INDUSTRIAL AND SYSTEMS ENGINEERING IN ORGANIZATIONS

1. OVERVIEW

The theme of this chapter is ‘‘achieving full potential.’’ We explore how industrial and systems engineering and engineers (ISEs) can achieve full potential and how the ISE function and individual ISEs can assist their organizations in the achievement of full potential. Our fundamental premise is that organizations that desire to achieve full potential can enhance their success by more fully utilizing the potential of their ISEs. This will require holding a different definition for ISE, organizing the function differently, and having a different expectation regarding the ISE value proposition. The practicing ISE will also need to envision the role(s) he or she can play in large-scale transformation. This possibility has implications for the way ISE is organized and positioned in organizations, for higher education, and for the individual ISE.

Full Potential Introduced

Have you ever experienced being a ‘‘10’’ ? Perhaps you struck a perfect golf shot, had a great day when everything went perfectly, or flawlessly executed a project. We’re thinking of something that turned out even better than you expected—when you were in ‘‘flow,’’ creating the optimal experience and optimal results (Csikszentmihalyi 1990). Full potential is about realizing personal and organi- zational possibilities. It’s about getting into flow and staying there. It’s about creating optimal results from the organizational system.

Structure of the Chapter

In its simplest form, an organization might be modeled as a complex collection of actions that drive particular results. These actions take place in a context or environment that mediates or moderates the results. Figure 1 illustrates such a model.

This model will be our organizing frame for the chapter. We will discuss the role of ISE in corporate transformation, in the achievement of organizational full potential performance. As you see in Figure 1, there are three roles that the ISE can play in this model:

1. Strategy and positioning (e.g., what is the value proposition? Are we doing the right things?

What is the strategic planning process, who is involved, what is the system, how do we ensure

it works?)

2. Conditions for success (what are the conditions surrounding the actions that drive results? Is the environment right to support success?)

3. ‘‘Drivers,’’ or operations improvement (are we doing the right things right? How are we doing things?)

We will discuss these roles in that order in the chapter. Note that the third role has been the traditional focus of ISE; we will suggest an expansion of the ISE ‘‘domain.’’ Rather than cover what is well covered in the rest of this handbook in the three roles for ISE in the future state organization, we will highlight, in each of the three roles, work that we believe ISEs will migrate to in achieving full potential.

ISE Domain Defined

As James Thompson points out, a domain can be defined by the ‘‘technologies employed,’’ the ‘‘diseases treated,’’ and / or the ‘‘populations served’’ (Thompson 1967).

Consider the remaining sections of this Handbook: Information Technology, Manufacturing and Production Systems, Service Systems, Organization and Work Design, Human Factors and Ergo- nomics, Project Management, Product Planning, Manpower Resource Planning, Systems and Facili- ties Design, Planning and Control, Quality, Supply Chain Management and Logistics, Probabilistic Models and Statistics, Economic Evaluation, Computer Simulation, and Optimization. All speak, in one way or another, to technologies employed by ISEs, diseases treated by ISEs, and / or to a lesser extent populations served by ISEs. Again, we will propose expanding the ISE role. Let’s begin by examining the traditional definition of ISE and then explore a broader domain definition in the context of full potential performance.

Operational Definition of ISE

‘‘An Industrial and Systems Engineer is one who is concerned with the design, installation, and improvement of integrated systems of people, material, information, equipment, and energy by draw- ing upon specialized knowledge and skills in the mathematical, physical, and social sciences, together with the principles and methods of engineering analysis and design to specify, predict, and evaluate the results to be obtained from such systems’’ (Womack and Jones 1996). This is the current and fairly traditional definition for ISE.

Applying the Definition

According to Dr. W. Edward Deming, an operational definition is a definition you can ‘‘do business with.’’ Let’s see if we can do business with the formal definition.

The key word in the definition is ‘‘system.’’ It prompts the question ‘‘What system is it that ISE’s work to optimize? ’’ Our contention is that the ultimate system of interest is the extended enterprise. Ken Wilbur (1996), a challenging author to read and understand, says growth is about ‘‘transcending’’ and ‘‘including.’’ To contribute to full potential, ISEs must include and also transcend the subsystem they are working on. ISEs must also transcend and include the roles they play and the work they do. ISEs must see how performance improvement in the target subsystem (warehouse layout, work cell configuration, display / human-equipment interface, queue design, simulation, supply chain, etc.) serves the higher good or works to optimize the performance of the larger system. Jim Tompkins (1999) speaks to this and provides an example in his lectures on the migration from warehouse management to supply chain management to supply chain synthesis. Transcending the ISEs traditional system of interest may be the most profound change facing our profession. Inability or unwillingness to address the larger system may hold a clue to the decline our professional society has experienced in the 1980s and 1990s.

Figure 2 is a portrayal of ISE extracted from the perspective of an academic program.

Notice how in this model ISE builds on a core engineering curriculum foundation and then specializes in four basic areas: human factors engineering, manufacturing systems engineering, operations research, and management systems engineering. Each of these four specialty areas dovetails

with basic knowledge areas and / or application areas such as statistics, psychology, mathematics, information sciences, accounting, and economics.

While this model is useful for portraying ISE from a curricular perspective, it is much less useful from an application perspective. Once the ISE begins reduction of theory to practice, the academic distinctions rapidly disappear. The ISE typically migrates to a setting that is defined by business processes rather than subdiscipline. The fledgling ISE is thrown into a system of people and capital that survives and thrives by continuing to enhance customer loyalty while at the same time reducing costs and improving efficiency. Fortunately, the ISE value proposition is so robust that enterprising ISEs find that they can contribute at any point and any level in the enterprise system.

ISEs at work are more accurately portrayed by the potential value contribution or offerings they bring to the enterprise as it migrates to full potential and future state. ISEs at work will increasingly find that they must transcend and include their academic training in order to contribute meaningfully to the quest for full potential. Figure 3 is an example of such a portrayal.

The specific contribution that ISEs make, the true value contribution, is the focus of this model. One example might be creating more effective measurement systems that lead to better information about the connection between improvement interventions and customer behaviors. Others might in- clude optimized supply chain systems or increased safety and reduced lost time injuries. What is important in these examples is their impact on business results rather than their particular tools, techniques, or disciplinary focus. It is the cause-and-effect relationship between the value proposition and the business result that is the emerging emphasis. The disciplinary tool, knowledge, or technique becomes valuable when it is applied and we see its instrumentality for achieving positive business results. The ISE value proposition isn’t only knowledge; it is the ability to reduce that knowledge to practice in such a way that it produces positive business results. In the coming decades, ISE practice is going to be very, very focused on creating results that move ISEs and their organizations toward full potential.

Integrating Work in Strategy and Policy, Conditions for Success, and Operations Improvement Leads to Full Potential Our point of view is that integrating work done to achieve strategy and positioning, the management of conditions for success, and operations improvement create full potential performance (again, see Figure 1). The role of ISE needs to expand to include more involvement with this integration. ISE work in operations improvement, at minimum, needs to be seen in the context of the other two roles. At the extreme, ISE needs to be active in strategy and positioning and condition for success work. And it is value creation for the organization that is the end in the coming decades. A profession that

is so constrained by the technologies it employs and doesn’t focus on the end will continue to struggle. We will explain what we mean further into this chapter.