Modeling a Control System for Organizational Processes

It is widely accepted that any well designed organizational process includes a control mechanism through which management decides which aspects of the process performance are to be measured and how these measurements are to be used to change the level of resources utilized in the process. Little is known, however, about the best ways to design such a control mechanism for typical service sector processes. The focus of this research is to study how a variety of control mechanisms performs in managing a business process. The goal is to identify control mechanisms that are effective in different types of environments. This requires modeling both levels, the business process (object level), and the control system (meta level). The fundamental question we ask here is why control systems so often founder. We address the logical aspect of modeling only, not the socio-logical aspects of model use and of implementation. The scenarios for which we try to establish optimal control systems are ones of stationary, dynamic, and turbulent demand patterns. For this purpose we have designed a generic system dynamics model of a business process. The extensive simulation experiments realized with this model corroborate some of the generally acknowledged, basic principles of control, while refuting some of the usually accepted common-sense knowledge about management and organization. The pertinent reflections also lead to some substantive conclusions concerning the design of control systems.