Collect information from documentary sources and through interviews; identify and document each business function, activity and transaction and establish a hierarchy of them, that is, a business classification system, and identify and document the flow of business processes and the transactions which comprise them. [AS ISO 15489.1, Clause 8.4]
- Content and scope of Step B
- Sources for Step B
- Hierarchical analysis
- Sequential analysis
- Analysing risk
- Documenting Step B
This is an introduction to Step B: Analysis of business activity. This section: outlines the aim of Step B including what understanding the analysis will give you and what tools can be developed; summarises the major elements of Step B; explains why it is important to undertake Step B for particular DIRKS projects; indicates how Step B is scalable and when it is necessary to complete, and; shows how Step B relates to the other steps in the DIRKS methodology.
The aim of Step B is to analyse your business in order to gain a thorough understanding of the business activities and processes that are carried out. It also involves establishing a classification structure known as a business classification scheme. A business classification scheme is a hierarchy of functions, activities and transactions that can be used to support a variety of records management processes. 
In Step B you should analyse the documentary sources and interviews you have collected in order to identify:
- your organisation's goals and the strategies to achieve these goals
- the broad functions the organisation undertakes to support its goals and strategies
- the activities which contribute to the fulfilment of the organisation's functions, and
- the groups of recurring transactions or processes which make up each of these activities.
Two types of analysis may be used:
- hierarchical analysis, a 'top down' approach where you start with the goals and strategies and gradually look deeper into how these are achieved, and/or
- sequential analysis, a 'bottom up' approach where you start by examining work processes and the transactions resulting from them, then gradually relate it to more broader levels of classification.
The analysis can be represented in a number of ways. The hierarchical model, known as a 'business classification scheme' is the method preferred by State Records. This scheme can then be used to make a variety of decisions about the management of records.
Step B is a foundation step for many DIRKS projects. It helps you to:
- gain a greater understanding of your organisation both at a micro level and a macro level and the context in which records are being created (in this way it adds to Step A: Preliminary investigation)
- start identifying existing recordkeeping problems and issues, such as inadequate work processes
- establish a business framework for recordkeeping tools, such as thesauri and retention and disposal authorities which can also be used to populate metadata fields
- establish a business framework to map recordkeeping requirements to, which will assist with the production of creation and retention and disposal authorities, metadata strategies, the identification of vital records, gap analysis and system design or redesign.
Relate to the project scope
The scalability and relevance of Step B depends on the scope of your project and the outcomes you are looking for.
You may decide not to do Step B at all if you:
- do not need to conduct such a detailed examination of processes, transactions and records generated, and
- do not need to construct a business classification scheme based on functions and activities (used as a basis for recordkeeping tools or to map your recordkeeping requirement to).
See Doing your DIRKS project for how Step B specifically applies to particular projects.
Step B can be scaled down for particular projects if existing generic or organisational classification schemes, already exist and are suitable. You may have, for example, a general retention and disposal authority or keyword thesaurus in place. If this is the case, you can easily scale down your project to examine a specific function in isolation (perhaps due to identification of a recordkeeping crisis or a recognised problem).
Example: Scaling down
Your project may be to do DIRKS to ensure the creation and capture of the necessary records to meet your recordkeeping requirements for a key, high risk function. You may already have a functional thesaurus that covers the majority of your business and which can provide a suitable classification framework.
You can then choose to examine a particular function in detail using sequential analysis.Be careful however, if you are using a thesaurus as the basis for your assessment. Thesauri generally only cover records documented in files or file like structures. As a consequence they may exclude terminology for records not documented in files - for example those maintained within databases.
Example: The personnel management function
One council decided to undertake a DIRKS project where they needed to analyse the business conducted within their human resources function. Their aim was to improve their current practices and to identify their recordkeeping requirements and determine their levels of compliance.They chose to use the function of PERSONNEL and related activities from the Keyword for Councils thesaurus as a basis for their business classification scheme. However, they still needed to analyse the way business was being conducted and the records produced (sequential analysis in Step B) and recordkeeping requirements (in Step C) to determine changes to their current practices.
When to look more broadly
If your organisation's core functions are not covered by a classification scheme of any kind, it is not advisable to try to analyse a core function or system in isolation. You should at least roughly map your core business functions and activities in a business classification scheme and consider issues which may affect them before trying to concentrate on one function or system.
The reason for this is that:
- you need a broad perspective of the boundaries of the function or system and how it relates to, and impacts on, other business activities being performed
- you may discover when taking a broader view that there are other areas of high risk that may warrant priority in subsequent stages of the design and implementation process. These areas may correlate to particular recordkeeping systems, business activities or business units.
- if you analyse one function or system in isolation, without a broader map, you may inadvertently cross boundaries of other functions and may miss risk identification. These omissions may force you to revise your analysis later.
Step A: Preliminary investigation and Step B both involve data collection. If you are doing Step A and are familiar with the requirements of Step B before you start, you may start identifying functions and activities while completing Step A. If this is the case, record your findings and refer back to them when you start Step B.
Step B may also be carried out concurrently with parts of Step C: Identification of recordkeeping requirements, as many of the same sources are used. You will often find that you come across recordkeeping requirements when you are conducting research to identify functions, activities and transactions. All of these can be documented using the using the function source template.
It is also possible to gather information about the use, scale and operations of systems for Step D: Assessment of existing systems when you are undertaking Step B.
Steps E and F
If you are examining your processes, you may discover during the sequential analysis in Step B and assessment of how these are working in Step D: Assessment of existing systems that you need to redesign some processes. Redesign will occur in Step F: Design of a recordkeeping system.
You may also decide on other methods of representing the information from the business classification scheme for particular uses in Step E: Identification of strategies for recordkeeping and design these methods in Step F.
If your organisation has been analysed for other purposes it may be possible to draw on the results of such work. Projects which may involve an analysis of business activity include:
- business process re-engineering
- privacy management strategies
- imaging and work flow automation
- activity-based costing or management
- quality accreditation, and
- systems implementation.
Likewise, if these projects have not been undertaken yet, the results of your analysis can be a valuable source for future projects of this nature.
If the analysis arising from such projects is available, you will need to consider how, why and when the projects were undertaken to determine whether their findings are applicable for recordkeeping purposes.
If you do not have these tools, you may wish to obtain what is available from State Records or their delegates. You need to obtain a licence to use Keyword AAA or Keyword for Councils. The general retention and disposal authorities are available for free on State Records' Web site but only apply to the NSW public sector.
If you use the structure and terminology from these products you can save considerable time in planning frameworks in Step B and can concentrate more on the analysis. Such analysis can actually help you to refine the applicability of generic recordkeeping tools by mapping your specific business needs to them.
Example: Streamlining tools
A council may discover during the business analysis that some of the activities in the Keyword for Councils thesaurus are not actually performed by their council, or they are documented in databases rather than files.
In this case they can remove them and streamline their version of the Keyword for Councils thesaurus, increasing the usability of the tool for file titling and customising it to their exact business. The council may also find a need for additional or more customised subject descriptors based on the transactions performed. Any changes should be documented so that they can be made again when Keyword for Councils is revised.
Note: Records stored in databases and business systems should be retained in accordance with the General retention and disposal authority: local government records.
Another useful source to check before the Step B analysis is to see if other organisations that have similar functions or share parts of the same function have performed an analysis or have functional classification schemes or recordkeeping tools.
Example: Similar functions
Both the Sydney Harbour Foreshore Authority and the Historic Houses Trust have functions and activities concerned with managing heritage buildings.
There may also be other state or federal bodies that carry out similar functions.
Example: Similar functions
Each of the state fire brigades services will perform similar functions.
If these related organisations or counterparts have existing schemes that are comprehensive and they are willing to share them, you may find them valuable to draw on. Alternatively, you may decide to share resources and undertake some joint development. Such consultation will reduce duplication and enhance consistency.
It is very important to remember, however, that even if classification schemes can be partially shared, each organisation will still have to perform its own analysis (Step B) and define its own recordkeeping requirements (Step C) as they will have different operating environments, with different cultures, risks and recordkeeping regimes.
Example: Shared classification schemes
A number of galleries and museums around Australia all participated in the PAINT project, the goal of which was to produce consistent classification schemes and controlled language to share between participating agencies.
Naturally each museum or gallery will need to analyse their own business environments and recordkeeping requirements. They will have to take these into account when customising the product. In addition, if government organisations wish to produce retention and disposal authorities, each organisation will need to do so in line with the relevant archival authority's procedures and have them separately authorised.
Many of the sources used in Step A: Preliminary investigation will be pertinent to the analysis of your organisation's business activity. These include:
- internally generated sources such as mission statements, corporate plans, annual reports, organisational charts, policy statements, procedure manuals, information systems documentation, records and forms
- external sources such as legislation, regulations, instructions and circulars. Legislation is a particularly important source for this step as it can indicate when your organisation has a legal responsibility to perform particular functions, activities or tasks.
Although you may refer to many of the same sources if you are doing Steps A, B and C, it is important to note that you are seeking different information from the sources and working towards different outcomes for each step.
Interviews are used in a number of DIRKS steps. For example, you may have interviewed people in Step A: Preliminary investigation to help you to get an overview of the organisation and an understanding of their context. In Step B you can interview people to gain more information about their functions and activities, but also to give you process and transactional information and to verify your analysis. Staff are also aware of ad hoc practices that might go undocumented. An advantage of involving staff is that by contributing they feel they have some ownership of the project and are more likely to accept outcomes.
It can be useful to clarify 'big picture' functions with a group of staff from several parts of the organisation and use smaller groups or one-to-one interviews for obtaining the detailed information about processes and transactions.
Tip: Be prepared for interviews
To ensure you do not waste staff time you should be prepared fully before interviews take place. This may involve preparing questions relating to a number of DIRKS steps.
See for more guidance:
Once you have established the scope of your project and collected sources, you can apply two main types of analysis used to understand your business activity - hierarchical analysis and sequential analysis.
There are several useful reference sources to assist you with the analysis. You should then analyse the risks associated with your business activities.
This section describes what hierarchical analysis is and the steps in performing the analysis.
Hierarchical analysis involves taking a 'big picture' view of your organisation's business activity and then breaking it down into more detailed parts. You look first at the goals and strategies of the organisation, then at component parts - the organisation's functions, activities and transactions. The boundaries of your analysis will be based on your project's scope.
A function is 'a set of related and ongoing activities of the business.'  Functions represent the major responsibilities that are managed by the organisation to fulfil its goals. Functions are high level aggregates of the organisation's activities.
Functions are generally not based on organisational structures because they are more stable than administrative units, which are often amalgamated or devolved when restructuring takes place. Functions can also be dispersed across structural components of an organisation.
Example: Functions cut across organisational structures
The Roads and Traffic Authority has a LICENSING function - including a range of activities performed to manage the licensing of drivers in NSW. Different organisational units within the RTA may be involved in performing aspects of this function.
In some organisations there may be multiple layers of functions. There can be very large government functions which relate to a number of different organisations. Government functions are too large to be useful in the Step B business analysis.
Example: Levels of functions
Law and Order is an example of a government function. However, that level of function is too broad for a business analysis for NSW Police.
Even within an organisation there may be larger and smaller functions and you will need to decide which level you choose for your business analysis.
Example: Levels of functions
Human Resource Management was considered to be too large a function when producing the Keyword AAA thesaurus, so it was broken down into smaller functions like Personnel, Industrial Relations, Staff Development etc.
Functions are then decomposed into smaller (sub) functions or into a discrete and related set of ongoing activities.
Activities are the major tasks performed by the organisation to accomplish each of its functions. An activity should be based on a cohesive grouping of transactions producing a singular outcome.
Example: Transactions making up an activity
Transactions under the activity of 'drafting' may be:
- write draft
- circulate for comments
- receive comments
- incorporate comments in new draft
- seek approval.
It is a cohesive group that results in the production of a draft.
Activities should not be based on how records are currently kept, for example as a case, project or event file. Such files might comprise many activities and represent a legitimate way to maintain the record, but the analysis of business activities should represent the component parts.
There may be several activities associated with each function. In some cases, the same activities may occur under a number of different functions.
Example: Recurring activities
Generic activities like giving advice or planning may recur under administrative and core functions.
Transactions are 'the smallest unit of business activity'. In the business classification scheme, they should be represented as tasks, not subjects or record types.
Example: Transactions within an activity
In the Indiana University Electronic Records Project they identified the activity of 'Student grades and credit maintenance.' The transactions were:
- Registrar's Office posts grade for students upon completion of course work, and
- Registrar's Office assigns credit for student work done at other academic institutions. 
Often transactions relate directly to recordkeeping requirements which are identified in Step C.
It depends very much on the scope of your project whether you will look at each transaction in depth. If you are doing DIRKS to create a thesaurus you may decide to classify more at the level of groups of transactions, subjects or record types than individual transactions.
Example: Transactions, subjects or record types
A transaction may be to 'complete an evaluation form for a training course.' The record type produced from this transaction is the 'evaluation form' and the subject may well be the name of the training course.
Transactions help you to define the scope of your activity. The identification of transactions will also help:
- you to identify what records support the transactions and the recordkeeping requirements related to these (Step C)
- in the formulation of the records description part of a retention and disposal authority.
Relationships between entities
Example: Relationships between entities
Function: Publication - the function of having works, irrespective of format, issued for sale or general distribution internally or to the public.
Activity: Drafting - the activities associated with preparing preliminary drafts or outlines of addresses, reports, plans, sketches etc prior to publication.
Transaction(s): Create draft copies of publications/website/intranet with associated metadata, distribute drafts for comment, file comments made on these drafts.
The following tables outline one recommended approach to identifying your organisation’s functions, activities and transactions.
Stage 1: Identify your organisation’s functions
|Examine the organisation's establishing legislation for a description of the purpose for which the organisation was established, possibly in a section called 'Functions' or similar.
Tip: There may be more than one relevant piece of legislation.
|List of functions identified in legislation.
For example, the Greyhound Racing Act 2002 lists a number of functions for Greyhound Racing NSW, including:
|Examine the organisation's annual budget for the current year. This may list the outputs of the organisation with a description of each output.||List of annual budget outputs, with descriptions.
For example, the 2003/04 budget lists the following outputs of Greyhound Racing NSW:
|Examine the organisation's most recent annual report and identify the main headings under which the organisation’s achievements are grouped. Alternatively, identify the main budget headings under which expenditure was incurred.||List of key achievements for the organisation in the past financial year, with summaries of each achievement.
For example, the Greyhound Racing Authority (NSW) Annual Report 2003 grouped its outputs and achievements under the following headings:
|Examine current or recent organisation-wide corporate or action plans for the key objectives of the organisation or of significant parts of the organisation.
Note: If the plans only apply to part of the organisation, they will probably be of more use in identifying activities and transactions in Stages 2 and 3.
|List of corporate objectives.
For example, the corporate objectives for the Greyhound Racing Authority in 2003 included:
|Examine the organisation's website and Intranet, and note the main headings.
Tip: Ignore headings like 'About us' and just focus on the headings that relate to things the organisation does for its clients (whether external or internal).
|List of main subject headings with summaries of the area to which each refers.
For example, the Greyhound and Harness Racing Regulatory Authority’s website includes the following headings:
|Assess any other relevant sources for possible information about the organisation's functions.||Other information about the organisation’s functions.|
|Use the lists developed in this Stage to compile a single, consolidated list of the functions of the organisation, including a description for each function which states what the term includes. (The description may also state what the term excludes, if necessary.)
Tip: Compare the lists developed in this stage and group elements together as appropriate.
Tip: Use the descriptions to ensure that no functions overlap, and that all aspects of the organisation’s business are covered.
Tip: It may be necessary to come up with new terms to describe the organisation’s functions rather than using the language from the sources examined.
|Draft list of the organisation's functions with descriptions|
|Identify which business units are involved in delivering each function.||List of functions and associated business units|
Stage 2: Identify your organisation’s activities
|Examine the sources looked at in Stage 1 for references to specific activities that the organisation undertakes in support of its business.
Tip: See Sources for Step B for other suggested documentary sources.
|List of activities undertaken by the organisation, with descriptions
For example, the Greyhound Racing Authority (NSW) Annual Report 2003 identifies a number of activities, including:
|Use the list of functions and associated business units developed in Stage 1 to identify and arrange interviews with key staff in the business units that deliver each function, ensuring that all involved business units are covered, to discuss the activities their unit carries out.||List of activities carried out by organisational units, with descriptions
For example, staff in the Stewarding Section of the Greyhound Racing Authority may undertake the activities of:
|Use the lists developed in this Stage to compile a single, consolidated list of activities for each function identified in Stage 1, including a description for each activity which states what the term includes.
Tip: Compare the lists developed in this stage and group elements together as appropriate.
Tip: Use the descriptions to ensure that no activities overlap, and that all aspects of the function are covered. Combine any overlapping activities into a single activity if appropriate. Otherwise, redefine the description of the activities so that they do not overlap.
|Draft list of activities for each function with descriptions|
Stage 3: Identify your organisation’s transactions
|Review the organisation's lists of records series (if available) and identify the transactions which produce these records.||List of transactions which produce the organisation's records, with descriptions.
For example, if the Greyhound Racing Authority has a series of records called ‘Greyhound welfare policies’, the transactions which produce these records may include:
|Use the list of functions and associated business units developed in Stage 1 to identify and arrange interviews with key staff in the business units that deliver each function, ensuring that all involved business units are covered, to discuss the transactions their unit carries out.||List of transactions carried out by organisational units, with descriptions.
For example, staff in the Stewarding Section of the Greyhound Racing Authority may undertake the transactions of:
|Examine the draft list of activities with descriptions developed in Stage 2 and detail the sequence of steps that make up each activity.
Tip: Use the descriptions to refine the list of transactions.
Tip: After this step, it may be necessary to go back and further refine the activity descriptions developed in Stage 2.
|Draft list of transactions that make up each activity|
|Use the lists developed in this Stage to compile a single, consolidated list of transactions for each activity.
Tip: Compare the lists developed in this stage and group elements together as appropriate.
|Draft list of functions, activities and transactions with descriptions of the scope of each function and activity|
Stage 4: Review functions, activities and transactions
|Review the draft list of functions and their descriptions from Stage 1 with reference to the draft list of functions, activities and transactions with descriptions of the scope of each function and activity developed in Stage 3. This may highlight any gaps or problems with the way the functions are defined.
Tip: It should always be clear as to which function an activity belongs. If it is not clear, refine the description of the scope of the function or the scope of the activity.
|Reviewed list of functions, activities and transactions with descriptions of the scope of each function and activity|
Stage 5: Testing functions, activities and transactions
|Test the list of functions, activities and transactions with descriptions of the scope of each function and activity developed in Stage 4 in interviews and workshops with relevant staff members.||Final list of functions, activities and transactions with descriptions of the scope of each function and activity|
Although the hierarchical analysis involves a 'top-down' approach, it is not essential that you finalise the highest level of the hierarchy before moving on to its lower levels. Indeed, identifying transactions will help define the boundaries of activities and therefore the scope of functions. The examination of sources will often provide information that is relevant to a number of levels and you should expect to revisit each level several times in order to refine and enhance the model.
Tip: Start with the function you understand best
This might be the one in which you are involved or it might be the one that is very easily understood. This will help you get used to the methodology.
Tip: Verify your findings with staff at logical points
Don’t wait until you think you have finished, as it is likely that when you first start your analysis you will have to review and refine your findings frequently.
Involving staff in the process at this early stage also ensures that they are aware of the project and feel involved in the process.
This section describes the other type of analysis carried out to analyse your business activity - sequential analysis.
Functions also consist of business processes which are responses to a business event. An event is 'a logical unit of work that must be completed as a whole. An event is triggered by a discrete input and is completed when the process has responded with appropriate outputs'. Sequential analysis is a 'bottom-up' approach - at a smaller scale than the hierarchical analysis. It involves identifying the sequence of steps or transactions and any variations that are currently undertaken to respond to a business event and achieve an outcome within the context of an organisation's functions, systems and rules. This may involve identifying the linkages and dependencies between processes and is workplace and time specific. Sequential analysis should be carried out after, or as part of the hierarchical analysis, and the processes mapped to the hierarchy. The advantage of starting with hierarchical analysis is that it gives you the organisational context in which the activities and processes are taking place. Processes may straddle across a number of different functions or may be contained within one or two functions.
Tip: Making sense of sequential analysis
Sequential analysis documents the actual work processes you do in performing your business operations. It shows the relationships and dynamism that exist between your functions and activities.
Considering the boundaries of your project and the tasks on which your analysis will be focused, you need to begin by investigating the process to find out:
- the standard sequence of steps within the process. Each transaction should be a separate step
- the inputs or dependencies from other systems (such as the need for authorisation, records etc)
- critical actions which need to be completed before steps can occur
- the people managing and performing the process and what accountabilities they have
- where the process is being carried out
- what rules affect the process
- what records are currently being generated as a by-product of transactions and why, and
- any needs for generating records that are not currently being created.
Not all processes are step by step. There may be different paths contingent on certain decisions or actions and these should also be examined.
You can identify these by:
- observing work flows
- reviewing regulatory and legal requirements that impact on the process
- reviewing local operational manuals, business rules and organisational policies and related documentation that impact on the process, and/or
- interviewing staff members involved in performing the processes and managers who have accountabilities.
Australian Standard AS 5090-2003, Work process analysis for recordkeeping contains a range of questions to assist you in identifying the sequence of actions, variations and rules that provide the basis of processes, and other elements of the sequential analysis. 
Example: Sequential analysis of training authorisation process
This is the sequence of steps in a process to authorise training for a staff member:
- a staff member expresses interest in a training course
- a training application form is completed by the applicant
- the form is authorised by the supervisor along with details of the course applied for
- the form is sent to the Human Resource Manager who checks for conformity with internal training policy and records details in database
- the form is authorised by the Human Resource Manager and recorded in their training database
- notice of the authorisation is confirmed to the supervisor and applicant.
A variation to this process may be that the form is rejected and notice is given to the supervisor and applicant of the rejection. Another possible variation may be an appeal about the rejection.
A related process would be the process of enrolling and paying for a training course that has been approved. The process of enrolling is contingent on the authorisation process.
Like hierarchical modelling, you should expect to revisit your business process models several times in order to refine and enhance them. You should document your analysis and seek validation of the information from participants in the process.
If you find problems or issues with your processes during sequential analysis you should note them and consider whether you want to redesign them in Step F: Design of a recordkeeping system.
Process mapping provides a graphical representation of a process, using arrows, boxes and other tools to indicate the ‘flow’ of the process, what steps are taken, what decisions are made and what records are created. It is a methodology used in systems design.
Using a process map may assist in graphically documenting your analysis of the records produced by different activities. The value of a process map is in building a picture of activities with which you are less familiar, helping you to identify the different steps in the process and what records should result.
Example: Process map of training authorisation process
Once the hierarchical analysis and process analysis has been performed, the risk connected to functions and activities should be analysed.
How detailed the process will be will depend on your organisational culture with respect to risk, whether recent organisational risk assessments have been done and whether research indicates there is likely to be a high level of risk.
Assessing risk at the functional level in Step B assists in:
- prioritising areas for future analysis, and
- identifying organisational areas that perform the function as requiring more stringent recordkeeping practices and training.
If you have conducted the analysis in Step A: Preliminary investigation you may have already identified some areas of risk in your organisation. Source analysis during Step B may have revealed other areas of risk, for example, legislation may carry strong penalties for non-compliance in particular areas, or risks may have been identified in workshops with staff.
You also need to consider the consequences of these risks, such as financial loss, public embarrassment or unacceptable delays. The degree of analysis will be dependent on your organisation's culture and experiences with respect to risk.
If you have identified areas of risk in Step A: Preliminary investigation or Step B you should link them to the analysis you have performed. For example, the risk can be noted next to the functions - activity - transaction it relates to. This will assist you to see what functions and activities constitute the most risk for the organisation and help you if you wish to prioritise your DIRKS work based on levels of risk.
It is at your discretion regarding how you wish to document the business analysis and how detailed this documentation needs to be.
Decisions may be made based on the aims of your project.
Example: Check existing requirements
State Records has certain requirements regarding the structure of a retention and disposal authority. The hierarchical business classification scheme described below provides the basis for this structure. Therefore, if you project is to create a retention and disposal authority you will save time if you document your Step B analysis in this way.
Example: Merging with Keyword AAA
Keyword AAA is an alphabetic representation of a hierarchical classification scheme customised for records titling. If the aim of your project is to create a thesaurus to merge with Keyword AAA, you should consider documenting your analysis in Step B using the hierarchical business classification scheme described below.
Documentation should be kept on functions, activities, transactions, processes and sources analysed. This section gives further advice on what should be documented.
The business classification scheme is a hierarchy of functions, activities and transactions. A business classification scheme helps you to make decisions about the management of records at an aggregate level.
The layout of the business classification scheme can make it easier to see if there are any inconsistencies or overlaps in your analysis. You can check that:
- the combined functions account for all of the business the organisation carries out
- each function and activity and transaction is described using meaningful terms
- each function and activity has a definition and date ranges if they can be found (and if they are relevant to the project)
- the boundaries of each function mutually excludes the other functions, and
- the boundaries of each activity mutually excludes the other activities.
Example of a business classification scheme
An example of one way you might represent a hierarchical business classification scheme is shown below. In this example, the definitions have been turned into scope notes in preparation for a thesaurus. The organisation is a fictitious one that monitors food production.
Date range: 1998 -
Description: The function of monitoring the observance of quality assurance standards and licence conditions by food producers. Includes managing complaints, inspecting facilities and taking enforcement action where the health and safety of consumers is at risk.
Date range: 1998 -
Description: The activity of receiving and responding to complaints. Includes ensuring that any necessary corrective action is taken.
Date range: 1998 -Description: The activity of inspecting food producer production methods and facilities. Inspections may be in response to complaints or as a part of licence allocation or monitoring processes. Includes reporting on the inspection, issuing notices, re-inspection and referrals to other Departments for action.
Date range: 1998 -Description: The activity of investigating and reporting on breaches of quality standards and licence conditions with regarding to food production methods and facilities. Includes interviewing and observing production and facilities, reporting and referrals.
Aside from your business classification scheme, it can be useful to record your more detailed findings regarding the functions. This information can be picked up in later steps or projects. For example, you could record information on:
- legislation or other sources that underpin the functions and activities
- risks associated with each function and activities
- stakeholders that have an interest in the function or activity
- business sections that are responsible for or carry out aspects of the function, and
- changes to the function through time (if found), and
- more details regarding the dates of functions (if found).
In addition, you should keep documentation of the information collected in your sequential analysis. Diagrams, known as 'logical models' are often a suitable way to record the analysis of business process information. Textual information should also be recorded about processes, such as the name of the process, transactions within it, records created or that need to be created as part of transactions, responsibilities, recommendations regarding changes and what functions and activities they have been mapped to. Dates when the processes were analysed should be recorded.
As part of your analysis it will be necessary to choose terms that can provide labels for the functions and activities you have identified. The terms chosen should reflect the terms used in your organisation or industry and in current files.
At this stage the terms do not need to be too controlled - they simply act as a 'handle' on the concepts. They can be phrases, for example, rather than one or two terms. If you are going to develop a keyword thesaurus you can refine them at a later stage.
Tip: Using controlled vocabulary
Some people do set up a controlled vocabulary in their business classification scheme as it enables them to clarify the document and make it suitable for viewing by organisational staff. If you have an existing thesaurus or retention and disposal authority, you may decide to use that terminology in your business classification scheme. If you are going to develop a thesaurus anyway, you may find it useful to include the controlled vocabulary in the business classification scheme. You will need to consider how the terms used 'fit' with Keyword AAA terms and should refer to Guidelines for Developing and Implementing a Keyword Thesaurus for more information.
Tip: Terms that reflect administrative areas
If you choose terms that relate to administrative areas you may have difficulty in convincing staff of the differences between the function and the administrative area. If the terms are also in the thesaurus, staff will need to be instructed in their use or they tend to assume the terms refer to the administrative area.
You will also need to include descriptions for functions and activities in the business classification scheme. The main reason to define the boundaries or breadth of each function or activity is so you can ensure that their meaning is understood, that entities at the same level do not overlap and that the relationship between entities is clear.
The definition of the function or activity will start as quite tentative statements or even dot points, and then can be revised as you refine your business classification scheme. If you are intending to compile a thesaurus these definitions can be turned into scope notes.
If your project involves creating a disposal authority, it is valuable to note down details of changes in the ways functions and activities are performed when you come across them. Sources for this information should also be noted in case you wish to go back and check the information.
Date ranges are particularly valuable for compiling retention and disposal authorities. Information about changes over time will help you to assess whether additional disposal classes and actions are required in the retention and disposal authority to reflect the changes.
Tip: Note changes
If you suspect or know changes have taken place but you cannot find authoritative sources to support this, note the changes and inform State Records when you submit your retention and disposal authority.
As part of analysing the broad legal and social context in the preliminary investigation (Step A), you would have identified organisational stakeholders and you may come across more during this step.
Example: Identify stakeholders
- external stakeholders that participate in the work of the organisation, like individual clients, client organisations or other NSW public offices will be obvious when you analyse activities and transactions
- particular areas or individuals in the organisation may also have an interest in the function. They will include those areas responsible for carrying out the function and activities, but may include other areas and individuals.
Stakeholders in processes will include those involved and those managing the processes or those requiring the process to take place in order to complete other processes.
These stakeholders should be linked to the relevant function or activity as their interests may be a source of recordkeeping requirements in Step C: Identification of recordkeeping requirements.
It is important that you consult widely during your functional and sequential analysis of business activity. It is also important that you validate what you have found and documented in your business classification scheme. This will involve asking questions of managers and operational staff to confirm that your analysis and representation is accurate and complete. It is essential that your models are meaningful to the organisation as they have the potential to inform key recordkeeping activities (including intellectual control and appraisal).
The hierarchical and sequential analysis and business classification scheme should also be validated with senior management. You may, for example, compile a report on your findings to show senior management which can also serve as a progress report on your project.
Analysis of business activity can provide an effective and powerful tool for managing records. To ensure that your analysis and business classification scheme remains relevant to your needs it is prudent to periodically review its currency, particularly when there is:
- administrative change within the organisation
- a government election, or
- a change in organisational responsibilities.
 Australian Standard AS ISO 15489-2002, Records Management, Part 2, 8.4b
 For example: Standards Australia AS 5090, Australian Technical Report: Work Process Analysis. This document is available for purchase from Standards Australia. This document provides guidance on undertaking work process analysis for recordkeeping purposes and includes both hierarchical and sequential analysis methods.
Indiana University Electronic Records Project, Step 1 of 'A Methodology for Evaluating Existing Information Systems as Recordkeeping Systems' available at December 2002 via http://www.libraries.iub.edu/index.php?pageId=3313 This document describes practical use of both hierarchical and sequential analysis.
 J. Whitten and L. Bentley, Systems Analysis and Design Methods, 4th ed., McGraw-Hill, Boston, 1998, 218
 AS 4390-1996, Part 1: General, Clause 4.27
 Philip C Bantin, 'The IndianaUniversity Electronic Records Project Revisited', The American Archivist, Volume 62, Spring 1999, 156
 J. Whitten and L. Bentley, Systems Analysis and Design Methods, 4th ed., McGraw-Hill, Boston, 1998, 218
 Standards Australia, AS 5090-2003, Australian Technical Report: Work Process Analysis, pp 4 and 8. This document is available for purchase from Standards Australia.
 Australian Standard AS 5090-2003, Work process analysis for recordkeeping. This document is available for purchase from Standards Australia.
 Cayman Islands National Archives (CINA), Records Management Workbook 1: Developing a disposal schedule(Draft) (2006)
 Such models are shown in Jeffrey L. Whitten and Lonnie D. Bentley, Systems Analysis and Design Methods, 4th ed, McGraw-Hill, Boston, 1998, 122