Researches

The research carried out by ISEE to identify and better understand the application potential of available scientific fundamental knowledge about economic management and to compare this potential to the capabilities offered by the IT solution developed, which offers knowledge of a brand new order is a serious cognitive process. A process that is inextricably linked to the creative and experimental work of ISEE, which is implemented on an ongoing basis in background mode and via projects and dedicated campaigns. The knowledge process focuses on the following as the principal sources of available ‘scientific’ fundamental knowledge about economic management:

Academic circles and recommended scholarly publications;
Global audit and management consultancy companies;
ERP business software developed by global companies.

In line with the view that each high-quality IT solution for the management modelling of enterprises should be based on holistic fundamental knowledge about economic management, the research efforts of ISEE focus on the third area — ERP business software developed and sold by some of the most renowned global companies.

In order to obtain a general idea of the research work of ISEE, short descriptions of several research projects (one project in the first two areas and two projects in the area of ERP business software) are set out below.

Academic papers and other research material

To date, during the course of ISEE’s twenty-year history, in addition to current research, three major projects for evaluation of ‘academic circles and papers’ were conducted to appraise existing fundamental knowledge about economic management in the form of a universalist industrial enterprise model.

All three research projects were implemented through thematic meetings with representatives of academic circles and representatives of Bulgaria’s professional economic thought, who then recommended research papers to be reviewed. The latest research project is of particular interest. It was not only the largest-scale but also the most relevant one. The project was implemented in the first half of 2012. Eighty-nine calls were sent to prominent representatives of the professional academic community. Over a period of 5 months more than 50 working meetings with the invited representatives of academic circles took place and dozens of research papers were reviewed and analysed between meetings.

Similar to those under the first two projects, the meetings under this project warranted the conclusion that Bulgarian academic circles have failed in their mission to generate systemic knowledge. Another conclusion was that people in these circles firmly believed in the enormous societal benefit of such knowledge while also believing that efforts aimed at obtaining such knowledge were futile and an unachievable task.

In conclusion, by mid-2012 the widespread opinion of a significant number of Bulgarian economic scientists and other members of the academic community was that global economy science did not possess fundamental knowledge on the management of the economy in the form of a universalist enterprise model. A model which, for the purposes of economic practice, contributes clear and verifiable knowledge about the principle setup and functioning of the enterprise as the systemic anatomic and physiological model does for medical practice.

Researching audit and consultancy companies

Research projects were the main tool used by ISEE to evaluate audit and management consultancy companies as sources of fundamental knowledge about economic management in the form of a universalist enterprise model. The research projects focused on global companies such as Deloitte, KPMG, PricewaterhouseCoopers, etc.

Throughout the years ISEE has implemented several such projects — the most recent one in the spring of 2012. However, the project implemented in the autumn of 2007 is considerably more interesting.

In the early autumn of 2007, an idea was born at ISEE from the cognitive platforms known as Industrial Cross and Industrial Cognition Tree. It entailed designing a third knowledge platform, which was later called Subjecthood Implementation System.

At the same time, the media were becoming increasingly willing to publish materials dedicated to human competencies, corporate competencies and job competency models. At the centre of media publications were the audit and management consultancy companies studied back in 2001 as potential sources of knowledge about a systematic universalist enterprise model. The results of the study were unsatisfactory overall but six years had elapsed between the first and the second research project, which is a lot of time. The insistence and conviction with which the terms ‘competencies’ and ‘competency models’ are used had given us at ISEE the impression that between 2001 and 2007 global audit and management consultancy companies had arrived at a breakthrough in fundamental knowledge about economic management, more specifically by creating knowledge about a universalist model of the enterprise as a systemic subject and object at the same time.

This made the team of ISEE hope that it would no longer be a lonely pioneer in working on the development of an IT solution capable of providing fundamental knowledge about economic management of a new order and that there would be others to exchange and benchmark ideas against. With this idea in mind, in the autumn of 2007 ISEE launched a project to research the companies Deloitte, KPMG, PricewaterhouseCoopers and IDS Scheer as potential creators of fundamental knowledge of a new order about the management of the economy of the industrial enterprise.

These hopes were short-lived.

During project implementation it was established that the use of the terms ‘competencies’ and ‘competency models’, in their capacity as a cognitive basis for the management of enterprises as unitary subjects, was not the result of serious work to generate systemic knowledge about a universalist enterprise management. These were rather the product of a waxing contemplative and were not grounded in sound logic in terms of practical implementation.

In conclusion, by mid-2012 the widespread opinion of a significant number of Bulgarian economic scientists and other members of the academic community was that global economy science did not possess fundamental knowledge on the management of the economy in the form of a universalist enterprise model. A model which, for the purposes of economic practice, contributes clear and verifiable knowledge about the principle setup and functioning of the enterprise as the systemic anatomic and physiological model does for medical practice.

Research of ERP software solutions of global companies

ERP type business software means a piece of computer information technology for enterprise resource planning. This type of software is considered the most comprehensive solution for the management modelling of industrial enterprises and corporations. ERP is usually accompanied by a number of modules with three-letter abbreviations that require additional integration as part of an expensive and time-consuming process in order to achieve optimal functionality. The global companies developing such software include SAP™, Microsoft™, Oracle™, BAAN™, Infor™, 1C™, etc.

The study of various types of ERP software as sources of fundamental knowledge of economic management had two aspects: (1) a review of companies that had implemented such software solutions and (2) research projects, including a series of paid working meetings with companies specialising in assisting companies with the rollout of ERP software.

More specifically, ISEE implemented four projects studying various types of ERP software as sources of fundamental knowledge of economic management. Two of them are presented below:

The project implemented in the autumn of 2003 was particular.
The project implemented in the spring of 2012 is the most recent.

The project implemented in the autumn of 2003

This project differs from all other projects implemented by ISEE with a view to researching the cognitive potential of the most highly regarded brands of ERP software available on the market. Each of the other projects had the task of studying several brands of ERP type business software developed by various global companies. The research of a given brand of ERP software invariably includes demonstrations testing its capacity to serve as an enterprise management modelling tool. Such demonstrations were made by the specialists tasked with implementing the software. On the basis of the knowledge gained during the demonstrations, the ERP type business software examined was evaluated as a source of effective knowledge for the management modelling of the industrial enterprise.

Unlike the other projects, the project implemented in 2003 studied solely the ERP – BAAN 5.0 business software. The study of the modelling potential of this software was conducted through its experimental implementation in one of the companies of ISEE. For this purpose a license was purchased and consultants who had completed specialist training were hired.

The process of comparative experimental installation of BAAN 5.0 took place in parallel to the development, implementation and practical study of the second version of the IT solution developed by ISEE. This version of the IT solution was used to manage a large-scale campaign for industrial reengineering at the same time at the same enterprise. The sales, supply, production and engineering of new solutions, together with the entire documentation necessary to enable each of the above processes, was also managed in an interrelated mode. Engineering models for production cost quality management were also developed via the version. The production capacity was also modelled.

In parallel, work continued on the implementation of BAAN 5.0. The comparison conclusively demonstrated that BAAN 5.0 was absolutely unfit as a tool for industrial reengineering. It was also unfit as an instrument for developing production cost quality management engineering models. To a certain extent BAAN 5.0 is compatible with the IT solution developed by ISEE as an instrument for interlinked management of the processes of sales, supplies and production and also for production capacity appraisal. However, albeit generally compatible, that compatibility correlated with a significantly lower quality of practical work.

The only functional advantage of BAAN 5.0 compared to the proprietary IT solution developed by ISEE was in the area of corporate accounting. This advantage may be described as absolute as the ISEE IT solution does not regard accounting as a management process.

The experimental study of BAAN 5.0 lasted approximately three months and ended with a major disappointment in its capacity as a management modelling tool of a large machine building enterprise by Bulgarian standards.

The assurances received from consultants that BAAN 5.0 was one of the best instruments for management modelling of industrial enterprises were thus cast into doubt. Furthermore, the assertions to the effect that the corporation BAAN had won an exclusive contract against SAP and ORACLE and was the sole supplier of ERP software to BOEING and that BAAN 5.0 was the main IT instrument for corporate management used by BOEING also failed to be substantiated.

At the time, i.e. at the end of 2003, the ISEE team, more specifically the engineers involved in the experimental rollout, expressed considerable doubts that renowned global IT solutions for the management modelling of industrial enterprises and corporations could perform so poorly as an instrument for achieving consensus and hence taking collective action geared towards enterprise management. These doubts were dispersed over time mainly due to the findings from the next two research projects, more specifically the one launched in the spring of 2012.

The project implemented in the spring of 2012

At the beginning of 2012 ISEE celebrated the completion of the third version of the IT solution it had developed. This version was to be used to substantiate the principal premise of ISEE that it is possible to develop IT solutions serving as bearers of fundamental knowledge about economic management of a new order. The third version of the IT solution developed by ISEE was to demonstrate the possibility to achieve this.

In order to do so conclusively, the IT solution to be used as an instrument relevant to innovative management of the enterprise as a subject and an object at the same time, the solution had to demonstrate major cognitive advantages and be free from the flaws inherent in enterprise management modelling IT solutions available on the market at the time.

The definition of the knowledge advantages and flaws of the IT solution developed by ISEE as compared to counterpart IT solutions for enterprise management modelling requires by necessity a study of these solutions as sources of knowledge about the enterprises as a system object and subject.

In order to fulfil this requirement, at the end of 2011 ISEE launched a market study project to examine the enterprise management models available as bearers of knowledge about the nature of the enterprise as a systemic object and subject, implementing said project in the spring of 2012. This is the most relevant and largest-scale project implemented by ISEE, which entailed a market survey conducted in order to review commercially available business software.

In preparation for the actual research work to be conducted, a system comprising ten indicators enabling a comparison between the IT solution developed by ISEE and other commercially available solutions for enterprise management modelling was developed. This system of indicators enabled a comparison and appraisal of the quality of the solutions as a tool for collective consensus and concerted action in corporate management in the spirit of innovation while striving to nurture and develop highly effective human resources.

Research and analysis, along with the comparative studies and appraisals, of commercially available software and the IT solution developed by ISEE was conducted by three relatively independent working groups. The first working group comprised representatives of an economics institute, the second comprised representatives of a technical university and the third – practising machine engineers.

Within the framework of the project, 64 companies implementing a wide variety of business software solutions were contacted. A total of 21 working meetings took place. At the centre of the study ISEE placed the most popular enterprise management modelling IT solutions in 2012 developed by renowned global companies such as SAP, ORACLE and Microsoft through their IT solutions SAP R/3, SAP HANA, Oracle Business Solutions, Microsoft Dynamics NAV/AX.

The meetings of the working groups tasked with the comparative evaluations organised by ISEE and representatives of the parties responsible for the implementation of the IT projects lasted several days and involved demonstrations of product capabilities as an instrument for enterprise future management, focused on the processes of building technologically innovative human resources.

The results of the comparative evaluations conducted by the three working groups conclusively demonstrated the following:

The third version of the ISEE proprietary IT solution is superior to all other solutions studied under the project and used for management modelling of the enterprise, including those most renowned, when assessed against the entire range of indicators.

These evaluations suggest that there is a reason to claim that in mid-2012 ISEE was at the threshold of demonstrating the viability of its thesis, i.e. that it is possible to create IT solutions that can serve as bearers for fundamental knowledge of a new order about economic management.

One step only remained — to create conditions for an experiment involving the IT solution developed by ISEE in a mode of intensive training of technologically innovative human capital.

This step would take the next three years.