Organizations, Business Processes, and IT Systems Relationships

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Introduction

Forming the corporate principles of activities and implementing appropriate management mechanisms are the fundamental algorithms of an organizational regime. Firms that focus on different market segments and distinct target audiences may have a variety of planning and development strategies. However, the general approaches to maintaining the workflow can be highlighted, and the characteristics of operating activities in the business environment can be given. This work aims to analyze what an organization is from the perspective of its basic structure, what business processes are and why organizations execute them, what types of structures are used for operational activities, and how technologies are used to implement specific objectives and business processes.

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Definition of an Organization

Based on the assessment of academic sources, scholars offer different formulations that describe what an organization is and what its purpose is. In his work, Ouchi (1980) proposes one of the earliest definitions of an organization and notes that this is “a purposive aggregation of individuals who exert concerted effort toward a common and explicitly recognized goal” (p. 129). This formulation emphasizes several crucial aspects that define an organization as a single mechanism – a group of participants, specific activities, and the planned result. Jensen (1983), in turn, focuses on structural composition and notes that an organization is represented as a single system of labor, which is subject to a specific algorithm and mode of activities.

The difference between these two definitions is evident: in the first case, the key attention is drawn to the general principles of people’s professional, while in the second one, the focus is on the structural aspect of collaboration. At the same time, in both formulations, the group element is mentioned, which is one of the key components of any organization.

Other existing definitions can also be compared to highlight differences and similarities in the interpretation of the same phenomenon from a distinctive perspective. For instance, Jones (2013) remarks that an organization is a tool utilized by stakeholders to achieve what they aspire to and value. This formulation is generic and hardly conveys the unique characteristics of a corporate system that promotes teamwork. In comparison, in the past, Miles and Snow (1992) described organizations as “flexible structures that closely resembled networks rather than traditional pyramids” (p. 53).

This definition carries a deeper meaning even though it appeared earlier in the academic community. The key emphasis is on the flexibility of a unified labor system built not on a banal hierarchy but on complex interaction principles. There is nothing in common in these formulations, which can be explained in terms of distinctive approaches to the research process and tasks. Thus, one can state that an organization implies a group of stakeholders united by common goals and using appropriate mechanisms to achieve assigned tasks through collective interventions. As an approach to achieve these objectives, a business process needs to be considered.

Definition of a Business Process

Any organization operating in a specific market segment implements certain business processes. In academic literature, different scholars offer individual definitions for this concept. Morris and Pinto (2010) mention a number of formulations, and one of the earliest is as follows: a business process is a “structured, measured set of activities designed to produce a specified output for a particular customer or market” (p. 82).

Despite the fact that the definition is detailed, it is perceived as a narrow characteristic of the business process. The emphasis on activities aimed at customer satisfaction is not the only characteristic of this phenomenon. Not all organizations manufacture products since reselling, supplying, and other work activities are possible. Therefore, one should refer to later definitions to analyze what a business process is from other standpoints.

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In online resources, more general definitions of a business process are proposed, which, nevertheless, allows describing this phenomenon as extensively as possible. For instance, there is a statement that a business process is “a set of activities or tasks, often connected and automated, triggered by an event to carry out a predetermined specific organizational goal such as a service or a product” (“Business process definition,” 2019, para. 1).

This description makes it possible to evaluate the entire spectrum of activities and includes tasks and methods. Venkatesh and Bala (2007) also describe a business process as work associated with interrelated actions to realize a specific objective. The main similarity between these definitions is that dedicated tools are mentioned to assist in the implementation of intended action plans. At the same time, the formulation from the online source is more detailed since the algorithms for performing tasks are given. Accordingly, a business process is an activity aimed to achieve specific entrepreneurial goals through the use of clearly formulated strategies and work mechanisms. When applied to real operation environments, such processes should be viewed in terms of specific organizational structures.

Types of Organizational Structures

The topic of organizational structures comes up in many sources and in different contexts. Ahmady et al. (2016) offer the following definition: “organizational structure is the framework of the relations on jobs, systems, operating process, people and groups making efforts to achieve the goals” (p. 456). This formulation is complete and includes the maximum necessary aspects to address when studying such a phenomenon. Kribikova (2016) confirms the complex mechanism of organizational structure and notes that this algorithm is dynamic and adaptive regardless of a specific type.

As one of the most acceptable classifications mentioned in past years, one can single out Harris and Raviv’s (2002) scheme in which the researchers cite such variants as a flat structure, divisional hierarchy, functional hierarchy, and matrix organization. This division reveals the key aspects of business process management and reflects the principles of control over all stages of operating activities. For modern organizations, a wide range of work strategies based on the proposed list opens up prospects for adapting to dynamic market environments. Therefore, covering all the nuances of activity is a valuable approach to the interpretation of organizational structure as a development parameter.

As additional ideas, other definitions of organizational structure may be considered. For instance, Marasi et al. (2018) describe this phenomenon as a set of properties that determine the relationship among the key elements of the organizational process and provide a division based on the principle of centralization and formalization. This explanation is rather subjective than objective since, as is clear from the aforementioned definitions, an organizational structure is a more complex and multi-layered mechanism. As evidence, Moldovan-Borsos and Matei’s (2016) remark that organizational structure includes many components to take into account when developing a business strategy – size, control system, and other parameters.

Some of them were mentioned in the middle of the last century by Merton (1940) who reviewed categorization, bureaucratization, and other approaches to the formation of a specific framework. At the same time, most researchers agree that organizational structure is an adaptive phenomenon and, like Tolbert and Hall (2015) state, dynamic, despite its apparent inertia. As a result, the considered ideas about an organizational structure confirm the complexity of this phenomenon. To supplement the research on organizational features, discussing reasons for executing business processes is an essential activity.

Reasons for Executing Business Processes

Executing business processes is an integral aspect of organizations’ activities and has a number of justified reasons. Kalpič and Bernus (2006) consider specific advances that firms can realize through the use of business processes and note such benefits as reduced complexity, improved management, knowledge capitalization, and other significant perspectives. These goals are important objectives to strive for due to the high dynamics of many modern organizations and the competitive aspect that encourages frequent changes in operating regimes. Jiang et al. (2015) also focus on a similar vector and argue that “business processes are designed and implemented by the organizations to guide and to regulate business operations, aiming at improving work efficiency by normalizing the actors’ behavior” (p. 393). Thus, an approach to maintaining sustainability and control over all the necessary nuances of business practice is possible due to the introduction and strengthening of business processes.

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In most of the existing formulations, the competent executing of business processes is viewed from the standpoint of multiple merits. Nishadha (2020) complements the aforementioned perspectives achieved through business processes and mentions increased control, improved communication, and some other important changes. At the same time, depending on the type of organization and its structure, different processes are implemented. The more extensive and active is the work of a company, the more complex and numerous processes it uses. As a result, one can state that organizations implementing business processes seek to optimize their work regimes and strengthen operations due to efficient models. As relevant mechanisms to achieve these purposes, utilizing technology may be an efficient solution.

Using Technology to Accomplish Business Processes

To accomplish business processes, many modern organizations introduce relevant technology. However, even a few decades ago, the process of implementing specific algorithms was discussed as a critical measure to enhance productivity. Davenport and Short (1990) state that information technologies are “the capabilities offered by computers, software applications, and telecommunications” (p. 1). In more recent definitions, such as in Dickson’s (2003) research, the author adds additional elements, including automatically generated teaching and analysis processes. This progress is significant as a way to improve the efficiency of business processes.

Applying powerful algorithms to achieve business objectives is a valuable practice. Davenport (1993) offers to pay attention to business process innovation as an activity that is realized through specific mechanisms. Business owners are able to manage their assets more intelligently due to supporting tools that eliminate human errors by providing sustainable planning algorithms, which is one of the essential implications of the aforementioned approach. In recent analyses, for instance, in Melo’s (2018) assessment, the author also argues that “the role of technology in business is vital” (para. 3). Thus, all the presented researchers agree that innovations are an integral component of progress in entrepreneurship and contribute to optimizing specific processes and the methods to achieve them.

Conclusion

The analysis of an organization as a structural unit through the assessment of existing definitions, including different strategies and processes for achieving its objective, makes it possible to determine the characteristic features of corporate principles. The main structures are listed, and their impacts on operating activities are mentioned. The factors and reasons that drive organizations to execute business processes are presented, and the values of applying technology to accomplish these processes are reflected. Modern researchers’ studies are more complemented than those of past scholars due to the greater development of the business industry and the emergence of new concepts and approaches to establishing sustainable activities in a competitive environment.

References

Ahmady, G. A., Mehrpour, M., & Nikooravesh, A. (2016). Organizational structure. Procedia – Social and Behavioral Sciences, 230, 455-462.

Business process definition. (2019). Comidor. Web.

Davenport, T. H. (1993). Process innovation: Reengineering work through information technology. Harvard Business School Press.

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Davenport, T. H., & Short, J. E. (1990). The new industrial engineering: Information technology and business process redesign. Sloan Management Review, 31(4), 1-31.

Dickson, P. R. (2003). The pigeon breeders’ cup: A selection on selection theory of economic evolution. Journal of Evolutionary Economics, 13(3), 259-280.

Harris, M., & Raviv, A. (2002). Organization design. Management Science, 48(7), 852-865.

Jensen, M. C. (1983). Organization theory and methodology. Accounting Review, 58(2), 319-339.

Jiang, J., Aldewereld, H., Dignum, V., Wang, S., & Baida, Z. (2015). Regulatory compliance of business processes. AI & Society, 30(3), 393-402.

Jones, G. R. (2013). Organizational theory, design, and change (6th ed.). Pearson.

Kalpič, B., & Bernus, P. (2006). Business process modeling through the knowledge management perspective. Journal of Knowledge Management, 10(2), 40-46.

Kribikova, P. (2016). Organizational structure and performance. Aktual’Ni Problems Ekonomiky = Actual Problems in Economics, (175), 109-118.

Marasi, S., Bennett, R. J., & Budden, H. (2018). The structure of an organization: Does it influence workplace deviance and its dimensions? And to what extent? Journal of Managerial Issues, 30(1), 8-27.

Melo, S. (2018). The relevance of technology in business. Data Scope. Web.

Merton, R. K. (1940). Bureaucratic structure and personality. Social Forces, 18(4), 560-568.

Miles, R. E., & Snow, C. C. (1992). Causes of failure in network organizations. California Management Review, 34(4), 53-72.

Moldovan-Borsos, R., & Matei, C. (2016). Organizational structure in impasse. Electrotehnica, Electronica, Automatica, 64(2), 165-169.

Morris, P., & Pinto, J. K. (Eds.). (2010). The Wiley guide to project technology, supply chain, and procurement management (Vol. 7). John Wiley & Sons.

Nishadha. (2020). Importance of business process modeling for your business. Creately. Web.

Ouchi, W. G. (1980). Markets, bureaucracies, and clans. Administrative Science Quarterly, 25(1), 129-141.

Tolbert, P. S., & Hall, R. H. (2015). Organizations: Structures, processes and outcomes (10th ed.). Routledge.

Venkatesh, V., & Bala, H. (2007). Adoption of interorganizational business process standards in business-to-business integration: An exploratory study. Systèmes d’Information et Management, 12(2), 53.

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