Advanced Relationship Management

THE PROBLEM

Single hierarchy

Enterprise wide software such as Enterprise Resource Planning (ERP), Human Capital Management (HCM), Org Charting, etc. usually stores only a single hierarchy to represent the organization structure. This is inadequate since each software application may require different types of relationships in order to route a workflow item to the correct person.

 

Only hierarchies

Many relationships in a company are not hierarchical at all, but rather matrix or network structures. This management organization originated in the early 1970’s and has rapidly gained popularity. It allows for more agile resource allocation, since a resource can be used by several business areas to maximize their effectiveness. The strict hierarchical structure requires redundancy of resources, which deliver suboptimal effectiveness. It is essential that matrix management structures be reflected in organization models.

 

Relationships not validated

Some hierarchical structures are deemed “mission critical.” However, sometimes a worker has no supervisor assigned to her in the organization system of record, because it is often not a required field. Sometimes that supervisor’s reporting structure ends in a circular reference: she reports to someone who, in turn reports to her. Sometimes the reporting chain does not go all the way to the top of  the company. A valid structure of this type is called a “fully articulated tree structure.” If an automated business process relies on a supervisor who is defined as someone who can approve a transaction, and that supervisor cannot be found, the business process is broken. Additionally, there are circumstances where if a critical structure is not fully articulated, the company runs a regulatory compliance risk.

 

Person to person only

For large companies, indicating all reporting relationships on a person-to-person basis is tedious, and not really reflective of the true organizing principles of the company. Organizing principles are often rule based, which can allow them to be self-maintaining. For example, suppose you are the supervisor of all accountants in the Prague office, and an accountant transfers to the Zurich office. The reporting relationships must be hand-maintained, whereas applying the rule based on the employee indicative data would make the relationship self-maintaining.

 

No central repository

Since the system of record for organization structure information is inadequate to serve the needs of all software applications with workflow, what often happens is that each application stores the relevant structure information in its own “silo.” This is an undesirable practice because there is often no procedure in place to keep the information up to date—and it’s changing all the time! Thus, reporting structure information becomes invalid and automated business processes fail to work correctly.

 

Scalability

Suppose an automated business solution is in place, and the implementer has successfully modeled the business process and correctly identified the actors. This will work well if it is confined to the limited scope that was analyzed. However, if the company would like to standardize the process enterprise-wide, the process will not scale because the actors identified were individuals and not a full contextual organization model.

 

THE Extended Relationship Management (xRM) SOLUTION

Contexts

A Workforce Relationship software solution should be able to maintain relationships in multiple contexts. This effectively creates a multi-dimensional organizational model.

 

Multiple structure types

A Workforce Relationship software solution should be able to represent relationships in hierarchical, matrix and peer-to-peer structures.

 

Validates relationships

A Workforce Relationship software solution should validate that critical contexts are compliant as a fully articulated tree structure. It should be sensitive to daily HR transactions (new hires, terminations, transfers, etc.) that would break the fully articulated tree structure; a process should move all nodes up in order to remain compliant, and notify a responsible party to make the proper adjustments in a timely manner. This process has been referred to as “self-healing.”

 

Organization Modeling

A Workforce Relationship software solution should be able to apply rule-based criteria for assembling workers into groups that have similar reporting relationships. This way, movement within the organization would be self-maintaining by consistently applying the rules. In order to accomplish this, it is helpful to leverage the meta-data layer of the Human Capital Management system in order to dynamically construct and enforce the rules.


 
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