**7. Structured value chain model**

192 New Research on Knowledge Management Models and Methods

Having defined Knowledge-Based Enterprise architecture independently from the products the enterprise produces, the following knowledge management modeling approach is concerned with the identification of the types and actual content of the enterprise

Framework Enterprise domains and aspects of the Enterprise knowledge

*Business domain, Businessinfrastructure*

Business domain; Processes/Functions, Data,People, Network

Business domain, Primary activities

Business domain; Resource,Organization,

Business domain; Operational goals Employees,machinery,

Business domain; Information and communications; Operations

Business domain; Information flow, Resources, Organization

Business domain; Organization unit, Enterprise object (Product, Order, Resource (Human,

unit, Role,

Machine));

Table 1. Enterprise domains and aspects of the Enterprise knowledge

Information, Function

Organization structure, Task process,

*IT domain,IT strategy*

IT domain; Goals/Objectives,

knowledge domain

IT domain; Human, Machine

Information System (domain); Requirements metrics, Architecture, Object model,

Technology domain;

IT domain; Resource (Human)

Strategy, systems, structure

Time, Peoples

Organization domain Information/

*IT domain,IT infrastructure*

IT domain; Functions,Data structure,Networ

IT infrastructure domain

IT domain; Software, Hardware

Information System (domain); Application, transaction workflow

Technology domain; Infrastructure, Operations

IT domain; Enterprise object Resource (Application, Machine)

k,

**6. Enterprise domains and aspects of the knowledge** 

*Business domain, Business strategy*

Business domain; Motivation, Time

Business process domain

Business domain, Support activities

Business domain; Management & control,Customer

Business domain; Goal(competitiveness), Resource (Human resource technology), Structure(Strategic Business units), Process (Value Chain)

Business domain; Strategy, Structure

Business domain; Event, Function, Work, Control flow

Business domain; Event, Process, Activity, Role

service

knowledge.

Modelling

*Henderson,Venkatra man, 1990* 

J.Zachman, ISA Framework (Zachman, Sowa,

B. Iyer, R. Gottlieb,

M.Porter's value chain model (Porter, 1985)

GERAM (GERAM, 1999), (Williams, Li,

Multi-Perspective Enterprise

Modeling (MEMO) (Ulrich, 2002a)

1992)

2004

1995)

Maes, R., Rijsenbrij, D., Truijens, O., Goedvolk, H. (2000).

ARIS (EPC) (Scheer, 1999)

2002)

UEML (Vernadat,

The Value Chain model comes from M. Porter's book (Porter, 1985). A Value Chain is a high level business model, a model that breaks down an organization into a series of valuegenerating activities. Two major interacting parts of VCM are *Support Activities* and *Primary Activities* (Porter, 1985).

Fig. 13. The structured Value Chain Model (SVCM)

The analysis of the Enterprise modelling from *the management (control) point of view* gives some new aspects for the Enterprise modelling itself (Gudas et al., 2005):


Knowledge-Based Enterprise Framework: A Management Control View 195

information items) is formed and transmitted during each management step. A management *Function F(j)* is initiated by some *Event* – a fact or a message associated with some internal or external (environmental) object. This definition of *Function* is close to the definition of function presented in (ENV 40003, 1990). This paper presents more detailed content of *Function F(j)* since it defines a sequence of definite types of interacting information activities (*Interpretation, Information Processing, Realization*) directed to control

All other constructs of *Function-Process* interaction (except constructs *Process, Input flow* and *Output flow*) in the structured model are assumed to be the components of the construct

Fig. 15. The control view based structure of Management Function (Gudas et al., 2005).

with the description of modified semiotic tetrahedron of FRISCO (Fig. 4, Fig. 6).

A new perspective - control view perspective of Enterprise management modeling is beneficial and constructive for advancing of Business Process modeling and IS engineering methods. An Enterprise Management Model provides the theoretical background for system analysis of management information processes, identification and more detailed decomposition of enterprise data and knowledge components *Function, Process, Activity,* 

It is assumed, that *Process* and *Management Function* are activated by some *Event*. A definite set of *state attributes* of an activated *Process* is the information flow defined as an input of (one or more) specific management *Function* that is activated by some particular *Event*. It should be pointed out, that the set of attributes of management *Function* is closely related to the description of function presented by CIMOSA (ENV 40003, 1990)**.** The CIMOSA specification of function includes the structural part (the list of sub-functions is used), the functional part (goals, limitations, functional description, necessary equipment, input, output) and the part of an attitude (goals, limitations, procedural rules, events, end state). The Elementary Management Cycle (EMC). The structured model of the *Function-Process*  interaction (Fig. 14) is formally specified as **Elementary Management Cycle (EMC )** at Fig. 16. The Elementary Management Cycle (EMC) is the basic construct of Enterprise management modelling, refines the components of management (control) cycle as well as content of management information transformations (Gudas, 1991), (Gudas et al., 2005). The semantics of *Elementary Management Cycle (EMC***)** transactions at Fig. 16 are co-related

*Process P(i)* (Fig. 13).

Enterprise *Management Function* (Fig. 15).

*Information flow, Control flow, etc.* 

From *the management (control) perspective* the major parts of M.Porter's Value Chain Model are renamed as follows (Fig. 13):


The Structured Value Chain model is used to identify the information transactions between *Management Functions* and *Enterprise Processes.* T*he Structured VCM* refines the enterprise management & control as a system of closed loop interactions of Management Functions {Fj} and Enterprise Processes {Pi}:

#### **SVCM = {Function (Fj) x Process (Pi)}. i = 1,m; j = 1,n;**

The interaction of *Function* and *Process.* The interaction of Enterprise model core elements *Process* and *Function* is formally assumed as a *Control Process*. It is defined as a *Feedback Loop*  between *Process P*(i) and *Function F*(j). The analysis of the *Function- Process* interaction is a background of the formalized model of the organizational system (an Enterprise model) described in (Gudas, 1991).

Fig. 4 presents the structured model of the *Function-Process* interaction. The concept *Process*  is assumed as "a Black Box". The internal structure of *Process* is unstudied, the concept *Process* is characterized by a set of *Process state attributes* (this set comprises subsets of *Input flow attributes*, *Output flow attributes* and *Process attributes*) and it is influenced by the output of a management *Function* – a set of *Process control attributes* (Gudas et al., 2005).

From the management point of view, *Process P(i)* is defined by two sets of attributes: a set of *Process state attributes* and a set of *Process control attributes*. A set of *Process state attributes*  includes the *Process input* (material flow) *attributes*, *Process output* (material flow) *attributes*  and the *attributes* of the particular *Process P(i)*.

Fig. 14. The structured model of the *Function-Process* interaction

A management *Function* consists of the predefined sequence of mandatory steps of information transformation (*Interpretation, Information Processing, Realization*); these steps compose a management cycle (a feedback loop). A definite set of attributes (a set of

From *the management (control) perspective* the major parts of M.Porter's Value Chain Model



The Structured Value Chain model is used to identify the information transactions between *Management Functions* and *Enterprise Processes.* T*he Structured VCM* refines the enterprise management & control as a system of closed loop interactions of Management Functions {Fj}

**SVCM = {Function (Fj) x Process (Pi)}. i = 1,m; j = 1,n;**  The interaction of *Function* and *Process.* The interaction of Enterprise model core elements *Process* and *Function* is formally assumed as a *Control Process*. It is defined as a *Feedback Loop*  between *Process P*(i) and *Function F*(j). The analysis of the *Function- Process* interaction is a background of the formalized model of the organizational system (an Enterprise model)

Fig. 4 presents the structured model of the *Function-Process* interaction. The concept *Process*  is assumed as "a Black Box". The internal structure of *Process* is unstudied, the concept *Process* is characterized by a set of *Process state attributes* (this set comprises subsets of *Input flow attributes*, *Output flow attributes* and *Process attributes*) and it is influenced by the output

From the management point of view, *Process P(i)* is defined by two sets of attributes: a set of *Process state attributes* and a set of *Process control attributes*. A set of *Process state attributes*  includes the *Process input* (material flow) *attributes*, *Process output* (material flow) *attributes* 

A management *Function* consists of the predefined sequence of mandatory steps of information transformation (*Interpretation, Information Processing, Realization*); these steps compose a management cycle (a feedback loop). A definite set of attributes (a set of

of a management *Function* – a set of *Process control attributes* (Gudas et al., 2005).

consequently they are renamed as *Enterprise Processes* {Pi};

are renamed as follows (Fig. 13):

(control) system.

and Enterprise Processes {Pi}:

described in (Gudas, 1991).

and the *attributes* of the particular *Process P(i)*.

Fig. 14. The structured model of the *Function-Process* interaction

information items) is formed and transmitted during each management step. A management *Function F(j)* is initiated by some *Event* – a fact or a message associated with some internal or external (environmental) object. This definition of *Function* is close to the definition of function presented in (ENV 40003, 1990). This paper presents more detailed content of *Function F(j)* since it defines a sequence of definite types of interacting information activities (*Interpretation, Information Processing, Realization*) directed to control *Process P(i)* (Fig. 13).

All other constructs of *Function-Process* interaction (except constructs *Process, Input flow* and *Output flow*) in the structured model are assumed to be the components of the construct Enterprise *Management Function* (Fig. 15).

Fig. 15. The control view based structure of Management Function (Gudas et al., 2005).

It is assumed, that *Process* and *Management Function* are activated by some *Event*. A definite set of *state attributes* of an activated *Process* is the information flow defined as an input of (one or more) specific management *Function* that is activated by some particular *Event*.

It should be pointed out, that the set of attributes of management *Function* is closely related to the description of function presented by CIMOSA (ENV 40003, 1990)**.** The CIMOSA specification of function includes the structural part (the list of sub-functions is used), the functional part (goals, limitations, functional description, necessary equipment, input, output) and the part of an attitude (goals, limitations, procedural rules, events, end state).

The Elementary Management Cycle (EMC). The structured model of the *Function-Process*  interaction (Fig. 14) is formally specified as **Elementary Management Cycle (EMC )** at Fig. 16. The Elementary Management Cycle (EMC) is the basic construct of Enterprise management modelling, refines the components of management (control) cycle as well as content of management information transformations (Gudas, 1991), (Gudas et al., 2005).

The semantics of *Elementary Management Cycle (EMC***)** transactions at Fig. 16 are co-related with the description of modified semiotic tetrahedron of FRISCO (Fig. 4, Fig. 6).

A new perspective - control view perspective of Enterprise management modeling is beneficial and constructive for advancing of Business Process modeling and IS engineering methods. An Enterprise Management Model provides the theoretical background for system analysis of management information processes, identification and more detailed decomposition of enterprise data and knowledge components *Function, Process, Activity, Information flow, Control flow, etc.* 

Knowledge-Based Enterprise Framework: A Management Control View 197

Fig. 17. Knowledge component e (b, t, k) for enterprise management activities

(K) (Gudas, Brundzaite, 2006).

chapter.

The internal structure of the enterprise knowledge component (b, t, k) (see Fig. 17) represents a new viewpoint to enterprise knowledge modelling: the enterprise management facilities (decision making units of organizational structure) should be supplied and operate with *complex integrated knowledge* about different Enterprise domains as follows: business knowledge (B), IT knowledge (T) and knowledge about enterprise management modeling

Fig. 18. Enterprise knowledge component e (b, t, k) is integrated with enterprise data items The depicted enterprise knowledge component (Fig. 18) represents a structural viewpoint to enterprise knowledge modeling: the Knowledge Base should include *integrated enterprise knowledge* (validated models, theories, arguments, descriptions, problem statements) about business strategy and infrastructure (*B*), IT strategy and infrastructure (*T*), enterprise

On the basis of the internal structure of enterprise knowledge component (b, t, k) the abstract space (the Universe of Discourse) for Enterprise knowledge modeling is defined as follows (Fig. 19): Enterprise Knowledge Space (B, T, K), in which B – axis of business process knowledge hierarchy; T – axis for IT management knowledge hierarchy, K – axis of

The Enterprise Knowledge Space axes (B, T, K) reflect the different management knowledge types, each axis having its own hierarchical structure. Semantics of the enterprise knowledge hierarchy levels (partition of the axes B, T, and K) is discussed in the following

management modelling knowledge and knowledge management methods (*K*).

enterprise management knowledge hierarchy (Gudas, Brundzaite, 2006).

Fig. 16. The Elementary Management Cycle (EMC) – specification of *Function-Process*  interaction
