Profit, profit, profit. That's it, folks: money. It's what makes the world go 'round. This week, we took EA one step further and learned how to use the foundation we've created for profitable growth. After a quick lesson regarding the difference between organic and acquisition-driven growth, we can look at a few scenarios:
In a unification model, a maturing company continuously refines and matures its EA foundation. Through this strong, broad foundation, more processes are streamlined and digitized, which translated to better customer service and repeat-ability of results. (Ross 167).
A replication model has companies leverage business processes rather than data. With a maturing company refining their processes, rapid growth can occur in emerging markets or new products. By opening more streams of cash flow, the company becomes more profitable. (Ross 169-170).
A coordination model is more complex in that it uses its foundation across multiple businesses, sometimes offering drastically different services or products. By using a more generic approach, a company can focus on customer interaction, often aiming at identifying "the need behind the need." For example, by knowing your customer's habits or patterns, you can identify what project they are working on or what product they may need in the near future. Then, increased profitability comes from upselling or adding on extra items. (Ross 172-174).
The diversification model is the oddball: there is typically no integration or standardization cross business units. Why? Sometimes it makes more sense to give business units the autonomy to do things their way - if they know a specialized business better than a central authority, for example. (Ross 176).
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