Principles of Enterprise

Systems

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Introduction
Most organizations are The focus of this research has
compelled to continuously been aimed at determining
transform the way they effective strategies for
perform in order to achieve successful enterprise
their strategic business transformation.
objectives.
The Massachusetts Institute
of Technology (MIT) through
its Lean Advancement
Initiative (LAI) research team
has been conducting
research in enterprise-level
transformations in large
complex sociotechnical
enterprises since its inception
in1993.

28/09/10 Principles of Enterprise Systems 2

 Framework for Enterprise
Transformation

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 7 Principles of Enterprise Thinking
1. Adopt Holistic
Approach to
Enterprise 7. Emphasize Organization
Transformation. Learning.
2. Identify 6. C
relavant and ultiv
dri ate l
ve e
stakeholders and Ent ader
determine their erp ship
rise to
value proposition. beh sup
avi po
ors
.
3. Focus on
Enterprise
4. Address internal 5. Ensure stability
effectivenes
and external and flow within and
s before
Enterprise accross the
efficiency.
interdependencies. Enterprise.
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 Principle 1
• Adopt a Holistic Approach to Enterprise Transformation

- Holistic approach to consideration and integration of lifecycle

processes, enabling key leadership processes.
- Transformation at two levels: Strategic level and Tactical level.

Principle 2
• Identify Relevant Stakeholders and Determine their Value
Propositions

 Identify stakeholders value.

 Specify the value being delivered.
 Determine the effectiveness of the enterprise in delivering value.
 Uniformly distribute value to all of them.

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 Principle 3
• Focus on Enterprise Effectiveness before Efficiency

 Effectiveness: extent to which an organization fulfills its

objectives.

 Doing the right thing before ‘doing it right’.

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 Principle 4
• Address Internal and External Enterprise
Interdependencies

 Three lenses: what is controllable by the enterprise,

what the enterprise influences, and what the constraints
are on the enterprise.

 Example: Improving time to market for new product.

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 Principle 5
• Ensure Stability and Flow within and across the Enterprise
 Foundational to any enterprise transformation effort.
 Stability enables determine the watermark of enterprise
performance.
 Flow of value within the enterprise determine the focal points for
improving enterprise value delivery to its key stakeholders.

Principle 6
• Cultivate Leadership to Support and Drive Enterprise
Behaviors
 Senior leadership commitment ensures that the transformation
efforts are strategically focused and resourced adequately.

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 Principle 7
• Emphasize Organizational Learning

 Top down and bottom up.

 Continuously experimenting and gaining knowledge

about the processes and the manner in which it creates
value.

 This learning translates into deeper insights that

motivate and support transformation execution.

 Focus on enabling the enterprise to learn from each of

the localized improvement efforts and to improve the
effectiveness of the improvement efforts.

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 Enterprise Architecture Framework
Enterprises have long been studied through one single
view.

For e.g. studying the organizational structure or the

informational technology architecture.

In this paper focus is on Enterprise Architecting must

take a systems perspective, viewing the entire enterprise
as a holistic system that can be understood by examining
the enterprise through multiple perspectives or views of
an overall integrated framework.

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 Enterprise Architecture View Descriptions
Strategy Strategic goals, vision, and direction of the enterprise including
the business model; enterprise metrics and objectives.
Policy/External The external regulatory, political and social environments in
Environment which the enterprise operates.

Process Core leadership, lifecycle and enabling processes by which the

enterprise creates value for its stakeholders
Organization The organizational structure of the enterprise as well as
relationships, culture, behaviors and boundaries between
individuals, teams and organizations.
Knowledge The implicit and tacit knowledge, capabilities, and intellectual
property resident in the enterprise.
Information Information needs of the enterprise, including flows of
information as well as the systems and technologies needed to
ensure information availability.
Product Product(s) developed by the enterprise; key platforms; modular
vs. integral architectures, etc.
Services Service(s) delivered and or supplied by the enterprise, including
in support of products.

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 Enterprise Architecting Framework

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 Enterprise Transformation Roadmap
 Enterprise Transformation Roadmap provide leadership with a
decision aid for consideration of cultural, organizational and
change management.
 Consists of three cycles:
• Strategic Cycle
• Planning Cycle
• An execution Cycle
 Employed by enterprise leaders to enhance the quality of
thinking on enterprise transformation issues.
 Provides guidance for increasing the value delivery for maximum
benefit of entire enterprise.

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 Enterprise Transformation Roadmap
(Cont’d…)

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 Enterprise Strategic Analysis for
Transformation
(ESAT)
ESAT is a holistic analytical process for analyzing and
improving overall enterprise performance.

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 Enterprise Strategic Analysis…
(Cont’d…)
 Step 1&2: Focuses on enterprise-wide processes and
considers needs and values of all stakeholders.

 Step3&4: Current state is analyzed and identifies key

process interfaces along with resulting disconnects and
delay.

 Step 5&6: Establish an enterprise vision for the future and

identifies improvement opportunities.

 Step 7&8: Integrated transformation plan is developed.

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 Lean Enterprise Self Assessment Tool
(LESAT)
 LESAT is tool for assessing the maturity of an organization and its readiness to
change.

 Linked to the Enterprise Transformation Roadmap.

 Based on Seven Enterprise Principles.

 Powerful tool for assessing gaps in enterprise performance when used in

conjunction with ESAT.

Integrated Enterprise Transformation Framework

 Seven Principles and Enterprise Architecture views provide holistic way of
thinking about and analyzing enterprises.

 Enterprise Transformation Roadmap provides framework for effective and

efficient transformation strategy, planning and execution.

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 Integrated Enterprise Transform….
(Cont’d…)
 ESAT creates an environment for understanding the current
state, creating a future state vision and developing an
action plan for prioritized transformation.
 LESAT and the EA views are used in concert with ESAT to
analyze and assess both current and future states.

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 Conclusion
 Principles were drawn from lean principles and practices and
scaled to drive enterprise level transformation.

 Enterprise Transformation Framework provides an integrated

set of methodologies that make key enterprise principles
actionable.

 Additional research will yield additional insights into the

mechanisms of transformation as well as principles of
leadership and change management.

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 Thank You
Any
Questions?

Pa
n
ka
jK
09 u
60 in u

Sonal Bora
06502923
09 Ja n

60 m
ee

3 908

90 ar
M

36 Sin
gh