the Agile Virtual
Enterprise
empty concept or future necessity?
Marc Buyens
marc.buyens@xpragma.com
www.xpragma.com
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contents
the historical perspective
is it a better organisational form?
can it be done within a single
organisation?

the historical
PERSPECTIVE

the concept “business agility”
“an agile organization is one that responds
quickly to changes in its business
environment; immediately exploiting new
business opportunities whilst recognizing and
repelling unwelcome threats”
Business Agility (www.business-agility.com)

the concept “business agility”
high
change flexibility
flexibility agility
agility
commoditisation
commoditisation innovation
innovation
low
high low
predictability

changing without changing
“The good-to-great companies paid scant
attention to managing change, motivating
people, or creating alignment.
Under the right conditions, the problems of
conditions
commitment, alignment, motivation, and change
largely melt away.“
Jim Collins, Good to great

the product “business agility”
On Demand — IBM, CA, and others
Adaptive Enterprise — HP
Organic Business — Forrester Research
Agile Enterprise — EDS, Unisys
Scalable Enterprise — Dell
Adaptive Infrastructure — CAP/E&Y
Dynamic Systems Initiative — Microsoft
Other
– Policy-based computing
– Service-centric computing
– Harmonious Computing
– Open mission-critical systems

the product “business agility”
On Demand — IBM, CA, and others
Adaptive Enterprise — HP
Organic Business — Forrester Research
Agile Enterprise — EDS, Unisys
Scalable Enterprise — Dell so I can
Adaptive Infrastructure — CAP/E&Y really BUY
this?
Dynamic Systems Initiative — Microsoft
Other
– Policy-based computing
– Service-centric computing
– Harmonious Computing
– Open mission-critical systems

the “virtual enterprise”
“a virtual enterprise is a temporary
aggregation of core competencies and
associated resources collaborating to address
a specific situation, presumed to be a
business opportunity“
H. T. Goranson, The agile virtual enterprise, Cases, metrics, tools

what good is it for?
The AIM-9X Sidewinder Air-to-Air missile program will develop a short
range heat seeking weapon to be employed in both offensive and
defensive counter-air operations. The new missile is required to
reestablish the parity of US aircraft in short range air combat, vis-à-vis
improved foreign export aircraft and missiles.
Source: http://www.globalsecurity.org/
AIM-9M Sidewinder R-77RVV-AE Missile (NATO designation: AA-12 Adder)

examples

types of Virtual Enterprises
opportunity-driven capability-driven
supply chain bidding consortium

the Virtual Enterprise framework
opportunity
identification
virtual enterprise
partner
reconfiguration /
identification
dissolution
virtual enterprise virtual enterprise
operation formation

the networked market model
market
market lead partner B
lead partner B
lead partner A
lead partner A
coordinator B
coordinator B
coordinator A
coordinator A
contributor A
contributor A contributor C
contributor B contributor C
contributor B

is it a better
organisational form?

UNPREDICTABILITY is fact

…but we keep on dreaming of
PERFECT control
© The Cockpit Group

…but we keep on dreaming of
PERFECT control
when everything is GREEN
most likely, you are DEAD
© The Cockpit Group

structure
MATTERS

the beer game
brewery
wholesaler
retailer

so…
“... if everyone has to think outside the box,
maybe it’s the box that needs fixing”
Malcolm Gladwell

the INNOVATION mantra
the creation of a working environment that
facilitates and stimulates innovation
the development of personal skills and the
promotion of practices, tools and methods to
stimulate creative thinking
the management of new ideas

...but we keep on playing the
dog crate race

can it be done
within a single
organisation?

the innovation requirements list
adopting an open communication between all layers of the
organisation so that everyone is fully aware of the strategic
direction, the opportunities and also the challenges of the
organisation
having a willingness to accept a reasonable amount of
promising, yet risky ideas to have their fair chance for
development and implementation; being tolerant for failure
stimulating an entrepreneurial mindset
fostering knowledge sharing and cross-fertilisation of ideas
across all entities of the organisation
having the conviction that anyone in the organisation can be a
potential contributor for innovation
introducing a fair amount of challenge
freeing up the necessary time/resources for innovative thinking

the promise of the VE
peer-to-peer; relationships based on equality
loosely coupled; nothing is forever
trust; accepted distrust
shared/partial control
small footprint relationships
high concept
not built to last

differentiators
high concept strategy and objectives
unprotected protected
negotiated inherited
open closed
interpreted understood
autonomous dependent
light-weight agreements formal contracts

characteristics of the VE agreement
personalised mission statement
personal agenda’s are OK
peer-to-peer relationship
actors are contributors or facilitators, not control layers
participation and positioning in VE is competence based
not seniority
‘no expectations’ based trust
together we succeed, together we fail
it’s your problem

remaining questions
how do we protect the lower layers?
the impact of external stakeholders is not
balanced
pains and gains are not identical at all levels
‘breed’ and ‘greed’ are still the dominant
models
legal and regulatory requirements

is CSR a way to go?
“Socially responsible practices are the ultimate
value creators: They create emotional value,
experiential value, social value, and have course,
financial value. People who interact with such
companies feel safe, secure, and pleased in their
dealings.”
Idris Mootee

annex

Creative Commons
gailf548 Zak A jslander photohome_uk
clip works
Office Now billjacobus1 closelyobserved.com Orin Optiglot
MK Media Wonderlane tyger_lyllie
JOE M500 Productions

Creative Commons
billjacobus1 @ http://www.flickr.com/photos/billjacobus1/
clip works @ http://www.flickr.com/photos/14947022@N06/
closelyobserved.com @ http://www.flickr.com/photos/soylentgreen23/
Gailf548 @ http://www.flickr.com/photos/galfred/
JOE M500 @ http://www.flickr.com/photos/m500/
Jslander @ http://www.flickr.com/photos/pancakejess/
MK Media Productions @ http://www.flickr.com/photos/yakobusan/
Office Now @ http://www.flickr.com/photos/officenow/
Orin Optoglot @ http://www.flickr.com/photos/orinrobertjohn/
photohome_uk @ http://www.flickr.com/photos/photohome_uk/
tyger_lyllie @ http://www.flickr.com/photos/tyger_lyllie/
Wonderlane @ http://www.flickr.com/photos/wonderlane/
Zak A @ http://www.flickr.com/photos/79605023@N00/

resources
The agile virtual The Tipping Point
enterprise How Little Things
Cases, metrics, tools Can Make a
H.T. Goranson Big Difference
Malcolm Gladwell
The Black Swan The Fifth Discipline
The Impact of the The Art & Practice
Highly Improbable of the Learning
Nassim Nicholas Organization
Taleb Peter M. Senge

resources
Good to great
Why some companies
make the leap and
others don't
Jim Collins