The Value CompoNet Architecture is a way to model large business and government organizations as components of Value connected to other components in a network. The purpose of the Value CompoNet Architecture is to help organizations structure themselves and their systems in the way that will maximize short and long term Value while managing the effects of Change, Complexity, and Cost. Organizations can thus maximize their efficiency and effectiveness while minimizing risk in the short and long term. For business this results in maximum possible profitability.
Many tools have been developed to model businesses and their systems. This approach makes the core value of the organization its primary focus. This method then makes the core constraints of large organizations; Change, Complexity, and Cost, the secondary focus. The current way a business is structured and its current systems are only considered as informative in modeling the dynamic network of components since those can change.
The world is changing faster and faster. Organizations which adopt this approach can continue to maximize their Value while responding well to this change. Without it, organizations will face rapidly increasing cost and risk. Most approaches model organizations according to their current structure and systems. This is a very ineffective focus since these are changing faster and faster. Modeling according to Value provides the most stability possible since an organization’s core Value it brings to the marketplace rarely changes. If this core value does change, the organization will probably cease to exist or at least its new purpose will need to be modeled.
The company itself is modeled as one component of Value based on the value it provides to the marketplace. A large organization will use some other components such as services, resources, and raw goods. It will perform some processing and then produce some outputs which may be products or services.
The products or services a business uses may themselves be modeled as components of Value. Each of these may themselves be composed of other components of Value. These may be internal or external to the organization. If they are internal they are often considered part of the organization’s internal structure. If they are external they are often considered to be part of the supply chain. With this approach the same model is used regardless. Outsourcing decisions should be driven by market forces and not artificial system constraints.
Does your organization need to become more efficient and effective? Are you facing challenges from changes in your marketplace or technology? Do you feel that maybe you need to Agilize?
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