SoftScience Group, Inc.

Small Business Enterprise Solutions

White Papers

Small Business Enterprise Solutions

By David Neal
President, SoftScience Group, Inc.

Traversing the business formalization interval

One of the most vexing problems in our economy is how to improve the chances that a new business can grow from a small startup into a healthy larger mature business organization. Numerous studies and articles describe the high failure rate of business startups. Many authors have attempted to document reasons for these failed businesses and have cited a large list of perceived reasons. It is this author's belief that most of the stated reasons for the difficulty of an immature business to succeed can be traced to an inability to leverage the founders' expertise (intellectual capital) far enough at a low enough cost, to transition the company from an informally managed organization to a more structured organization. The failure point or glass ceiling for the business is the point at which the owner’s internal processing (his/her internal knowledge and intuition) is no longer able to adequately manage the growing and more complex nature of the growing enterprise.

Initial Phase - Small Business

Initial Phase - Small Business: Founder and key personnel can manage the business less formally with a combination of simple information technology and their own internal knowledge and 'feel' for the business.

(Credit ‐ illustration by SoftScience Web Media)

Many small businesses fail during the transitional phase when the company grows beyond the size that the founders can effectively informally manage. This is the point at which formal management information systems must be introduced into the organization. The need for distinct management capabilities in multiple areas becomes critical during this period of growth which will be referred to as the business formalization interval.

Transitional Growth Phase - Small Business

Transitional Growth Phase - Growing Business: Founder and key personnel can no longer effectively manage the business informally with a combination of simple information technology and their own internal knowledge and 'feel' for the business. Formal information systems are needed to keep track of what is actually going on.

(Credit ‐ illustration by SoftScience Web Media)

Most small businesses do not have the resources, either financial or in terms of time horizon, to create separate departments with trained personnel and specialized software to provide comprehensive management functions to the owner/founder in an easily understandable way. Often the result is that the larger the company grows, the more unmanaged it actually becomes, leading to a high rate of failure.

One practical solution to navigating the business formalization interval is the development of an integrated data layer that spans the entire business enterprise. This enterprise data layer is the foundation upon which applications supporting the needed business functions are built. Each new business function can then be introduced or extended as needed with all applications interacting with the common enterprise data layer.

Non-Integrated Database Layers

Non-integrated databases associated with discrete applications require copies of information to be stored multiple places. These information instances must be kept consistent across discrete applications when changes/corrections are made in order to generate valid results from processes.

(Credit ‐ illustration by SoftScience Web Media)

If all the declarative knowledge relevant to the business organization could exist in a single properly structured repository, then the complexity of the business's information systems is reduced through reuse of the enterprise's declarative knowledge and the utility of the system is increased by allowing decision-makers to access and utilize the entire enterprise-base of knowledge rather than the limited subset of business knowledge contained within single purpose software such as an accounting system.

Integrated Database Layer

An integrated enterprise database layer which serves discrete applications require single copy of information instances to be stored in a common repository, making it possible for each discrete application that needs the data to reference a single verified instance of the information in any process tasks.

(Credit ‐ illustration by SoftScience Web Media)

...

Rationale for small business IT strategy that is declarative knowledge oriented

Over the past 30 years, the SoftScience Group's founder David Neal has pioneered the concept of software mass customization using a software engineering approach based on the principles of "Information Naturalization".

Information Naturalization is a term introduced to describe proposed extensions to existing modeling techniques which assist in the analysis and design of large-breadth information systems and promote reusability of both the declarative and procedural components of a business's knowledge base.

Unlike other methodologies including object-orientation, which start from the philosophical mindset that software systems are models of processes, Information Naturalization begins with the idea that data representation and organization are actually the better foundation of software systems.

Declarative knowledge is the portion of information that contains actual values in order to be understood. In software engineering parlance, this declarative portion of knowledge is said to have 'state' because it contains a distinct value at any particular time. Most people refer to declarative knowledge that has state as 'data.'

Information naturalization analogy: individual component gears are less useful if the connections to other gears are lost.

Information Naturalization analogy: individual component gears are less useful if the connections to other gears are lost.

(Credit ‐ Shutterstock)

Declarative knowledge is not just unstructured data, however. There are natural groupings of related data which describe something larger. There are also specific relationships between instances of these larger things. How things are connected to other things is worth recording. Often, only the connections needed for a particular process are captured with other unneeded information discarded. The stored structure of declarative knowledge must closely model more broadly the information content of the actual things operating in the real physical world space, not just a particular process space.

Information naturalization analogy: connected component gears are fully functional parts of something bigger.

Information Naturalization analogy: component gears with all their interconnections preserved are fully functional parts of something much bigger that operates in a broader context.

(Credit ‐ Shutterstock)

If the natural structure of the declarative knowledge can be understood, modeled in all its richness beyond the current process, and implemented in a properly designed data layer, then all processes in the real world can be easily implemented as applications operating on the common data layer. The declarative knowledge is reusable and is able to be shared by all processes/actors in the real world that need such declarative knowledge.

Over the past 20 years, Information Naturalization principles have been employed to produce specialized configurations of mass customization software application products that address the unique needs of individual business organizations operating in very different industries and business environments using a common extensible design.

...

The application layer exists on top of the independent enterprise data layer

At the core of each family of software applications is a common data environment (data layer) which can be thought of as an integrated database environment housing all the declarative knowledge that an entire enterprise generates or uses.

The common – and independent – data layer is designed using a set of enhanced normalization principles called "Information Naturalization" that observes how data (declarative knowledge) are grouped in the "natural" real-world environment. This observation and analysis is done without first limiting that understanding to a particular limited problem domain or the processes that a proposed system will be designed to automate.

Such a 'naturalized' analysis approach leads to the design of database or objectbase structures for containing the declarative knowledge that fit together naturally and can be extended organically as needs of the application layer change.

Individual applications, modeled around specific job or departmental functions within the organization, have access to and operate on those portions of the data layer of the enterprise that are appropriate for accomplishing the function of the application. This application layer represents the procedural component of the business organization's knowledge base.

Even smaller, limited-scope applications are designed to operate on a database design consistent with the enterprise data layer. In that way, if the client ever needs to expand functionality, the application will be easily evolvable to the expanded functionality without significant re-design or modifications to the original software application components. The declarative knowledge previously collected will be available for additional use in any new application functionality.

...

Information Naturalization leverages business knowledge

"Information Naturalization” is based on an unconventional way of looking at the problem domain of real world systems. A companion paper asserts that declarative knowledge and procedural knowledge are not co-equal in importance in the real world. A thing exists first before it can be consumed / used by a process. Understanding the declarative knowledge associated with something, including its identification and relationships to other things, is a necessary precondition for the understanding of the procedural component of knowledge.

The paper also asserts that other modeling approaches, including most object-oriented modeling strategies, start with a bias toward the procedural knowledge component because software is fundamentally about performing some process(es). The analyst/designer of software is naturally influenced to focus on elements of declarative knowledge that directly impact the process(es) envisioned for the software system.

By stepping out for a much wider analysis view first, and using that more holistic view in design, the reusability of the declarative knowledge component of computer systems can be dramatically expanded.

SoftScience Group believes that fully leveraging the declarative knowledge component of a business entity is actually the most significant information technology goal that a small business should pursue in order to successfully traverse the business formalization interval of the organization's lifecycle.

The declarative knowledge of the business is the most important portion of its intellectual capital. Declarative knowledge not captured and retained is effectively intellectual capital squandered.

SoftScience Group has shown how an integrated enterprise-wide knowledge system built based on Information Naturalization principles can be constructed with technologies that are easily affordable for small businesses. The resultant leveraging of the business founder's skills can allow the business organization to successfully grow through the business formalization interval that destroys so many promising startups. The only affordable transition path, in the absence of extraordinary financial capital, is to efficiently reuse the declarative knowledge that a business generates thereby multiplying its intellectual capital.

SoftScience Group has the blueprint.

GET IN TOUCH!