De La Vega, Roberto, Mathias Kirchmer, Laengle, Sigifredo: The Real-Time Enterprise. In book: Industrial Management, July/August 2008.

Abstract

Becoming a real-time enterprise is an important challenge for companies who operate in a chang mg and highly competitive environment. Real-time enterprises not only design, implement and monitor their processes, they do it at high speed, resulting in business agility. This article shows an actual case of how industrial engineering tools and techniques can be used to systematize the design-implementation monitoring cycle and ensure it functions quickly and accurately.

To really understand the challenge of building a real-time enterprise, think for a moment of the Formula One auto race. How does a team win the Fi? What factors are key to its success? The obvious answer is high speed, and the same is true of a company’s ability to satisfy its customers. But how do you achieve that high speed on the racetrack?

A large part of any race is played out in the pit stops, where a whole series of complex maneuvers have to be executed simultaneously in a matter of seconds. This requires coordination supported by sophisticated communication systems. Working quickly and precisely is absolutely fundamental, with nothing left to chance. Speed and accuracy are of the essence.

The brutal reality of the Fi is evident at the end of the race. A stroke of luck and the team grabs a winning position; an engine breakdown or technical error and they end up well back in the field. A huge effort goes into the search for mechanical and aerodynamic improvements, for every second saved is precious. Discouragement is a constant danger as the teams pull out all the stops to achieve an optimum speed and score points.

But that’s not all. The pit stop team works in close coordination with the team’s telemetry data unit, whose job is to monitor vehicle behavior from second to second. Sensors measure engine temperature, oil composition, the rpm-speed ratio and other vehicle performance parameters, and the unit’s engineers closely analyze the information to determine exactly what’s happening and why at every moment. They, too, leave nothing to chance, deciding when the driver takes a pit stop and what adjustments to make in the few seconds the car is off the track. Speed is everything, of course, but speed is only possible if the pit crew can count on a rigorous and detailed performance monitoring system to back them up.

These performance measurements make it possible to adjust the vehicle to the changing conditions of the race. Without such any-time, any-place information captured by the data-acquisition technology, fine-tuning the original strategy would be out of the question. Fortunately, in the business world the technology for implementing rapid strategy adjustments is available. How well it works will depend on the following three factors: rapid design (adjustment) of long-term plans to meet the latest needs, rapid implementation of the designs and effective and accurate monitoring.

Another question for top management is: Where does the real challenge lie? The heart of the matter is choosing how fast to carry out process innovation, which means determining the speed of the design implementation monitoring cycle. A 1960 Volkswagen Beetle may have been an economical alternative in its time, but today it would be a slow solution. A Formula 1 vehicle is a fantastic choice for speed, but it’s likely to be expensive, not to mention risky. Today, however, companies who go for the Formula ? option have the technology they need at their disposal; the test of their managerial abilities will be to elect a process innovation speed that will meet the challenges of their environment.

Increasing the optimum speed

The key to the real-time enterprise approach is the speed at which the design implementation-monitoring cycle is applied to business processes. How can we ensure the cycle is implemented effectively and without delays? How should each of the three tasks be coordinated?

In modern companies, two functional units often lead an uneasy coexistence: processes and information technology.

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