Business Systems Modelling: Function Modelling (Tutorial 1) by John Owens

It may come as no surprise to many 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), a complete modelling framework that integrates the various elements of Business Systems Analysis, Business Process Modelling, BPM, BPR and Data Modelling into a single methodology.

This series starts by focusing on function modelling. Probably the most critical of all the modelling activities 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.”

All other business models can be derived from the Function Model.

Effective business modelling has five facets:

  1. Information gathering
  2. Analysis and investigation
  3. Modelling
  4. Feedback
  5. 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:

  1. Using existing documents
  2. Running strategic interviews
  3. Running modelling workshops

These methods are not mutually exclusive! In a well run business modelling project each of them 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 customerwe 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 invoicesif there are any
  • We check that the goods are in stockand, 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 weplace a purchase order with our suppliers
  • When we receive the goods from the supplierswecomplete outstanding customer orders
  • We invoice private customers at the end of each week, weinvoice commercial customers at the end of each month”

From such a transcript we will extract a list of Candidate Business Functions and then convert these to actual business functions.

Candidate Business Functions

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

This short extract has yielded thirteen separate Business Functions.

The items in the column on the left above were phrases that suggested Business Functions. We listed these and converted them to actual Functions.

The conversion technique is as follows:

  1. 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.
  2. Choose good verbs: Choose a strong, positive, active verb with which to begin the Function name.
  3. 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.
  4. 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”.
  5. 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.

In Integrated Modelling Method the Functions are arranged 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 would give 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.


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. Use the comments section below to post questions for John and we’ll help you complete the exercise correctly. We’ll also be running regular coaching calls with John to help solve your modelling queries.


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