The purpose of an Enterprise

The Big Picture…

If beneficiaries need help in making progress with some aspect of their life, who is it that can help them? It is the enterprises – individuals, firms, multinational conglomerates, non-profits, entrepreneurs, start-ups etc. And these all have one thing in common. They are instances of a:

value co-creation enabling system that is intensely beneficiary focussed and constantly updating its value proposition(s) in order to remain viable and sustainable

This definition is an evolution of McKinsey’s Lanning & Michaels’ paper – A Business is a Value Delivery System – combined with Druker’s insight on the purpose of firms, and adjusting for a service-dominant logic view.

And that constant updating comes about through Innovation – which nicely evolves into the act of creating a new value proposition that offers to help beneficiary make progress better than they currently can.

Similar thinking can be applied to departments within an enterprise: their beneficiary is the enterprise. And similarly, the departments need to keep their value propositions updated (innovate)). Additionally, Lush & note that departments group micro-competencies together (perhaps defining the boundaries of the department and firms).

Important is that the enterprise remains viable and sustainable. Does it need to make a profit? It is a consideration but theoretically not required.


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