Business Functions: Presentation

 

The 3 dimensions of Business

Any business has 3 dimensions in terms of value management: the Market dimension, the Capture dimension and the Industry dimension.

Those dimensions are defined by the direction of the Value flows (except for costs) in the viewpoint of the organization:

In the same way we use x, y & z as a basis to characterize an object in the physical 3 dimensional world, we can use the 3 business dimensions as a basis to characterize business operations in the 3 dimensional world of value management. This gives rise to the 3 Business Functions.

Running a business requires a balance between the 3 Business Functions, with respect to business operations.

 

The 3 Business Functions

The Bm2 considers the 3 following Business Functions:

                          

1- The Market Function: Value Generation & Delivery (VG&D).

The Market Function consists in providing value to the targets.

2- The Capture Function: Value Contracting & Capture (VC&C).

The Capture Function consists in capturing value through transactions.

3- The Industry Function: Value Integration & Maintenance (VI&M).

The Industry Function consists in integrating value for the organization.

 

Business Functions and Corporate Strategy

As described in the chapter "Frame of Reference", the BM is defined in the context of an organization, a business and a strategic goal for a given business phase. This strategic goal is defined at a corporate strategy level. 

The strategic goal is the expected outcome of the Business Functions at the end of the business phase. Therefore, defining the balance between the 3 Business Functions is of crucial importance for the business.

 

Business Functions in the Bm2

The Business Functions are one of the 3 overall elements of the Bm2, together with the Business Activity and the Business System:

  • The Business Activity is the application of the 3 Business Functions at strategic level.
  • The Business System is the application of the 3 Business Functions at tactical level.

 

 

NEXT > Business Functions as BUs

 

 

Bm2: Design, Analyse & Manage your Business