIGURE 5.5 FLOW ANALYSIS OF DIMENSIONLESS BLOCK DIAGRAM ...................................................... 82
FIGURE 5.6 THE IDEAL LAYOUT FOR THERM0 ....................................................................................... 83
FIGURE 5.7 THE THERMO LAYOUT WITH MINOR MODIFICATIONS ......................................................... 84
FIGURE 5.8 CONSOLIDATED THERMO & PAPER-CUP PLANT LAYOUT ................................................... 87
FIGURE 5.9 PROCESS CHART OF LINE 2 OPERATIONS ............................................................................ 88
FIGURE 5.10 ANNUAL PERCENTAGE LINE LOADING ................................................................................ 88
FIGURE 5.11 VOLUME-VARIETY CORRELATIONS PER LINE ..................................................................... 89
FIGURE 5.12 3-YEAR PROJECT PLAN FOR AUTOMATION ......................................................................... 90
FIGURE 6.1 PERFORMANCE SENSITIVITY OF THE STRATEGIC OPTIONS FROM BENFITS ANALYSIS ....... 97
FIGURE 6.2 PERFORMANCE SENSITIVITY OF THE STRATEGIC OPTIONS FROM COSTS ANALYSIS .......... 97
FIGURE 6.3 EFFECT OF INCREASING PRIORITY OF THE MIDDLE MANAGERS W.R.T. COSTS ..................... 98
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List of Tables
TABLE 2.1 CLASSIFICATION OF IDEF TECHNIQUES ............................................................................. 14
TABLE 3.1 FORMAT OF THE TABLE USED FOR COMPARING CONCEPT MODELS ..................................... 33
TABLE 3.2 ACTIVITY RELATIONSHIP WORKSHEET. ............................................................................. 36
TABLE 4.1 COMPARISON OF CONCEPT MODEL1 WITH THE REAL WORLD ACTIVITIES ........................... 71
TABLE 5.1 ACTIVITY RELATIONSHIP WORKSHEET. ............................................................................. 81
TABLE 5. 2 AREAS REQUIRED BY INDIVIDUAL DEPARTMENTS .............................................................. 82
TABLE 5.3 BUDGET COSTS & TIME SCALE FOR PROJECTS .................................................................... 91
TABLE 6.1 PAIR-WISE COMPARISON OF MAIN STAKEHOLDERS ............................................................ 92
TABLE 6.2 PAIR-WISE COMPARISON OF MIDDLE MANAGERS ................................................................ 93
TABLE 6. 3 ASSESSMENT OF COST CRITERIA FROM THE STAKEHOLDER POINT OF VIEW ........................ 93
TABLE 6.4 ASSESSMENT OF BENEFIT CRITERIA FROM THE STAKEHOLDER POINT OF VIEW ................... 94
TABLE 6.5 A SENIOR MANAGERS PRIORITIES TO OPTIONS .................................................................. 94
TABLE 6.6 A SENIOR MANAGERS PRIORITIES TO OPTIONS .................................................................. 95
TABLE 6.7 GLOBAL PRIORITIES OF STRATEGIC OPTIONS RESULTED FROM COST ANALYSIS .................. 95
TABLE 6.8 GLOBAL PRIORITIES OF STRATEGIC OPTIONS RESULTED FROM BENEFIT ANALYSIS ............. 95
TABLE 6.9 COST-BENEFIT ANALYSIS .................................................................................................. 98
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MODELLING BUSINESS PROCESS: An Integrated Approach
Chapter 1
INTRODUCTION
1.1 Research Objectives

The aims of this research is to analyse the business processes of a manufacturing unit
(Thermo) of Huhtamaki (UK) Ltd. by means of process modelling and assist the senior
management in the strategic decision-making.
The objectives of the research are to answer the following questions:
1. How process modelling can help in process improvement?
2. How process modelling can assist in strategic decision-making?
3. What are the benefits of process modelling? And how they can be realised?
4. Which business process modelling techniques are to be applied in order to achieve
the aims of a project?
The author believes that the methodology and results of the research will benefit not only
the host organisation, but also other organisations in similar context, to perform process
modelling, analysis, re-engineering and change initiatives. Academics could use the
research, to support their research interests or to explore further any specific areas
described, adding to the existing knowledgebase on Business Process Modelling.
The author conducted the empirical research at Huhtamaki (UK) Ltd. The background of
the organisation and the problems to be analysed are given in the following section.
1.2 Background
Established in 1920, Huhtamaki is one of the worlds largest packaging companies with
expertise in paper, plastic, film and moulded fibre. It has a global network of 70
manufacturing and sales units and 15,531 employees in 36 countries. The Groups parent
company Huhtamaki oyj is domiciled and headquartered in Espoo, Finland. For the fiscal
year ended December 2004, Huthamaki reported revenues of 2,092 million, and net
income of 90 million. The company has two main divisions: The Consumer Goods
division and Foodservice division. Huhtamakis operations are organised into three
regional groups: Europe, Americas and ASIA-Oceania-Africa. (Source: Datamonitor &
company reports)
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Recently Huthamaki oyj has decided to reorganise its European plastics and paper
packaging plants. As part of this strategy, it is preparing to close the fresh-food and
consumer packaging facility in Leeds, England, that failed to produce any profit for the
past three years. The injection moulding machines have been transferred to Auneau,
France, while the thermoforming machinery-which represented over three-quarters of
Leeds business-, is going to Huthamaki (UK) Ltd. Gosport.
Huhtamaki (UK) ltd. Gosport is one of the four Huhtamaki SBUs in United Kingdom.
The company employs 420 staff and has a total turnover of 46 million per annum.
Launched in 1970s it has two main packaging production facilities: The Paper-Cup
plant producing paper products and the Thermo plant producing thermoformed plastic
items. The ten production lines from Leeds plant are being relocated to the Thermo plant,
which had eight production lines of its own. The installation of the new lines needed to be
quick to reduce the disruptions to production from existing lines that ran 24 hours, 7 days
a week. Hence, the management decided to install or squeeze the new lines in the
available space. The above project was titled Leeds Integration Project. The
management had not planned the integration and its implications in detail. Their plan was
to install the machines first and plan the rest later.
The Operations manager appointed the author to conduct a process mapping exercise to
analyse the current business and manufacturing operations of Thermo and suggest any
recommendations for improvement. The author was also required to analyse the viability
of the three strategic options and recommend the best option. The options were, redesign
of Thermo plant; Automation of Thermo production processes; and relocation and
consolidation of Paper-Cup plant with Thermo.
The rationales to consider the above options are as follows. In the past, visitors from
Huhtamaki Head Quarters had complained that there are too many staff and raw materials
in the Thermo shop floor than necessary. Installing ten more production lines meant more
people and materials in the shop floor. The Operations manager wondered whether
automating the production processes would solve the problem. For that decisions about
the activities to automate, costs, benefits and timescales were necessary. In fact, the
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operations manager had a vision of totally automated operations. In his words Its a Big
bang modelThis means automated production, packing and shipping. The operators
themselves will carry out all the repair and maintenance activities avoiding specialist
maintenance personnel. The operators are better at diagnosing his lines problems than a
maintenance person, just as you know whats wrong with your own car. All they will
need is some training and extra pay. It would be possible to operate three lines by one
operator whereas now it requires one operator and two to three packers per line. It is
possible, one of the Huhtamaki SBU in Germany has done it, but they dont have as many
product variations as us. The Operations manager also had reservations about the
efficiency of the current plant layout. Does it need to be redesigned? How much does it
cost? Are there real benefits? Recently the senior management have decided to outsource
the companys warehouse function. The current warehouse is part of the paper-cup plant.
This decision made the operations manager to consider relocating the Paper-Cup plant to
the Thermo site, and sell or lease the Paper-cup site. Here again, he was not sure about the
costs, benefits and timescales involved. The result of the feasibility analysis will help the
senior management (Including the Operations Manager) in the strategic decision-making
as well as to obtain funds from the Head Quarters to implement one or more of the above
options. The company management think the automation is the ideal way ahead for
Thermo.
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Chapter 2
LITERATURE REVIEW
2.1 What is a Business Process?

According to Rummler & Brache (1990), between every input and every output is a
process. This view has been supported by Armistead and Machin (1997) and many
others. There are several definitions and classifications to Business processes. Krajewski
and Ritzman (2005, p3) define business process as Any activity or group of activities
that takes one or more inputs, transforms and adds value to them, and provides one or
more outputs for its customers. According to them, a process view is important, as
organisations are only as effective as their processes. A business process is the
combination of a set of activities within an enterprise with a structure describing their
logical order and dependence whose objective is to produce a desired result (Aguilar-
Savn, 2004). Another recent definition is by Shen, Wall, Zarembab, Chena and Browne
(2004) that A business process is a set of one or more linked procedures or activities
which collectively realise a business objective or policy goal, normally within the context
of an organisational structure defining functional roles and relationships. Hunt (1996,
p.3) classifies business processes into three categories: Customer processes which
results in a product or service that is received by an organisations external customer;
Administrative processes that are invisible to external customer but essential for
effective business management; Management Processes are actions that managers are
required to take to support business processes. Peppard and Rowland, 1995 classifies
business processes as strategic, operational and enabling. Their classification has
similarities to the Michael Porters Value chain framework, which classify
organisational activities into primary and secondary. However, Lindsay, Downs and Lunn
(2003) argue that most definitions take machine metaphor type view and fail to express
the true nature of business processes that need to develop and adapt to challenging
environment. Bititci and Muir (1997) argue that most enterprises are concerned with the
detailed operational (bottom-up) models, rather than abstract (top-down) models, so the
value of latter approach to business process definition is questionable. Melao and Pidd
(2000) take an alternative view to rest by means of four perspectives to describe business
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processes and to understand them fully. The four perspectives are Business processes as
deterministic machines; Business processes as complex dynamic systems; Business
processes as interacting feedback loops; Business processes as social constructs.
However, these perspectives are inter-related and it is difficult to identify their
boundaries. This concept is presented in Figure 2.1.
Figure 2.1 Four interlinked perspectives on business processes (Melao & Pidd, 2000)
2.2 Business Process Modelling/ Mapping: What are they?

The two phrases Process mapping and process modelling are often used
interchangeably. It has origins in industrial engineering and as a management tool
initially was developed by General Electric (Hunt, 1996, p.1). Anjard (1996) defines it as
identifying, documenting, analyzing and developing an improved process. Business
process modelling enables a common understanding and analysis of a business process
(Aguilar-Savn, 2004). Loh (1997, p.67) defines a Business process model as a
representation of the companys operation or a specific part of the operation. It is usually
a graphical depiction of the structure and activities of the operation. The model often
shows the relationships between work steps and their sequence portraying workflow.
According to Hines and Rich (1997), it is an excellent process management tool and
mainly aims at reducing waste (due to overproduction, defects, unnecessary inventory),
and identifies, eliminates irrationalities and inconsistencies in processes. There are five
key stages to process mapping:
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1. Study of current flow of processes

2. identification of sources of waste
3. Consider whether the sequence of activities can be rearranged and made efficient
4. Optimisation of flow layout e.g. reducing distances between stages
5. Elimination of unnecessary activities.
Hunt (1996) suggests developing As-Is (current state) and To-be (ideal) process maps
to assist the process.(Peppard et al, 1995, p.170) argues that there are advantages and
disadvantages to process mapping: The maps give a clearer explanation of a process than
words; by working on maps, better understanding of the tasks and problems that face the
organisation can be gained. However, Process Maps can prove to be too distracting and
can slow down actions to ensure the integrity of the maps; Process maps can also take on
a life of their own and lose relevance to those working on the process; the maps cannot be
relied always as a good means of communications between layers of management.
2.3 Need and significance of Process Modelling

An organisation is a complex system comprised of functions, processes, resources,
customers, suppliers etc. In order to understand its components and their
interrelationships, a manageable model of reality is necessary. Process models can serve
this purpose (Briffaut & Saccone, 2002). An enterprise can be analysed and integrated
through its business processes. Hence the importance of correctly modelling its business
processes (Aguilar-Savn, 2004).
2.3.1 Business Process Improvement (BPI)

Business process improvement covers both business process redesign and re-engineering.
Business Process Re-engineering is the radical redesign of business processes to achieve
dramatic improvement (ONeill & Sohal, 1999). Business Process Redesign and Business
Process Reengineering can be differentiated by means of efficiency and effectiveness.
The former is concerned with efficiency improvement of existing processes while
Business Process Reengineering seeks effectiveness and efficiency of What is being
done (Wilson, 2001, p.60). Business Process Reengineering (BPR) analysis of a
manufacturing enterprise can be effectively performed using the function and process-
modelling framework (Jang, 2003). Aldowaisan and Gaffar (1999) sites Hammer and
Champy (1993) and defines BPR as the fundamental rethinking and radical redesign of
business processes to achieve dramatic improvements in critical contemporary measures
6
of performance, such as cost, quality service and speed. Davenport and Short (1990)
have explained BPR as the analysis and design of workflows and processes within and
between organisations. The modelling and analysis of business process along with
business strategies and organisational structures are essential to study the implications of
BPR (Gunasekaran & Kobu, 2002).
2.3.2 Business Process Management (BPM)

The role of process mapping in process management is known for many years. Elzinga et
al. (1995) states that any structured approach used to analyse and continually improve
core processes of an enterprises operation can be classified as BPM. It focuses on
enhancing efficiency and effectiveness, offer profit, growth and sustainable business
(Yang & El-Haik, 2003, p.35). To meet business goals, managers should establish process
goals and once those goals are established, managers need to design processes that would
achieve the goals efficiently. Effective process management requires 1. Process goal
management, 2. Performance management, 3. Resource management and 4. Process
interface management (Hunt, 1996, p.10-14). Today, Business Process Management has
several facets: Workflow Management (WFM), Case Handling (CH), Enterprise
Application Integration (EAI), Enterprise Resource Planning (ERP), Customer Relation
Management (CRM), etc. (Weske, Van der Aalst, & Verbeek, 2004). Process mapping,
its integration and understanding is one of the key success factors (KSF) in process-based
management (Balzarova, Bamber, McCambridge & Sharp, 2004).
2.3.3 Business Process Simulation

Darnton and Darnton (1996, p.224) states that simulations allow one to play with a model
of part of the real world, without having to play with the real thing. The real world model
is developed using computer software and the model can be used for experimentation.
The eight process characteristics that differentiate the simulations are, Discrete Vs
continuous, Stochastic Vs. deterministic, critical event Vs Time-scale and Machine
simulation Vs human-machine simulation. Irani, Hlupic, Baldwin and Love (2000) state
that the effects of redesigned processes can be simulated before implementation. This
improves the efficiency and effectiveness of the process, thus reducing expenditure.
Greasley (2004) found that simulations over time help to judge whether operational level
changes can lead to achievement of strategic targets over time and can reduce risk
aversion to implementation. However, simulations require careful planning in order to
7
obtain results within cost and time targets. Monfared, West, Harrison and Weston (2002)
illustrate the application of business process simulation in automotive industry. Melao
and Pidd (2004) argue that proprietary software used for business process simulation are
inflexible and proposes an easy to use and flexible approach using BPSim++.
2.3.4 Managing Change

Organisational change can be managed by enterprise modelling, especially business
process modelling (Chung et al., 2002). A study by Werr, Stjernberg and Docherty (1997)
comparing leading consulting organisations in Sweden state that structured methods and
tools have a significant role in the change process. Belmiro and Pina (2001) found that
business process modelling could assist understanding and engagement as part of a
change programme. Greasley (2004) reports a process-based approach to change in the
implementation of an information system and claims that process mapping and business
process simulation used in the change process aided communication of current process
design and peoples roles in the overall performance of that design.
2.3.5 Knowledge Management

An organizations use of its explicit and tacit knowledge can be effectively managed by
effectively managing the organisational processes (Tuggle & Goldfinger, 2004). Kalpic
and Bernus (2002) point out that Business Process modelling facilitates the
transformation of informal knowledge into externalised form and in turn allows the
externalised form to be interpreted and be used to build internalised pragmatic
knowledge. Koubarakisa and Plexousakisb (2002) propose a business process model to
assist business analysts to capture enterprise knowledge in a way that is both intuitive and
mathematically formal. According to Vollmer and Phillips (2000), knowledge
management is greatly dependent on process mapping and process maps are the best way
to know where knowledge resides in an organisation. Kesner (2001) propose a seven-step
methodology to business process mapping to obtain a holistic picture of business process
and its knowledge management requirements. The seven steps are, Process
decomposition; Roles and responsibility matrix; Approval rules governing the process;
list of access rights; Performance matrices; Process templates; Knowledge library.
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2.4 Uses / Benefits of modelling business processes

Kueng and Kawalek (1997) investigated whether and how process models are useful.
They maintain that process models are best suitable for analysis and design purposes but
their role in implementation is not clear and further research is required. They cite Curtis
et al. (1992), process models can be utilised in the following five areas: (1) facilitating
human understanding and communication; (2) supporting process improvements; (3)
supporting process management; (4) automating process guidance, i.e. supporting the use
of tools for manipulating process descriptions; (5) automating execution support. The use
of process models is advocated as a facilitator for organizational learning (cites Schl,
1990; Senge, 1993), and benchmarking a companies performance (Childe & Smart,
1995), and in order to support process evolution (Robertson, 1996). Kieth (1995) claims
that Process mapping can reduce work cycle time. Process maps offer a shared view, can
motivate people to participate in change initiatives and present new ideas, aid in critical
business communication, Illustrate important process characteristics such as number of
people, steps involved, bottlenecks etc. (Paradiso, 2003).Top-level process maps can act
as business plans to define the business strategy and scrutinize how that strategy can be
carried out; To support quality certification documentation requirements; As an aid to
decision makers in prioritisation of improvement actions and resource allocation
decisions; As an effective communication tool across internal and external organisational
boundaries (Hunt, 1996, p.52-53).
2.5 Process Modelling Tools, Techniques and Methodologies

There are a number of approaches to process mapping. Hunt (1996) divided them into
three general categories: Flow diagramming tools, Case tools and Simulation tools. Melao
and Pidd (2000) argue that success of business process modelling depends on the nature
of the business process. They reviewed and classified contemporary modelling techniques
based on their four perspectives to business processes. So the business processes as
deterministic machines view corresponds to Static business process modelling;
Business processes as complex dynamic systems view is linked to Discrete event
simulation techniques; Business processes as interacting feedback loops view is
supported by System dynamics techniques; Business processes as social constructs
view is related to Soft business process modelling. Their classification can be
summarised in a matrix format (see Figure 2.2).
9
Figure 2.2 Classification of modelling techniques based on four business process

perspectives
Aguilar-Savn (2004) analysed various process modelling tools including the generic
ones, and asserts, It is important to understand the uses or purposes of models when
undertaking modelling of any kind. According to them, there are two dimensions to
modelling techniques or methodologies. These dimensions are Purpose of the model and
Change model permissiveness. The uses or purposes of business process models was
further divided into four main categories as follows: Descriptive models for learning;
Descriptive and analytical models for decision support to process development and
design; Enactable or analytical models for decision support during process execution, and
control; and Enactment support models to Information Technology. Some process models
are Active as they allow users to make changes, or are dynamic themselves, whereas
10
some models are passive as the user could not change them without remodelling the
process. This characteristic between active and passive models is the change model
permissiveness. The framework for selection of modelling techniques is shown in figure
2.3.
Figure 2.3 Framework for selection of modelling techniques (Aguilar-Savn, 2004)
Shen et al. (2004) reviewed several BPM techniques (See Figure 2.4) prior to developing
an enterprise information system. According to them, the choice of suitable technique
depends on the project requirements, as well as the implementation scenario. As the
scenario changes, the technique should also be changed correspondingly. They stress the
importance of a language that is understandable and unambiguous by both the end user
and the developer. The combination of IDEF0, IDEF3 and DFD
11
Figure 2.4 A classification of modelling methods and techniques ( Shen et al., 2004)
2.5.1 Simple flow Charts

According to Harrington (1991) cited by Dranton and Darnton (1997, p.) these are easy to
read, where a high level process is broken down into smaller processes. The lines
represent sequence of lower level processes. The criticism of basic flow charts is that,
they lack details, and real world processes does not follow precise simple sequences.
2.5.2 Process Charts

The ANSI (American National Standards Institute) has developed a standard for process
charts and is being widely used. The ANSI defines process chart as a schematic or
tabular representation of the sequence of all relevant actions or events operations,
transportations, inspections, delays, storages occurring during processes or procedure.
The ANSI process chart symbols are shown in Figure 2.5. The ASME (American Society
of Mechanical Engineers) produced a similar standard of which an example is shown in
Figure 2.6. Using the ANSI process approach, it is possible to develop high level and
micro level maps. A major advantage is that value added by each activity can be
questioned to improve a process, so it has a significant role in process improvement and
performance (Slack, Chambers, & Johnston, 2004, p.104-105).
12
Operation (an activity that Beginning or end

directly adds value) of process
Inspection
Activity
(a check of some sort )
Transport Input or output from the

(a movement of something) process
Delay Direction of flow

(a wait, e.g. for materials)
Storage (deliberate storage, Decision (exercising

as opposed to delay) discretion)
Figure 2.5 ANSI mapping symbols (Slack et al, 2004)
Figure 2.6 Example of ASME mapping (Oakland J, 1994) cited in www.lsbu.ac.uk
2.5.3 IDEF techniques

IDEF techniques, commonly known as Integrated DEFinition methods were developed
by US Air Force in order to describe, specify and model manufacturing systems in a
structured graphical form (Plaia and Carrie, 1995). According to IDEF also means ICAM
Definition method, which relates to the US Air Force program for Integrated Computer
Aided Manufacturing (ICAM). It is a subset of structured Analysis and Design technique
(SADT) (Darnton & Darnton, 1997, p.114). There are different methods within IDEF
13
family mainly classified into modelling and descriptive categories as shown in Table
2.1. The description tells what a system is supposed to do whereas a model predicts what
a system will do (Plaia and Carrie, 1995).
Method Name Descriptive Modelling
IDEF0 Function modelling 9
IDEF1 Information requirements modelling 9
IDEF1X Database design 9
IDEF2 Simulation modelling 9
IDEF3 Process description capture 9
IDEF4 Object oriented design 9
IDEF5 Concept/ ontology description 9
IDEF6 Design rationale capture 9
Table 2.1 Classification of IDEF techniques (Plaia & Carrie, 1995)
The IDEF methods can be further classified: Methods for describing existing or proposed
systems and methods for designing proposed systems. IDEF0 and IDEF3 belong to the
first category. Plaia and Carrie (1995), concludes that when the objective is to consider
the sequencing of activities in a process with simultaneous activities, IDEF3 is more
suitable. However, when the objective is to highlight the objects (inputs, outputs, controls
& mechanisms) that participate in the process, then the use of IDEF0 is suggested. The
activities modelled in IDEF0 can be used as a basis for the definition of IDEF3 processes.
Hence, IEDF3 is a good option to use as a method after an IDEF0 model has been
developed (Dorador & Young 2000). Aguilar-Savn (2004) and Shen et al. (2004)
recommend both IDEF0 and IDEF3 techniques for Business Process Modelling, so they
are explored further.
The basic concept of the IDEF0 modelling is the IDEF0 activity box shown in Figure 2.7.
The IDEF0 principle is that, all activities have four attributes such as Inputs, Outputs,
Controls and Mechanisms. The inputs show what is required before an activity can occur,
e.g., shop orders, managers signature, etc. The outputs show what is produced by an
activity, e.g., reports, products, etc. The controls are the constraints on an activity, e.g.,
procedures, budgets, etc. The mechanisms show what enables an activity, e.g., equipment,
staffing, etc.
14
Controls
Process/Activity /
Inputs Outputs
subset
Mechanisms
Figure 2.7 Basic IDEF0 process map template
Figure 2.8 IDEF0 Activity Map Decomposition (Hunt, 1996, p.100).
15
The IDEF0 diagrams (Darnton & Darnton, 1997; Bal 1998; Hunt, 1996) display a top-
down multiple layered view of a process, starting at highest- level A0 and drill down to
expose greater levels of detail. The decomposition of IDEF0 system is shown in Figure
2.8. The diagram consists of rectangular boxes and arrows (boxes numbered from A0
down to A6 or further) with title and identification information. The rule is that each
diagram has no fewer than three and no more than six boxes. There are strict syntax and
semantic rules (Feldmann, 1998). IDEF0 is adopted as a standard process modelling
technique within a variety of service industry companies, including ICL, IBM, Natwest,
TSB, Portman and Scottish Power, and is the modelling base for the BPR offerings of
most of the main consultancy firms (Maull & Childe, 1993). A survey conducted by
Defence Information Systems Agency in 1995 (Bal, 1998) over 37.4 percent of
organisations with experience in reengineering, has chosen to use this technique. It is
suited for detailed level mapping and particularly useful for understanding existing
processes (As- Is) and restructuring or designing a new functional structure (To-Be)
structure. One disadvantage is that only readers familiar with the technique can interpret
them. Another problem with IDEF0 is that it can have embedded sequences, which could
result in misinterpretation. Plaia and Carrie (1995) states that IDEF0 can describe what an
organization does, but it does not consider the specific logic or timing associated with
activities. IDEF0 has been widely used to assist BPR (Kim & Jang, 2002; Jang, 2003).
Lo, Humphreys and Sculli (2001) report a novel application of IDEF0 to produce an ISO
9001 quality manual for a manufacturing enterprise. The authors survey showed that
users found the IDEF0 approach very clear and less ambiguous. The paper claims that
IDEF0 format meets ISO 9001 documentation requirements, and forms a good alternative
to the conventional type of quality manual. Feldmann (1998, p41-42) claims that there are
several benefits of using IDEF0. It helps to identify needs and opportunities for
improvement; Through the reader/author review methods, can establish consensus
between entire staff; Enhances vision; The model structure may be used to define an
Open Architecture; Broadens automation and commonality potential; Supports
management control through metrics; Defines variants for broader support system use.
According to (Huang & Kusiak, 1998; Cho & Lee 1999), IDEF3 methodology has
extensive uses for modelling manufacturing processes. The important characteristics for
analysis include stage description that specifies each activity; structure of underlying
16
stages; flow of objects and their relationship. The graphical syntax consists of boxes,
labels, arrows and connections symbols. Three types of relationship links exist between
boxes as precedence, relational and object flow. Another distinguishing feature compared
to IDEF0 is the branching through junctions classified as And (&), Or (O), and Exclusive
Or (X). An example of IDEF3 process flow diagram is shown in Figure 2.9. The junctions
can be used to split the stream into several branches (fan-out), or join branches into a
single stream (fan-in). In IDEF3 unlike IDEF0, there is no constraint on the number of
boxes per page (Plaia & Carrie, 1995). The deficiency of IDEF3 models is that they are
not sufficiently powerful to show clearly the information flow among different activities,
but this can be overcome by using Data Flow Diagrams (DFD).
Receive and
Activate
Contract
3
Organise
Activate Plan
Team &
3.1.7 3.1.11
Receive Set Up
Contract & Subcontracts
3.1.6 3.1.8 Hold Kickoff

& Meeting
3.1.10
Construct Plan
3.1.9
Figure 2.9 Example IDEF3 process flow diagram (Yang and El-Haik, 2003)
Plaia and Carrie (1995) had indicated the scope for simulations using IDEF. The system
description using IDEF can be used for modelling simulations in industrial engineering
projects. The duplication of effort in developing a simulation models can be avoided by
using the IDEF descriptions, which require consideration of same factors. IDEF maps
developed with AI3 or Prosim software packages can produce automatically a
WITNESS (a simulation software) model for detail simulations.
17
2.5.4 Soft Systems Methodology (SSM)

Soft systems methodology (SSM) was developed and established by Peter Checkland and
his research team at Lancaster University. It is a methodology to model and analyse hard
to define complex systems that are a mixture of technology (hard) and human (soft)
systems. SSM deals with problem formulation at the strategic level. It partly aims to
structure previously unstructured situations, rather than to solve well-structured problems.
It deals with fuzzy problem situations situations where people are viewed not as
passive objects, but as active subjects, where objectives are unclear or where multiple
objectives may exist (Rosenhead, 1989 cited by Kirk, 1995, Platt & Warwick, 1995).
The methodology and its development is described in many papers and in six books:
Systems Thinking, Systems Practice (1981); Systems: Concepts, Methodologies and
Applications (1984,1990); Soft Systems Methodology in Action (with J. Scholes, 1990);
Systems Information and Information Systems (with Sue Holwell, 1998) and SSM: A 30-
Year Retrospective (1999). In his works (Wilson, 1992; Wilson, 2001) has extended
SSM to cover role analysis and information analysis. He has developed a tool, the
Maltese Cross to assist in the latter task.
7.
Actions to improve
1. the problem
Problem situation situation 6.
considered Changes:
problematic Systemically
desirable, culturally
feasible
2.
5.
Problem situation
Comparison of
expressed Real world activities models and real
world
Systems Thinking
3. about Real world
Root definitions of 4.
relevant purposeful Conceptual models of the
activity systems systems ( holons) named
in the root definitions
Figure 2.10 The classic 7-stage model of SSM (Checkland, 1981)
18
Checklands Soft Systems Methodology consists of seven interrelated stages (see Figure
2.10). Brief descriptions of the stages are given in the Appendix. Readers are directed to
the publications cited above for a wider appreciation of the SSM. Stages (1), (2), (5), (6)
and (7) can be regarded as working in the real world, while stages (3) and (4) can be
considered as systems thinking about the real world.
SSM is often used as a front end to a hard methodology, such as the structured systems
analysis and design method (SSADM) (Platt & Warwick, 1995). It has been useful at
deriving recommendations for improvement, reorganization and role analysis and the
only limitations are the capability, and adaptability to new situations, of the consultant
(Rose & Haynes, 1999). SSM could function well in multinational/ multicultural projects
(Bell, Coleman, Guo, & Sewell, 2000).) The epistemological principles of SSM
facililitate organisational learning (Rose & Haynes, 1999). SSM may be used as a
medium for developing competence profiles in human resource management (Brocklesby,
1995). The paper notes the benefits of learning, insight and systems thinking while points
out the shortcomings due to the time consuming process and the level of commitment
required from users. (Nidumolu, Bie, Keulen, Skidmore & Harmsen, 2004) have applied
SSM in analysing land use planning and found SSMs capability of integrating the socio-
economic factors useful. Presley & Meade (2002) discusses the possible role of SSM in
sustainable production planning and argue that SSM is just another tool available to the
decision maker and benefits can be gained combining SSM with other strategic planning
tools such as forsighting and backcasting. Green and Simister (1997) found that SSM
can be used as an aid to strategic briefing along with established quantitative methods.
They argue that a social constructivist approach to BPR can be subsumed within the
framework of SSM. However, they note the danger of practitioners adopting techniques
of SSM without necessarily buying in at the methodology level. The terminology of SSM
is identified as a potential barrier for understanding the methodology. Molineux and
Haslett (2003) in their work, propose SSM as a methodology to enhance creativity in
organisational design contexts. Presley, Sarkis, Liles, & Barnett (N.D.) report the
application of SSM in the participative design of organisational systems. They have used
SSM in combination with other modelling methodologies such as QFD (Qulity Function
19
Deployment), IDEF0 and AHP (Analytic Hierarchy Process). QFD for the identification,
categorization, and prioritization of requirements for both the justification process and
tools, IDEF0 for the stage 3 and 4 of the SSM and AHP for the prioritisation of
requirements.
2.5.5 Analytic Hierarchy Process (AHP)

AHP is a multi-criteria decision analysis (MCDA) tool developed by Saaty (1980) cited
by Belton & Stewart (2002, p151). It can handle problems involving both multiple
objectives and uncertainty (Goodwin & Wright, 2004, p423). AHP incorporates
inconsistency, mimics the human decision making process and facilitates acquiring
information from the evaluator (Saaty, 1990 cited by Borenstein, 2004). AHP is a flexible
methodology for solving complex problems quantitatively and allows individuals and
groups to shape their ideas and define problems by making their own assumptions and
deriving the desired solution from them (Saaty, 1995, p.23). In general, the AHP involves
following steps: 1) Define the unstructured problem 2) Decompose the problem into a
systematic hierarchical structure (similar to a decision tree) 3) Employ the pair-wise
comparison method 4) Carry out the consistency measure 5) Estimate the relative weights
of the components of each level of the hierarchy 6) Use the relative weights for different
purposes (Saaty, 1980; 1994) cited by Cheng, Li, & Ho, 2002). The mathematical theory
of the AHP is provided as an appendix. There are two implicit assumptions of AHP
methodology (Cheng & Li, 2001 cited by Cheng et al. 2002): 1) It only recognises the
interaction between elements of two adjacent levels. 2) There is no hypothesized
relationship between the elements of the same or different groups at the same level. There
are three primary functions of the AHP: Structuring complexity, measurement on a ratio
scale, and synthesis. AHP can be applied to a wide variety of applications with an
understanding of the primary functions (Forman & Gass, 1999). The hierarchy structuring
principle is illustrated in figure 2.11.
20
Figure 2.11 General guidelines for constructing a hierarchy (Chan & Chan, 2004).
There are numerous examples of AHP application in academia and industry. They can be
broadly classified into stand-alone and hybrid applications.
Many practitioners report stand-alone applications of AHP. Borenstein (2004) propose a

generic model for IT investments justification using AHP. The paper argue that the AHP
model provide decision makers with a set of validated and structured criteria for IT
justification problem, considerably reducing the time and effort in decision-making.
Chandra and Jayachandran (2001) illustrate the application of AHP in a facility layout
design problem where quantitative and qualitative factors need to be considered. Hafeez,
Zhang, and Malak (2001) propose an AHP based framework for determining the key
capabilities of a firm. It takes into account the quantitative (financial) as well as
21
qualitative (non-financial) measures providing a balanced scorecard for capability

evaluation. Ananda and Herath (2002) demonstrate the application of AHP incorporating
stakeholder preferences in the complex task of forest planning. They found that, the
success of the method depends on (1) appropriate structuring of decision problem (2)
pairwise comparison method and (3) ability of respondents to provide credible answers.
Bevilacqua and Braglia (2000) describe an application of the AHP for selecting the best
maintenance strategy. Chan (2002) describes the development of a material handling
equipment selection system involving AHP that has three modules: A database to store
equipment types with their specifications; a knowledge-based expert system for assisting
material handling equipment selection; An AHP model to choose the most favourable
equipment type.
Following are some examples of hybrid AHP applications. Kengpol and O'Brien (2000)
outlines a decision support tool that include a data structure to monitor the effectiveness
of a decision, and a decision model which consolidates quantitative and qualitative
variables through the use of the Analytic Hierarchy Process (AHP), Cost/Benefit and
statistical analyses. Yurdakul (2004) illustrates the application of AHP and ANP
(Analytic Network Process) in the Machine tool selection problem. Davidson and Labib
(2003) illustrate the application of AHP in design improvement decisions by integrating
with a modified form of Failure Mode Effect Analysis (FMEA) for problem analysis.
Rong, Takahashi and Wang (2003) report the application of AHP in union with fuzzy set
theory for the enterprise waste evaluation problem. Chan and Chan (2004) illustrate the
application of AHP and quality management system principles such as PDCA in a
supplier selection problem. They argue that AHP is a good candidate where both
qualitative and quantitative objectives have to be considered and can significantly reduce
the time and effort in decision-making. Yang and Kuo (2002) propose a methodology
using algorithmic layout methods, AHP, and DEA (Data Envelopment Analysis), in a
hierarchical scheme, to solve a layout design problem. Algorithmic layout methods for
quantitative data generation and analysis, AHP for qualitative analysis and DEA for final
design. Searcy (2004) investigate the use of AHP at the performance category level of the
balanced scorecard hierarchy with data from six firms and describe a systematic process
for using Excel in AHP applications.
22
Though widely used, AHP has its critics. Bititci, Suwignjo and Carrie (2001) argue that to
gain valid results, managers using AHP should be aware of the rank reversal'
phenomenon; managers' reluctance in completing the pair-wise comparison
questionnaires; and problems in achieving consensus in pair-wise comparison with
multiple decision makers. Cheng et al. (2002) argue that AHP can be a defective tool if
used improperly and illustrate using an example how defective methodology of AHP can
contaminate the findings and subsequent analysis and discussions. Tolga, Demircan and
Kahraman (2005) propose a framework for operating system selection using
fuzzyAHP. They argue that conventional crisp AHP cannot reflect the human
thinking style in capturing the experts knowledge and fuzzy AHP and fuzzy extensions
of AHP are required to solve hierarchical fuzzy problems. Milleta and Schoner (2005)
argue that the current AHP methods are incapable of dealing with positive and negative
preference (aversion). To tackle the problem they propose a Bipolar Analytic Hierarchy
Process (BAHP) approach. According to Abdul-Hamid, Kochhar and Khan (1999), the
main problem with AHP is the need for very tedious calculations, which can be made
much easier by using personal computer software. Perez (1995) tries to clarify the
concerns regarding suitability, correctness of the way AHP handles criteria weights and
occurrence of rank reversal problem and concludes that the application of AHP is not
suitable to all situations.
2.6 Conclusions from Literature Review

The investigation of existing academic literature showed that much research has been
done on the subject of Business Process Modelling (BPM). It ranges from the defining
business processes to the process simulation using advanced simulation software and
programming techniques. The definitions cause confusion and do not share much
common elements. It was noted that most definitions are based on the machine metaphor
type interpretations and avoid the human element. BPM has humble origins as an
industrial engineering tool and now wildly used by many academics and business people.
The need for BPM was investigated and found that it is a valuable tool in Business
Process Improvement, Business process management, Business process simulation,
Change management and Knowledge management etc. The benefits of BPM are in
facilitating human understanding and communication; supporting process improvements
and process management; automating process guidance, automating execution support,
23
facilitator for organizational learning, and benchmarking a companies performance and in

order to support process evolution
A number of methodologies and techniques are available to model business processes.

Review of current literature show the importance of considering following factors while
selecting tools and techniques: The nature of the process to be modelled; Purpose and
change permissiveness of models; and the context of modelling and adaptability and
communicability of tools. These factors imply that it is not possible to model business
process using a single tool. An integrative approach may be required. It is important to
understand the adaptability and communicability of different business process modelling
techniques. It would be useful to model using simple tools such as IDEF0, IDEF3 initially
to understand the process and gradually progress towards advanced techniques such as
simulation.
An organisation is a complex whole, which include soft and hard entities. Many of the
techniques reviewed only consider the hard aspects and ignore the human aspects. On the
contrary, Soft Systems Methodology takes the social constructivist view to organisation
and its processes. Several characteristics make it unique compared to others. It can be
used as a front end to a hard methodology; SSM could function well in multinational/
multicultural projects; SSMs epistemological principles facililitate organisational
learning; it has the capability of integrating the socio-economic factors; It can be
combined with other strategic planning tools.
The Multi Criteria Decision Making (MCDM) tools are gaining popularity among
researchers and organisations. The methodology, applications and limitations of
Analytical Hierarchy Process (AHP) has been reviewed. The application of AHP ranges
from machine tool selection to land use planning. It was found to be particularly useful at
analysing problems involving qualitative and quantitative objectives. Many practitioners
have applied it in combination with other techniques such as QFD, FMEA etc. There are
drawbacks to AHP, but the review shows that many of them are due to facilitator/
analysts improper use of the technique. As any technique the application, need to be
thought through.
24
Firstly, whilst there is much literature about business process modelling in general and
process modelling techniques, little is reported on the empirical assessment of these
techniques. Secondly, very little has been reported that integrate hard and soft approaches
and qualitative and quantitative approaches to business process modelling. Thirdly, the
majority of research was carried out in SMEs and public sector organisations and the
author was not able to locate any research in this subject specific to the packaging
industry. Therefore, it is expected that the proposed research would benefit not only the
client organisation, but also other large organisations and especially those in the
packaging industry. The author was also not able to find much literature on the benefits
that can be attained through business process modelling. It was also noted that modelling
tools and techniques were applied blindly by many practitioners rather than being
pragmatic. Research should focus on reducing the shortcomings, e.g. complexity, time
consumption etc. of contemporary techniques and improve the advantages, e.g.
transparency, participation, ease of use.
25
Chapter 3
METHODOLOGY
The Action Research (AR) approach was adopted throughout the project. AR involves
helping an organization to improve some of its key attributes such as productivity, the
quality of their products and/or services, and working conditions as well as collecting,
analyzing, and drawing conceptual and theoretical conclusions from organizational
research data (Kock, 2004). AR has three common themes. First is the emphasis on the
purpose of research, second relates to the involvement of practitioners and third, the
results could inform other contexts (Saunders, Lewis, & Thornhill, 2000). The primary
data was collected through observer as participant method and semi structured
interviews and questionnaires. Secondary data from company reports, manuals, drawings,
process layouts, plant layouts and other relevant sources were extensively used. The
research had three main phases:
1. Process modelling
2. Plant layout design & Automation
3. Decision analysis
A schematic of all activities involved in the above phases is presented in Figure 3.1.
26
START
Analyse Secondary Data
Identify process Identify functions/

experts processes for mapping
Conduct Observe/ Record

Interviews Processes
Develop Rich Develop micro & Develop Workflow Develop Value

Pictures macro IDEF0 models Diagrams Stream maps
Develop Root Combine to form Develop Identify Activities

Definitions the AS-IS map Relationship chart to be Automated
Obtain budget
Develop Block
Review with No costs/ Timescales
Develop Concept layout of Plant
experts- Map from vendors
models using SSM complete?
Allocate floor
Develop Project
Yes space for
plans
functions
Finalise
As-Is map
Develop Ideal
layout with
Comparison: Does Calculate Payback
concept activity exist Yes necessary trade-
in real world? offs
No Review with
experts- Activities Model AHP
Desirable? Structure
Compare with
No existing layout :
High
Yes Disruption to
production?
Collect Data for
Recommend AHP analyis
Keep the activities
Process changes Low
Develop layout Conduct Cost-

Layout with major Benefit Analysis
with minor
modifications
modifications
Develop To-Be
Process maps Take Decision
Develop
consolidated
layout of Thermo
& Paper Cup END
Review layouts
with experts
Figure 3.1 Research Methodology: flow-chart
27
3.1 Process modelling

Three methods were used in the process-modelling phase of the project: Value stream
mapping; and Workflow mapping; IDEF0 Process activity mapping; and Soft Systems
Methodology
3.2 Soft-IDEF0 Approach
Soft-IDEF0 approach combines the functionalities of IDEF0 modelling and SSM. Here
the concept models of SSM were compared (5th stage of SSM) with the As- Is model
developed using IDEF0. The activities not present or sufficiently judged in the real world,
actions for change are recommended. Thus, Soft-IDEF0 combines the best of both
worlds. This approach was applied because rich pictures were found to be inadequate to
represent activity details and time consuming to develop. The approach is represented in
Figure 3.2.
Real world
activities
Comparison
Comparison
Systems Thinking
about Real world
Know how to run the production
Know the strategic lines efficiently and effectively Co
plans of the company ntr o
l
Develop training Decide criteria for acti
Monitor development Procedures assessment on
of training Assess the trained
procedures employees
Recognise individual
employees attitudes , skill/ Take control action so that
knowledge retention levels employees can run the lines
efficiently and effectively
Train the Monitor trained
Con l
ac ti
Employees employees
o
tr
Take control action so that to

on
develop training procedures

to operate lines efficiently Define performance measures
and effectively Consider the time appropriate to the training
Performance information
available requirements
from all activities
C Assemble information Report on performance to

a c on t ro about total performance Operations manager
t io l Take control action to
n ensure that performance is
as required by the
Operations manager
Figure 3.2 Core concept of Soft-IDEF0 approach
28
3.3 IDEF0 Process Activity Mapping

The IDEF0 process activity mapping comprised of four phases. Viz. Identification of core
processes and experts associated semi-structured interviews, observation and IDEF0
modelling. The first phase was carried out by an initial scanning of secondary data
available such as organisation charts and consulting senior managers of the organisation.
Semi-structured interviews were conducted to gather information on organisational
structures, tasks, roles, business processes, manufacturing processes and information
flows. With the total population of some 200 derived from personnel records, it is
impossible to interview all process owners. Upper level staff interviews (2 nos.) were
conducted to get the big picture, lower level operating staff interviews (10 nos) for
detail process information, and middle level staff interviews (10 nos.) for bridging the
gap. Prior to the interviews, the interviewees were briefly introduced to the IDEF0
methodology. This helped them to focus on their processes and to think in a structured
manner. The questions were framed on 5W1H method (asking: Why does an activity
occur? Who does it? Using What resources? Where? When? and How?).
3.3.1 Micro, Macro and As-Is IDEF0 models

During the interviews, micro models of the process was developed in the IDEF0 format
and interviewees were consulted on the accuracy the information used. The interviewees
found such a participative approach comfortable. For example, the Manage Supply
activity comprise of the following information. The inputs: Managed customer orders,
Minimum stock levels required, Aggregate demand, Planned maintenance schedule and
Daily operations sheet; The outputs: Purchase orders and Production plan; The controls:
Machine capacity, Machine downtime, Minimum run length, Budgeting process and
SLAs (Service Level Agreements); The mechanisms: Four planning staff and ERP
software. The micro model summarising the above information is presented in Figure 3.3.
For each micro model, the sources of inputs and the recipients of outputs were also
identified. For example, for the manage supply activity, the inputs are mainly from the
demand managers, customer services and the production department receives the outputs.
This also helped to validate and amend the processes identified at the beginning of the
modelling exercise.
29
Figure 3.4 Micro IDEF0 model of Manage Supply
The micro models generated through interviews were digitised and consolidated using
IDEF0 software (AI WIN -Version 7.2, http:// www.kbsi.com). The consolidated
micro models were used to structure the macro IDEF0 model. An example of the macro
IDEF0 model is shown in Figure 3.3. Some activities were decomposed further to
understand them in detail. The IDEF0 software indicates parent activities with shaded
boarder around their activity boxes. These macro models were elaborated with sufficient
detail and coupled to produce the As-Is model of the organisation (See Results chapter).
To avoid unnecessary decomposition mapping, setting the context, purpose and
viewpoints of mapping usually preceded the mapping exercises.
30
31
Figure 3.5 A Macro IDEF0 model of Thermo operations
3.4 Soft Systems Methodology (SSM)

Initial analysis of the Huhtamaki problem showed a predominantly political emphasis. As
an organisation it was complex and dynamic, so the need to consider the socio-economic
variables, which is deemed appropriate, then the shift from hard to soft systems. The SSM
is adopted to carry out the required analysis. The Huhtamaki problem can be treated as a
system whose main characteristics include interconnected functions, boundary conditions,
emergence, sub-systems and processes. The boundary conditions include competition
from other manufacturers, and customers requirements etc. The problem was divided
into its Issue based and Primary Task based components and analysed using the seven-
step SSM approach.
3.4.1 Understanding and expressing the problem

The first two stages form the expression phase of the methodology. This phase was
completed by the development of As-Is IDEF0 maps. A dialogue-based rich picture was
also developed. The use of rich picture was limited as much of the information was
captured in the As-Is IDEF0 maps.
3.4.2 Formulating Root Definitions

Five root definitions were developed in total. These were not produced at the same
instance. Initially two root definitions (RD1 & RD2) were formulated, RD1 relating to the
primary tasks and RD2 addressing the issue-based view of the system. While
developing RD1, the operations managers worldview of the existing organisation was
taken, whereas in RD2, the Operations managers vision of converting raw materials to
finished products with minimum labour, minimum time and without compromising
quality is taken as the worldview. Three more primary task based root definitions (RD3,
RD4 & RD5) were formulated to describe some of the problematic subsystems identified
in the initial analysis of RD1. In developing RD3 the worldview of Maintenance leaders
is considered, Engineering store managers worldview for RD4 and Training officers
worldview for RD5.
32
3.4.3 Building Conceptual models

Five concept models (CM1, CM2, CM3, CM4 & CM5) were produced for each of the
root definitions formulated. Following rules were applied in the process: 1. Concept
models must be derived from the words in the Root definitions; 2. Justification of the
model against the formal systems model (FSM). The elements of the FSM are
connectivity, purpose, measures of performance, decision taking process (control),
boundary, resources and hierarchy.
3.4.4 Comparison of concept models with the real world activities

This stage of the SSM was carried out by comparing each activity in the concept models
with the real world activities. The real world activities are represented in the rich picture
and IDEF0 models. The comparison is a seven-step enquiry process. First the activities
are questioned whether they exist in real world or not; Second if the activities are present,
then who does it; Third, how is it done; Fourth, how is it judged that an activity has been
done; Fifth, evaluate the activity has been done as desired (judgement); Sixth, list any
potential changes required to achieve the desired activity and finally what are the
political, social, economical and ethical implications of those changes to the system as a
whole. The results of the above analysis were recorded in a table format as shown in
Table 3.1 (Wilson, 2001, p65). The comparison was an iterative process, for those
questions where adequate answers were not available from the rich picture or IDEF0
models, process experts are consulted. This was also a learning process for both the
author and the actors in the system being modelled. The output of the model comparison
stage is a set of conclusions derived from the comparison tables, which would help the
problem owner/ owners to improve the problem situation.
Comparison of Concept model # with real world activities
Activity Is it By How? How is it Judgement Potential Implications

done Whom? Judged? changes
now?
Table 3.1 Format of the Table used for comparing concept models
33
3.5 Value Stream Mapping `

The purpose of this was mainly to identify waste and potential activities to be automated.
Mapping of all the production lines were undertaken and the results were recorded in
process charts (See the format used in Figure 3.6). Each step in the process has been
categorised in terms of five activity types: operation; transport; inspection; delay and
store. The process chart format used was a modified version of Microsoft Excel template
provided with the textbook Operations Management by Krajewski and Ritzman. A
stopwatch was used to note the time taken by each activity. Distance was measured by
walking the distance travelled by the products/ operators and approximating the value to
the nearest feet measurement. Distance measuring instruments were avoided as it could
intimidate the participants.
Figure 3.6 Format of the process chart used
34
3.6 Workflow mapping

The workflow mapping was performed to track the movement of finished goods, Raw
materials, Reels and Tools. This information is especially useful for evaluating current
plant layout and designing new plant layout. The flow paths were identified by means of
observation and enquiry. Their flow paths are plotted over the existing plant layout
drawing using AutoCAD 2006 software. The distances travelled were measured and
possibilities of shortening the paths were examined.
3.7 Plant layout design

The methodology described by Meyers and Stephens (1999) was adopted for developing
layouts. In general it involved six stages: 1. Develop activity relationship charts; 2.
Develop worksheet; 3. Develop dimensionless block diagram; 4. Perform flow
analysis; 5. Allocate areas to the block diagram; 6. Produce the final layout. The readers
are directed to the text referred, for detail explanation of the individual stages. However,
to comprehend a brief outline of the stages follows.
3.7.1 Activity Relationship Diagram
Figure 3.7 Activity relationship Diagram matrix
35
As the name suggests, the activity relationship diagram shows the relationship of every
department, office, or service area with every other department. First, the departments to
be included in the plant were identified, second their interrelationships were determined.
The interviews and the As-Is maps helped in this process. Finally, closeness codes were
assigned to reflect each relationship. The closeness codes are as follows:
A Absolutely necessary that these departments be next to each other.
E Especially important
I Important
O Ordinary importance
U Closeness undesirable
The department names and closeness codes were arranged in a matrix format (See Figure
3.7). The experts in the organisation were consulted to check the closeness factors. Thus,
it was an iterative process.
3.7.2 Worksheet
The worksheet is the stage between the activity relationship diagram and the
dimensionless block diagram and shows the same relationships as the activity relationship
diagram. It was developed by listing the activity/ department number(s) under the
appropriate relationship in a table format (See Table 3.2).
Table 3.2 Activity Relationship Worksheet.
36
3.7.3 Dimensionless Block Diagram (DBD)

The dimensionless block diagram is the basis for master layout and plot plan. Producing a
DBD is an iterative process, so CAD software (AutoCAD2006) was used. For each
department or activity, squares about 2-inch X 2-inch were drawn. Each square was
marked by placing the activity number in the centre and the relationship codes at the
corners as shown in the Figure 3.8.
A E
Activity number (n)

X
I O
Figure 3.8 Representation of a single block
These squares are then arranged next to each other in a way to satisfy as many activity
codes as possible. Meyers & Stephens, (1999, p143-144) explains the procedure in detail.
The basic idea is all As should have full side touching and all E should have at least a
corner touching. No X relationship should be touching. The shape of the resulting
layout is not important; the importance is on satisfying the relationships.
3.7.4 Flow Analysis

Flow analysis was performed to validate the dimensionless block diagram. The purpose
of the flow analysis is to ensure that the layout makes sense and the routing of materials
etc is considered.
3.7.5 Area allocation

The purpose of the plant layout design was not to produce a new plant but to design a
better layout within the boundary of the existing building; hence, the conventional area
allocation procedure was not applied. The approximate areas required for each
department were calculated from the existing layout. The areas were then allocated to the
dimensionless block diagram.
37
3.7.6 Ideal layout for Thermo

The resultant block diagram was overlaid on the existing thermo plant layout to see the fit
of all functions in the available space. Finally, an ideal layout was developed allowing
some tradeoffs.
3.7.7 Thermo layout with minor modifications

Implementing the ideal layout will cause prolonged disruptions to production. As a short-
term alternative, another layout with minimum disruptions to the facility and production
was designed using the ideal layout as a guide. This was considered as a more practical
option.
3.7.8 Combined Thermo and Paper-cup layout

A third layout was developed combining Thermo and Paper-cup layout. The inside details
of the paper cup facility has not been modified greatly as the idea was mainly to suggest
an ideal location to place the paper cup plant in relation to Thermo and to assess the
benefits of such a capital intensive project.
3.8 Feasibility and budget costs
3.8.1 Thermo Automation

The real saving on labour can be achieved only by automating the labour intensive
processes. A requirement specification was issued to the suppliers. The priority of lines to
be automated was decided by analysing the line loading per year and the volume and
variety characteristics. Several industrial automation suppliers were brought-in to analyse
the requirements and submit their proposals and recommendations.The automation
project was spread over a period of 3 years and into four phases. Microsoft project Gantt
chart was used for this purpose. It also shows the labour saving per line and the budget
costs of automation. The payback for the total automation was calculated. To calculate
the payback the percentage line loading per year and the number of people that can be
saved through automation were considered.
3.8.3 Paper-cup and Thermo consolidation

First, the major activities required were identified, and then budget costs and time scales
were obtained from builders and other contractors.
38
3.9 Decision analysis using Analytic Hierarchy Process (AHP)

It was decided to perform a cost-benefit analysis to select the best option from the three
strategic options identified.
3.9.1 Structure of the Hierarchy model

The cost analysis and benefit analysis hierarchies were developed as separate AHP
models (See Figures 3.9 & 3.10). Cost analysis model with a goal of selecting the project
with the lowest cost and Benefit analysis model with the goal of selecting the project with
the most benefits. The validity of the hierarchies was assessed by asking whether the
elements of an upper level can be used as common attributes to compare the elements in
the level below. A logically constructed hierarchy is the backbone of the entire AHP
approach, which means AHP is both a problem solving and problem-structuring tool.
Select project with

the lowest cost
Senior Middle
Shareholders
Managers Managers
Production Quality Maintenance Facilities
Capital Depreciation Disruption Timeframe
Plant Plant Plant

Redesign Automation Consolidation
Figure 3.9 Cost Analysis hierarchy
The first or uppermost level identifies the stakeholders, i.e. shareholders, senior managers
and middle managers those who have the most influence in organisations decision-
making process. The second level is an extension of first level and shows the decision
39
makers in middle management. The third level is concerned with the main criteria or
objectives that affect the project selection and the last level shows the three strategic
options. Both cost and benefit hierarchies share the same elements in all levels except the
third level. The number of elements in each level was limited to plus or minus seven the
magic number (Saaty & Ozdemir, 2003). The elements of the various levels are explained
in detail below:
Select project with

the most Benefits
Senior Middle
Shareholders
Managers Managers
Work Time Material Labour Company

Quality Flexibility
Environment Saving Saving Saving Image
Plant Plant Plant

Redesign Automation Consolidation
Figure 3.10 Benefit Analysis hierarchy
Stakeholders (Level 1 and 2)

Identification / selection of the stakeholders (actors) were not so difficult in this problem.
All the three options called-for considerable financial investment. This required the
approval of the shareholders. The senior managers make the strategic decisions for the
company and obtain the funds required to implement those plans. The middle managers
implement the strategic plans as well as help the senior mangers in the planning process.
Four middle managers: Production, Quality, Maintenance & Facilities are included in
level two. Although they fall in the same level in the organisational hierarchy, each have
dissimilar stakes/ preferences/ power in organisational matters. Prioritisation of their
40
stakes was essential for a high-quality decision. This is achieved by adding a separate
level in the hierarchy as shown. Other stakeholders can be included in the hierarchy if
necessary. In this case, those stakeholders were included who had the most say in the
decision making process as perceived by the author.
Criteria (Level 3)
This level shows the cost and benefit criteria. As many criteria can be added, but here
only the key criteria were listed. They were identified based on authors knowledge of the
three options and comments from stakeholders in the company. The logic of traditional
cost-benefit analysis was applied here. Cost criteria are those, which required direct or
indirect spending from the company. Four kinds of costs were considered: Capital,
Depreciation, Disruption and Timeframe. Naturally Capital and depreciation costs need to
be considered as all the three options requires profound capital investment. Disruption
costs are important as all thee projects causes varying amounts of disruption to the
existing production process. Various other costs will be incurred based on the estimated
duration of the options.
The benefit criteria are those, which could attain quantitative or qualitative benefits to the
company such as work environment, time saving, labour saving, material saving,
improved quality and flexibility. The choice of criteria needs further explanation.
Potential benefits are expected due to improved ergonomics and workflow; time saving is
possible through reduction in packing time, palletising time and shipping time; Labour
saving can be gained by reduction in the number of packers, operators or other workers;
Material saving is possible by reduction in start-up losses or scrap; Benefits are gained by
improving quality which could be consistent production output and reduction in scrap;
Flexibility can be achieved through the ability to expand the production facility and
sharing of resources.
3.9.2 Analysis of AHP

Decision applications of the AHP were carried out in two phases, viz 1. Hierarchic
design, 2. Evaluation. In the evaluation phase, the first step is to assess the relative
importance (local priorities) of the stakeholders in making strategic decisions (Labib,
Williams & O Connor, 1996). The evaluation is achieved via a pair-wise comparison
based on their ability to influence the decisions. The pair-wise comparisons and local and
41
global priority computations were carried out using Expert Choice 2005 software
(http//: www.expertchoice.com). The relative importance of criteria , alternatives with
respect to stake holders were collected using 1- 9 scale questionnires. An example of the
questionnaire is shown in Figure 3.11. First, Pair-wise comparisons were conducted based
on hypothesised weights and relative importance of the members of the stakeholders.
Second, priorities of the criteria/ objectives were obtained in a similar fashion followed
by the final assessment of the relative importance with respect to the three strategic
options with respect to the criteria.
Figure 3.11 Example of 1-9 scale Questionnaire used to record relative importance
3.9.3 Sensitivity analysis

Sensitivity analysis was performed to analyse the robustness of the models. It is useful to
test the responsiveness or sensitivity of the outcome of a decision to changes in the
priorities of the major criteria (Saaty, 1995, p140). Expert Choice software allows five
ways of representing the sensitivity of the model such as: Performance sensitivity;
Dynamic Sensitivity; Gradient sensitivity; 2D sensitivity; Head to Head sensitivity.
42
Figure 3.12 Performance Sensitivity-graph for Best car selection
Figure 3.13 Performance Sensitivity-graph for Best car selection II
An example of performance sensitivity is illustrated here. Figure 3.12 shows the

performance sensitivity graph for a car selection problem. The four criteria are
represented as vertical bars, the left hand scale shows the criteria importance, and right
hand scale shows the alternative priorities. Here for the given criteria levels the first two
43
cars (Volvo and Benz) are most suitable. The sensitivity of this decision can be checked
by altering the criteria weights (Sliding the vertical bars). For example, increasing the
priority of the initial cost showed that best cars to buy are either Ford Fiesta or Fiat Uno
(See Figure 3.13). This proves the strength of the model, and it makes logical sense.
3.9.5 Cost-Benefit Analysis

The global priorities of strategic options calculated using the cost and benefit models
were used to complete the final stage of the cost-benefit analysis. Here the benefit
priorities were divided by cost priorities. The option with the highest score will be the
most preferred option. (Saaty, 1995)
44
Chapter 4
SOFT-IDEF0 APPROACH
4.1 IDEF0 Process Activity Mapping

The deliverables of the IDEF0 process activity mapping were, 1. The As-Is maps, 2. Issue
descriptions, 3. To-Be process models
4.1.1 As-Is process model of Thermo operations

The As-Is map starts with a top-level diagram, which was further decomposed to illustrate
further levels of details (See Figures 4.1 4.12). The Magic number 7 rule (Saaty &
Ozdemir, 2003) was applied in the diagram layout.
45
46
Figure 4.1 Top level As-Is model of Thermo operations
Figure 4.2 Decomposition of Manage Supply Activity
47
Figure 4.3 Decomposition of the As-Is activity Produce Goods
48
49
Figure 4.4 Decomposition of the As-Is activity Manage Production
Figure 4. 5 Decomposition of the activity Control Production
50
Figure 4. 6 Decomposition of the activity Operate Production Lines
51
52
Figure 4. 7 Decomposition of the activity Pack Finished Products
Figure 4.8 Decomposition of the activity Process Engineering
53
Figure 4.9 Decomposition of the activity Manage mechanical Processes
54
Figure 4.10 Decomposition of the activity Manage Electrical Processes
55
Figure 4.11 Decomposition of the activity Maintain Plant & Machinery
56
Figure 4.12 Decomposition of the activity Manage Engineering Store
57
4.2 Soft Systems Methodology (SSM)
4.2.1 Understanding and expressing the problem

The rich picture developed in this phase is shown in Figure 4.13. According to Wilson,
rich pictures should not contain large pieces of text and be comprised of simple pictures,
arrows etc. Both Checkland and Wilson say that rich pictures are tools for the facilitator/
consultants use and must not be used for any communication with Client. However, the
author believes that any method that can express the real situation suitable to the users
should be used. The rich picture gives an overview of the system. It may be possible to
make several rich pictures to represent details of the problem. In this case, the As-Is
model developed using IDEF0 was used to gain insight into the details of the processes.
58
Figure 4.13 Real Picture developed after initial interviews
59
4.2.2 Formulating Root Definitions

The five root definitions developed and their constituting CATWOE elements are given
below.
Root Definition 1 RD1
A Huhtamaki shareholder owned system operated by Huhtamaki employees, to
manufacture plastic packaging products using thermoforming technology in order to
satisfy the requirements of customers while recognising the competition from other
suppliers.
C : Customers
A : Huhtamaki employees
T : Manufacture of plastic packaging products
W : Plastic packaging products can be manufactured using thermoforming
technology and satisfy the requirements of customers
O : Huhtamaki Share holders
E : Competition from other suppliers

A Huhtamaki shareholder owned system operated by Huhtamaki employees, to covert raw
materials into finished products with minimum labour and minimum time and by but not
compromising the quality while recognising the requirements of customers and
competition from other suppliers.
C : Customers
A : Huhtamaki employees
T : A system to covert raw materials into finished products with minimum labour,
minimum time but not compromising the product quality
W : It is possible to convert raw materials into finished products with minimum
Labour and minimum time without compromising the product quality
O : Huhtamaki Share holders
E : Competition from other suppliers, customer requirements
60
The Operations manager owned system operated by maintenance personnel, to maintain

the production lines always in good working condition as required by the production
personnel, while recognising the fluctuating production demands from customers.
C : Production personnel
A : Maintenance Personnel
T : To maintain the production lines always in good working condition
W : A maintenance system is necessary to ensure that production lines are kept in
good working condition
O : Operations Manager
E : Fluctuating production demands from customers

The Operations manager owned system operated by engineering store staff, to provide
replacement parts as and when required by the maintenance personnel within the
constraints of the delays caused by suppliers and the price of the items.
C : Maintenance personnel
A : Engineering store staff
T : Provide replacement parts as and when required
W : An engineering store can provide replacement parts as and when required
E : Delays caused by suppliers, Price of the items
Root Definition RD5

The Operations manager owned system operated by the training officer, to train the
production personnel on efficiently and effectively running the production lines while
recognising the different attitudes and skill/ knowledge retention levels of individual
employees
C : Production personnel
A : Training Officer
61
T : To train the production personnel on efficiently and effectively running the

production lines
W : It is possible to train the production personnel in efficiently and effectively
running the production lines
E : Employee attitudes, Skill/ Knowledge retention levels of individual employees
4.2.3 Building Conceptual models

The concept models (CMs) developed with respect to the five root definitions are
presented below (See Figures 4.14--4.18).
62
Know about Accumulate Knowledge

Know customers
thermoforming about the manufacturing
requirements
technology process
Decide how to monitor the
manufacturing process
Decide how to apply

C
Thermoforming Manufacture products
technology in the
manufacture Take control action to
Monitor the ensure that customers
manufacturing requirements are satisfied
process
Co
Decide how to assess the
nt
ro
products to satisfy customers
la
ct i
Activity information requirements
o
Assess the products
n
Appraise available
Determine the skills / employees
capabilities required for
manufacturing and related Define competition Assess the impact of
activities
competition
Assess their respective
capabilities
Know own strengths
Develop employee and weaknesses Decide how to react
skills / capabilities
C
Inform activity
controllers Formulate goals and
Match capabilities Allocate activities to objectives
and requirements
Co
employees
nt
ro
la
Take control action to ensure

ct
io
conformanace
n
Monitor the match of Take control action to con Monitor

capabilites to requirements match capabilities to tro l act
ion conformanace
requirements
Performance information C
from all activities
Determine performance
measures
Monitor system performance
Take control action to Determine Shareholders

Contr o achieve expectations performance expectations
l action
Figure 4.14 Concept Model 1 CM1
63
Know how to convert

Loose unnecessary Know about
raw materials into
employees available employees
finished products
Know customers
requirements
Take action to
ensure only Determine minimum Decide how to achieve
minimum labour is labour required for conversion with minimum
allocated conversion without labour and resources without
compromising quality compromising quality
Obtain raw materials

Take action to
Retain and develop
ensure only
Minimum labour
minimum time is Take control action to ensure
Determine minimum
allocated that resources provided can
time required for achieve conversion with
conversion without minimum labour and time
Provide raw materials compromising quality
Allocate minimum Allocate minimum
labour to conversion time for conversion
process process
Monitor provision of
Monitor provision of
resources Determine new
raw materials
resources required
Convert raw materials

into finished products
Provide resources
provision of materials to achieve
conversion with minimum labour Know about new
and time resources
Decide how to achieve Appreciate existing

Monitor the conversion
conversion without Obtain resources resources
Assess Impact on process
compromising quality
product quality
Control the
conversion process
Define competition
Take actions not to
compromise product Define quality Assess the impact of
Decide how to react
quality competition
Inform activity
Performance information controllers
from all activities Determine performance Formulate goals and
Co
measures nt r objectives
ol a
c t io
n Take control action
Monitor system performance to ensure
conformanace Know own strengths
Monitor
and weaknesses
conformanace
Take control action to Determine Shareholders

achieve expectations performance expectations
action
Contr ol
64
Con
Determine replacement trol
a cti
parts required on
Take control action to
Decide how to maintain the
ensure development of
production lines always in Monitor development
maintenance procedures
good working condition of maintenance
procedures
Know about current Develop maintenance Know the strategic plans
n
tio
Production Lines procedures of the company
ac
ol
ntr
Co
Maintain production
lines Monitor maintenance Take control action to
Determine the priority of of production lines ensure production lines
production lines to be
are kept in good working
maintained
condition
Know about production

demands
from all activities Define performance measures
appropriate to the maintenance
requirements
Assemble information about total
performance
Report on performance to
Take control action to Operations manager
ensure that performance is
as required by the
on Operations manager
ct i
tro la
Con
65
ion
Appreciate act
replacement parts
Know delivery lead-
ntrol
times of suppliers Co
required

Obtain replacement parts are provided on time
parts
Provide replacement
parts
Know the cost of

replacement parts Store replacement
parts Monitor provision of
replacement parts
Monitor storage of
replacement parts
Know storage area
available Con
trol
Take control action to acti
Determine storage on
ensure parts are stored in
area required
order to provide on time
from all activities
Define performance measures

Assemble information about
appropriate to the provision of
total performance
replacement parts
Co
ntr
ol

act
ensure that performance is Report on performance to

ion
as required by the Operations manager

Operations manager
Know how to run the production

Know the strategic plans lines efficiently and effectively
of the company
Develop training Decide criteria for

Procedures assessment
Monitor development Assess the trained
ol
of training procedures employees Contr
action
Recognise individual
employees attitudes, skill / Take control action so that
knowledge retention levels employees can run the lines
Con
efficiently and effectively

tr
ol ac
Monitor trained
Train the Employees
employees
tion
Take control action so that to

develop training procedures to
operate lines efficiently and Define performance measures
effectively Consider the time appropriate to the training
available requirements
Co
from all activities

ntr
ol
ac
Assemble information about Report on performance to

tio
n
total performance Operations manager

ensure that performance is
as required by the
Operations manager
66
4.2.4 Defensible logic of concept modelling

It is vital to justify the structure and composition of the concept model against the formal
systems model. One of the simple concept models, CM5 is used here to explain this logic.
Connectivity: The dependencies between actors (Training officer), constraints (Employee
attitudes, Skill/ Knowledge retention levels), and performance control are linked to all
other activities through arrows representing information dependency and/ or constraint
dependency.
Purpose: This is clearly defined in the transformation process (To train the production
personnel).
Measure of performance: These are not explicitly stated, but provision of the monitor and
assess activities will lead to measures. E.g., Monitor development of training procedures;
Monitor trained employees; Assess the trained employees.
Decision-taking process: These are explicitly specified by the control activities
Boundary: The boundary is defined by encompassing the activities in sets and providing
controllers for the total set of activities.
4.2.5 Comparison of concept models with the real world: The Soft-IDEF0 approach
The results of comparing concept model1 with the real world activities are given in Table
4.1. The comparison tables for the remaining concept models are given in the Appendix.
Comparison of Concept model 1 (CM1) with real world activities
Activity Is it By How? How is it Judgement Potential Implications

done Whom? Judged? changes
now?
Know yes Sales Through Managem Customers Develop Improved
custome and sales staff ent generally longer term feedback
rs marketi contact reviews satisfied sales through S &
require ng staff strategies for Ops
ment growth meetings
Know yes NPD Knowledg Ability to Need more Need to de Speed up
about staff, e gained develop support from skill problem
thermof and through process seniors processes solving, Key
orming process experience and new through new people fear
technolo engineer products technology of loosing
gy s power and
control
67
Accumu yes Specific Developin Staff Very rarely Need to have Informed
late ations g standard could used. Bulky user friendly decision
knowled staff, operating easily use files. Many a system that making
ge about Training procedures them for does not allows easy rather than
manufac officer , training know they storage and an
turing production and exist retrieval individual's
databases reference judgement
Decide Yes Process Brainstor Not Need to Can ensure

how to engineer ming judged involve monitoring
monitor s between people from of critical
the themselve production process
manufac s and detail areas.
turing analysis of Efficient use
process the of resources,
manufacturi Process
ng process engineers
need to be
convinced
Decide Yes NPD Brainstor Managem New New NPD New
how to ming ent products are structure and customers,
apply between meeting mainly group more sales,
Thermof themselve variations of coordination production
orming s existing capability
technolo products stretched
gy in the
manufac
ture
Manufac Yes Machine Extruding Produce Meet New Cost
ture s and sheets, the quantity technology reduction
products shop thermofor quantity specified
floor ming, specified
staff trimming, in shop
rim rolling orders
etc
Monitor Yes Producti By Smoothly production Continuousl Reliable and
the on attending running lines do not y Monitor consistent
manufac manager to issues machines run production output that
turing , shift reported smoothly stages, meet
process manager by very often Automate customer
s operators, the specification
walking monitoring s, May
around process require high
capital
investment
Take Yes Operato Check products The products Need to Continoues
control rs, conforman in the do not investigate production,
action to Quality ce of acceptable conform to the root less
ensure assuranc products variance specification causes frustrated
that e team to limit to , often needs operators,
custome customers specificati operator happy
rs specificati on intervention customers
require ons, if not
ments adjust
are machine
satisfied controls
68
Decide yes Quality Developin Customer Retained Directed Potential

how to Assuran g quality satisfactio business through organic sales
assess ce manuals n surveys Sales & growth
the Manage etc. Operations
products r processes
to
satisfy
custome
rs
require
ments
Assess Yes Operato Checking Should There are Automate Reduction in
the rs them meet all human the human error,
products against aspects of errors, assessment Assessed
specificati specificati through data can be
ons ons repetition stored and
analysed for
future use,
efficient use
of operator
time
Determi Yes Human Referring Annual colour vision Analyse the Efficient &
ne the to resource to the appraisals and manual processes effective
skills some s and skills of dexterity and the production
required extent Training existing alone are not people and processes,
for officer operators enough determine motivated
manufac criteria the skills/ workers, less
turing motivation labour
and factors to turnover,
related facilitate more work
activitie those for HR &
s processes training
Know Yes Human Mainly Previous At present More people Right people
availabl resource internal work existing from outside for the right
e s, recruitmen history packers are organisation jobs
employe producti t considered should be
es on for an
manager operators
, shift position
manager
s
Assess Yes Human colour Pass the Tests are Strict right people
their resource vision and tests inadequate assessment for the right
respecti s Manual criteria and jobs' can be
ve producti dexterity tests, include ensured,
capabilit on and tests simple reduction in
ies shift psychometri labour
manager c tests, let turnover,
s candidates more work
know whats for HR
expected of
them
69
Develop Yes Training Induction Ability to Only couple Provide Will generate
employe officer training to operate of expert continuous more expert
e skills/ new some of operators as training and operators,
capabilit operators the there is no assessment less machine
ies machines continuous downtimes,
provision of may need to
training. No sort out
motivation issues of
for operators grading
to learn new
skills
Match No yes manageme Ability to People who Introduce Reduction in

capabilit nt operate are not apprenticesh labour
ies and production motivated to ips to turnover,
require lines do the job, develop increased
ments but take the employees performance,
job for with Satisfied
money required employees
skills and emploers
Allocate Yes Producti Training Appraisal HR process Training More
activitie on matrix s flexibility
s to manager
employe and
es Shift
manager
Monitor yes Line Appraisal Performa Line Review Improved

the manager s nce performance training skills
match of s criteria needs
capabilit
ies to
require
ments
Take yes Senior New Efficienc cost Investment Lower cost
control manage process y base
action to ment technolog
match y
capabilit
ies to
require
ments
Define yes Sales Market Sales turnover Investment Loss of sales
competit share growth
ion
Assess Yes Sales Market Sales turnover Investment Loss of sales
the share growth
impact
of
competit
ion
Know Yes Senior Group Managem KPIs Actions Develop
own manager Meetings ent review from strength and
strength s management improve
s and meetings weaknesses
weaknes
ses
70
Decide Yes Senior Group Managem KPIs Actions Develop

how to manager Meetings ent review from strength and
react s management improve
meetings weaknesses
Inform Yes Senior Meeting, Actions Excellent
activity manager emails taken by communicati
controlle s controllers on between
rs controllers
Formula Yes Operatio Setting Achievem Not all KPI's Need to Employees
te goals ns Key ent of are met communicat would feel
and manager performan KPI's e the goals part of the
objectiv and ce and company,
es other indicators objectives to motivate
manager lower levels them to
s achieve goals
Take yes Shift Actions KPIs Monthly Success of Lower cost
control manager management actions base and
action to s reviews improved
ensure efficiencies
conform
anace
Monitor Yes Producti
conform on
anace manager
Determi Yes Operatio Meetings Share Share price Lack of
ne ns with price supprt
Sharehol manager representat through
ders ives reduced
perform dividend and
ance share price
expectat
ions
Determi Yes All Turnover, Ebit Monthly Actions Imroved
ne business KPI's reviews from Ebit
perform areas management
ance meetings
measure
s
Monitor Yes Operatio Meetings, KPIs Managemen Results and Improved
system ns Review t reviews trends of ebit
perform manager performan KPIs
ance ce reports
Take Yes Operatio Meetings, KPIs Managemen Results and Improved
control ns Review t reviews trends of ebit
action to manager performan KPIs
achieve ce reports
expectat
ions
Table 4.1 Comparison of Concept model1 with the real world activities
4.1.2 Issues / Bottlenecks identified

Much valuable information about the current activities was gathered during the mapping
process. They are listed below.
71
There is no central point of contact for customer complaints. The customer service
is responsible for the invoice related queries and the Quality systems are
responsible for all other queries and complaints. Often some customers contact the
wrong team to report an issue.
Production plan is set for 7 days. However, this plan rarely stays fixed due to
machine downs and material shortages etc.
The Quality assurance function was mainly conducting the inspection of variation
in production. This inspection was carried out 3 times in a shift. The inspection
sheets are filed, but it was not clear that this data is analysed for long-term
purposes. A computerised system could help the operators to make real time
decisions and the auditing team for Historical data analysis.
The Shift managers were found to be very busy with daily paperwork. The
production manager was engaged in micro issues such as repairing rapping
machines and fault finding of production lines etc.
Production inefficiencies due to lack of skills. There were only two expert
operators available per shift. This meant that some of the less skilled operators
could not maintain continuous production. They stopped the line if they came
across a problem that they could not fix causing losses. It was physically not
possible for the experts to assist the other line operators.
Lack of continuous training and assessment. Production operators are selected
based only on manual dexterity and colour vision tests etc. In some cases, packers
were promoted as operators. The training is given only at the beginning. The
grading system and performance assessment was not communicated well to the
operators.
Material handling issues. The material handlers set the blend ratios, but the
operators regularly change the setting to avoid any possible quality issues and
subsequent problems. They try to avoid using regrind material. The material
handlers also have to face occasional shortage of raw materials.
Production control had to prepare daily production overview reports for the
production managers using Excel. In fact, the production management staff
themselves could generate these reports from the ERP system. The shop floor
staffs often help themselves to low cost items such as sealing tapes and poly-bags
without using the necessary request forms.
72
The Planned maintenance was often rescheduled to attend to breakdown

maintenance. There were also coordination issues between the Tool change,
Breakdown maintenance and planned maintenance functions. At present, the
production manager is also in charge of the maintenance function. This resulted in
higher priority given to production compared to maintenance. The maintenance
tracker sheet does not include information about replaced parts. There was an
Excel based maintenance management system available, but it was not being used
as the users found it too complex to understand and use. The maintenance staffs
also do not have direct access to the CAD database, which caused delays in
getting parts fabricated etc.
At the Engineering store, there was no system (manual or computerised) listing
the parts inventory to the direct users such as fitters and engineers. They needed to
ask the store manager verbally or fill out a request form that will be filled partially
by the storekeepers. The store manager updates the inventory based on the manual
or verbal requests. The store manager admitted that the present system caused
many errors in stock levels.
The raw material warehouse did not have enough space to store the finished
goods, so it was observed during the project that the shop floor walkways are
filled with pallets to be shipped.
4.1.3 To-Be process maps for Thermo

To-Be maps for some of the major issues observed were developed (See Figures 4.19-
4.21). The To-BE Manage store activity has been improved by providing a computerised
inventory movement system. This system allows users to locate the parts themselves and
update the inventory data automatically once the parts are withdrawn. The To-Be
maintenance management incorporate a computerised maintenance management system.
This system takes the maintenance history as the input and develop appropriate
maintenance procedures, prioritise maintenance procedures and develop inputs for the
computerised training system. The To-Be Training model, take new recruits for training
than existing packers, grades the trainees who come back for further training. This
creating feedback and continuous training and assessment. It also incorporates
computerised Training System avoiding huge paper based training manuals.
73
Figure 4.19 To Be Training
74
Figure 4.20 To-Be Engineering Store Management
75
Figure 4.21 To-Be Maintenance management
76
Chapter 5
PLANT LAYOUT DESIGN AND
AUTOMATION
5.1 Plant Layout Design
5.1.1 Workflow mapping

Flow paths were plotted on the current plant layout (See Figure 5.1). Two problems in
flow paths were prominent: Four production lines (#15, #16, #18, #20), were installed
with their packing section away from the main gangway. This required the finished goods
to be routed backwards through conveyors to the front of the lines. Waste of material,
time and power (See Figure 5.2). Another flow issue was with the tools movement, the
current location of the tool room required the tools to be taken around to the lines in a
longer route than necessary (See Figure 5.3). The other flow maps produced were shown
in Appendix.
Figure 5.1 Current layout of Thermo
77
Figure 5.2 Finished Goods flow path
78
Figure 5.3 Tool Flow path
79
5.1.2 Activity Relationship Diagram

The activity relationship diagram developed is shown in Figure 5.4. Several days were
spend in developing the relationship diagram as it forms the backbone of the layout. The
explanation for each closeness code shown is beyond the scope of this paper. Meyers &
Stephens (1999, p140) suggests the use of reason codes for this purpose. Here for
illustration purposes, some closeness codes are explained. The shop floor itself was
considered as a department as it performs the core manufacturing process of the company.
All the other departments are considered as supportive functions. Some readers may
disagree with the logic and may confuse with the terminology of shop floor and plant. P.
Managers room (Production Managers room) and shop floor are given an absolutely
necessary (A) closeness code. Naturally, the production manager should be close to the
shop floor to monitor and control the processes. Similarly, an absolute closeness is
assigned between production control and shop floor. It should be noted that the material
lab and quality inspection room are assigned X closeness codes to several departments.
This is because these two departments contain several sensitive instruments, which could
malfunction due to vibrations, magnetic fields etc. The process knowledge gained through
the IDEF0 modelling was also helpful to allocate appropriate closeness codes to various
departments.
Figure 5.4 Activity relationship Diagram of Thermo
80
5.1.3 Worksheet
The worksheet developed from the activity relationship diagram is shown in Table 5.4.
Any errors are avoided by checking that every activity number appear somewhere on
each row.
Table 5.1 Activity Relationship Worksheet.
5.1.4 Dimensionless Block Diagram (DBD) and Flow analysis

The DBD developed using the activity relationships are shown in the Figure 5.5. It was a
time consuming process as it was not always possible to maintain the closeness of the
departments as defined by the worksheet parameters. The best possible layout was
chosen. The routing of the raw materials to the finished product and the flow of the tools
are especially important in the case of Thermo. These flow paths were plotted over the
block layout until a smooth flow through the concerned departments were obtained.
81
Figure 5.5 Flow analysis of Dimensionless block diagram
5.1.5 Area allocation

The areas required by departments/ activities were calculated from existing plant layout
(See Table 5.2). The information collected from interviews was also considered in
allocating areas. For example, the space provided in current layout for reel storage was
inadequate, so more area was allocated to Reel storage.
Table 5. 2 Areas required by individual departments
82
5.1.8 An ideal layout for thermo

An ideal layout for Thermo was developed using the dimensionless block diagram (See
Figure 5.6).The production lines were laid out based on following conditions: lines that
used same raw material were to be kept together to reduce the raw material routing; lines
that used reel-feed were kept together to reduce reel movements; Reel extruders to be
placed closer to the reel store to reduce reel movements; All lines to face the gangway to
reduce finished good flow path; Extra space at the front of all lines for packing
automation units.
Figure 5.6 The ideal layout for therm0
83
5.1.9 Layout with minor modifications
Figure 5.7 The Thermo layout with minor modifications

In this layout (See Figure 5.7) the keifel lines (#15, #16, #18, #20) were rotated 1800 so
that the distance travelled by the finished goods can be minimised. The second change
was the repositioning of the tool room with engineering store and maintenance office.
This change had two benefits: 1. it reduced the distance covered for tool changes; 2. it
will allow the reorganisation of engineering store into a larger space. An unused
mezzanine floor available at the site can be used for that purpose. One of the rationales
84
for this expansion move is the additional spares inventory to be kept for the new
production lines. An extension was added for the raw material and reel stock storage.
The rationale for this was that the current raw material store area would be used in future
as a central palletising area. The workflow mapping exercise also proved that very little
space was available for reel stock in the existing layout.
5.1.10 Consolidated Layout of Thermo and Paper-cup

The consolidated Thermo and Paper-cup layout in shown in Figure 5.8. It was decided to
combine the shipping functions of both plants. To achieve this it was necessary to keep
the two plants joined together. There were two options: one to build the plant in multiple
stories at the rear of the thermo plant; and the other to build a single story plant to the left
of the Thermo plant. The second option was chosen, as first option will restrict the future
expansion of both Thermo and Paper cup. The land near the current shipping was
identified as the ideal location to base Paper cup. This plan allows in a less disruptive
integration of Paper cup to the Thermo plant. The layout in Figure 3.20 shows the single
storied arrangement. The layout shows both palletisers placed in the same area. An
additional receiving bay was added to allow Paper cup goods in. The building floor area
can be reduced by installing some of the machines on a mezzanine-floor, for example, the
cup formers can be placed at the bottom and the packing stations at the top. The
administrative office was not in the scope of the plant layouts. However, the senior
management recommended the land in front of Thermo for that purpose.
85
86
Figure 5.8 Consolidated Thermo & Paper-cup plant layout
5.2 Automation of Thermo
5.2.1 Value Stream Mapping

The results of the value stream mapping were recorded in the Process charts. The
mapping exercise was performed to analyse the operations of eleven production lines at
Thermo. The remaining seven lines were being installed at the time of mapping. The
mapping was completed over a period of two weeks mainly due to line downtimes.
Figure 5.9 Process chart of Line 2 operations
87
The active observation caused discomfort to some subjects in the activity being mapped.
It was necessary to explain to the curious members that, it was the process the author was
interested and it was not a faultfinding exercise. They became accustomed to the authors
presence after the first few days. Another problem was the high noise levels at the shop
floor. This made communication to the members difficult. One of the process charts
developed is presented below (See Figure 5.9). Refer Appendix for more process charts.
In general, it was noted that most of the time a packer had to wait for the products to
collate. Therefore, output speed of the machine had a direct impact on the packing time.
The packer used the waiting time to erect and line the cartons. Therefore, buffer stocks of
lined cartons were found near all production lines. The major wastes identified in the
mapping are the distance moved by the packer to stack the pallet and the time for
transporting the finished pallet to a stretch-rapping machine. Considering these factors, it
was decided to explore automation of packing, palletising and the transportation of
finished goods to shipping.
5.2.2 Feasibility of automation

The decision on which lines to be automated was made by analysing the line loading per
year and the volume and variety characteristics. The figures 5.10 & 5.11 show the
analysed data. The lines with high loading and less variations were given priority. Thus,
It was decided to automate lines #8, #9, #3, #12, #13, #14, #20, #18, #16, #15 and #5.
Figure 5.10 Annual percentage line loading
88
Volume-Variety Correlation
8
e
lin
800,000 30
2
e
lin
700,000
25
600,000
3 20
14
e
500,000
lin
18
ne
Li
ne
5
Volume
Variety
Li
e
6
lin
400,000 15
9
lin
15
16
e
lin
ne
ne
5
e
Li
Li
lin
300,000
12
8
ne
13
10
e
lin
Li
ne
Li
4
200,000
9
e
e
77
lin
lin
ee
linlin
3
14
5
4
18
12
2
15
16
e
1177
e
lin
lin
e
13
lin
ne
ne
ne
100,000
lin
ne
ne
nnee
ne
Li
Li
Li
Li
Li
LLii
Li
0 0
Annual Volume (000) Product Variety
Figure 5.11 Volume-Variety correlations per line
5.2.3 Project plan for Thermo automation

Several industrial automation suppliers were approached to analyse the automation
requirements and submit their proposals and recommendations. A requirement
specification was issued to the suppliers. The automation project was spread over a period
of 3 years and into four phases (See Figure 5.12).
The payback for the total automation is calculated as 4.1 years. To calculate the payback
the total cost of the automation was divided by the projected cost savings. The projected
cost saving was obtained by multiplying the annual salary to the number of labour saved.
89
Figure 5.12 3-year Project plan for Automation
90
5.3 Budget costs and timescales of Projects

Budget costs and time scales were obtained from builders and other contractors. The
summery of the major activities, their cost and time scales are shown in the Table 5.3.
Cost Elements Cost () Timeframe (Years)

Plant Redesign 2,000,000.00 1
Plant Automation 5,000,000.00 3
Plant Consolidation 9,000,000.00 2
Table 5.3 Budget costs & Time scale for projects
91
Chapter 6
DECISION ANALYSIS
6.1 Illustration of AHP Analysis
6.1.1 Pair-wise comparisons

Table 6.1 summarises the results of the pair-wise comparison based on hypothesised
stakeholder weights. The weights can be justified as follows. The shareholders have
higher importance compared to senior managers and senior managers have higher
importance than Middle managers do. Shareholders decide which project to invest the
money, so they have the extreme importance; It is the senior managers who decide which
projects are to be proposed for investment, so they have strong importance; It is the
middle managers who decide whether they have a requirement for a project, so they have
a low medium importance.
Top level stakeholders (actors)
Relative
Stakeholder group Shareholders Senior Middle
importance
managers managers
Shareholders 1 3 9 0.672
Senior Managers 1/3 1 5 0.265
Middle managers 1/9 1/5 1 0.063
Inconsistency ratio (CR) 0.03
Table 6.1 Pair-wise comparison of main Stakeholders
The relative importance of the members of the middle managers was assessed in a similar
fashion. The Production manager had the most influence in the company, while the
quality, maintenance and facilities mangers had lesser degrees of influence in an
ascending order. So the weights were assigned in that order. The result of the pair-wise
comparison matrix is shown in Table 6.2.
92
Relative
Sub-group of Stakeholders
Sub-group of importance
stakeholders
Production 1 3 5 5 0.538
Quality 1/3 1 5 5 0.305
Maintenance 1/5 1/5 1 1 0.078
Facilities 1/5 1/5 1/1 1 0.078
Consistency ratio (CR) 0.06
Table 6.2 Pair-wise comparison of middle managers
The priorities of the criteria/ objectives were obtained in a similar fashion as the priorities
of the stakeholders. The weights of the criteria from the stakeholders point of view are
presented in Table 6.3 & Table 6.4.
Cost criteria
Stakeholder group
Capital Depreciation Disruption Time-frame
Shareholders 0.447 0.053 0.105 0.396

Senior managers 0.250 0.054 0.289 0.407
Middle managers
Production manager 0.175 0.060 0.383 0.383
Quality manager 0.113 0.064 0.411 0.411
Maintenance manager 0.083 0.083 0.417 0.417
Facilities manager 0.113 0.064 0.411 0.411
Table 6. 3 Assessment of cost criteria from the stakeholder point of view
93
Benefit criteria
Labour saving
environment
Time saving
Flexibility
Improved
Company
Stakeholder group
Material
quality
saving
Image
Work
Shareholders 0.310 0.111 0.044 0.262 0.071 0.033 0.169
Senior managers 0.161 0.055 0.044 0.392 0.044 0.191 0.113
Middle managers
Production manager 0.052 0.231 0.231 0.231 0.091 0.054 0.111
Quality manager 0.069 0.093 0.136 0.073 0.420 0.067 0.142
Maintenance
0.137 0.137 0.137 0.119 0.199 0.104 0.166
manager
Facilities manager 0.254 0.073 0.073 0.064 0.064 0.236 0.236
Table 6.4 Assessment of benefit criteria from the stakeholder point of view
For each criterion, the relative importance (local priority) with respect to the three
strategic options was entered from the viewpoint of each stakeholder. To illustrate this,
the option priorities of the senior manager are shown in Table 6.5 & Table 6.6.
Cost criteria
Options
Capital Depreciation Disruption Time-frame
Plant Redesign 0.202 0.143 0.618 0.258
Plant Automation 0.097 0.714 0.086 0.105
Plant Consolidation 0.701 0.143 0.297 0.637
Table 6.5 A senior managers priorities to options
94
Benefit criteria
Labour saving
environment
Time saving
Flexibility
Improved
Company
Options
Material
quality
saving
Image
Work
Plant Redesign 0.429 0.143 0.200 0.143 0.143 0.143 0.200
Plant Automation 0.429 0.714 0.600 0.714 0.714 0.714 0.200
Plant Consolidation 0.143 0.143 0.200 0.143 0.143 0.143 0.600
Table 6.6 A senior managers priorities to options
Finally, the global priorities can be calculated based on weighting schema for the
stakeholder groups, the importance of criteria from the point of view of the stakeholder
groups and the relative priorities of decision alternatives with respect to the criteria (See
Table 7 & Table 8).
Strategic Options Priorities

Plant Redesign 0.373
Plant Automation 0.142
Plant Consolidation 0.485
Table 6.7 Global priorities of strategic options resulted from cost analysis
Strategic Options Priorities

Plant Redesign 0.277
Plant Automation 0.496
Plant Consolidation 0.227
Table 6.8 Global priorities of strategic options resulted from benefit analysis
From the table it can be concluded that, the lowest cost option is Plant Automation since
it scored the least and the option with the most benefits is also Plant automation as it
scored the highest in the benefit analysis. Next step is to synthesise the results of the cost
and benefit analysis. Prior to that, the subject of inconsistencies in pair-wise judgements
and application of sensitivity analysis will be explained.
95
6.1.2 Dealing with inconsistency

Any possible errors in expressing judgements as well as actual inconsistencies in the
judgements can be identified by measuring inconsistencies (Labib & Shah, 2001). The
authors illustrate how to maintain consistency using the following simple mathematical
example. Consider three alternatives: A, B, C. If A is three times better than alternative B
and that alternative B is two times better than alternative C. Then, a perfect consistency is
that alternative A is six times (three multiplied by two) better than alternative C. AHP
uses Consistency Ratio (CR) values to denote this. Cheng et al. (2002) cites Saaty (1994)
and recommends new threshold values for CR: 0.05 for 3X3 matrix; 0.08 for 4X4 matrix;
0.1 for larger matrices. Labib and Shah (2001) argue that consistency is necessary but not
sufficient for a good decision and perfect consistency should not be expected with AHP.
They cite Saaty (1994) who recommends that CR values greater than 0.10, require
investigation of the causes of inconsistency. The above approach was applied on both
Cost analysis and Benefit analysis models. In both the cost and benefit model, there were
perfect and imperfect consistency ratios. The cause of imperfect CR was due to lack of
sufficient information to make the decision.
6.1.3 Sensitivity analysis

Figures 6.1 & 6.2 shows the results of the performance sensitivity analysis of the three
strategic options based on the Stakeholder criteria. The sensitivity analysis shows how
the alternatives were prioritised with respect to each objective as well as overall objective.
The left y-axis gives each objectives priority (based on the decision makers paired
comparisons) and the right y-axis gives the alternatives priority. For example,
shareholders preferences are given the highest priority compared to senior mangers and
middle mangers.
96
Figure 6.1 Performance sensitivity of the strategic options from Benfits analysis
Figure 6.2 Performance sensitivity of the strategic options from Costs analysis
What-if analyses were performed to see the effects on alternatives by changing the
weights of objective criteria. Giving higher preference to senior mangers did not result
any variations in alternative priorities in both cost and benefit model. However,
increasing the priority of middle managers resulted in a change in the overall alternative
97
priorities (See Figure 6.3) resulting the plant redesign as the option that incur the highest
cost. This meant a different perception of costs on the part of middle managers compared
to the shareholders and senior mangers. Further investigation is required to analyse this
phenomena.
Figure 6.3 Effect of increasing priority of the middle managers w.r.t. costs
The above analysis showed the effect on alternative preferences with respect to changes
on stakeholder priorities. It is possible to carry out what-if analysis in a similar fashion of
the effect on alternative priorities by altering the priorities of specific benefit criteria (e.g.
work environment, company image etc) and cost criteria (e.g. capital, disruption).
6.1.4 Cost-Benefit Analysis

The results of the analysis are presented in Table 6.9. The results show that Plant Automation is the
most suitable option for PAK as it scored the highest followed by Plant Redesign and Plant
consolidation.
Strategic Options Costs Benefits Benefit/ Cost
Plant Redesign 0.373 0.277 0.74

Plant Automation 0.142 0.496 3.49
Plant Consolidation 0.485 0.227 0.47
Table 6.9 Cost-Benefit Analysis
98
Chapter 7
CONCLUSIONS
Process modelling and process improvement

The IDEF0 mapping process, captures knowledge about current processes, which is
essential to analyse current processes and design new processes for process improvement.
The ICOM feature of the IDEF0 models, help the participants in the processes to become
customer oriented. Moreover it makes the participants to think about the Whats of the
process rather than the Hows . Modelling using SSM assist the process improvement in
a similar but Systemic manner. The concept models of SSM can represent participant
visions of improved process. They can be used as a reference for comparison with the real
world activities. The comparison gives an opportunity for participants to openly judge the
current processes find radical or incremental changes to improve processes. The value
stream mapping can improve processes by reducing or eliminating the non value added.
The workflow mapping can improve the processes by analysing the current flow path and
finding out ways to reduce the flow paths. The process modelling was also found to be
useful as a method to elicit ideas to improve their current processes.
Benefits of process modelling and ways to realise them

The benefits of using process modelling is that they facilitate process thinking, learning,
documentation of process structures, explicit analysis (evaluations of efficiency and
effectiveness) , explicit design and justification of the decisions made. It is important to
plan the modelling process effectively. This is especially important if a single researcher
carries out the research. Planning may require finding out the availability of interviewees,
the production schedules etc. Missing a key process owner could result the total delay of
the project. Encouraging the participation of members of the firm in the modelling
process is extremely important. This may require spending time to familiarise them with
the techniques used. This would help the participants to create a genuine interest in the
modelling process and its results. Most importantly it will prevent the notorious Not
invented here problem. The research also showed that As-Is model developed using
IDEF0 can be used as an alternative to rich pictures. The capability to decompose IDEF0
99
models is useful in mapping the details of many activities. The decomposition levels for
processes were cannot be predefined, and they evolve as the modelling progress. The soft
system methodology cultivates holistic thinking in participants. This is necessary for the
radical changes to current processes, whereas IDEF0 focuses on subsystem or micro
thinking, which is sufficient to record current processes and efficiency improvements.
Once more, these factors stress the need for a hybrid approach such as Soft-IDEF0.
While other techniques concentrate on the hard aspect of the processes, soft systems
methodology can be used to model both hard and soft elements of an organisation. The
futuristic worldviews of the key stakeholders of the process can be effectively used to
develop issue based and primary task based concept models. This way an explicit
analysis of the problem or system is possible. The model comparison process
facilitated further investigation of the As-Is processes captured and documented using
IDEF0. It helped to identify mismatches, define potential changes and predict the
implications of those changes. Moreover, it considers the effect of change on people in
the system. This feature allows the problem owners to take preventive measures to
eliminate or reduce any adverse impact on the people and other systems. This
demonstrates the significance of soft systems methodology in change management.
The value stream mapping can identify the non-value added and the processes to be
automated. The modeller/ analyst need to be diplomatic to deal with the suspicion of
people involved in the process being mapped. This problem can be reduced by informing
the subjects in advance about the purpose of the mapping exercise possibly through the
subjects superiors. The workflow mapping can be useful in evaluating current flow paths
of objects or people as well as a reference tool for the new layout design. Again, this kind
of modelling can be equally suitable to an office workflow analysis and layout design.
Process modelling and Strategic Decision making

The model comparison phase of the soft-IDEF0 method allows decision makers to think
about the effectiveness of existing processes and develop strategic changes to improve
their effectiveness. It may even result in redefining the process goals itself. The value
stream mapping and workflow mapping aids strategic decision making by capturing the
strengths and weakness of existing structures. Although not classified as a process
modelling tool, The AHP based cost-benefit analysis can replace the conventional cost-
100
benefit analysis used for appraisal and selection process. The methodology considers the
preferences of the stakeholders as well as many quantitative and qualitative criteria. The
result of the cost-benefit analysis matched the decision taken by the company
management prior to the analysis. This proves the capability and robustness of the
methodology used. The proposed AHP methodology is generally applicable to any
strategic options/ projects selection problem. By applying the methodology as a cost-
benefit analysis, three main benefits have been achieved:
1. Significant reduction of the time and effort in decision-making.
2. Easiness for the decision makers to arrive at a consensus decision.
3. Documentation and justification of the decision made.
Selection of modelling techniques

The purpose and perspectives of the modelling exercise is extremely important in the
selection of modelling techniques. In the case of the Huhtamaki problem, the company
had several objectives. To realise these objectives it was necessary to use multiple process
modelling techniques. No single technique could meet all process modelling needs. The
author used a mixture of Hard, soft, qualitative and quantitative process modelling
techniques. IDEF0 was used to develop the As-Is and To-Be process models; SSM for
process modelling and analysis of As-Is processes and to derive potential changes;
Process charts for identifying waste and processes to be automated; Workflow mapping
and Activity relationship diagram towards plant layout design; Gantt charts for project
planning; and Analytical Hierarchy Process for decision making.
It may not be possible to identify all process modelling tools and techniques required
prior to a modelling process. As one develops knowledge and gain insight into the
processes being modelled and problems to be solved, appropriate techniques can be
introduced Thus it is a learning process. For example in the Huhtamaki project, the
application of SSM was not pre-planned, it was introduced when the limitations of IDEF0
in capturing the social aspects of the system and the inability to perform explicit analysis
was noticed.
Following criteria are useful in the initial selection of modelling tools:
1. Purpose/ objectives e.g. process reengineering, process redesign
2. Resources available. e.g., time, money, people
3. Availability of data
4. Capabilities of the techniques. e.g., qualitative, quantitative, static, dynamic etc.
101
5. Further applications process models. E.g. simulations, integration with other tools
etc.
6. Facilitators/researchers ability to understand and use the tool
Limitations of research
There are some limitations to the proposed methodology. First the methodology applied
do not allow for the behaviour of the system over time, dynamic simulations may be
required for further analysis. Second, due to time constraints the Activity Based Costing
(ABC) of IDEF0 has not been applied. The IDEF0 software used for modelling was not
flexible enough to represent models in a readable format. Some additional features would
be beneficial to users of AIWIN IDEF0 software.
102
Chapter 8
RECOMMENDATIONS
Further research is required to analyse the application and benefits of process modelling
in general and Soft IDEF0 in particular, in implementing process change.
The Soft IDEF0 approach can be further developed to use IDEF0 models to represent
SSM concept models. This may require incorporating the CATWOE elements to the
ICOM components of IDEF0.
The IDEF0 models developed can be converted into IDEF3 format, which in turn can be
used to conduct dynamic simulations. Through simulations the strength of the current
processes and the sensitivity of the To-Be processes can be analysed.
Further research can be carried out to analyse the scope of applying IDEF0 in Layered
business modelling (Briffaut & Saccone, 2002) .
The Following features are recommended to improve the IDEF0 modelling software, AI
WIN- R7:
1. Provision to control the display of (hide & unhide) the elements in a model by the
users.
2. Provision to move and place the elements in user defined positions. The existing
features only allow the elements to be placed at fixed distances apart as dictated
by the software.
3. Provision to view the entire hierarchy structure within a diagram view.
103
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Appendices
Appendix 1: Working paper 1
Appendix 2: Working paper 2
Appendix 3: The seven stages of Soft Systems Methodology
Appendix 4: Mathematical Theory of AHP
Appendix 5: Soft-IDEF0 comparison tables
Appendix 6: Value stream maps
Appendix 7: Workflow maps
Appendix 8: Project plan of the research
Appendix 9: Benefits of dissertation to Company Report
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Appendix 1 Glossary
ABC: Activity Based Costing
AHP: Analytic Hierarchy Process
ANP: Analytic Network Process
BPI: Business Process Improvement
BPM: Business Process Modelling, Business Process Mapping, Business Process
Management
BPR: Business Process Reengineering, Business Process Redesign
ICOM: Input, Control, Output, Mechanism
IDEF: Inegrated DEFintion modelling, ICAM DEFinition Modelling
MCDM: Multi-Criteria Decision Making
SSM: Soft Systems Methodology
Appendix 2 Working paper 1 (Abstract)
Title:
Strategic Project Selection Through Incorporation of Stakeholder

Preferences Using Multi-Criteria Decision Making
Authors
Binoy P. Perumpalath, Colin Pardoe, Ashraf W. Labib, David Smith
Keywords
Multi-Criteria Decision Making, Analytic Hierarchy Process, Stakeholders, Cost/ Benefit
Analysis, Sensitivity Analysis
Structured Abstract:
Purpose:
To develop a methodology that could assist decision making process to satisfy all
stakeholders while achieving company objectives.
Approach:
112
A cost/ benefit analysis method using Analytic Hierarchy Process (AHP) is presented.
The paper is based on a real exercise in a leading packaging company. The result of the
AHP analysis matched the decision taken by the company management prior to the
analysis proving the capability and robustness of the methodology used.
Findings:
By applying the methodology as a cost-benefit analysis, three main benefits have been
achieved: Significant reduction of the time and effort in decision-making; Easiness for the
decision makers to reach a consensus decision; Documentation and justification of the
decisions made. The proposed AHP methodology is generally applicable to any strategic
options/ projects selection problem.
Research limitations/implications: This work does not provide an exhaustive list of all the
factors that need to be considered apart from those identified by one UK company which
perhaps limits its usefulness elsewhere. Nevertheless, it offers a methodology where
different companies could follow.
Practical implications:
Appraisal and selection of strategic capital-intensive projects is required by many
companies. Often these projects will have several interested parties or stakeholders with
multiple objectives. Companies rarely succeed in selecting a project that satisfies all
interested parties. Frequently these decisions are made at the top levels of the
organisational hierarchy and later imposed on to the lower levels. The proposed
methodology assists the decision making process to satisfy all stakeholders while
achieving company objectives.
Originality / value:
This work fulfils an identified need and offers practical help to a company in their
strategic decision making process.
Appendix 3: Working paper 2 (Abstract)
Title:
113
Modelling Business Process: The Soft IDEF0 Approach
Authors
Binoy P. Perumpalath, Colin Pardoe, Ashraf W. Labib, David Smith
Keywords
Business Process Modelling, IDEF0, Soft Systems Methodology, Business Process
Improvement, Process view
Structured Abstract:
Purpose:
To assess the role and benefits of modelling business process in Business process
improvement.
Approach:
A Soft IDEF0 method using IDEF0 and Soft Systems Methodology is presented. The
paper is based on a real exercise in a leading packaging company. The staff at different
levels of the organisation participated in the modelling, analysis of current processes and
design of improved processes.
Findings:
Process modelling and the resulting process models have distinctive benefits. The former
encourages process thinking while the latter documents the process information. Together
they facilitate explicit analysis of business processes. Process modelling using soft system
methodology cultivates holistic process thinking in participants, required for radical
process improvement. The IDEF0 process activity modelling facilitates subsystem or
micro thinking, required for efficiency improvement. The IDEF0 process maps captured
the existing process information that can be used as a reference for process improvement.
The concept models of SSM capture the worldview of participants about ideal processes
while the model comparison tables and IDEF0 To-Be maps document the means of
achieving those visions. Again, these factors stress the need for a hybrid approach such as
Soft-IDEF0 for process modelling and analysis. The proposed methodology is generally
applicable to any process modelling, analysis, improvement and change initiatives.
114
Research limitations/implications: This work does not provide an exhaustive list of all the
factors that need to be considered apart from those identified by one UK company which
perhaps limits its usefulness elsewhere. The proposed framework is static and do not
allow for the behavior of the processes over time. Nevertheless, it offers a methodology
that different companies could follow.
Practical implications:
Today, organisations take the process view of their operations and process modelling is
considered by many as essential for process management and improvement activities.
There are several techniques available for modelling business process. Many popular
techniques e.g. IDEF0 and IDEF3 take the hard mechanistic view of processes. These
methods are excellent for systematic documentation of current processes and their
efficiency improvement. However, they do not allow for systemic thinking about the
processes. Soft Systems Methodology does just that. The proposed methodology
incorporates both hard and soft process modelling techniques to aid modelling and
analysis of business processes.
Originality / value:
This work fulfils an identified need and offers practical help to a company in their
business process improvement initiatives.
Appendix 4
The Seven stages of Soft System Methodology by Checkland, 1981

Stages one and two
The problem situation are expressed using rich pictures. The concept of rich pictures is
to represent pictorially all the relevant information and relationships. However, they are
to be used only as aids to the analyst/analysts to gain an understanding of the situation
and as a tool to communicate with the client.
Stage three
Issue based or Primary task Root definitions are constructed for the Human
Activity Systems (HAS) identified in stage one and two. The root definition should
115
encompass the emergent properties of the system in question. To define the emergent
properties one needs to consider the mnemonic CATWOE:
C: customer (people affected by the system, beneficiaries or victims); A: actor (people
participating in the system); T: transformation (the core of the root definition the
transformation carried out by the system); W: Weltanschauung (world view); O:
ownership (the person(s) with the authority to decide on the future of the system); E:
environment (the wider system).
The CATWOE elements can be used as a checklist to ensure that the root definition is
complete. The root definition must have all of the words or phrases that appear as
elements of the CATWOE. To add richness a root definition may contain other words or
phrases other than the CATWOE elements. Several root definitions can be constructed for
each of the relevant HAS identified. Each root definition will encompass a different
Weltanschauung.
Stage four
A conceptual model is developed from each root definition. The conceptual model
represents the minimum necessary activities and their relationships for that HAS. It is a
representation of root definition not a representation of the real world. To be complete,
the concept model should be defensible against the Formal Systems Model (FSM). This
means there should be adequate connectivity, purpose, measures of performance, control
process, boundary, resources and hierarchy subsystems within the concept model.
Stages five and six
The conceptual model identifies which activities need to be included to achieve the
emergent property of a particular HAS. It is not concerned with how these activities will
be carried out. Removal of activities from the conceptual model would result in those
emergent properties being lost. The conceptual model will be compared with the real
world to highlight possible changes in the real world. It may be that activities in the
conceptual model do not exist in the real world. This would then be a recommendation for
change. Conversely, it may be the case that activities appear in the real world that do not
fit into the conceptual model. These activities are either unnecessary, or are included in
the conceptual model in a different form.
Stage seven
Recommendations for change will be implemented. It is important to appreciate that once
these changes have been implemented, the problem situation will be modified. In other
116
words, the process is cyclical. It is recognized that nothing remains static and that mere
intervention by the consultant will affect the organization.
Appendix 4
Theory of the analytic hierarchy process (AHP)

Labib et al. (1998)
The theory of AHP is based on the concept of having n alternatives and their relative pair-
wise comparison aij is an approximation to the ratio of wi/wj which is the weight of
alternative i to alternative j. The decision maker does not know in advance the value
i/j.
The hierarchy normally consists of a top node the goal then the second layer is the
criteria level, and finally the third layer is the alternatives level. The basis of the AHP is
the completion of an i x j matrix at each level of the decision hierarchy.
This matrix A is of the form aij = 1/aji, aij >0; i.e. A is a positive, reciprocal matrix. The
basic theory is based on the fact that aij is an approximation to the relative weights ( i/j)
of the n alternatives under consideration; the value assigned to aij is typically in the
interval [1/9,9].
The estimated weight vector w is found by solving the following eigen vector problem:
Aw = lmax (1)
where lmax is the principle eigenvalue of A.
Therefore,
117
1/1 1/2 1/3

...
A= ... (2)
...
n/1 n/2 n/n
As an example, assume that one is given three machines of different criticality according
to their downtime failures. These machines are a, b, and c of criticality 3, 5, and 7 hours
respectively, taking downtime as a criteria. Suppose that a matrix of pair-wise ratios is
formed whose rows give the ratios of the downtime of each machine with respect to all
others. Thus one has the equation of :
a b c
3/3 3/5 3/7 3 3
A = 5/3 5/5 5/7 5 =3 5 - n (3)
7/3 7/5 7/7 7 7
Where A has been multiplied on the right by the vector of weights . The result of this
multiplication is n. Thus, to recover the scale from the matrix of ratios, it is necessary
solve the problem Aw = n. This is a system of homogeneous linear equations. It has a
nontrivial solution if and only if the determinant of A-nI vanishes, that is, n is an
eigenvalue of A.
Appendix 6
SSM Comparison Tables
Comparison of Concept Model 3 with Real world activities
Activity Is it By How? How is it Judgement Potential Implica

done Whom? Judged? changes tions
now?
118
Decide how Yes Maintena Personal Running Machines Systemati Less

to maintain nce judgement Machines break down c breakdo
the Leaders quite often maintenan wns,
production ce more
lines always procedure producti
in good s vity
working
condition
Know the No Need to Plan

strategic Maintena have mainten
plans of the meetings ance
nce
company with actions
personnel senior required
managem for new
ent decision
s made
Know about Yes Maintena Work Only few Experienced Ways to Faster
current nce experience staff know staff know assist mainten
Production personnel about it as about the judgement ance
Lines they only lines, but of decision
do new staff inexperien s
mechanica need to learn ced
l work
Determine Yes Maintena Based on Not Available Use Efficie
the priority nce production judged data is not maintenan nt use
of personnel demands abnalysed ce history of
production and OEE resource
lines to be methods s
maintained
Determine Yes Maintena Referring to Few Decisions Need to Time

replacement nce operating people left to store develop a saving,
parts personnel manuals, refer managers. database New
required experience manuals, of staff
so maintenan would
decision ce history, be able
are made which will to
by seniors contain maintai
the n
replaced machine
parts data without
help
from
experts
Know about Yes Maintena From By Knowledge Use the Avoid
production nce production setting mainly used knowledg breakdo
demands personnel plans maintenan for e for wns
ce breakdown planned continu
schedules maintenance maintenan ous
ce producti
on
119
Develop Yes, Maintena Writing Ability to Very rarey Systems Redutio

maintenance partially nce some follow the being used, should be n in
procedures leaders procedures procedure "They know in place to machine
s by fitters how to open standardis down
up a e the times
machine and maintenan
find faults" ce
procedure
s. They
should be
easily
accessible
to the
users
Monitor No Maintena Can
development nce or make
of operations sure the
maintenance managers effectiv
procedures overview emess
Take control No
action to
ensure
development
of
maintenance
procedures
Maintain Yes Maintena Through machines Need tp Achieve
production nce planned and breakdowns concentrat on time
lines personnel breakdown very often, e on the producti
maintenance causing planned on
production maintenan
delays ce and the
causes of
breakdow
ns
Monitor Yes Maintena Meeting Timely Maintenanc Computer Predict
maintenance nce with Fitters completio e activities ised ability
of leaders n of often take systems of
production maintenan more time to can be mainten
lines ce finish. integrated ance
activities Estimations time.
are incorrect
Take control Yes Maintena Planned Number Often Planned Longer
action to nce maintenance of planned maintenan machine
ensure personnel breakdow maintenance ce need to life less
production ns is postponed be given break
lines are to allow more downs
kept in good production importanc
working e
condition
120
Define No
performance
measures
appropriate
to the
maintenance
requirement
s
Assemble No
information
about total
performance
Report on Yes Maintena Daily
performance nce meetings
to leaders
Operations
manager
Take control Yes Producti
action to on
ensure that managers
performance and
is as maintena
required by nce
the leaders
Operations
manager
Concept Model 4 comparison with real world activities
Activity Is it done By How? How is it Judgement Potential Implica

now? Whom? Judged? changes tions
There has
not been an
assessment
Store Parts are of For all
manager identified replacment machines,
& based on the parts the Reducti
Appreciate Mainten judgement required for replaceme on in
replaceme ance of New nt parts machine
nt parts yes, personne maintenance production should be downti
required partially l personnel. lines identified mes
Efficien
Know the follow the t use of
cost of Engg. pareto rule money
replaceme Store Quotes from in spare and
nt parts Yes manager suppliers inventory space
Know
delivery
lead-times Engg.
of Store
suppliers Yes manager
121
Obtain Engg,
replaceme Store
nt parts yes manager
Know
storage Engg.
area Store
available Yes manager
The area
required for
the spares of
existing
machines
are known,
but no idea
In about the
Determine consultation spares
storage Engg, with needed for
area Yes, store Maintenance new
required partially manager personnel machines
Ergonomi
cs and
user
friendly May
arrangeme have to
nt, convinc
provision e the
for easy need to
storage store
on racks and and staff
Engg. cardboard retreival, and
Store Store boxes, They cluttered and e.g. others
replaceme personne are marked rusty racks barcodes concern
nt parts Yes l with codes not judged and boxes on boxes ed
Monitor
storage of Engg.
replaceme Store
nt parts Yes manager
Take
control mismatch
action to between
ensure inventroy in
parts are database and
stored in actual Occasiona
order to Engg check of inventory l audit of
provide on Store stoke levels was parts
time Yes manager maintained not judged observed stored
122
avoid the Accurat

two stage e
Users fail to process, inventry
Store enter provide a databas
Take out the manager sufficient compueris e, ease
part they enter the data in the ed system of use
need. Fills data in the form, this in which for
out a form form into causes faulty users can users as
Provide with details the invntory search and well as
replaceme of the parts computer data in the enter data store
nt parts Yes Users taken database database directly staff
Monitor
provision
of
replaceme
nt parts No
Take
control
action to
ensure By ordering
parts are new parts,
provided Store maintaining
on time Yes manager inventory
Define
performan
ce
measures
appropriat
e to the
provision
of
replaceme
nt parts No
Assemble
informatio
n about
total
performan
ce Yes
Report on
performan
ce to
Operations Store Daily group
manager Yes manager meeting
123
Take
control
action to
ensure that
performan
ce is as
required
by the
Operations Store
manager Yes manager
Concept Model 5 Comparison with real world activities
Activity Is it done By How? How is it Judgement Potential Implica

now? Whom? Judged? changes tions
Know how Yes Trainin Knowledge Ability to They do More Knowle

to run the g gained operate all know how experts dge
production Officer, through productio to run lines having manage
lines Few work n lines efficiently process ment,
efficiently experie experience well and knowledg fast
and nced effectively e is decision
effectively producti required s
on
personn
el
Know the No Trainin Need to Flexibili
strategic g be made ty to
plans of Officer aware of adapt to
the strategic the
company plans, so business
he can needs
develop
training
programm
es to align
the
strategies
Recognise Yes, Human Assessment Attitudes are

individual partially resource tests, peer given more
employee s, reports etc imprtance
s attitudes, Trainin than skills
skill/know g and
ledge officer, knowledge
retention producti
levels on
manage
r, Shift
manage
r
124
Develop yes Trainin Writing Training Develop a More

training g officer trining manuals are manual work
Procedure manuals huge files, which can for
s which be easily initially
intimidate used, and for the
the trainees easily training
and are understoo officer,
rarely used d - use but
more benefits
diagrams in the
than longer
pictures - term
Computeri
se the
manuals
Monitor No Dedicated User

developme personnel friendly
nt of to monitor and
training activities reliable
procedures procedu
re
Take No Dedicated
control personnel
action so
that to
develop
training
procedures
to operate
lines
efficiently
and
effectively
Consider yes Trainin Consultatio Completi
the time g officer n with HR on of
available training
on time
Train the Yes Trainin Classroom Training is Continoue Reducti
Employee g officer training, on limited to s training on in
s the job the should be machine
training induction given downti
training for mes,
new Confide
operators, nt and
after that self
they learn as reliant
they work operator
on new s
machines
Assess the yes Trainin Written Need to

trained g officer tests, include
employees vivavose simple
phychome
tric tests
125
Decide Yes Trainin

criteria for g officer
assessmen
t
Monitor No
trained
employees
Take No
control
action so
that
employees
can run
the lines
efficiently
and
effectively
Define No
performan
ce
measures
appropriat
e to the
provision
of training
Assemble No Computeri
informatio sed
n about system
total
performan
ce
Report on No
performan
ce to
Operations
manager
Take No
control
action to
ensure that
performan
ce is as
required
by the
Operations
manager
Comparison with Concept Model 2 with real world activities
126
Activity Is it By How? How is it Judgem Potential Implications

don Whom? Judged? ent changes
e
no
w?
Know Yes Sales Personal ?
customers and visits,
requiremen marketin phone
ts g calls,
emails
Obtain raw Yes Purchasi ERP Someti Assure Can ensure continoues
materials ng mes regular production, Some
producti supply of people may loss jobs
on is raw
delayed materials,
due to Automate
lack of the
raw reordering
material process
s
Provide Yes Producti Respond checking Excessi Strict can reduce any misuse
raw on to written it with the ve raw control on of rawmaterials, can
materials control request productio material the issue, free the shop floor
from n output s were Canban from getting cluttered
operators and work found system,
in on the 5S
process- shop technique
"Down floor s can be
time used
sheets"
Monitor Yes Producti review of Daily
provision on Productio meeting
of raw manager n with
materials overview planning,
reports maintena
nce,
productio
n control
staff
Take No
control
action to
ensure
provision
of
materials
to achieve
conversion
with
minimum
labour and
time
127
Take
action to
ensure
only
minimum
labour is
allocated
Retain and No
develop
Minimum
labour
Determine Yes Operatio Based on Need to Can achieve consensus
minimum ns expereinc consult and avoid "not
labour manager e the key invesnted here" issue
required productio
for n
conversion personnel
without to
compromis understan
ing quality d the
requireme
nts
Know No Assess All employees should
about their be assessed, work
available skills and expereince alone
employees capabilitie should not be the
s criteria
Decide Yes Operatio Meetings
how to ns
achieve manager
conversion , Quality
with Manager
minimum , and
labour and Producti
resources on
without manager
compromis
ing quality
Know how Yes Few Many Assessme Tests Impartial Dispersion of
to convert Producti years of nt tests are for Assessme knowledge to many,
raw on experienc namesa nt of rather than few -
materials personn e ke, knowledg bottleneck,operators
into el e who are self sufficient
finished
products
Determine Yes Operstio

minimum ans
time manager
required &
for manufac
conversion turing
without analyst
compromis &
ing quality Author
Allocate No
minimum
time for
conversion
128
process
Take No
action to
ensure
only
minimum
time is
allocated
Allocate No
minimum
labour to
conversion
process
Provide Yes Operatio Respond
resources ns to request
manager from shop
floor
Obtain Yes Producti
resources on/
quality
manager
&
Process
engineer
s
Determine Yes Operatio Meetings

new ns
resources manager
required and
other
manager
s
Know Yes Operatio Visiting
about new ns other
resources manager organisati
, Process ons,
engineer suppliers,
s feasibility
studies
Appreciate Yes Operatio
existing ns
resources manager
, Process
engineer
s
Monitor Yes Operatio
provision ns
of manager
resources
Convert Yes Producti Extruding Meet

raw on , customer
materials personn Thermofo requireme
into el rm, Trim nts
finished & rim roll
products
129
Take No
control
action to
ensure
provision
of
materials
to achieve
conversion
with
minimum
labour and
time
Assess Yes Quality feasibility

Impact on manager studies
product
quality
Take Yes Quality

actions not manager
to
compromis
e product
quality
Decide Yes Quality
how to manager
achieve &
conversion Process
without manager
compromis
ing quality
Define yes Quality Confirmat
quality manager ion to
customer
requireme
nts
Determine
Shareholde
rs
performanc
e
expectation
s
Determine
performanc
e measures
130
Monitor
system
performanc
e
Take
control
action to
achieve
expectation
s
Appendix 6
Process Charts
131
132
133
134
135
136
137
138
139
140
Appendix 7
Workflow mapping
Figure 4.36 Raw-material (cartons) flow path
141
142
Figure 4.38 Plastic raw material (C-PET) flow path from silos
Figure 4.39 Plastic raw material (APET) flow path from Silos
143
Figure 4.40 Plastic reels (CPET & APET) flow path
144
Appendix 8
Project Plan of the Research
145
146
Appendix 9: Benefits of Dissertation to Company
147

Modelling Business Process

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Modelling Business Process

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PORTSMOUTH BUSINESS SCHOOL

MASTER OF BUSINESS ADMINISTRATION

Title MODELLING BUSINESS PROCESS:

Author Binoy P. Perumpalath

Tutor Prof. Ashraf W. Labib

Year of submission 2005

Signed statement of originality

1.1 RESEARCH OBJECTIVES........................................................................................................ 1

2.1 WHAT IS A BUSINESS PROCESS?........................................................................................... 4

3.1 PROCESS MODELLING ......................................................................................................... 28

4.1 IDEF0 PROCESS ACTIVITY MAPPING................................................................................. 45

5.1 PLANT LAYOUT DESIGN ..................................................................................................... 77

6.1 ILLUSTRATION OF AHP ANALYSIS ..................................................................................... 92

Many people have contributed directly or indirectly to the development of this

encouragement and assistance during the conduct of this research:

Ms.Roni Lee, Personnel Manager (retd.) of Huthamaki (UK) Ltd

Mr.Colin Pardoe, Operations Manager of Huthamaki (UK) Ltd.

Prof. Ashraf Labib, Project Supervisor, Portsmouth Business School

Mr.David Smith, Director of MBA programme, Portsmouth Business School

Staff and colleagues of the MBA programme.

Family and friends

FIGURE 2.3 FRAMEWORK FOR SELECTION OF MODELLING TECHNIQUES ............................................... 11

1.1 Research Objectives

2.1 What is a Business Process?

2.2 Business Process Modelling/ Mapping: What are they?

1. Study of current flow of processes

2.3 Need and significance of Process Modelling

2.3.1 Business Process Improvement (BPI)

2.3.2 Business Process Management (BPM)

2.3.3 Business Process Simulation

2.3.4 Managing Change

2.3.5 Knowledge Management

2.4 Uses / Benefits of modelling business processes

2.5 Process Modelling Tools, Techniques and Methodologies

Figure 2.2 Classification of modelling techniques based on four business process

Figure 2.3 Framework for selection of modelling techniques (Aguilar-Savn, 2004)

2.5.1 Simple flow Charts

2.5.2 Process Charts

Operation (an activity that Beginning or end

Transport Input or output from the

Delay Direction of flow

Storage (deliberate storage, Decision (exercising

Figure 2.5 ANSI mapping symbols (Slack et al, 2004)

Figure 2.6 Example of ASME mapping (Oakland J, 1994) cited in www.lsbu.ac.uk

2.5.3 IDEF techniques

Figure 2.7 Basic IDEF0 process map template

Figure 2.8 IDEF0 Activity Map Decomposition (Hunt, 1996, p.100).

3.1.6 3.1.8 Hold Kickoff

2.5.4 Soft Systems Methodology (SSM)

Figure 2.10 The classic 7-stage model of SSM (Checkland, 1981)

2.5.5 Analytic Hierarchy Process (AHP)

Many practitioners report stand-alone applications of AHP. Borenstein (2004) propose a

qualitative (non-financial) measures providing a balanced scorecard for capability

2.6 Conclusions from Literature Review

facilitator for organizational learning, and benchmarking a companies performance and in

A number of methodologies and techniques are available to model business processes.

Analyse Secondary Data

Identify process Identify functions/

Conduct Observe/ Record

Develop Rich Develop micro & Develop Workflow Develop Value

Develop Root Combine to form Develop Identify Activities

Develop layout Conduct Cost-

Figure 3.1 Research Methodology: flow-chart