Business Systems Modelling: Function Modelling (Tutorial 1) by John Owens
It may come as no surprise that when we find defective data we often find poorly designed business functions.
To create long-term data quality health it is imperative that every business understands the functions it should be performing as opposed to the functions and processes it is currently delivering.
Our aim with this tutorial series is to help our readers learn some of the key modelling skills that are typically required for data quality improvement.
We have therefore enlisted John Owens to coach our readers on the finer art of business and data modelling.
John is the creator of the Integrated Modelling Method (IMM) which is a framework that integrates the elements of Business Systems Analysis, Business Process Modelling and Data Modelling, all into a single methodology.
This series starts by focusing on Business Function Modelling, arguably the most critical of all the modelling activities for data quality, as it forms the bedrock for which the other modelling processes are dependent upon.
Starting in the Right Place
The essential starting point for good business modelling – and that includes data modelling – is to model the Business Functions.
"Know the Business Functions and you know the business.”
- John Owens
All other business models can be derived from the Function Model.
Effective business modelling has five facets:
Information gathering
Analysis and investigation
Modelling
Feedback
Implementation
Information Gathering
Effective information gathering is the cornerstone for effective results so it is worth taking the pains to get it right first time.
Information gathering is be done in three main ways:
Using existing documents
Running strategic interviews
Running modelling workshops
These methods are not mutually exclusive. In a well-run business modelling project, each will be used as appropriate.
Strategic interviews with senior executives are essential for success and yet they are the one step that most analysts miss out. Inexperienced analysts miss them out because they are afraid of wasting the time of busy people. Many "experienced” analysts miss them out because they already "know” what the business needs and do not need to ask anybody. Good analysts never miss them out.
Business analysts are experts in analysis and modelling. They are not business experts and should never try to be. This is a common error that de-rails all to many projects.
Analysis and Investigation
Documentation is not analysis!
Too many analysts gather large amounts of information – often from the wrong sources – and then produce weighty documents and think that they have done analysis. Common mistake!
Information gathering is only the beginning. The information must now be analysed and the business functions and other business objects extracted from it.
The Integrated Modelling Method provides the means to consistently analyse all gathered information and extract the required business objects, missing nothing.
Extracting Business Functions
The following is an extract from an interview with the manager of the sales department of a distribution company:
“We sell products and services to authorised customers”
“We receive applications from prospective customers all the time”
“We vet prospects and, if they pass, we register them as authorised customers”
“When we receive an order from a customer we make sure that weidentify the products or services that are required”
“If the order is taken by phone we chase the customer for payment of overdue invoices - if there are any”
“We check that the goods are in stock and, if they are, we dispatch them to the customer”
“We send the delivery note to the invoicing department to confirm that the goods have been sent”
“If the goods are out of stock then we place a purchase order with our suppliers”
“When we receive the goods from the suppliers we complete outstanding customer orders”
“We invoice private customers at the end of each week, we invoice commercial customers at the end of each month”
From such a transcript we can start to extract a list of Candidate Business Functions and then convert these to actual business functions.
Candidate-to-Actual Business Functions
sell products and services to authorised customers (Sell Products and Services)
receive applications from prospective customers (Accept Applications from Prospective Customers)
vet prospects (Vet Prospective Customers)
register prospects as authorised customers (Register Authorised Customers)
receive an order from a customer (Accept Orders from Customers)
identify the products or services that are required (Identify Products or Services Required)
order is taken by phone (Accept Orders from Customers)
chase the customer for payment of overdue invoices (Request Payment from Customer)
check that the goods are in stock (Carry out Stock Check)
dispatch them to customer (Dispatch Products to Customers)
send the delivery note to the invoicing department (Confirm Order Dispatched)
confirm goods have been sent (Confirm Order Dispatched)
place a purchase order with suppliers (Order Products from Suppliers)
receive the goods from the suppliers (Accept Products from Suppliers)
complete outstanding customer orders (Dispatch Products to Customers)
invoice private customers at the end of each week (Invoice Customers)
invoice commercial customers at the end of each month (Invoice Customers)
Conversion Approach from Suggested Business Functions to Actual Business Functions
Do you see how this short exercise yielded thirteen separate Business Functions?
The items in the list on the left above were phrases suggested as Business Functions so we converted them to Actual Functions.
The conversion technique is as follows:
Eliminate Mechanisms: Most Business Functions will be hidden behind Mechanisms. Business Functions are WHAT the business OUGHT to be doing and mechanisms are HOW it currently does it. Most business functions hide behind mechanisms. In order to convert the candidate to a real Function ask the question "what is the objective of the action described by the candidate?” The objective is the Function.
Choose good verbs: Choose a strong, positive, active verb with which to begin the Function name.
Remove any ambiguity: For example, "vet prospects” is ambiguous because, reading it in isolation, we would not know what "prospects” are. Are they prospective employees, suppliers, customers? If the Candidate Function does not make this clear then we need to to return to the extract from which the candidate came and clarify this. From this extract we see that "prospects” refers to prospective customers and so "Vet Prospective Customers” is a good name for the Function.
Remove extraneous words: If we had a Function named "Develop a Plan to Give to a Customer” we would change this to "Develop Plan for Customer”.
Capitalise all major words: Function names should be written using initial capitals on all verbs, nouns and adjectives, for example, "Issue Parts from Stores”, "Book Passenger on Flight”.
Function Catalogue
A long list of Business Functions is not easy to work with so in the Integrated Modelling Method you will arrange your functions into a hierarchy called the Function Catalogue – this is the core model of the method and an essential model in every business.
Arranging the above list of functions into a hierarchy now gives us the following:
Sell Products and Services
Manage Customers
----- Accept Applications from Prospective Customers
----- Vet Prospective Customers
----- Register Authorised Customers
Manage Sales
----- Accept Orders from Customers
----- Identify Products or Services Required
----- Carry out Stock Check
----- Dispatch Products to Customers
----- Confirm Order Dispatched
Manage Revenue
----- Invoice Customers
----- Request Payment from Customer
Manage Stocks
----- Order Products from Suppliers
----- Accept Products from Suppliers
This is a simple hierarchy that will grow as we work throw each interview an workshop session.
TIP: A good modelling tool will enable you to draw hierarchy in diagram form – making it even more usable. When choosing a modelling tool make sure that it is repository based i.e. has a database in which each function needs to be defined only once and can be re-used on as many diagrams as are required.
Know the Business
The Function Catalogue is the one model that allows you to see the whole of the business from end to end without duplication of any elements.
It is a unique catalogue of all core business activity that tells us what the business is all about.
What Next?
Having built the Function Catalogue for all or part of a business we can now go on and build any other models we need.
Process Models: Processes are simple the linking together of Business Functions into a particular order to achieve a particular business result.
Data Structure Model: The shows the relationships between the data entities created and used by Business Functions.
Information Flow Model: This shows how information flows between Business Functions within the business and between Business Functions and the outside world.
Data State Model: This shows how data entities from the Data Structure Model are transformed by Business Functions.
Procedure Model: This shows the mechanisms by which Business Processes are executed day-to-day.
In the next tutorial we will look at how to build a process model. Many organisations start their modelling efforts at this level which can lead to confusion so we will explain the important difference between process models, function models and procedure models plus provide some practical techniques to help you build your own process model.
Exercise
Using the techniques provided here, assess whether your organisation possesses an accurate function model for your part of the business.
If it doesn't then follow the steps above to create one for a critical area of the business.
John Owens
John Owens is passionate about bringing simplicity, power and elegance to the world of Business Systems Analysis, Business Process Modelling and BPM.
He is an international consultant and mentor to a wide range of enterprises of all sizes in the UK, Ireland, Europe and New Zealand. He has put all of this knowledge into a set of books and the Integrated Modelling Method (IMM™).
John is based in New Zealand and provides mentoring to enterprises of all sizes, from start-ups to large corporations, to aid them improve their business and increase their cash flow.