I3E Lee&Dominguez Cit

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ICT SUPPORT FOR EVOLVINGHARMONIZATION OF INTERNATIONAL

ALLIANCES

IFIP Conference on E-Business, E-Commerce and E-Government

22-24 September 2003, Sao Paulo, Brazil

Ronald M. LeeSchool of Business, Florida International University, USA; andEURIDIS Institute, Erasmus University, The [email protected]/Euridis/

Elizabeth Dominguez CampilloUniversidad de la HabanaHavana, [email protected]

ABSTRACT

International alliances are agreements between multiple countries tocooperate on trade, or other forms of economic activity, for mutual benefit.This paper focuses on how information and communication technologies

(ICT) can support transaction efficiency and effective controls in the context

of evolving international alliances. We concentrate on the potential forelectronic procedures to manage the document flows automatically, in a

fashion analogous to workflow systems within organizations. The keychallenge, however, is how to support the evolution of these documentary

procedures to match the dynamic structure of international alliances.

INTRODUCTION

There is a saying that no man is an island we are social animals and needto participate in social networks. The same, it seems, also applies to nations.

More and more, nations are interlinking via various forms of internationalalliances. By international alliance we mean agreements between multiplecountries to cooperate on trade, or other forms of economic activity, for

mutual benefit. Examples include the World Trade Organization (WTO)which is the administrative organization that implements the GeneralAgreement of Tariffs and Trade (GATT), European Union (EU), North

American Free Trade Alliance (NAFTA), MERCOSUR (Argentina, Brazil,


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Normal Operations

The normal operation of documentary procedures for an international

alliance includes the following features:* computerized implementation of international alliance protocols* facilitate learning and adoption of international alliance protocols

* deployment -- making international alliance protocols readily available

and useable to all appropriate international parties* secure -- controlling access, authentication as appropriate so that the

international alliance protocols are not abused or used fraudulently

* monitoring usage and performance of international alliance protocols

Change, Evolution Management

The dynamic nature of international alliances also imposes the following

additional requirements:

* detecting need for change (based on monitoring)

* helping to organize change proposals* help to analyze, determine potential consequences and costs of changes

EXAMPLE INTERNATIONAL ALLIANCE:

CARICOM

The Caribbean Community and Common Market (CARICOM) provides a

typical example of an international alliance. It is a regional alliance to provide

economic integration, hence reduction of transaction costs and economies ofscale, for countries in the Caribbean region. It was established in 1973 under

the Treaty of Chaguaramas. CARICOM replaced the former Caribbean FreeTrade Association (CARIFTA). As is seen in various other internationalalliances, CARICOMs primary mandate is to provide a framework for

regional, political and economic integration. Also common in other

international alliances is the heterogenous status of membership, whichpresently has four levels:* full members of both the community and common market

* members of the community only;* associate members

* observers

Members of the Caribbean Community and Common Market include: Antigua & Barbuda Barbados Belize Dominica Grenada Guyana


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Haiti Jamaica Montserrat St. Kitts & Nevis St. Lucia St. Vincent and the Grenadines Suriname Trinidad and Tobago.

The Bahamas is a member of the Community, but not the Common Market.

Associate members are British Virgin Islands and the Turks and Caicos.

Observer nations include Anguilla, The Dominican Republic, TheNetherlands Antilles, Puerto Rico and Venezuela. The objectives ofCARICOM include the free movement of goods, services, persons, and

capital throughout the region. These policies, and the current status of specificitems is clearly stated in their Web site (www.caricom.org). Table I providesan excerpt of major points and their status. As can be seen, this is an evolving

process, with various members subscribing to various provisions and not toothers.

ELEMENTS STATUS

1.TREATY

REVISION

Eleven (11) Member States have signed Revised

Treaty - Antigua and Barbuda, Barbados, Belize,Grenada, Guyana, Jamaica, St. Kitts and Nevis, St.Lucia, St. Vincent and the Grenadines, Suriname and

Trinidad and Tobago

4. FREEMOVEMENT

OF GOODS

Ten (10) Member States have implemented Rules ofOrigin - Barbados, Belize, Dominica, Grenada,

Guyana, Jamaica, St. Kitts and Nevis, Saint Lucia, St.

Vincent and the Grenadines, Trinidad and Tobago

4.3. Removal of

unauthorised

import (or

equivalent)

duties on goods

of Community

Origin

Belize applies a Revenue Replacement Duty on a

specific list of goods of Community Origin;

Antigua and Barbuda, Dominica, Grenada,Montserrat, St. Kitts and Nevis, St. Lucia, St. Vincent

& the Grenadines apply Customs Service Tax on

goods of Community origin.

Jamaica applies a Customs Users Fee( JM$600 -3000) on goods of Community origin

4.5. Removal of

discriminatory

Internal Taxes

and Other Fiscal

Charges

Discriminatory Environmental Levy applied by

Antigua and Barbuda and Barbados on goods ofCommunity origin.

Discriminatory Environmental Tax applied by Belize;


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Discriminatory Environmental Surcharge applied by

Dominica, Grenada and Guyana;

Discriminatory Bottle Deposit Levy applied by St.Kitts and Nevis, Saint Lucia and St. Vincent and theGrenadines.

A discriminatory Standard Compliance Fee is appliedby Jamaica on all imported goods of Communityorigin on which there are compulsory standards;

An Inspection Fee is applied by Trinidad and Tobago

on a certain goods of Community origin.

A Statistics Fee and a Consent Fee are applied bySuriname on all imports of Community origin.

Discriminatory Consumption Tax applied by Antiguaand Barbuda on all imports of Community origin;

and by Guyana on imports of apparel of Communityorigin.

Montserrat applies a Special Produce Import Tax on

wine, beer and rum of Community origin.

5. FREE

MOVEMENTOF SERVICES

The 13th Inter-Sessional Meeting of the Conference

in February 2002 formally approved the Schedules ofCommitments for removal of Restrictions byMember States, which took effect from 1 March 2002.

The Conference has agreed that Programmes for the

removal of restrictions on international maritime andair transportation would be negotiated at a later date.

Montserrat granted two-year derogation from itsobligation to implement Programmes.

6. FREE

MOVEMENTOF PERSONS

6.1. Free

Movement of

Skills

Belize, Dominica, Guyana, Jamaica and St. Vincent

and the Grenadines have explicit legal provisions for

free movement of university graduates, mediaworkers, artistes, musicians and sports persons.


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Barbados is currently facilitating free movement of

these categories administratively.

6.3. Facilitation

of Travel

Visa requirements have been eliminated except in the

case of St. Kitts and Nevis which require visa for

Suriname nationals. However, St. Kitts and Nevisadministratively facilitates entry for Suriname

nationals.

7. FREE

MOVEMENT

OF CAPITAL

The 13th Inter-Sessional Meeting of the Conferencein February 2002 formally approved the Schedules of

Commitments for removal of Restrictions byMember States, which took effect from 1 March 2002

.

Montserrat granted two-year derogation from itsobligation to implement Programmes.

10. PUBLIC

EDUCATION

Public education activities undertaken by MemberStates independently and by Member States incollaboration with the Secretariat continue to be on-

going.

Table I. Excerpt of Major CARICOM Provisions, and their Status

CHALLENGE: FLEXIBLE, ADAPTIVE

BUREAUCRACIES

In the theory of organizations (e.g. Weber l956/l978), the term

bureaucracy refers to management based on uniform, explicit rules, ratherthan case-by-case discretionary decisions. In this technical sense, internationalalliances are bureaucracies. Note: bureaucracies no longer need to be of the

brick-and-mortar variety they may also exist virtually. For instance, the

North American Free Trade Alliance, NAFTA, is a virtual organization. Acommon complaint about bureaucracies is that they are inefficient. Requests

are routed through numerous offices, each of which may have a backlog,leading to an accumulation of delays. Non-routine requests are sometimes

misrouted, creating additional delays. Errors in the request cause

backtracking and sti ll further delays. Other complaints are about theeffectiveness of the system. In order to keep the complexity manageable,

bureaucratic rules may be simplistic, covering only standard cases.Exceptional requests are either rejected or diverted to a discretionary

authority. When there are many exceptions, a change in regulations may be

called for. However, because of the complexity already present, this is often

difficult to do. Change is either resisted or made minimally.


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On a broader scale, the very existence of a bureaucracy is sometimes

criticized. Bureaucracies are often erected to perform a particulargovernmental or social function, and are thus protected from competitive

challenges. They may grow to such size that the sheer momentum of their

economic weight relative to the society carries them forward. An importantaspect of this problem is a failure to effectively manage complexity.Bureaucracies are "sticky upwards". That is, they seem to grow more easily

than they shrink. Nearly three decades ago, Elgin and Bushnell (1977, p. 337)complained that "we have rushed to create bureaucracies of such extreme

levels of scale, complexity, and interdependence that they now begin to

exceed our capacity to comprehend and manage them." Today, despite all theremarkable advances that we have seen in information and communicationtechnologies, these complaints seem just as appropriate. Furthermore, this is

certainly not because bureaucracies have ignored these advances. Indeed,bureaucracies are among the most aggressive consumers of ICT. Certainly,ICT has done much to improve bureaucratic efficiency. On the other hand, we

claim, it has not helped at all in the management of bureaucratic complexity.Indeed, it has aggravated the problem by obscuring bureaucratic rules and

procedures in the form of computer codes. (For instance, many of us have

experienced the frustrations of trying to rectify a billing problem that is

computerized.)

This is both a representation problem and a modeling problem. It is a

representation problem in that computerized rules and procedures need to be

made more accessible and directly controllable by management. It is a

modeling problem in that improved methods of systems analysis are needed tomore effectively analyze and design complex bureaucratic systems. This isnot, we argue, merely a matter of refining present techniques. There is a needfor more fundamental revisions in our approach to such problems (Stamper,

1979; Lee, 1985). Bureaucratic systems are not merely information

processing systems. They are systems of organizational and social control.

They convey more than data; they convey orders, commands, obligations,contracts, permissions, licenses, vouchers, receipts, prohibitions, waivers,verifications, etc. etc. etc. These are performative transactions in that by their

communication they change the nature of social relationships within theorganization.

These problems are well-recognized in large rationalized organizations andgovernmental agencies. However, we argue that these kinds of problems are

most salient for international alliances, which are an evolving dialectical

balance among multiple national interests.


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SOFTCODED ELECTRONIC PROCEDURES

As illustrated by the example of CARICOM, international alliances

typically deal with the free movement of goods, services, persons, and capital

among the countries that are party to the alliance. One may view this as atransaction simplification process, reducing the bureaucratic overhead of these

kinds of exchanges. However, this process of simplification tends to be agradual one, over an extended period of time.

To give a sense of the scope of complexity that is involved, consider the

procedure in Figure 1, which is for the import/export of goods through aseaport. This is a typical procedure, not involving added complexities ofdangerous goods, animals, foodstuffs, or terrorist controls.

A point that we want to emphasize here is that the reduction of bureaucraticrequirements can be complemented with the introduction of ICT solutions,

which can make the existing bureaucratic overhead much less costly and timeconsuming.

We might illustrate this point with a comparison to a standardization of

keyboard layout for Latin alphabet languages. The US and UK have akeyboard standard called QWERTY, which refers to the keys in the left sideof the top alphabetical row. The French prefer a layout that is AZERTY.

During the time of Salazar, Portuguese adopted a standard layout HCESAR.

At one time, the choice of a standard keyboard layout was a point of seriousdebate. Eventually, however, computers became flexible enough to support

any variety of keyboard layouts, simply by changing software. Thus, theadvance of technology made the problem disappear.


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Export

ImportFigure 1. Typical International Trade Transaction


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In a similar way, we believe that software solutions can also help to

eliminate negotiation obstacles for international alliances. That is, instead of

everyone agreeing to a single standardized solution, there may be aharmonized approach that allows existing national standards to inter-operate,

with a minimum of adaptation. In many cases, software has already been

developed to automate international procedures at a national level. However,it is likely that the procedures have been hard coded into the applicationsoftware that is, the sequence of procedural steps is expressed in the

program code. A key aspect of the architecture presented here is that theinternational procedures are 'soft coded', in a declarative, rule-based form.

Application software then needs to be made generic, not committed to a

particular version of the procedure. Instead, the application will interpret theprocedure from an external specification (analogous to the idea of table-driven software).

Within a national context, this has an immediate benefit of expediting thedeployment of changes to procedures. Rather than sending out new versions

of manual instructions (for non-automated procedures) or new versions ofsoftware (hard-coded programs), one may simply distribute a revisedrepresentation of the procedure, or have it accessed from a central repository

as illustrated in Figure 2. Even more significant is that such procedures can

be analyzed and managed using computational tools. For example, analyticaltechniques can be applied to check for formal correctness (boundedness, etc.),as well as fraud potential and other audit controls. Further, soft-coding allows

for the representation of generic models that are parameterized for specific

circumstances. Additionally, soft-coding enables the navigation, synthesis and

negotiation of procedures from different trading sectors or regulatoryenvironments.

Figure 2. Parties Downloading from eProcedure Repository


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REPRESENTATION OF DOCUMENTARY

PROCEDURES

Formal Requirements

Formal requirements include the possibility to express concurrency, choice(internal to a party) and contingency (external to a party) and therepresentation of deontic and/or legal relationships and changes. Furthermore,

not only the static properties of the system should be modeled but also the

dynamic properties. Finally, it should be possible to explicitly model time,both absolute and relative.

Concurrency: Since trade procedures inherently consist of multipleparties performing their actions in parallel it is essential to be able to

effectively model concurrency.

Decision points: Since the execution of a trade procedure often

depends on internal or external decisions, modeling constructs forsuch decision points should be included in the language. Since the

focus is on inter-organizational trade procedures, only decisions thatare visible externally should be modeled.

Deontics: deontic logic is a branch of logic that formalizes reasoningabout normative vs. non-normative behavior by means of primitives

such as obligations, prohibitions and permissions. The representation

of deontic and/or legal states in a model of a trade procedure is

essential because organizations should be able to derive theirobligations, rights and duties etc. at each point during the execution ofthe trade procedure. Changes in these states are mostly brought about

by a party performing an action involving another party. For example,sending a purchase order to a seller will in most cases bring about an

obligation to buy for the buyer. In Speech Act theory, these

communications are referred to as 'performatives' (Austin, 1962;Searle, 1969). Therefore, the intention of a communication between

parties should be clearly specified so that each may reason about

deontic states and changes thereof. All actions must be

unambiguously attributed to roles so that contract performance (orlack of performance) may be evaluated.

Dynamic properties: In the execution of a trade procedure, severaldynamic properties have to be analyzed, such as deontic state

changes. Therefore, a representation language should enable the

expression of the dynamic behavior of the roles involved, in otherwords, it should be possible to monitor the execution of the trade

procedure.


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Time: The modeling of absolute and relative time is essential because

organizations need to be able to evaluate a trade procedure onthrough-put time and they should be able to specify deadlines.

Especially in cases where time is one of the most critical factors such

as in just-in-time logistics, a thorough investigation of such timingproperties is crucial.

Notational Requirements

Notational requirements include the possibility to represent trade procedure

designs in a graphical way. Also, there should be a hierarchical way to

decompose a trade procedure into a number of levels. A graphicalrepresentation of international procedures enables business experts to reason

about the proposed procedures without the need to become experts in formalrepresentation languages as well.

A hierarchical (de)composition of trade procedures is necessary to reduce

the complexity of the specifications. Furthermore, it allows the reusability ofparts of the specification. For example, the expected behavior of a bank in adocumentary credit procedure is similar in most documentary credit

transactions, whereas the behavior of the other roles involved may differ.

Verification Requirements

Finally, automated verification and/or performance evaluation of themodels must be possible. This verification includes, but is not limited to,

properties such as boundedness and liveness of a trade procedure, but alsoconstraints such as the legal soundness of a procedure and measures whether

insufficient or superfluous controls are established in the trade procedure.

Techniques that can be used to perform these validations include formal,mathematical algorithms, pattern recognition and gaming theory. Formal

algorithms can be used to prove the absence or presence of deadlock states(liveness), never-ending loops (boundedness) etc. Pattern recognition can be

used to reason about control issues (Chen, 1992; Lee, Bons and Wagenaar,

2001). Finally, simulation gaming can be used to validate dynamic properties

and to validate the properties mentioned in the previous sections.

Documentary Petri Nets

We found Petri Nets as being one of the few acceptable candidates that

offer both a graphical representation and a formal basis for the verification of

various properties of these nets. The main advantage of the Petri Net


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formalism, in addition to its capability to graphically model both concurrency

and choice, is that it offers various kinds of both formal and informal analysis

methods, which make Petri Nets especially suitable for modeling discretedynamic systems (van der Aalst, 1992). In the remainder of this section, we

introduce the Documentary Petri Net representation: an extension to the

classical Petri Net formalism we developed to satisfy the modelingrequirements of trade procedures.

Classical Petri Nets (Petri, 1962; Peterson, 1981) satisfy the need forexpressing concurrency and choice. A classical Petri Net is a bi-partite,

directed graph. It has two disjunct sets of nodes: places (represented as

circles) and transitions (represented as bars). Arcs connect places withtransitions or vice versa (it is not allowed to connect two places or twotransitions). The dynamic behavior of the modeled system is represented by

tokens flowing through the net (represented as dots). Each place may containseveral tokens (the marking of the place); a transition is enabled if all its input

places (i.e., arcs exist from those places to the transition) contain at least one

token. If this is the case, the transition removes one token from each inputplace and instantaneously produces one in each output place (i.e., an arcexists from the transition to the place). This is called the 'firing' of a

transition. The transitions in Documentary Petri Nets are labeled in order to

identify the role that brings about the transition. The syntax of these labels isRole(s) : Action.

Classical Petri Nets only allow the modeling of relative time, but not

absolute time. However, it should be possible to specify timers, e.g. for

modeling contractual deadlines. This is referred to as 'timed Petri Nets'(Peterson, 1981; van der Aalst, 1992). Documentary Petri Nets allow thespecification of timers in the following manner. Setting a timer is modeled by

putting a token in a place labeled X:TimerSet. This place is an input place for

a transition labeled timer: Timer_condition. This transition has an extra

constraint on its firing rule: not only all input places need to have a token, but

the timer condition needs to be satisfied. It then fires a token into a placelabeled X:TimerExpired. An example of such a timer condition is timer:current_date >> expiry_date. This is similar to the timing properties of the

Petri Nets as proposed by van der Aalst (1992).

The classical Petri Nets only allow one kind of token. In order to

distinguish between different types of information parcels, different types oftokens have to be distinguished. The various types of tokens are called

colors, leading to a notion of 'colored Petri Nets'. A related extension to

classical Petri Nets are predicate/transition nets, in which logical predicates

are associated with transitions (Genrich and Lautenbach, 1979; Genrich andLautenbach, 1981). Documentary Petri Nets use colors and predicates tospecify the different information parcel types, goods, funds and deontic states.


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The main extension in documentary Petri nets is the notion of document

place. A document place is represented by a square box. These kind of placeshave labels that identify the information parcel type. Sending a parcel is

represented by a transition labeled X to Y: D, in which X identifies the

sender, Y the receiver and D the type of parcel that is exchanged. Thistransition has a document place of type D as an output place. It will be part ofthe sub-net describing the behavior of role X. Conversely, receiving an

information parcel is modeled by a transition labeled Y from X: D. Thistransition has a document place of type D as an input place. This will be part

of the sub-net for role Y.

Physical goods are represented in a similar way as document places,but using a notation of a cube. A description of the goods, including

quantity, weight, volume, quality etc. may be added. The transfer ofgoods among parties is modeled using the same primitives X to Y: Gand Y from X: G as used in the modeling of information exchanges,

but in this case G refers to the goods description.

The exchange of funds is modeled as just another kind of document

exchange. Since the concept of money is closely related to documents

(a 100 dollar bill is a performative document), we use the documentplaces to denote funds transfer. In the description of these documents,the amount and currency are specified in the structure of these

documents.

The deontic states of each individual role, as seen by the other roles,are modeled using the classical Petri Net control places and tokens.They are represented by circular places, and labeled with adescription of the deontic state. An example of such a description is

'oblig(X,A)' which means that party X has an obligation to perform

action A.

One important aspect of modeling complex scenarios is the ability to modelroles as separate Documentary Petri Nets. This allows the decomposition of

an trade procedure into a number of logically separate sub-nets. Thismodeling style results in a clear "geographical" separation between the roles.

As the role description is a sub-net in the scenario description, designers have

some flexibility for experimenting with different role descriptions within theoverall scenario constraints.

EXAMPLE DOCUMENTARY PROCEDURE


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Figure 3 presents an example Documentary Petri Net, as modeled using the

graphic design environment InterProcs.(Lee, 1998). This system produces

executable electronic procedures that are decomposed by role to executeautonomously in each of the separate organizations involved in the

transaction.

Figure 3. InterProcs Display of Order Process as DPN


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MESSENGER MODEL

To help cope with cases of conflicting control policies, we propose a kind

of computational agent, that we call a messenger. A messenger is an agent

specialized in navigating depositories and knowledge bases of electronicprocedures and procedure components (regimes in the terminology

introduced above), and where needed, negotiating novel procedural solutionsto meet the needs of a special situation.

The notion of messenger is based on a metaphor to physical messenger

services (such as UPS, Federal Express). Such physical messengers arenormally charged with delivering a message or parcel to some recipient. Moreimportantly, they often make delivery of performative communications such

as contractual offers (bids), legal summons, as well as payments. If obstaclesarise, (recipient is not home), the messenger has some limited discretion toresolve the problem (leave parcel at neighbor's). If this is not possible, the

messenger is to contact the client for further instructions. Our notion forelectronic messengers goes beyond this physical metaphor to include not only

the execution of certain contractual actions, but also the navigation and(limited) negotiation of control procedures.

A brief scenario: Lee, an American, lives abroad in Holland. His passportrenewal is due. Normally he would need to travel to the US Consulate in

Amsterdam, wait in line, fill out the forms, pay the fee, etc. In all, this could

easily cost an entire afternoon (if all goes well; if not, for instance if thepassport photo is the wrong size, a return trip might be needed). Instead, Lee

logs on (to Internet) and initiates a messenger with the goal: US passportrenewal. The messenger contacts the US Consulate's on-line regime, and

identifies the procedural subset relevant to Lee's case. Since the messengerhas access to the relevant personal data for Lee (including digitized passport

photo), it can do most of the form-filling automatically. It then returns to Lee

with a request for confirmation (plus requests for any additional data, e.g.choice of delivery mode), and release of payment for the fee. Lee gives theOK, and the messenger then returns to the Consulate and executes the

transaction. The passport is sent via post or conventional messenger service.

(Perhaps someday the passport itself will be electronic.)

The reader is no doubt acquainted with various other bureaucratic duties of

this kind. They include driver's license applications, voting registrations,building permits, visa applications, credit card applications, phone card

applications, etc. These illustrate the use of messengers in a uni-lateral

situation. In bi- or multi-lateral cases, the messenger needs to navigate amongmultiple regimes and attempt to synthesize the various proceduralrequirements. Failing this, the messenger may attempt to locate another

company or agency that offers similar goods or services, but with more


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compatible control requirements (either stricter or more lenient as the case

may be). Or, the messenger may request a compromise in the control

requirements of a current party, e.g. include the sending of an invoice wherenone was required. As outlined, messengers have four kinds of capabilities:

1. navigation of regimes (procedural requirements)2. synthesis of procedures (from multiple regimes)3. detection of procedural conflicts

4. suggestion of remedies for conflicts

These are the subject of our continuing research. To address these four areas,

a generalization of the DPN representation called procedure constraintgrammars (PCG's) has been developed, Lee (2001). Like language grammars,which give rules of well-formedness, PCG's specify the characteristics of a

family of procedures at various levels of abstraction. Just as a generativegrammar for a language can produce various sentences, so too a PCG cangenerate particular procedures, given specified parameters. Representing

regimes in this formalism, procedures specific to individual cases areextracted and presented as Documentary Petri Net procedures. Unlikelanguage grammars, however, which are typically represented as an integrated

hierarchy of rules, PCG's are organized as constraints on a target procedure. It

is the job of the PCG constraint solver to identify a (minimal) solutionprocedure (according to some preference ordering of the user -- e.g. minimalduration vs minimal risk). This mechanism is essential for the other three

areas of messenger functionality: synthesis, conflict detection, and conflict

resolution.

CONCLUSIONS, FUTURE RESEARCH

This paper has focused on how ICT can support transaction efficiency in thecontext of evolving international alliances. We have concentrated on the

potential for electronic procedures to manage the document flowsautomatically, in a fashion analogous to workflow systems within

organizations. The key challenge, however, is how to support the evolution ofthese procedures.

In this regard, there is an emerging area of research that addresses change and

adaptation of workflow systems. See for instance, Sheth (1997), Bernstein,Dellarocas, and Klein (1998), Joeris and Herzog, (1998), Mller (2002).

These focus on change management of the procedure, with special attention

to non-monotonic changes that might alter transactions in progress. Jarvis etal. (1999) also consider the deontic aspects regarding change management of

workflows. While this research is certainly relevant to the problems of


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international alliances, it is the multiplicity of governing interests that creates

special challenges in this area.

Here we have sketched out a solution to this challenge with three principal

aspects. The first aspect is the definition of a common, representation for the

specification of documentary procedures, which is formal, computable andexecutable. A list of candidate requirements for such a representation wassuggested. The documentary petri net (DPN) formalism was proposed which

satisfies these requirements. (Other representations might also be sufficientfor this purpose, e.g. BPSS -- see www.ebxml.org). A second aspect is to use

this formalism to define typical transaction models that are representative of

the needs of the international alliance. This can be the basis for furtherdetailed analysis, especially of control requirements and alternative types ofcontrol solutions (e.g. depending on available technology). A third aspect is

development of an architecture and a protocol for sharing these proceduresamong the parties to the international alliance. Three modes were suggested:full consensus integration; bi-lateral negotiation and coordination; and multi-

lateral harmonization. As observed, there is an inverse relationship betweentechnical difficulty and political difficulty. The first mode is easiest to achievetechnically, but difficult politically. The last mode is most challenging from a

technical standpoint, but is most easily achieved and desirable from a political

standpoint.

These observations highlight the focus on aspects of multi-lateral

harmonization as a priority for future research.

A technical solution to enable multi-lateral harmonization that we describe isthe agent-based approach called the Messenger Model. Further refinement ofthis technology focuses on the constraint resolution mechanism for ProcedureConstraint Grammars (PCG's).

Another research direction relates to normative modeling of documentary

procedures: given the goals and control concerns of the various membercountries for a particular type of transaction, what constitutes a 'good'

procedure, which balances the excess transaction costs of over-control against

the risks of under-control?

This direction of future research will pursue development of automated

verification tools that may be used to check whether a proposed documentaryprocedure conforms to specified control requirements. An advantage of using

Petri nets as the basis of the DPN formalism is that various kinds of

automated verification algorithms and tools already exist, for instance to

detect possible dead-lock situations. However, our modeling experience hasshown that these are of limited usefulness in practical situations these kindsof problems seldom arise, and if they do, are usually quite obvious. The more


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serious control problems have to do with fraud and collusion, which require a

deeper semantic understanding of what the procedure is actually doing. An

approach to this is the notion of audit patterns, originally developed byLee (1991), and elaborated in the dissertation work of Chen (1992) and Bons

(1997). Further research opportunities exist in this direction.

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