Individual Project Assignment

Applying critical thinking to business process modelling – Airbnb case study

1 Introduction

Business analysts (BA) have responsibility to bridge the gap between stakeholders, and call forth the solutions to help organisations achieve the goal and competitive advantage. The solutions could be worked on business-level, IT-level, and data-level. Since the initial point, BA have been active in business and software development processes, performing required business analysis activities at various levels. BA have to ensure to grasp information and question at right issues within a short frame of time. The job is required for BA to hold logical discussions with different recipients such as business, IT, end-users, etc. BA is also demanded to hypothesise connections between different ideas and requirements of different recipients to set up the coherent right way and save reworks down the line. As a good business analyst, one should always takes into account different ideas and requirements, and puts on cognitive process to all side of project process to make decisions among choices. Cognitive process includes information process and thinking process. Critical thinking is useful to design thinking process and refine cognitive biases for every tactics BA conduct, and every decision BA make. Critical thinking does not guarantee precise standards and the removal of prejudices, yet the more detailed and specific the requirements are, the greater the probability that the project’s outcomes fulfil the stakeholders’ true needs. In other words, the quality of everything that we carry on, after all, is influenced by the quality of our thought.

Business analysis engages a set of tasks in attempt of meeting business goals, solving problems, or incorporating changes to areas such as business process (IIBA – International Institute of Business Analysis, 2015). Business processes involves operating internal activities and processing within external events to enhance value for the organisation. Business process modelling is a cross-functional and complicated methodology to create a coherent model of the actions needed to provide a customer or another part of the organization with a service and/or product (Aldin L., 2009). The comprehensive technical nature of Business process modelling applies to several areas of management (business, operation, transition, projects, etc.) and its process-emphasis connects it closely with quality management rising from the analytical approaches. And critical thinking is analytical approach to help BA make assessment and reflection before jumping to premature conclusions and decisions. In other words, critical thinking is considered as a crucial skills of BA, while business process modelling is a methodology that BA apply to enhance the quality of business and projects. Thus, I would like to carry out the report to study about the application of critical thinking in the context of business process modelling as business analyst, and apply the theoretical concepts into real-life case study of Airbnb.

2 Critical thinking in the context of business process modelling

2.1 Critical thinking concepts and techniques

Critical thinking has many definitions and concepts. In earlier time, Glaser (1972) describes critical thinking concept involves three parts: (i) an attitude of being able to consider the issues and topics that fall within the context of one’s experiences in a reflective way, (ii) an awareness of logical inquiry and reasoning processes, and (iii) the capability to apply critical method and techniques.” Ennis (1991) defines critical thinking as “reasonable reflective thinking focused on deciding what to believe or do”. Critical thinking is a proactive, self-regulatory decision that results in the perception, examination, assessment, and inference of the evidential, conceptual, methodological, criteria, or contextual factors on which that judgment is based. According to Facione (1984), individuals having critical thinking is typically intellectually curious, well-informed, rational, open-minded, versatile, fair in evaluation, truthful in facing personal prejudices, cautious in making decisions, willing to reconsider, straightforward on problems, orderly in complex matters, vigilant in searching for relevant information, rational in selecting criteria, centred on investigation, and persistent in searching for criteria. Siegel (1988) also advocates that critical thinkers enhance the quality their way of thinking about any subjects, or issues by deliberately examining, skilfully evaluating and reconstructing real problems.

With respect to the prominent traits of critical thinking, critical thinking is reflective, in other words, it involves thinking about one’s own thinking (Nosich, 2012). Critical thinking is not once-and-done event. Critical thinking is a process of breaking down the issues into components parts, going around the circle, and putting into the synthesis in the different view. Critical thinking is required a continuous attempt to investigate any hypothesis or supposed form of knowledge based on the assumptions and evidence that it tends to provide to call forth the further solutions. Critical thinking is the ability to consider and assess information on the basis of their worthiness and authenticity, and to draw conclusions by assessing hypotheses from the information provided (Tiruneh, Verburgh, & Elen, 2014). Critical thinking requires a set of standards and abilities combined with the aspects of reasoning to produce consistent and trustworthy. Nosich (2012) states that critical thinking is transformative. Critical thinking provides holistic view to recognise the rational relationship between parties, to evaluate the assumptions and conclusions, to reconstruct one’s patterns of perceptions on the basis of broader experience, and to make precise decisions on particular objects and qualities in daily life.

Halpern (1998) proposes a taxonomy of critical thinking qualities involving a wide range of techniques such as (i) verbal reasoning, (ii) argument analysis, (iii) thinking skills such as hypothesis testing, (iv) coping with probability and doubt, and (v) decision-making and problem-solving abilities. Noisch (2012) displays 8+ elements of reasoning in critical thinking to clarify the problems and figure out the step in the process of analysis, such as: purpose, questions needed to be addressed, information, interpretation, concepts, assumptions, etc. Zyl et al. (2020) displays the sequence of elements of reasoning to illustrate the critical argument including making claim because of reason based on questions at issues and evidence in the context, also acknowledge questions and alternatives, and respond to by sub-argument. “Sig Thinking Hat” is a technique proposed by De Bono (2009) in attempt of promoting critical thinking through parallel thinking in group. The strategy of six thinking hats discusses the concerns associated with debate, adversarial, confrontational thought where each party takes an opposing view purposely.

2.2 The application of critical thinking in the context of business process modelling

According to Paul et al. (2014), the aim of business process modelling is: (i) to grasp the operation of the existing process; (ii) to create cross-functions among tasks in process, (iii) to identify the problems and weaknesses of business process. Business processes are the means by which an organisation carries out its internal operations and delivers its products and services to customers. The business processes need to operate within the external environment. In order to carry out and improve business process modelling, the primary step is to understand the business context in term of both internal and external events. Several analysis frameworks, for instance, Porter’s Value chain, or SWOT analysis, offer analysis tools to have insight of existing organisation and business process. The Porter’s Value chain describes key areas of primary and support operation that will be needed to provide value to the customers of the company and potentially distinguish the company from its rivals. In order to create high-level process maps for the organization, the idea of value chains should be applied. It is typically best to start with activities then consider the other fields, and identify current strengths and existing weaknesses, potential opportunities and threat. Some scholars and researches contends that these analysis frameworks are high-level and critical thinking exercise for business managers and analysts to have comprehensive view before making any decision (Coman & Ronen, 2009; Kambil, 2007). Upon integration with critical thinking, the implementation of technique analysis in a business setting will be effective. Identifying internal components and external considerations requires a better vision about the niching problems that the other businesses operating in the same industry could not even recognise.

A business process refers to a series of processes which is caused by a business event. Five main components are included in a business process: (i) tasks / activities, (ii) process flow, (iii) decision points, (iv) actors / roles, (v) business process outcomes (Paul, Yeates, & Cadle, 2014). There are the enormous availability of numerous techniques for the representation and specifications of business processes modelling. Each technique will concentrate on various aspects of process modelling. The techniques of business process modelling mainly involve ‘mapping’ and ‘workflow’ to facilitate comprehension, analysis and brief the requirements. The common diagrams for modelling business process are Business Process Modelling Notation (BPMN), and UML activity diagrams. BPMN has been developed to model and turn the business workflow into a graphic language. UML Activity Diagrams also graphically represent the interaction between actors and scenarios in the organization to enable to understand the flow of business control and use cases. Critical thinking is a key component of problem solving to encode problem information and represent the information related to use cases and activities in process by using relevant concepts from the domain. In order to set up UML activity diagram effectively and in every respect, Kendall K and Kendall J (2013) suggest a list of critical questions to help understand in depth and identify activities and actions from current business cases. Tabrizi et al. (2004) point out that critical thinking opens to opportunities to develop further solutions and design software more effective.

After depicting the ‘as is’ business process with above techniques, business analysts define issues and implement approaches for improvement. The improved processes are called the ‘to be’ business process models (Paul, Yeates, & Cadle, 2014). Six Sigma is a methodology initially developed in the 1980s by the company Motorola to improve and optimise process. It uses data and measurement to assess where it is possible to achieve the most business profit by process improvement. Six Sigma is applied DMAIC approach (Deﬁne opportunity, Measure performance, Analyse opportunity, Improve performance, and Control performance). It has developed into a rigorous methodology for business improvement that focuses on consumer needs, process alignment, analytical rigor and timely implementation by an organization. Six Sigma relies on statistical and scientific methods to significantly reduce the defect rates identified by the customer. However, business statistics method could not convey fully the entire story because process improvement is developed based on not only technical methodology, but also philosophy (Ayad, 2010). Critical thinking can discuss the unmeasured aspect of processes, including spoken and unspoken corporate politics and other social aspects, hence, critical thinking plays crucial role to contribute the complete picture in business process modelling.

In the making of correct investment strategies and decisions, business analysts apply critical thinking into business process modelling. Analysts have to think about the potential choices and take the most attractive and profitable one before making the correct decisions about where to invest. In this situation, critical thinking would assist BA to weigh the potential opportunity and existing weaknesses. By choosing the better choice, this helps them to make the most informed decision (Nosich, 2012). The efficiency of critical thinking in the context of business process modelling is proven to . After researching academic resources, and Internet information, I select four critical thinking solutions could apply for business process modelling. Four critical thinking solutions are attached in the Appendix section. The first solution is called 5W’s methodology to help identify clearly the root cause of problems or process detects (Ayad, 2010). The second solution is the list of typical questions proposed by Brown & Keeley (2004) in attempt of gainning understanding about . The third solution is named “Examination and Analysis” by Casey (2011). Examination is the procedure by which information is extracted and viewed from facts and made available for review, while analysis is the application of the scientific method and critical thinking: who, what, where, where, how, and why in order to answer the basic issues in an investigation. Final solution is the OO-method proposed by Pastor & Molina (2007). The OO-method use critical thinking to provide a textual summary of the specifications and validate them on the class diagram or on the application produced.

3 Case study: Airbnb business process in the application of critical thinking

In order to investigate the application of critical thinking in the change of business process, I select Airbnb to analyse based on the transition story of Airbnb in business process in attempt of becoming a billionaire company as a good example. There are many papers and Internet information to tell the story about how Airbnb undergo business process transformations associated with critical thinking. Airbnb is well-known community-based online platform for listing and renting local homes in accommodation service industry. It brings hosts and travellers together and promotes the rental process without owning any rooms themselves. In addition, it develops a shared economy by enabling property owners to rent private flats. Airbnb is more than a reasonable accommodation choice for travellers. The mission of Airbnb is “feel at home wherever you go in the world” by creating relationships with local hosts, gaining access to their destination’s distinctive spaces and culture. The below figure illustrates the as-is business model of Airbnb, and displays the interactions and activities between parties in Airbnb system.

(Source: Gary Fox, 2020)

In order to display activity diagram, business analysts of Airbnb must have critical thinking to identify what are the activities, and Who is responsible for each action, What are the scenarios for the corresponding use case, etc. According to activity diagram, there are six roles of Airbnb business process: Host, Guest, Hotel, Activity producers, tour guides, photographers. Guests are people who have demand to book private spaces for their personal purposes such as travelling or relaxation. Hosts are individuals having available spaces and they would like to generate profit from their spaces by renting out on Airbnb. Hosts can have business transaction after approving booking request from Guests. Hosts could freely set their own prices, check-in and check-out requirements, offer supporting service for customers without Airbnb constrains. Independent hotels could also register to be in list of Airbnb, yet hotels have to pay 13-20% commission for Airbnb. Besides, other roles such as freelancer photographers, experience providers, tour guides are important partners of Airbnb to enhance the quality of service. Accommodation providers and experience providers are all rated by Guests. Detailed actions and use cases are interpreted in the above Figure .

Designers, product managers, engineers, content strategists, data scientists are key contributors behind the scene of Airbnb product development,. However, they worked in silos, only jumping into the process at defined times (Magátová, 2020). Before a mock-up could be visualized on the computer, developers had to wait for engineers to write code. In exchange, engineers had to wait for scientists to test product theories, only to find that project conclusions were off-base at the very end. The company was struggling to identify its internal signature in a design, and to make a strong and smooth delivery in business development process. The failure of needy models or overly coveted functions was less so. It was a signal of process failure according to Judd Antin, Head of Research of Airbnb (From the Ground Up: Shining a light on how research guides our product development). Antin emphasises that collaborative working in associated with critical thinking is the key to establish strong foundation to develop Airbnb business.

Airbnb states problems by questioning critically about the business process. The simple way to clarify the problems is to make claims and questions as technique of critical thinking. Massaging evidence to support current ideas is not hard, however it is difficult to re-evaluate those. Airbnb firstly identifies the purpose of company about how to improve users’ experiences, and questions at process issues with the set of basic question with 5W’s (Who, What, When, Where, Why). Yet they are not only questions from the viewpoints of business, but also frequent questions about Airbnb product process from the users’ viewpoints. Airbnb swifts from function-focused to customer-centric in design. Airbnb revamped the design to include both the logo and its digital footprint on mobile and especially desktop experience applications. Instead of static photos about scenery or home space, Airbnb use short video loops and highlight people’s lifestyle such as living photo of people grilling out or lounging on the couch in attempt of simulating users. Such pictures must be immersive and cinematic. Besides, the Airbnb hosts’ network has become central to the users’ experience to create sustainable relationship. Although these tweaks were rather small, Airbnb was quick to emphasize that they all rely on a new focus they hope to expand the company’s horizons. Airbnb business model keep changing to catch up the trend of future and provide diverse range of experiences as well as accommodation for customers.

4 Discussion and conclusions

Critical thinking is applied to make efficient and effective long-term and short-term strategies for business organizations. Business analysts and managers have to think objectively in terms of their priorities and objectives in relation to the resources a business firm has in order for business managers to make decisions and plans for the company. They need to think critically to anticipate the future risks facing the organization and prepare suitable responses in time for challenges. They must make sure that the organization is well-prepared to encounter for any changes. There needs to be a lot of thought in the planning process for this to happen. They have to take into account every aspect of process before devising short-term and long-term plans. The principles of business process modelling originating from a panel consisting of actors illustrate the meaning of critical thought. Those that think critically about complex situations have a solution that earns significant net income for the company. Critical thinking guarantees advance preparation and there is order in the process of the businesses as a result. Advance preparation means that everything moves according to the planned period and this helps to clarify the steps and activities which are conducted.