Process and Value
The Business Sphere "Core Business"
End-to-End - developers of the Value Driver Model©
"Core Business" gives you a "view from the engine room" - but needs the rest of the ship to know where and how to go.
In the Value Driver Model© the sphere “Core Business” represents the organisational structure of a company. This is a conceptual
representation of the “live business” where jobs exist and competencies and capabilities are deployed. This is where the business
units consume resources and produce specific "products".
Although "Core Business" as a Business Sphere is nothing really unusual,
it should be noticed that the value perspective in The Value Driver Model© highlights the three Value Driver Fields "Line Management",
"Optimization" and "Balancing". The for most mangers not clear as the two first.
The Value Driver Model© shows through the identification
of the Value Driver Field “Balancing” that the organisation identified as “Core Business” cannot link the value drivers at strategic
and tactical level through the lines of business. The cross-functional value perspective is only realized if through BPM.
iIndustries are different and Core Businesses are organized in different ways. Organisational structures may reflect professional
disciplines, geography or other relevant perspectives. However, the need for allocation and controll of funds typically leads to a
very narrow management perspective where consumption can be directly related to output and productivity measured. This again shows
on the organization and managers and employees will identify themselves with the visible results in a narrow setup.
smaller successful companies, the organisation and production facilities are likely to be fine-tuned and well-balanced, possibly trimmed
using Lean approaches. In larger organisations, however, the crossorganizational relationships between units will be unclear to lower
level managers and employees. Eventually, separate cultures develop and the company will consist of separated functional “silos”.
This is a well-known challenge of which strategic management is aware.
Unfortunately, the approach to keeping a larger company
in shape wall-to-wall is very often to adjust the organisation and allocate responsibilities differently among senior managers. However,
looking through the prism of the Value Driver Model© this means navigating solely within the Value Driver Field “Line Management”.
This way, true wall-to-wall transparency is seldom achieved and new functional cultures and silos soon emerge.
Often, the programmes
launched in support of organisational changes also include introduction of new technology, developed with the new organisation in
mind. Immediately this makes good sense but due to the implicit functional approach, potential cross-functional business benefits
are unlikely to be realised in full.
Understanding that continuous change is not the same as agility and that the focus must
be on value creation rather than direct cost, top management starts to move into deliberations represented by the Value Driver Field
"Balancing". Next step for senior managers is to accept the need for BPM and make sure it is visible and accepted throughout the core
business. Accepting the need for overall management of business processes wall-to-wall also means introducing constraints on
the way business units make use of available capacities. Thus, optimizing the use of, and reconfiguring, IT systems or other capacities
is no longer to be seen in a narrow functional optimization context.
When consulting the Value Driver Model©, it is clear
how the Value Driver Field "Optimization" links up with the two other Value Driver Fields "Balancing" and "Configuration" in
a "triple-intersection". What must be accepted by business units from the identification of this operational triple-intersection
is that the value perspective hooks the Value Driver Field "Optimization" up to "Balancing". This means that optimization of daily
operations is not solely the responsibility of the operational business but must balanced in the wider business context. The
operational triple-intersection is also the only linkage to the Value Driver Field "Configuration" which illustrates that optimal
configuration of capacities demands a setting where company-wide BPM-derived value drivers set the scene.