Assessment of E-Business Transformation Using Simulation Modeling

Abstract

Business renovation is a key aspect of electronic business and a high-level strategy for managing change that generally cannot be handled by continuous improvement and organizational restructuring methods. Business process modeling and the evaluation of different alternative scenarios for improvement are usually the driving factors of the business reengineering process. This study investigates business process simulation as a tool for deriving new knowledge about current business processes, such as additional in-depth understanding of how the process is executed and identifying sources of the problems observed during the process execution. The main objective of the paper is to investigate the potential benefits and outcomes of e-business transitioning that can be assessed in advance by using simulation modeling. An example is presented of how simulation modeling can be used to understand a procurement process and evaluate how the proposed improvements and the introduction of electronic business will influence system performance. © 2002, Sage Publications. All rights reserved.