Beyond Business Process Reengineering Towards the Holonic Enterprise

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Beyond Business Process Reengineering Towards the Holonic Enterprise Patrick McHugh, Giorgio Merli and William A. Wheeler III What is a holonic enterprise? A holonic network is a group of businesses that, acting in an integrated and organic manner, is able to configure itself to manage each business opportunity that a customer presents. Each business in the network provides a different process capability and is called a holon. Each configuration of process capabilities within the holonic network is called a virtual company. By combining the core competencies of many individual holons within the network each virtual company is more powerful and flexible than the participating members alone. Each business in a virtual company is chosen because of its excellence. They form a team where members do not negotiate cost; that has been predetermined by the holonic network's pricing formula (each value adding step is worth a given percentage of the final sale price - which is decided by the market). All holons in the network agree to a set of design rules. This in turn allows for the flexible use of capability worldwide. Why "Beyond" BPR? The Holonic System is a natural extension of BPR - thus is beyond BPR. In holonic networks core business processes are not just optimized to provide BreakPoints in customer value, they are reengineered for every order! Holonic networks and the virtual companies that form within them are a practical operational response for all businesses whose customers seek customized products and services. These "prosumers" define the core business process performance which must be achieved by the holonic network. The core business processes in virtual companies stretch far beyond the boundaries of the individual holons and by definition they meet consumer demands for cost, quality, speed, innovation and service. Thus businesses in an holonic enterprise can leverage their customer relationships, maximize their margins and achieve superior business performance.