Organisations and enterprises

Many words have been written and many said about organisations and enterprises, and the extent to which they are the same or different.  This article is prompted by a current “debate” over the meaning of “enterprise” and a suggestion that “enterprise” is distinctly different to “organisation”.  I am not so sure about that!

So, this is part of my “normal process” of “thinking out loud” – an approach where I:

  • outline what I currently “think”
  • refine what I think in order to express it in a clear and coherent manner
  • expect to be challenged
  • am offered the opportunity to refine my thinking, based on the questions and challenges arising from articulating my thinking

For me, this is the way I have become better at understanding, articulating and practicing the disciplines of architecting enterprises, governing enterprises, becoming more systems savvy, and of recent times, becoming more brain savvy.

Organisations

In using this term, it is important to distinguish between organisations and legal entities.  Oftentimes, when I think of organisation, I am thinking of:

  • a commercial firm
  • a government department
  • a community entity

This pertains more to the legal status of the entity and to the basis upon which it is constituted, managed and governed.

In this discussion, whilst it includes all of these types of organisations, I am including other forms of organisation, including:

  • an organisational unit
  • a cross-functional team
  • a multi-organisational operation
  • a community
  • a region
  • an industry
  • a profession
  • a project
  • a program

Each of these groups have:

  • membership
  • bounds
  • shared interest and purpose
  • varying degrees of linkage and relationship
  • an existence for some period of time
  • some form of means by which they are “organised”

So to the definition of organisation

an organised group of people with a common purpose

Enterprise

A number of blogs have been written on this topic already, including:

In summary …

an enterprise is most easily understood as an undertaking or an endeavour

Context

Given a systems view of organisations and enterprises, it should not be surprising that there is a need to consider system context, including:

  • the market or environment in which the organisation, enterprise or system exists and operates
  • the economy, community and society within which the market and environment exists

Any organisation, enterprise or system will need to:

  • give attention to entities in these broader contexts
  • understand the relationships that exist or should exist, both
    • across the organisation / enterprise / system boundary, and
    • amongst entities in the external environment
  • adapt the structure and behaviour of the enterprise, both
    • in light of changes in the external environment, or
    • in order to shape and prompt changes in the external environment

These activities are evidenced as an inherent part of organisations through:

  • governance processes (attending to accountability and strategy)
  • intelligence processes (informing the organisation of activity in the external environment)
  • marketing processes (understanding changes and opportunities in the external environment)
  • supplier, partner, customer / consumer, regulator and other stakeholder relationship management processes (providing direct knowledge and understanding of key external relationships)

These represent the means by which organisations attend to life-beyond-the-organisation and about which organisations develop enterprise models to enable them to understand, architect and realise their intended business models and operating models.

In this respect, the business model is the key artefact which prompts understanding and articulation of the balance required between internal and external affairs (so to speak).  Further articles outlining key thinking and practices in this area, include:

Enterprise concept and views

There are a range of benefits that I see arise from taking an enterprise view of an organisation, including:

  • organisation tends to prompt a people / role based view
  • enterprise encourages a purpose and process view
  • enterprise allows the balancing of multiple views including:
    • strategic views
    • process views
    • role / responsibility views
    • information views
    • facilities / location views
    • service views (composite of internal and external sourcing)
    • integration views
  • enterprise provides an abstraction from the connection to organisation and the threat that arises in considering organisational change
  • enterprise enables views that are agnostic to a particular dimension

For me, there is incredible value in taking an enterprise view, but none of the value derives from viewing organisation and enterprise as distinctly different.  Perhaps the following is a reasonable way to summarise?

Enterprise is an abstraction that is orthogonal to organisation

 

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