By Javier Megías
come from a time when companies tended to integrate into your business the most processes within the production process, from raw materials to manufacturing logistics ( vertical integration).
This trend in recent times has been exceeded (generalist vs . specialist), and most companies understand we must focus on the processes of greatest value to the business ( core processes ) and all other ask the classic question " make or buy? ".... but this approach is still insufficient .
Derived from the reorganization of the market, we continually asked, almost in a nervous paroxysm "What are my key processes?" to focus on them. Normally, under the surface companies really have three "business a greater or lesser extent:
1. Customer relationship
3. Infrastructure management (or production processes repetitive)
These processes, which we consider core, and therefore we have within our organization, suffer constant tension between them ... so it's time seriously consider the disaggregate our business model.
The "business" above have divergent approaches producing strains important in the business, resulting from different pressures, priorities and conditions to economic, competitive, organizational or cultural. These three businesses account:
1. Customer relationship : Its purpose is to find new customers and build lasting relationships with them, improving brand awareness and generating new sales (closely related to focus on customer experience )
2. Innovation of product (or service) : The objective is to create products / services innovative and attractive to generate a clear value proposition, and bring to market as soon as possible (the time-to-market is critical )
3. Infrastructure Management : Includes everything related to building and maintaining facilities for platforms or support large volumes of transactions or repetitive tasks. Ranging from logistics, production processes or mass Internet platforms (Model "churros")
These businesses are often have a direct link to the organizational structure and processes that correspond to core are distributed (for example, innovation product often extend beyond areas of innovation , including the product and marketing, for example).
We are used to tolerate and take coexistence of these businesses as an evil to bear, since it believes that such processes can interoperate more optimal it is well within the company (let alone efficient, cheap or "insurance") ... however the conflict , that occur between them are by no means negligible (or from a strategic standpoint and from an economic one).
Elaborating on the above, and to itself arising from problems arising from their cohabitation , we can continue characterizing:
Comparison between the three business models
| 1. Customer Relationship | 2. Product innovation | 3. Infrastructure Management |
| Major investment in building relationships with customers, you need to find strategies to further generating more sales | investing primarily in highly qualified personnel (low compared to other models) | high fixed costs and high initial investment |
| scope : Once you have the "machinery" commercial, the important thing is to use it to sell more products | Economics innovation : Only part of the initiatives are successful, but often justify that have not been | |
| offers highly customized products and customer services | oriented niche markets and unmet needs (or can improve a lot) | Focus minimal customization, avoid special treatment and maximum volume. |
| service-oriented culture | Culture | Culture efficiency oriented |
| The customer comes first, establishing deep relationships | The processes are the More importantly, Taylor culture | |
| mark and image of the company is one of its main assets | Minimum bureaucracy, focus on the minimum hindrance to the creative process | superior level of bureaucracy and rigid processes (although they may be changed) |
| Compensation of depending on sales targets | highly differentiated remuneration according to the talent, creativity and value to the company | Payments by Category |
| are valued primarily on relational skills employees | is valued innovation, learning ability, creativity and thinking "out-of-the-box" | Experience in performing the same tasks and knowledge purely technical. |
| customer focus in providing products or services only proven and reliable | focus on speed, as important is to reach the market soon | Focus on efficiency in operations, the most important thing is to standardize. |
| The price is set by the market (supply / demand) | can set prices "premium" for new products | Price is a function of production costs and every penny must be justified |
| Organizations of all sizes, but to make better use of economies of scope, the better medium to large | The organizations that work best are small in size, agility and responsiveness | The larger the organization can best take advantage of economies of scale |
The divergence between the three types of model results in different strains that prevent companies can continue to exploit the potential individual from each of them. To give some examples:
· Customizing huge product vs services. efficiency of specialization
· Focus on the talent of the people vs. focus on efficiency ... operations.
· Payable equally to persons of the same class vs. reward based on the value or goals
But is this an evil with which we are destined to live? In my opinion, in fact serve as an example the many companies that have decided to choose only one of these models business and have taken the next step in the specialization ...
As the first step we focus on key processes, it is time to unbundle business models , and thus take the next big decision in life the Organization:
What are you going to specialize the Company?
Although you can attempt to partially disaggregate the business models and make to remain part of the same company (eg through business groups, a strategy that has been used General Electric to remain innovative ) The reality is that most organizations will lead the surgical separation of the two core businesses which will be chosen not on, the focus of the company .
A classic example of this decision is the performance of telecom operators , as mentioned A. Osterwalder the wonderful book "Business model generation ):
the three businesses traditionally lived in them: The management of a huge network of telecommunications, antennas, cabling ... etc (IM), provision of new services and different products to its customers (innovation) and branding, design, bidding and try to subscribers (RELATIONSHIP WITH THE CLIENT). In recent times, everything related to network management have subcontracted to large manufacturers who are outsourcing various operators (such as Ericsson, etc). Part of Innovation have decided to leave in the hands of third party companies, smaller, faster and faster, which may come the time to buy innovation or license. The "core business" has been chosen the customer relationship, where operators have the brand trusted by customers, and where they can specialize in creating innovative campaigns and continue to generate sales and customer value.
In short, we decide what the company wants to focus , but taking into account some additional conditions:
1. If you decide to opt for models business relationship with the client or infrastructure, one of the most important attributes is the size (resulting from need for economies of scale or scope). Therefore, the next step should be to seek increase the volume of the company , usually non-organic growth (acquisitions ... etc) to increase horizontal integration.
2. If you choose a model of innovation product, you should try to overthrow most organizational barriers that plague creativity (perhaps more complicated!) And establish a model human capital management the talent and creativity values \u200b\u200b(including projects not directly related to work)
3. In the case of platforms , must leave behind old views and prejudices, and try to achieve the highest volume. This can happen to open the use of the platform to third parties or competition , even if that was not the focus of primary production (which is what has made AMAZON through AWS with offering its processing capacity ( Elastic Compute Cloud - EC2 ) or storage ( Simple Storage Service - S3 )
What I stated is one of the decisions harder you can take a company, and has tremendously deep implications in your future ... but I think these are decisions that must be taken ... better before ; that later.
Source: manuelgross.bligoo.com
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