Domain is a word which expresses the order of operation in which the enterprise carries out its activities. In simple terms, it is an answer to the question as to what are the operation of our company and what exactly our company deals in. This is an important aspect which must be defined properly at the initial stage of formulation of all types of strategies. Furthermore, it is a particularly difficult problem.
(1) Why is it necessary to define the Domain?
For any enterprise, the effects given below can be expected by deciding the domain.
· The focus of attention gets restricted
The focus of attention and care which must be paid by the managers and all other persons responsible for decision making gets restricted and concentrated. As a result, the dispersion of management resources can be prevented.
· The index of accumulation of management resources can be obtained
By defining domain, it helps in not only clearly defining the type of management resources that need to be accumulated, it also clearly displays the management results that are required in the future.
· Helps in realisation of synergy
It clearly defines the possibilities of realisation of synergy showing what type of synergy today exists among the various operations. Further, the directions of realisation and synergies also start appearing.
· Gives birth to a feeling of oneness in the organisation
It helps in making all the individual members of the enterprise feel themselves a part of one body and makes it easy to seek the overall cooperation in the organisation and also to achieve the economic status within the scope.
This can be better understood by considering a case where clear domain does not exist or by imagining an activity carried put under wrong domain. The management resources gets dispersed and invested in under such a stage. The directions in which enterprise must progress becomes vague and the group of the organisation members become weak.
(2) Defining of Operation
While defining the domain, it is necessary to clearly distinguish it with the definitions various operations levels. The definition of operations shall form the definition of domain also, if an enterprise continues to operate only one operation without going in for diversification. However, today most of the companies are engaged in multiple number of operations, therefore, the definition of operation cannot be used as it is, as the definition of overall company domain.
However, the concept of defining individual operations forms the starting point for the definition of overall domain of the company. A proper understanding of this concept shall provide large number of suggestions. Therefore, let us first try to consider the definition of operation.
(a)Physical definition and functional definition
Traditionally, the definition of operation has always been provided in relation to the product.
For example, it is often said that “the operation of our company is the computer operation” or “our company deals in computer”. This type of definition can be called as physical definition which is based upon the physical characteristics of the product. This type of definition of operation does not provide for expecting continuous growth, so long as there exists a life cycle of the of product.
Therefore, T. Rebitt emphasised the necessity of functional definition on the basis of customer’s needs, besides the normal physical definition on the basis of product. He pointed out that the decline in the America Railway Company was because of their self imposed physical definition that they were engaged in Railway operations. He explained the necessity of defining the operation very broadly on the basis of customer needs. According to him, operation should be defined not by the product, but by the functions which are provided to the customers.
It is necessary to consider, that for what the customer has been paying the money actually? In other words, the railways company should have defined their operation as the “transportation” operation rather the “railway” operation.
However, the term “transportation” operation is also excessively ambiguous and it does not clearly define the exact operation. Further, a simple and wider definition also does not server the purpose . An excessively wide definition of operation without clear directions may end up in dispersion of management resources.
Three dimensional definitions
D.F. Eibell has carried out a detailed analytical study of definition of operation. And, he has attempted to define the operation from three dimensions, namely the customer layer, customer function and technology as against the two dimensional definition based on product and market, which has been prevalent so far.
The customer layer is classification based on the other person, in other words, who is to be satisfied. Precisely, it means the classification on the basis of identity. The identity dimension can be the region, sex, age or personality. For example, the target for a particular product may be unmarried male persons in the age group of 20’s in city.
Customer function deals with the problem of pursuing the requirement of customer and what needs to be satisfied. It can also be called as the functions fulfilling the product or the services provided to the customers. In the case of railway operations, transportation and leisure are the customer functions.
Technology is the method of performing a specific function of the customer. For example, the method of accomplishing the transportation can be the railways, bus, taxi, or the ship etc., whereas the method for accomplishing the function of entertainment can be the film and television or dram etc.
The focus of attention and care which must be paid by the managers and all other persons responsible for decision making gets restricted and concentrated. As a result, the dispersion of management resources can be prevented.
· The index of accumulation of management resources can be obtained
By defining domain, it helps in not only clearly defining the type of management resources that need to be accumulated, it also clearly displays the management results that are required in the future.
· Helps in realisation of synergy
It clearly defines the possibilities of realisation of synergy showing what type of synergy today exists among the various operations. Further, the directions of realisation and synergies also start appearing.
· Gives birth to a feeling of oneness in the organisation
It helps in making all the individual members of the enterprise feel themselves a part of one body and makes it easy to seek the overall cooperation in the organisation and also to achieve the economic status within the scope.
This can be better understood by considering a case where clear domain does not exist or by imagining an activity carried put under wrong domain. The management resources gets dispersed and invested in under such a stage. The directions in which enterprise must progress becomes vague and the group of the organisation members become weak.
(2) Defining of Operation
While defining the domain, it is necessary to clearly distinguish it with the definitions various operations levels. The definition of operations shall form the definition of domain also, if an enterprise continues to operate only one operation without going in for diversification. However, today most of the companies are engaged in multiple number of operations, therefore, the definition of operation cannot be used as it is, as the definition of overall company domain.
However, the concept of defining individual operations forms the starting point for the definition of overall domain of the company. A proper understanding of this concept shall provide large number of suggestions. Therefore, let us first try to consider the definition of operation.
(a)Physical definition and functional definition
Traditionally, the definition of operation has always been provided in relation to the product.
For example, it is often said that “the operation of our company is the computer operation” or “our company deals in computer”. This type of definition can be called as physical definition which is based upon the physical characteristics of the product. This type of definition of operation does not provide for expecting continuous growth, so long as there exists a life cycle of the of product.
Therefore, T. Rebitt emphasised the necessity of functional definition on the basis of customer’s needs, besides the normal physical definition on the basis of product. He pointed out that the decline in the America Railway Company was because of their self imposed physical definition that they were engaged in Railway operations. He explained the necessity of defining the operation very broadly on the basis of customer needs. According to him, operation should be defined not by the product, but by the functions which are provided to the customers.
It is necessary to consider, that for what the customer has been paying the money actually? In other words, the railways company should have defined their operation as the “transportation” operation rather the “railway” operation.
However, the term “transportation” operation is also excessively ambiguous and it does not clearly define the exact operation. Further, a simple and wider definition also does not server the purpose . An excessively wide definition of operation without clear directions may end up in dispersion of management resources.
Three dimensional definitions
D.F. Eibell has carried out a detailed analytical study of definition of operation. And, he has attempted to define the operation from three dimensions, namely the customer layer, customer function and technology as against the two dimensional definition based on product and market, which has been prevalent so far.
The customer layer is classification based on the other person, in other words, who is to be satisfied. Precisely, it means the classification on the basis of identity. The identity dimension can be the region, sex, age or personality. For example, the target for a particular product may be unmarried male persons in the age group of 20’s in city.
Customer function deals with the problem of pursuing the requirement of customer and what needs to be satisfied. It can also be called as the functions fulfilling the product or the services provided to the customers. In the case of railway operations, transportation and leisure are the customer functions.
Technology is the method of performing a specific function of the customer. For example, the method of accomplishing the transportation can be the railways, bus, taxi, or the ship etc., whereas the method for accomplishing the function of entertainment can be the film and television or dram etc.