The Key Components of a Business Model

The first and most obvious component is creating the process landscape itself. To do so, we must understand if these processes: Are end-to-end flows like order to cash? Are they ownership related so you know what organizations owned what processes? Are they customer journey related? Whatever the nature of the process landscape, you want to make sure it is captured in the business model.

Organizational elements are also key. You must be able to understand the roles, the people who fill those roles, and their location. As an example, there are often times when a role is responsible for a process. If you have multiple people who are capable of filling that role, you now have the ability to mitigate potential risk and implement backup processes. You can plug in people appropriately based on their effective location and ability to perform.

You must be able to represent your suppliers and partners. This is crucial in the case of a regional or global disruption. Understanding the location of these suppliers and partners along with how they may be impacted will help to mitigate risk and ensure continuity by identifying potential back up suppliers. So, assessing them using one of the many tools out there for third party risk assessment. Keep an eye on them in case they suddenly, unexpected go offline.

And then of course the IT landscape. Applications, relative locations, data infrastructure, buildings all fall into this infrastructure category. Understanding the effect your IT landscape has on your processes is very important. If your IT systems or buildings are no longer available, that impact should be brought into focus so you can adequately mitigate the risk and impact.

At the center of all this is a repository for the model and the process documentation. You need storage for the actual procedural documentation and diagrams that go with those processes. What these processes are, down to the activity level, must be accessible. All of these are referenceable materials within a repository to look through when modeling your business.

And of course, metadata is crucial. What are the key relationships between these business objects? Are you able to understand where gaps might be, and the risk or impact associated with them? Each organization has key sets of properties they want to track and report on. The ability to have custom properties assigned to objects makes them referenceable and reportable. It also allows for effective decisions based on something that is very specific to their core efficiency.

For even more information on this topic, download our latest whitepaper, Dealing with Uncertainty & Disruption with Effective Risk Management.

Ed Maddock
February 17, 2021

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