13. November 2008 by admin.

A synergy is defined as a situation where the final outcome of a system is greater than the sum of its parts. The operations of a business is best conducted when all departments are working in conjunction. Also, individual additions to the business can mean hidden benefits. For example, if free samples are offered outside restaurant in a shopping mall, then that would attract more customers inside. Not only profit is increased, but something else improves as well, including the atmosphere of the restaurant and the mood of the employees.

I would like to emphasize that synergies are not linear in return. If we add a component in business and it seems to generate a set amount of additional revenue, we nor the accounting department cannot calculate the long-term benefits, the total throughput of benefits yielded by the addition of a specific element. Because an additional element is not just another source of revenue, it is more complex than that. An element, vague as the term may seem, may have additional features and properties that make it much more than just mere profit; the returns are exponential.

The other definition of synergy is a dynamic state in which combined action is favored over the sum of individual component actions. We see collectivism is popular in certain types of companies. During board meetings, mutual consensus is reached and there are no debates on how to run the company, and a single direction exists. By working together instead of conducting office politics for personal gain, a company can offer a more competitive product than its rivals.

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The best synergies often arise when two very different persons or components of a company, are put together. Of course we can hire many like-minded and talented individuals, but that would be overkill for a certain task. Instead, you downsize the number of employees, since less members with different talents can often achieve more by doing multiple tasks at once, and hire a competent manager that is not only able to harness the different talents, but also see to that the members get along.

Many techniques exist to take advantage of synergies when we see companies as an individual unit. The first would be a revenue synergy where the first company, AMD, for example, sells microchips and has a strong global marketing ability. AMD then goes to acquires another smaller company which has little to no marketing ability but has a strong potential product. Then the parent company markets that product at greater efficiency. The second method is a cost synergy where different companies work together to share equipment and resources. If a serious merger is considered, the company cab then consider to eliminate extra departments that result as a duplicate of the merger (e.g. two marketing departments, two human resource departments).

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13. November 2008 by admin.

We have all heard of the term “cookie-cutter”, indicating a generic or popular approach towards solving a particular issue. In the realm of business, it means following a typical model. So what is the problem with the traditional business model? This question stands most relevant today in our current economy that follows the traditional capitalist model, that is breaking apart before our eyes.

A manifold of issues assault the traditional tried-and-proven model, on the magnitude of strategy, economics, and a political dominance. Strategically, the problem with a standard business model can be summed up as such: “I know how you operate, but you don’t know me. Now I will beat you.” With an understanding of how the majority of business operates, one can develop a organizational model to out-maneuver the targeted businesses in fields of advertising, sales, financing, and management. Also, the other problem many corporations face is that they are extremely effective in one field, and weak in another. The skill and experience found in one department may be too effective - or overkill. Perhaps that resource or talent could be better used when alloted to another task.

Economically, the main issue with a standard model is that it is susceptible to the rise and tidings of the economy. A non-standard models does not follow these rules, and thus remains largely unaffected. If the world is just a collection of set variables and rules, like what we find in a physics textbook, then we should act in our best interest to optimize these conditions, and avoid age-old traps, such as over-speculation.

Politically, a standard corporate model would make it vulnerable to arbitrary decisions of those in power. A small but powerful elite dictates the market, all others are disenfranchised and must follow to gain corporate respect and prestige. Nothing would be more senseless when conditions degrade to this level. Because a standard procedure is popular, it must be effective ad populum. Laws and legislation often have entire business models built around them. What happens when the government administration shifts its policies? We see this today as business owners and trade associations gather and confront the mounting challenges of a new administration and new laws that may or may not make a conducive environment for conducting business; it is the responsibility of executives to create new models.

From a programming standpoint, static and dated structures such as C will have to give way to more dynamic and object-oriented styles of languages such as C++, Java, and Perl. Although block programming can be far more useful in specific tasks (e.g. a smaller kernel), class construction is far more effective at handling large projects. Abstraction will pave the way for managing complexity, so that a large program can be divided amongst several team members.

From a biological standpoint, although evolution selects the most adapted genes for a certain environment, that very environment can change. Thus, the top carnivore will see itself competing with new predators, or will have to survive in increasingly arid conditions; even solid and evolutionarily viable animals such as tigers, fish, human beings, and oak trees have to change in this constantly turbulent and shifting world - All is change.

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