Catalyst Consulting — Enterprise Model

Putting Performance Improvement and Value Creation in Context

A 360 Degree Look at Your Business

The Enterprise Model presented below represents the "playing field" upon which strategy unfolds and success is won or lost. It is a 360-degree view of the critical areas for change and performance improvement in an organization; they are as interdependent as the various organs and systems of a living organism.

When working with clients, Catalyst uses this model to help leaders think through the implications of strategic and tactical decisions. It helps all of us — consultant and client alike — keep the entire value change in mind as we focus on particular leadership, strategy, process or issue resolution problems.

Source: How Organizations Work: Taking a Holistic Approach to Enterprise Health by Alan Brache (New York: John Wiley & Sons, 2002)

Assessing External Variables and Influences

Environmental Variables: The expectations of governmental and regulatory bodies, the local and global communities where the organization operates, economic and technological trends, threats and opportunities, and trends in society at large.
Shareholders and the parent company: The mutual relationship between the company and those who contribute to its financial strength and profit from its financial gains.
Customers and markets: The mutual relationship between those who have needs that are potentially fulfilled by the organization and the products and services that might meet those needs.
Suppliers and resource providers: The external sources of raw material and components, as well as technology, people, capital, and even wholly outsourced capabilities.
Competitors: Others engaged in creating similar value. Competition occurs both upstream (for suppliers/resources) and downstream (for customers/markets).

Critical Internal Variables

Strategy Formulation: The foremost responsibility of the organization's leadership is to set the overall strategic direction of the firm. Any sound strategic vision will be based on assumptions and implications about the external variables listed above.
Leadership: No internal factor is more critical than the organization's leadership. Leadership — visioning, developing, motivating, communicating, involving — is the real horsepower of successful organizations.
Strategy: A comprehensive understanding of the environment in which the organization functions coupled with sound leadership are required to yield strategies, action plans and measures of success that will create real value.
Strategy Implementation: Research indicates that 70% of companies fail to implement their strategy. Reasons for this level of failure are many, but lack of effective issue resolution systems is a significant contributor.
Issue Resolution System The quality, effectiveness, and speed of an organization's shared processes and structures for applying information, gaining commitment, exploiting opportunities, and turing away threats will move the business from vision to implementation.

Additional Internal Variables

Business processes: The processes that describe how work is done, both those that interface with customers and suppliers and those that are more internally focused.
Goals: The financial and nonfinancial measures of success derived from strategy, both as overall business objectives and as specific measures cascaded down through the organization, that support the assessment of team and individual performance.
Human capabilities: The skills and knowledge of the workforce, which may be of a process, content, or technical nature.
Organization structure: The formal grouping of responsibilities and the reporting hierarchy, most often designed around function, geography, customers, products, SBU's, or processes.
Information/knowledge management The data that are collected and subsequently analyzed, disseminated, and applied in support of the organization's value creation.
Culture: The combined effect of behaviors, values, heritage, thinking, and relationships and the way these are embedded in the organization and its performance.