BASE/X business agility through cross-organizational service engineering : the business and service design approach developed in the CoProFind project

Abstract

Many business domains are currently characterized by a move from an asset-orientation\nto a service-orientation: customers recognize that business value is not in owning assets,\nbut in using the services offered by assets (which they do not need to own). This creates\nservice-dominant business markets. The not-so-physical characteristics of these markets\ngive rise to high levels of dynamism. This places high demands on the agility of service\nproviders operating in these markets. These providers find their agility, however, heavily\nconstrained by the business and IT platforms they use to deliver their services.\nThis paper proposes the BASE/X framework for agility in service-dominant business, which\nhas been developed in the CoProFind project, a strategic collaboration between Eindhoven\nUniversity of Technology and De Lage Landen International B.V. This framework makes\ntwo fundamental distinctions in the setup of a service-dominant business environment.\nFirstly, the framework separates two concepts in business conception: business strategy\nand business models. Business strategy is linked to the identity of an organization and\nhence is relatively stable in time. Business models specify the operation in the here and\nnow of changing markets, and hence change frequently. Secondly, the framework\nseparates two concepts in business implementation: service capabilities and service\nofferings. Service capabilities are relatively stable in time as they are based on the\nresources of an organization (both human and non-human). Service offerings change over\ntime – they revolve with market dynamics as operationalization of network-centric\nbusiness models of a provider. The framework provides a basis for structural agility by on\nthe one hand coupling the stable elements to each other and on the other hand the fluid\nelements.\nThe concepts of BASE/X are combined in a service-dominant business structure that\nprovides an operationalization of the framework. As this is a structure with stable outer\nlayers and flexible inner layers, we call this the business sandwich model. Applying this\nsandwich model to the way business is organized thoroughly changes the traditional way\nof thinking in terms of decision horizons where it comes to implementing agility.\nThe business sandwich model describes the business view on agility. To enable automated\nsupport of agile business, the sandwich is mapped to an information system stack. This\nmapping how the business is connected to automated business applications at each of the\nlayers of the sandwich. The information system stack is in its turn mapped to an\ninfrastructure stack, which describes the basic IT platforms that form the implementation\nbasis for the business applications.\nThe BASE/X framework described in this document is a structure for the development of\nnew service-dominant business: business strategy, business models, their\noperationalization in service compositions, business services, and their implementation in\nstate-of-the-art automated service management platforms. To aid in the use of this\nstructure, the framework embeds tools that are tailored to business design in a servicedominant\ncontext. Application of the framework and its tools lead to well-structured\nmanagement of the complexity of service-dominant business and short time-to-market of\nnew business models. The approach is illustrated by a case study of an advanced travel\nindustry service orchestrator.

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