Value, Transactions & Customers

Enterprise by Design (Part 3)

Designing an enterprise requires an understanding of all of the components.  Today, we will do a little open mind surgery to expand thinking and definition.  Expanded thinking always creates opportunity.

In all customer and vendor relationships there must be an exchange of value.  Without an exchange of value, there is no transaction and without transactions, there is no business.

So does the transaction define the customer or does the customer define the transaction?  In truth it is value that defines the transaction and the customer.  Since value is the center component, what defines value?

Value is not always products, services and or money.  Value can be ideas, concepts, methodologies, relationships and of course exchange.  It can be transacted in many ways from direct sale to barter.  Value fulfills, gratifies, builds, enables and achieves.

• Fulfills – wants, needs, dreams and desire
• Gratifies – brings good feelings, positive energy or position
• Builds – resources, capital, structure, esteem and power
• Enables – progress, other transactions, and relationships
• Achieves – goals, direction, and mission objectives

Transactions as stated are an exchange of value.  Transactions without value given and received should be considered either charity or marketing.

Customers – The most common customer considered in business discussions is the external customer.  However in enterprise design, there are two other types of customers to be considered.  These are the Internal Customer and the Shared Customer.

External customers are not related to your company, business or enterprise except by a transaction in which the company, business or enterprise is the vendor

• Example – You go to the store and buy groceries.

Internal customers are those under the company or enterprise umbrella where the transaction facilitates a critical process, another transaction, or are required in the value chain for the external customer to transact business with multiple components of the enterprise as a shared relationship.

• Example – You go to the hospital and while there you see doctors, have tests and or procedures.  Each doctor or service linked to the hospital is an internal customer to the hospital.  You may receive an aggregated bill or separate bills but everything was linked to your hospital experience.

Shared customers are those that have stand-alone transactions with companies within the enterprise, partners or related services and are linked by shared relationships.

• Example – You buy a property through a real estate company and need a mortgage, title insurance, inspections, an appraisal, moving companies, utility services and more.  Some of these may exist under the enterprise, some will be partners and others simply related services where is often coordination and dependent conditions.  All are related by the relationship to the customer.

Value, transactions and customers are required for all businesses but enterprise design requires open mind surgery to consider vision and concepts that expand and define the enterprise and relationships it will enjoy.