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Business Transformation in Action

Joe McKendrick

Business Process Mediocrity: No Two Business Models Should be the Same

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The danger of buying too deeply into vendors' BPM, SOA, cloud and infrastructure solutions is that you end up building a business model that is a plain-vanilla fit with every other company using the same technology. Technology is touted as a great leveler of the playing field, but the flip side is that the playing field gets too leveled out -- and unique value propositions are lost.

Nicolas Carr warned of this commodization process a few years back in his work on "IT Doesn't Matter," in that no company has a competitive advantage because it has full-functioning electrical service or running water on premises.

I beg to differ when it comes to IT. The commodization argument makes a lot of sense when considering the commoditization of hardware, operating systems, networks, and storage. We've all become jaded by the breathless (and eye-rolling) claims of "revolutionary" technologies, paradigm shifts, and inflection points. He also correctly states that IT should not get full credit for corporate success.

But no one has ever expected IT to solely responsible for a company's rise or fall. Adroit management, supported by the right IT tools, makes the difference. A company that smartly and innovatively leverages its IT in new and creative ways will move to the head of the pack. And, thanks to IT, you don't need a workforce of thousands to do so.

The problem is that too many companies expect their software to do this heavy lifting for them, and that's where the risk of becoming plain vanilla comes in to play. In a recent post, Patrick Stähler, a tireless proponent of business model innovation, warned against succumbing to such mediocrity in the value chain, especially by fixating on core competencies at the expense of innovation at the edges of the enterprise. Don't be afraid to look backward and forward in the value chain to integrate new ideas and processes.

"The longer I work with business model innovation, the more I get bored by 'one solution fits all' in a specific industry," he points out. "The art of management and entrepreneurship is exactly to find a solution that makes you positively unique in the eyes of your customers."

"In management, we believe too often that there is just one right way to do business. And analysts pressure firms into what everybody else is doing. Actually, the opposite is true, as long as you have a good reason to do so. If you do what everybody else is doing in your industry, you are no different. You have no value proposition your customers will love since they cannot even see a difference between you and your competitors. Be different and have profile. Be brave and accept that being different means also that you expose yourself to criticism."

In this blog (formerly known as "SOA in Action"), Joe McKendrick examines how BPM and related business and IT approaches can promote business transformation.

Joe McKendrick

Joe McKendrick is an author and independent analyst who tracks the impact of information technology on management and markets. View more


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