Capability Maturity Model (CMM)
A model developed by the Software Engineering Institute (SEI) of Carnegie Mellon University that describes how organizations develop software. The model identifies five levels or steps organizations go through as they become more sophisticated in their use of process.. Level 1 organizations aren’t effective in using processes. Level 5 organizations are mature in their use of process and routinely manage and improve processes. Most organizations fall between Level 2 and 3. We argue that the same general concepts that apply to software organizations apply to any organization that attempts to organize around business processes. (www.sei.cmu.edu/cmm)

CASE (Computer Aided Software Engineering)
Software methods and tools designed to generate code from models. Those involved in the CASE movement have always sought to make software generation more systematic and predictable. Software developers often use CASE tools to model business processes.

Cause-Effect Diagram
A popular diagram used to analyze the causes of problems which provides an overview of all the possible causes. One starts at the right and lists the problem, and then extends a straight line to the left. From the line, one draws tangential lines and lists causes of the problems at the end of those lines. Lines can be drawn to the subsidiary lines as more discrete causes are considered, and so forth.

CIM (Computer Integrated Manufacturing)
Movement, techniques and tools for integrating manufacturing processes with computers and software.

Class Diagram
A UML diagram used for the design of object-oriented software systems, and, more generally, to describe any set of logical classes and their relations. The organization diagram that we use in this book could be said to be a loosely structured class diagram. Software developers sometimes speak of a high-level class diagram as a business model. (See Object-Oriented.)

Competitive Advantage
Occurs when one company can make more profits selling its products or services than its competitors. It occurs because a company can charge a premium because their product or service is more valuable, or because they can sell their product for less than their competitors because they are a more efficient producer. Rational strategists always seek to establish a long term competitive advantage for their company. Many managers associate competitive advantage with the description provided in Michael Porter’s Competitive Advantage (1985).

Component
Used generically, this can refer to any entity or part. In software, today, is usually refers to a software module, organized via object-oriented techniques. (See object-oriented.)

Core Business Process
Core processes are the processes that rely on the unique knowledge and skills of the owner and that contribute to the owner’s competitive advantage. Contrast with subsidiary business processes.

Cost Leadership
A competitive strategy that emphasizes offering the product or service at the cheapest price. This can be done by creating the most efficient manufacturing price, by economies of scale, or by control of suppliers and channels.

COULD Process
Also sometimes Can-Be Process. Description of one of two or more alternative redesigns that are being considered.

CRM (Customer Resource Management)
A vague term describing any of a number of packaged or tailored applications or tools designed to help with sales, tracking customers, or managing information gained from customer interactions.

CTO Tree (Critical-To-Quality)
A tree that lists the most important outcome, goal or measure for a process improvement effort on the left and then sub-divides it to identify more specific considerations that contribute to the outcome.

Customer-Oriented e-Business Applications
A generic way of talking about business processes and Internet applications that use Web sites or portal to allow customers to access the company over the Internet for information or commerce. (Compare with Supplier-Oriented and Internal-Oriented Applications.)

Decision Point or Diamond
A diamond or hexagonal figure used on process diagrams to show when a decision leads to a branching in the flow of information, control or materials. Technically, all decisions take place within activities and arrows only show the flow between activities. As a convenience, however, if the decisions lead to branching, we often represent them on the process diagram and label them to indicate why a flow would go to one subsequent activity rather than another.

Decision Support Systems
Software systems designed to pull together information for managers to facilitate decisions. Increasingly, applications are not simply designed to automate a process, but to provide managers with ongoing information about the process so they can make more timely and accurate decisions.

Diagram
An informal, graphical picture of some set of entities and some relations between them. Contrast with model.

Differentiation
A competitive strategy that allows a company to sell its products for a premium price. This emphasizes creating superior products, products with unique or more desirable features or design.

DMAIC (Define, Measure, Analyze, Improve, Control)
An acronym used by Six Sigma practitioners to remind them of the steps in a Six Sigma improvement project.

Dot.com Company
A generic, and increasingly derisive term, for any company that was created to take advantage of the Internet and its technologies. Most dot.com companies were founded in the late Nineties and most failed when the Federal Reserve restricted money in 2000. Most dot.com companies were based on inadequate business models. Some dot.com companies, like www.Amazon.com and www.ebay.com, have proved successful. While the recession of 2000-2002 eliminated most of the “pure play” dot.com companies, it didn’t dampen the interest of conventional companies that are currently seeking to integrate Internet techniques with their existing business models to gain new customers or increased efficiencies.

Downsizing
Reducing the number of employees at a company. Occasionally necessary. In the mid- Nineties, it was too often done in conjunction with BPR projects and many employees now associate BPR with downsizing

E-Business
A vague term that embraces all of the changes undertaken at companies that seek to take advantage of the Internet, the Web, email and a host of associated Internet technologies and protocols. At the moment companies are transitioning to e-business. By the end of this decade all companies will be more or less e-businesses.

ebXML (electronic business XML)
A consortium set up by two other organizations, a United Nations (UN/CEFACT) committee and OASIS, an Internet consortium. ebXML is charged with creating an XML architecture that standardizes all of the services companies will need to build Web Services. One sub- committee of ebXML is focused on business process communication, and has proposed BPSS. For more information, check www.ebxml.org

eTOM (electronic TeleManagement framework)
The TeleManagement Forum, a consortium of telecommunications companies, has worked to create a standard framework, called eTOM, that describes the process architecture of an ideal telecom company. In the nature of the Telecom industry, companies must work very closely together. This framework would allow them to share common process names and interfaces.

EAI (Enterprise Application Integration)
As companies seek to link their existing software applications with each other and with portals, the ability to get their applications to exchange data has become critical. EAI is usually close to the top of any CIO’s list of concerns. There are different approaches to EAI. Some rely on linking specific applications with tailored code, but most rely on generic solutions, typically called middleware. XML, combined with SOAP and UDDI is a kind of middleware.

EDI (Electronic Data Interchange)
A pre-Internet system for exchanging data between organizations. EDI requires that organizations standardize terms and invest heavily in computers and the maintenance of the EDI software. Although some companies use EDI systems and will only phase them out slowly, EDI is being replaced by less expensive Internet systems and protocols like XML.

Email
The use of Internet protocols to pass text messages from one email address (URL) to another. Facilitates communication between employees and between employees and customers or suppliers. Not always considered in redesigning processes, but email is gradually integrating companies in useful ways not previously achieved or fully understood.

eMarketplace

An Internet system maintained by a company or a consortium that allows individuals or companies to offer products and services or make bids to buy products or services. NASDAQ is an eMarketplace for stock. Covisint is the consortium and the name of the automotive eMarketplace.

Enterprise Alignment (Enterprise Alignment Cycle)
Enterprise Alignment refers to the ongoing process every company goes through to keep the elements of the organization aligned with the organization’s strategy and goals. Vertical alignment is used to assure that process and activity measures and the measures used to evaluate managerial performance are all aligned with corporate goals. Horizontal alignment, or process improvement, focuses in assuring that all of the activities that take place in a process are aligned with the goals of the process. In most organizations, change is constant and thus, the organization is always working to realign, vertically and horizontally, to keep everything in sync with the changing strategy and aims of the organization.

Enterprise Application
As used by software designers, an enterprise system is a major software application that is designed to be used or accessed by many different departments and is usually maintained at the corporate level. Payroll is a good example of an enterprise system.

ERP (Enterprise Resource Planning)
See Packaged Applications.

ERP-Driven Design
When a company elects to use an ERP application, it is getting an application that already makes assumptions about the inputs and outputs it will receive. To insert such an application into an existing business process, the company must first determine where it will fit and what it will replace and redo the existing process so that it interfaces with the new ERP application. In effect, this is the reverse of what happens when a company redesigns a process and then asks an IT group to create an application that will take inputs generated by the process and make designated outputs.

Feedback
Refers to passing information from one person to another person that performed some task earlier, or from one process or system or another process or system that has already occurred. When sales reports customer complaints about manufacturing defects to the manufacturing department, it is providing feedback to manufacturing. When a sales manager accompanies a new salesperson on a call and then critiques the new salesperson’s performance after the call, he or she is providing feedback. A lack of adequate or timely feedback is a major cause of process problems.

Fishbone Diagram
See Cause-Effect Diagram.

Fit
See Process Fit.

Function-Process Matrix
A diagram that lists functions or departments on the horizontal axis and value chains or business processes on the horizontal axis and shows which functions are involved in which processes.

Functional Measures
Measures assigned to departments or functional groups that focus on goals related to departmental efficiency rather than process efficiency. A sales department might measure cost of sales or the number of calls a salesperson made in a given period of time. (Compare to Process Measures.)

Gaps and Disconnects Pattern
A process redesign pattern that focuses on checking the handoffs between departments and functional groups in order to assure that flows across departmental lines are smooth and effective.

Goals, Processes and Projects Worksheet
A grid or matrix that one can use to analyze the relationships between goals, listed on the vertical axis and processes, described on the horizontal axis.

Goal Hierarchy
A hierarchical tree that shows how organizational goals, pictured at the top or on the left are subdivided into more specific goals for value chains, processes, sub-processes and ultimately to activity goals. For every goal there are measures – specific tests of whether the goal is achieved or not. Thus, there is also a measures hierarchy that shadows the goal hierarchy.

Horizontal Alignment
Focuses on business processes. The alignment of activities and flows of information and materials into processes that encompass everything that happens from when an order arrives until after the customer receives the product or service. (Contrast to Vertical Alignment)

Human Performance Analysis Worksheet
A grid or matrix that one can use to analyze the human performance requirements of a process or activity. Tasks, activities or steps are listed on the vertical axis of the worksheet and measures and the elements of the human performance model are listed on the horizontal axis, making it possible to identify measures and potential performance problems for each activity.

Human Performance Model
An analysis of what is involved in human performance. There are different versions of this model, but all emphasize: inputs, outputs, the consequences of performance, feedback and the skills and knowledge employed by the performer. Sometimes referred to as HPT or Human Performance Technology. These models and an analysis of the variables is associated with the International Society for Performance Improvement (ISPI) and with Thomas Gilbert and Geary Rummler. For more information, check www.ispi.org

Human Performance Analyst
Someone who uses Human Performance Technology to help with job analysis and design or to advise on how job performance can be improved.

Hypercompetition
Occurs when all companies focus on being the low cost producer. Each company tries to improve their processes by adopting the best practices of their competitors. In effect each company works harder and faster to be more efficient and their profit margins keep dropping. The alternative is for some companies to adopt other strategies. Associated with Michael Porter.