Working PaperDO NOT CITE WITHOUT PERMISSIONMaking Rosetta Dance: The Combinatorics of Standardizing Interorganizational Service Processes Matt WimbleEli Broad College of BusinessMichigan State [email protected] PentlandEli Broad College of BusinessMichigan State [email protected] to develop open process standards, such as Rosetta Net, havehad limited success in finding wide-spread adoption. Standardization ofinterorganizational business processes, previously viewed as aidinginterorganizational collaboration, is shown to impede that collaboration inservice contexts. We show that the modeling methods used to standardizeinter-organizational processes fails to account for the impact suchstandardization has on managerial flexibility. Service production involvesco-production between consumer and producer, giving rise to greateruncertainty in the sequence of production. Because of this uncertaintymanagerial flexibility is highly valuable in services. This will show thatthis uncertainty gives rise to an explosion in the amount of productionsequences making coordination between organizations very difficult usingprocess modeling paradigms imbedded in recent attempts atstandardization. It will be shown a different approach to modelingprocesses is needed in a service context. IntroductionComputing standards organizations, like Rosetta Net, have tried for years to developinterorganizational process standards with little success outside the IT manufacturingindustry that initially established the organization. Workflow modeling technology isused by frameworks, such as Rosetta Net, as the language to express the processes.Current workflow modeling frameworks used in practice are unnecessarily restrictive,making coordination difficult in service contexts. Using a different approach to modelingprocesses could resolve this problem. Services differ dramatically from manufacturing because production in servicesinvolves co-production between consumer and producer. A high degree of uncertaintyresults from this co-production (Argote, 1982; Jones, 1987). For example, in amanufacturing environment process variation is seen as indicative of poor quality(Oakland, 1996). In services by contrast, this variety can be a sign of the flexibility that isnecessary for high quality (Feldman, 2000). Co-production of output in services necessitates a dance between consumer andproducer. In service industries the choreography of this dance-of-production is highly1Working PaperDO NOT CITE WITHOUT PERMISSIONcontingent upon the specific interactions of consumers and producers, which implies fargreater uncertainty a priori in the sequence of events necessary for production of services.Choreographing this dance-of-production in services requires a fundamentally differentmodeling framework, which incorporates the flexibility that service productionnecessitates. Process modeling frameworks in use today evolved out of the modeling ofmanufacturing processes, which have the explicit goal of having as little variety aspossible. Initially these modeling frameworks were adapted to model services in aproject-oriented context. Projects, such as construction services or software design, are bydefinition unique. Constraints imposed by traditional manufacturing modelingframeworks are not excessively restrictive in a project environment because the sequenceof production was customized for each instance (Meredith and Mantel, 2002). Whenthese modeling frameworks are moved out of a project context into an ongoing servicecontext, where the model is explicitly designed to handle multiple instances, thelimitations that the framework places on flexibility becomes especially relevant. Byfailing to address inherent differences the production process between services andmanufacturing, the use these modeling frameworks to form standards results in pooradoption because of the loss of necessary flexibility. Conceptualization about the role of variety in services is supported by empirical workon task sequencing which has observed a high degree of variety in service settings(Pentland, 2003). Previous studies have shown processes to be a potential source offlexibility in organizations (Feldman and Pentland, 2003). It is necessary to examine whatis meant by variety in a service context. Good service processes are like goodmanufacturing processes in that they are repeatable (Parasuraman, et. al., 1985). Servicesand manufacturing are different in that in a service context the customer supplies keyinputs to the production process (Brown, et. al. 2002; ). Because of the co-productivenature of service production repeatability take on a different meaning that inmanufacturing. Repeatability in a service context refers to responding to customerrequests in a consistent manner. For example, responding to a given customer request in aconsistent manner from customer to customer would seem to be a mark of good service.In this respect services and manufacturing are very similar, but in services the serviceprovider has little control over when and in what order the customer chooses to provide agiven input to the production process. Often the expressed goal of good service is to beaccommodating to a wide variety of circumstances, which viewed another way is theability to handle a wide variety of inputs in as many sequences as possible. In many service contexts the sequence of production is unknown to the producer prior tostarting production because services involve co-production between consumer andproducer (Argote, L., 1982). This uncertainty gives rise to a combinatorial explosion offeasible sequences. In this context a production sequence is feasible if it is consistent withemployee or management understanding of how a process could be done, that is to saythe sequence does not violate any expressed or implied business rules (Kumar and Zhao,1999). It will be shown that, because of the number of potential process