Improving Inter-Organizational Processes with
Integrated Organization and Technology Development

Abstract: The goal of the OrgTech-project is to improve the cooperation between two engineering offices on the one hand, and a major German steel mill, on the other. An integrated change process has been initiated which combines the introduction of a groupware application with methods of organization development. This change process draws on the framework of Integrated Organization and Technology Development which is presented first. Then we

describe its application in the OrgTech project. The results of the first project phase are presented and discussed.

Keywords: Groupware, Organization and Technology Development, Tailoring, Requirements Analysis, Concurrent Engineering.

1 Introduction

ORGTECH (Organizational and Technical Development in the Context of the Introduction of a Tele-cooperation System in Small and Medium-Sized Engineering Companies) aims at supporting the cooperative work processes within and between two engineering firms and a steel mill as one of their customers. The two engineering firms take on subcontractual work for a large steel mill in the German Ruhr area, e.g. the construction and documentation of steel furnace components. A construction department inside the steel mill coordinates the construction and documentation, and manages the contacts with external offices at the steel mill. The external offices, however, complain about the specification of the construction orders being vague and due to this several meetings will have to take place before the project is over. The difficulty to gather the documentational data about the actual state of the plants is another problem. This has to do with the way the sketch archive of the steel mill is run. This situation often causes inconsistencies in the final design of steel mill components. This problem is seemingly caused by the huge number of sketches and the organization of the electronic archive, by the complexity of the construction

development process, and by communication problems among the engineers and their clients [Iaccuci et al. (1998)]. Besides, the work planning (work preparation) and the production department of the steel mill are not involved in the construction process which often leads to problems during the production process. Given this initial problem description, our key questions are:

• How can the underlying work processes be changed?
• How is the role to be determined which information and communication technology can play within this change process?
• Which applications should be chosen?
• What would be the best way to introduce these applications into the different organizations?

While this paper focuses on the steel mill / subcontractor scenario with all its specifics, the application base of the ORGTECH project actually comprises a number of other engineering companies (with other customers). Our experience shows that the characteristics exhibited by the scenario discussed here are widely reflected in these other fields of application. Furthermore, we have presented the scenario during a project transfer workshop to an even wider audience and their affirmative responses indicate the relevance of our findings for their respective domains.

2 Integrated Organizational and Technology Development

 process is thought to be an ongoing one [Hartmann (1994), Wulf and Rohde (1995)]. The next paragraph introduces the four components of OTD:

• organization development,
• work psychological analysis,
• evolutionary models of software development,
• tailoring in use.

2.1 Components of the OTD Approach

The organizational development process can be characterized by four steps: diagnosis, intervention planning, application of interventions and evaluation. Within this process, methods and instruments of applied social science such as theory of personality, social psychology, group dynamics and organization theory are applied [Huse (1980)]. Moreover, [Pieper (1988)] has proposed to modify traditional approaches of organization development towards a discursive one which offers a wide extend of participation to all members of an organization. Organization development approaches alone do not offer adequate criteria for the evaluation of their results.

To evaluate whether certain work systems are human centered and effective, work psychological research seems to be very useful. The Handlungsregulationstheorie [action regulation theory; Hacker (1986)] offers a theoretical foundation of several evaluation criteria for human - centered work systems. The theory focuses on psychological aspects of sensomotorical, cognitive, intellectual, and psychological regulation of human work [Hacker (1986), 73ff and activity theory by

Leontjew (1974)]. The completeness or wholeness of tasks are structured in: preparation of actions, planning of superposed and partial goals, organization of actions, coordination with actions of colleagues, control of action, and feedback about the results [Ulich (1991), Hacker (1987)]. On the basis of this theoretical approach four work psychological criteria of task analysis and job evaluation are derived: the possibility to perform the task (Ausführbarkeit), the harmlessness (Schädigungslosigkeit), the avoidance of impairments or interferences (Beeinträchtigungsfreiheit), and the promotion for development of personality including social skills and capabilities (Persönlichkeitsförderlichkeit) [Ulich (1991)]. Concerning single workplaces, we propose to apply these work psychological evaluation instruments (several procedures are available which are grounded on these findings) within organizational restructuring processes especially in the phases of analysis and evaluation of the work system.

Organization development and work psychological analysis take software as a given artifact, which is stable after its production. This perspective was dominating software - engineering for a long time too. Contrary to traditional approaches to software - engineering the STEPS - method of Floyd offers an evolutionary and participative framework which seems to be well adapted to develop software for organizational environments which can be described according to the paradigm of self - organization [Floyd et al. (1989); Floyd (1994)]. In order to keep pace with environmental changes it assigns an iterative development process establishing a system's revision as soon as the functions do not match anymore with the requirements of the users.

Evolutionary and participative software development has to be supplemented by activities performed by end users or local experts of the application environment [Wulf (1994); Stiemerling et al. (1997)]. Approaches of end users' modification of a system have been discussed under different labels [Trigg et al. (1987); Fischer (1990); Henderson (1991); Nardi (1993)]. We want to sum up these activities under the label of tailoring. Contrary to the development of a new system version the existing version is adapted by end users or local experts. Tailoring allows for adaptation just as far as these needs have been anticipated during system design. If there are requirements for adaptation which have not been anticipated, it is necessary to redesign the system. Therefore the activity of tailoring can become part of an evolutionary approach to software development and usage as it is described in the STEPS - model. As long as users' needs and environmental requirements can be handled locally during usage, there is no need to establish a revision of the system. So tailoring can play an

important role in enabling an organization to react to a changing environment [Wulf (1994)].

2.2 Integration towards a holistic approach

Establishing the process - A process of integrated organization and technology development starts with the perception of a problem. As a next step the discussion of the members of an organization, who are affected by the problem, must be fostered. They should find out whether there is a need for an integrated process of change.

Analysis of the actual state - First, the actual state has to be analyzed with respect to organizational structure, technology and qualification. The results of this analysis have to be discussed Such a discussion can be prepared by change agents using open interviews or different work psychological instruments for task and work analysis such as the methods mentioned before.

Creation of alternative options - Having clarified the actual state with its problems, it seems important to generate alternative approaches to its solution (organization, technology or qualification measures). The members of the organization should discuss these alternatives and find a solution agreeable to everyone. To judge the human centered potential of the different options, they should be evaluated with work psychologicalmethods.

Planning of interventions - After choosing a development option the members of the organizational unit have to decide on interventions in organizational, technological, and qualificatory dimensions. If in the context of the technological dimension software has to be (re)implemented, the establishment of the software development project takes place in this phase.

Interventions - Interventions derived from organization development play an important role within the wider process of integrated organization and technology development. Their main issue is the change of formal and informal aspects of an organization. Concerning the structures and processes of an organization, decentralization and new forms of labor division may have to be introduced. Software will have to be (re - )designed or tailored.

Figure 1: Model for the ORGTech project

Within the process of integrated organization and technology development two different requirements for qualification have to be considered: special professional qualifications and social competences as preconditions for participation. Task specific knowledge of organizations' members has to be up-to-date if organizational development leads to new task profiles for individuals or if the introduction of new technologies requires new skills.

Qualification for participation - Furthermore, the individuals involved in organization and technology development must be enabled to participate in the process adequately. Therefore, the social competences of the participants have to be promoted. Social competencies in this context are communicative and cooperative abilities for an involvement in discursive development

3 OTD Applied to the ORGTECH Project

After the project establishment (step 1) the process mainly comprises two equivalent cycles which give the project staff the opportunity to evaluate after 1.5 years (the whole project lasts 3 years) and use experiences from the first phase as basis for the second. Each phase consists of an analysis of the current situation in the field of application, the configuration and tailoring of the technical system and - in parallel - the organization development and the qualification of the employees involved. In this model the phases outlined in the previous paragraph are deployed in a form, which is project specific.

During the analysis of the actual state the current communication and cooperation structures within and between the organizations are analyzed with interviews, observations, and work psychological instruments. Based on these findings alternative options for cooperation are created participatively in workshops. To support the discussions about alternatives and to encourage the participants we use standard components and early prototypes of the communication system. Also, a qualification program which is aimed to improve the social and communicative competencies of the users involved, is introduced. It is supposed to enable the users to participate adequately in the process. Besides they are trained to moderate discussions and problem solving processes by themselves.

 This qualification for participation, will be applied continuously by change agents during the project's phases. We have applied a concept by [Sell (1994)] who proposes an approach to qualify for participation which is directed to analytical, synthetic, and dialectical abilities for problem solving and conflict management. These abilities are practiced by using methods as group discussions, group training, practice of communicational methods, and theme-centered interaction.

The planning of interventions will consider technological, organizational and qualificatorical aspects. The functions will be specified and implemented, a new concept for cooperation in project structures and task groups will be developed, and a concept for qualification of the users involved will be worked out. In the phase of intervention there will be an installation of groupware and multimedia systems, a restructuring of division of labor within and among the organizations, an establishment of project groups and a coaching and nurturing of users will take place.

After these modifications the work system will be evaluated by the users in the different organizations. Change agents will collect additional data with methods of observation and user interviews. The data is analyzed and discussed with users involved on the basis of work psychological analysis.

We do not expect that the first development cycle will lead to satisfactory results, and so another iteration of this development process is anticipated. The iteration offers potential playground for evolutionary and participative software development and tailoring in use, all of which has been explained in the previous paragraph. So, based on the data analysis in the discussion with the users, different options for further development will be created. The technological and organizational requirements will be defined, organization and technology development will be oriented again to the changed conditions and problems of cooperation, and the users involved will be qualified for the usage of the redesigned groupware and multimedia systems and trained to perform further development activities by themselves without external change agents. The second phase of the OTD process ends with another re-evaluation of the integrated socio-technical work system and the feedback of the results to the users involved. At this point the members of the organizations should be able to continue the process by themselves, to perform workshops for further qualification, problem solving and conflict handling, to tailor the shared communication system according to their needs, and to restructure task groups, if necessary. Thus, the OTD process is supposed to continue without the involvement of external change agents.

4 The ORGTECH Project at Work

4.1 The kick-off workshop

We discovered three main groups of problems: organization and information, technology and qualification. For the engineering offices two big organizational problems were the missing of detailed terms and easy ways to interchange information between them and MELTIT. Furthermore, the workshops showed lots of technical problems and the participants also had many suggestions for technical improvements. Quite a few cards mentioned problems with the construction data base of MELTIT and suggested an easier access to it for the engineering offices and a better organization of the data. Many participants wanted to use 3-D construction tools, but they had not found any suitable ones so far, and, again, they had no clue how to share the resulting data and how to archivate it. Other cards dealt with CAD-CAM integration and the problems resulting from the rapid development of exchange formats. Under the topic "qualification" the biggest number of cards dealt with special knowledge new employees had to gain in order to be able to work efficiently. Another problem concerned the acceptance of new design methods. The mode the engineering offices were paid by the steel mill was mentioned as a further problem when introducing 3D technology. It became clear that it is not easy to define the value of creative work like a construction, thus it is not easy to find a fair mode to pay the work done. Right now the offices are mainly being paid according to the amount of written lines in the 2D sketches produced.

At the end of the workshop, we gave a broad overview, of what the project is

capable of offering to overcome some of the problems. Besides, we used the results of the workshop to develop the interview methodology described in the next chapter.

4.2 The interviews

Based on the results of the kick-off workshop we created a semi - structured questionnaire, covering the following topics: task of the interviewee, communication and cooperation problems, information and communication infrastructure, data and archive management, CAD (Computer Aided Design) and CAM (Computer Aided Manufacturing), 3D-CAD, and teamwork.

The interviews lasted from 70 to 120 minutes and were held at the workplaces of the interviewees. They often involved quite a number of demonstrations of the systems in use. The demonstrations were essential to discern improvement potential. In the following, we will present the results of the interviews of each organization.

4.2.1 The point of view of MELTIT

• construction: manages the outsourcing of construction design,
• production planning: receives sketches from construction department and plans production,
• mechanical workshop: produces mechanical pieces, tubes etc. to maintain the mill,
• systems and methods department: also managing the electronic archive of the sketches used by all departments.

 the construction department is contacted. That department decides who will carry out the design and sketch and coordinates that process. Nevertheless, the final decision whether the object being designed will be produced in the company's workshop or by an external supplier is taken by another department.

A typical task of the construction department is to supply the external engineering offices with documentation and sketches, and discuss the design with them. From the commission of the order until the final acceptance , the external engineer may meet quite frequently with the construction department. Sometimes an on-the-spot visit is needed or a discussion with the operator, but most of the meetings have the sketches of the external office as point of interest. On the basis of seven on- ite interviews we were able to reproduce the typical development of a construction order from the point of view of the different actors of the steel mill (Figure 2).

The information infrastructure allows all departments mentioned and all operators to access the central electronic archive of more then 100,000 sketches. The archive system allows for searching, viewing and ordering of sketches. The system allows multiple users to simultaneously view the same sketch in read only mode. An employee from the construction department and one from the production planning department said that they used this viewing functionality to discuss design or manufacturing problems over the telephone. Such an improvised solution of computer supported cooperative work has been tested by those employees, who were very interested in such a new technology. This attempt was seen as a clear demonstration of how application sharing or whiteboards would improve communication within MELTIT or between the construction department and the external offices.

In general, employees and managers were doubtful at first, being concerned about potential benefits of groupware application in their daily work. The arguments against the application of new technologies for collaborative work were the following:

• real face to face is necessary to discuss problems,
• normally not just one but several sketches are of interest,
• some of the meetings involve more than two people.

searching the electronic archive is too unspecific. This causes difficult search efforts.

The production planning department complained that often the sketches are not ready for the workshop and that considerable alterations have to be made before the sketches can be used as a base for CNC programming. In general, they felt that they did not have a possibility of sufficient participation in the construction process. This causes additional efforts during the production phase. Three dimensional CAD is not used in production planning at the moment. It would be, in the opinion of a technician of this department, useful for three reasons:

• to communicate better with the workshop since the workers sometimes have problems reading 2D sketches,
• to improve the quality of the construction design by eliminating errors,
• to automatically create lists of the parts.

4.2.2 The point of view of the engineering office TECHNO

The typical design project (compare figure 3) requires first of all to get the sketches and documentation on the actual state. This need for sketches and documentation remains during the whole order cycle. The sketches are normally ordered by fax from the construction department, and after the print out they are stapled at MELTIT to be collected by the engineers. Although normally every day someone from the office drives to MELTIT (about a 30 min drive away) and checks if there are sketches to be collected, the waiting time can be up to one week.

When a project is finished, the sketches are delivered to the steel mill on a disk in an AutoCAD file and in an image file, ready to be saved in the archive. This could be done by sending the files via ISDN, but at the construction department only one of the group leader has a PC which supports ISDN connections. Unfortunately, the recipient of the files is most of the time someone else.

Figure 3: Information flow between TECHNO and the steel mill

The office has rather intense contacts with the construction department, and the engineers meet the plant's operator only on few occasions. They appreciate the high level of expertise of the construction department. Contrary to the plant operators they are technically able to value the prepared design.

Concerning future perspectives, both engineering offices would like to have permission to search and download sketches from the steel mill's archive via ISDN. On the other hand, MELTIT does not want to grant such a permission for obvious security reasons. Besides an engineer explained that he visits the steel mill every week. There, sometimes a brief teleconference could be enough. He can also imagine discussing some of the problems with a shared viewer. The introduction of groupware

 technologies by TECHNO would be a long term strategic choice considering that the office has many foreign customers, as well. For instance, an engineer maintains contact with a steel mill in the USA, currently using e-mail and telephone, and he said that in this case groupware would have a greater potential.

The 3D design has been used but only for new constructions. The head of the office is skeptic about introducing the 3D CAD mainly due to the high costs and due to the maintenance construction a 3D model of the environment which would be required.

4.2.3 The point of view of the engineering office DOKU

Like TECHNO, DOKU would like to search and download sketches directly via ISDN. Regarding the possibilities to apply videoconferencing one of the technicians explained that visiting the factory is necessary and that tele-cooperation would not improve the situation. This is due to the fact that most of his communication partners on the shop floor of the plant operators would probably not take the time to apply the new technology. To provide information for DOKU is not their main job but rather a service they provide due to personal contacts. Moreover, these people need quite some explanation to be able to understand the 2D sketches.

Three dimensional design is considered by the manager as a competitive advantage that could change his business. The employees also consider three dimensional design a useful technology, especially in documentation to facilitate the work of the plant operators in case of a breakdown If they had to locate the right pipe or valve fast.

4.3 Workshops introducing technological options

Each of the presentations started by an introductory statement of the presenter referring to some of the existing problems. As the group was rather small, the participants were able to ask and get explanations instantly. The workshop ended with a round table where the potentials of the different applications were discussed. applications of those technologies, which were ready for usage, were introduced and discussed. The interest of the participants focused on the video-conference and different applications of 3D CAD. Moreover, the integration of these applications in the existing technological infrastructure and the investments necessary for hardware and software were discussed. For administrative reasons, one manager of the steel mill found it difficult to authorize these expenditures from his current budget. Nevertheless, the workshop resulted in a certain preselection of technological options towards video conferencing and 3D CAD applications.

4.4 Feedback Workshop

• to present and feedback our understanding of the distributed engineering process,
• to develop a common perception of the existing problems,

• to find a common focus for the intervention phase of the project, and
• to establish joint work-groups to implement the interventions necessary.

The workshop started with presentations by two project members. Based on a graphic image similar to the one presented in figure 2 the different steps of the distributed engineering process were presented [chapter 4.2]. In the discussion following the presentation, some misunderstandings concerning certain details of the engineering process were clarified and missing information were collected. It became clear, for instance, that the operators of the plants decide whether an object which has already been constructed will be built. Thus, within the construction process it is not
 

 sure whether it makes sense to consider the particularities of the internal production department. Concerning the ''appropriate`` mode to start a construction project and the role of the plant operators, the members of the three organizations expressed slightly different opinions without discussing these differences openly. The head of the DOKU office pointed out the importance of the plant operators in this process several times, because they have final budgeting authority.

In the following a project member gave a presentation summing up the problems faced with in the interviews. This list of about 20 problems covered the following aspects of the engineering process:

• the cooperation of the plant operators with the internal and external construction units,
• the cooperation between the internal and the external construction units,
• the access to the sketch archive,
• the cooperation of the internal and external construction units with the internal production-planning and production department.

For those who did not participate in the previous workshop, one of the managers from the steel mill gave a survey on the system presentation and summarized the results of the final discussion round. Especially concerning the relevance of 3D CAD different opinions were expressed. While the founder of DOKU regards it as a strategic choice for his office, the head of TECHNO pointed to the lacking 3D model of the steel mill. That made it very expensive to apply 3D on a broader scale. An agreement could not be reached during the workshop.

Finally, we agreed on a project structure to guide the upcoming phase of interventions. The project team had suggested to implement four parallel task groups dealing with the following topics: 3D-CAD, synchronous tele - cooperation, conventions for the storage of sketches, and production - oriented construction. These task groups should have been coordinated by plenary workshops taking place every two months. Due to capacity restriction especially on the side of the steel mill, we decided to deal with the second and the third (group A) and the first and the fourth

 topic (group B) jointly within one task group. The task groups were asked to develop a concept on how to improve their aspect of the distributed engineering process and test it out during their daily work routine.

4.5 The task groups in practice

4.5.1 Task group A: Synchronous tele-cooperation and conventions for the storage of sketches

Actually six NetMeeting applications are installed at workspaces in the construction and production planning department of the steel mill, one centrally in the DOKU office, and two at the workplaces engineers in the TECHNO office. To reduce initial investment some of MELTIT's workspaces are not equipped with audio/video hardware. They use the telephone to discuss shared sketches. Figure 5 depicts the actual installation (a/v means full audio/video equipment). The new communication structure was to be used in 3D-CAD and production-oriented construction projects.

Task group B decided to tackle both of its foci in parallel. Concerning the 3D

 CAD the project members carried out a market survey and provided the information for the three organizations. The construction department of MELTIT decided to introduce Mechanical Desktop - a 3D package, based on AutoCAD. It allows to parameterize the design components. While TECHNO followed this decision, DOKU made its own additional inquiries and decided to introduce Plant-4D - a 3D application which supports the planning and animation of production facilities. To gain experiences with the new applications three of the current construction projects were selected by the group to try out the 3D applications.

4.5.2 Task group B: 3D-CAD and production-oriented construction

5 Discussion

5.1 Improving interorganizational engineering processes ...

Beyond different perspectives on the business processes, we have to deal with different long-term company strategies. Different strategies may even lead to the introduction of incompatible technical applications which endanger cooperation. For instance, the head of the DOKU office decided to introduce a widely incompatible 3D application, because he believed that its functionality would open new markets for other companies. A similar problem arises concerning security standards for video-conferencing. Right now MELTIT's central IT division builds up a firewall system to link their local network to the Internet. Our approach of RAS-based ISDN-connections is somewhat contrary to their centralized approach. Nevertheless, Internet-based video-conferencing will require additional security efforts on the side of the engineering offices.

Improving interorganizational business processes, we have to keep the underlying power structures in mind. For both engineering offices, MELTIT is a major client. Concerning the ORGTECH project, MELTIT was able to define the relevant business processes, and thus, influenced the project's goals considerably. While acknowledging the given power structure, facilitators in change processes need to balance their impact

 on operative decision-making to avoid suboptimal solutions. For instance, being confronted with the incompatible 3D CAD decisions of MELTIT and DOKU and an angry reaction of MELTIT's construction department, we still tried to initiate a discussion on the advantages of each of the two systems.

5.2 ... by means of Integrated Organization and Technology Development

The participation of the employees in the different organizations proved to be invaluable. Without the detailed knowledge of their daily work routine the analysis of the actual state of cooperation could not have reached sufficient depth. The employees' participation in the selection of different technological options and in the planning and implementation of the interventions secured a high level of motivation. Nevertheless, the participation of the employees in the improvement project takes considerable time resources. This causes problems-especially for the smaller engineering offices. Therefore, the project team provided quite a lot of help to the task groups. We had to reduce the speed of the project and became selective with the measures applied. Moreover, up to now we were not able to integrate MELTIT´s plant operators into the project. This is mainly due to inner-organizational rivalry between different departments of the steel mill in the context of a broader reorganization. Thus, an important part of the overall engineering process did not yet get actively involved.

Being still in the first part of the project, evolutionary development of the software and of the organizational interventions did not yet occur. Nevertheless, the usage of the video-conferencing application has led already to some requirements which will be implemented via the application programming interface (API).

 While the basics of the OTD framework seem to be sound, the anticipated process model (see figure 1) needs ongoing revision. We had to change the temporal order of certain measures and abandon or redesign others. The market overview, for example, was carried out just after the feedback workshop, because the focus of the task groups had not been well defined before that. Moreover, we have not yet carried out any qualification for participation measures, since the participants involved so far were fully able to articulate their interests during workshops and interviews. The qualification concerning the new computer applications was not provided within a workshop, but by supporting the individual users at their workplaces, via a telephone hotline and by handing out written documentation. Thus, the project had to adapt itself in an evolutionary way.

6 Conclusions

Even though this paper has a look at just one specific case study, we believe to have presented a scenario which is representative for many interorganizational engineering processes and - to a certain degree - also for other cases which concern the outsourcing of non-core activities. Any organization deciding to go this route faces two primary problems:

• How to define ``outsourcable'' activities with enough sharpness in order to precisely specify the interfaces between the outside organizations and the relevant groups on the inside. Part of these interfaces are, for instance, measures of performance which are exact enough to serve as basis for legally binding cooperation agreements.
• How to integrate the outside organizations into the overall business process. This problem not only concerns ``official'' communication with entities on the inside, but also the support of informal exchanges, perhaps not anticipated by the management.

intervening of technological and organizational change and the need to take both into account.

While the technological solutions designed in the ORGTECH project can only be applied within the rather narrow focus of outsourcing engineering work, the organizational questions raised and addressed within the project and the general process model have a far wider applicability.

Acknowledgements

We first would like to thank our co-financees, the European Community and the state of North Rhine - Westphalia. Moreover, we are grateful the employees of MELTIT, TECHNO and DOKU for the time and efforts they spent making the project work.

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