System Organisation

Designing Institutions, Companies, Businesses

and/or Departments

- Applied System Theory -

Axel J. Papendieck

Part 1: Definitions

- Part 2
- Part 3
- Part 4
- Part 5
- Productivity
- History
- About

The key structures of organizations are a very logical system. For creating new or changing existing organizations it is highly useful to harness the basic mechanisms of the system organization. The definitions of its elements: - workplaces, - products, - bill of materials, - components, - production processes will enable handling and changing organizations as a logical procedure.

Most organizations are the result of historical developments, all elements of the organization change over time, thus all organizations have to be adjusted continuously.

Each organization consists of a set-up of workplaces and of a product flow.

Set-up: An organization is a set-up of two - or many more - workplaces. - If there's only one workplace no organization is needed, it would be a simple input-output system.

An organization is set up to manufacture one or many different products by divided labor.

A workplace is made up of one person plus (machine-) tools. A workplace has a site, the site may be fixed or it may be moving e. g. workplace airplane cockpit (person: pilot, tool: airplane).

Product flow: the manufacturing processes within the organization constitute the product flow. The product flow determines the architecture of the organization.

The product of an organization is the object, component or the service delivered
- to persons, companies or groups - customers outside the organization or
- to workplaces inside the organization - e.g. tools, staff, material etc. That are internal products.

Products can be
1 physical, tangible objects
2 services on foreign objects or
3 information - information can be "transformed" just as tangible objects

Products can be one piece or an assembly of many components.

The bill of materials delineates the structures of products with all its components and assembly levels.

An operation is the work accomplished in one workplace by one person with the assigned tools. An operation may consist of one or many steps. Each operation changes the object/ component/ product/ information and enhances its value. There are operations executed consecutively and others executed concurrently.

Each operation is accomplished in a certain amount of time.

The production process is the chain of operations to manufacture the component or the product. The production process is laid down in work plans. - The typical production process of a product starts in research & development, continues in manufacturing and ends in sales workplaces. At any point of the production process information about the status of the object for steering the process can be delivered.

History shows operations in research & development and sales are increasing substantially in volume since the beginning of the industrial revolution.

Increasing the number at manufacturing the same product reduces costs (economy of scale). Doubling the number of altogether manufactured products reduces costs by 20 % (rule of thumb). At the same time division of labor (usually) rises too, clearly to be seen at assembly lines. (Car production: 250000/year, ca. 600 operations per car assembling.)

Figure 1