Without delving into management theory and practice, the solution to the complexity of structures is often a return to the roots, i.e., division. These divisions can take different forms, such as competencies (e.g., legal, accounting), segments (e.g., retail, corporate), business areas (e.g., brokerage, leasing), etc. – but what unites them is that they still belong to the same group. This makes managing all these aspects a challenge. It is necessary to implement a management strategy that allows control and coordination of different areas of activity.
One of the approaches that can help address this challenge is using the Line of Business (LOB) concept as a dedicated service area.
Line of Business enables efficient management of various areas within an organization, which is crucial for maintaining order and effective operation.
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What is the Line of Business Concept?
Line of Business (LOB) is an attitude to managing an organization that involves the isolation and definition of specific areas of activity. Each such area, or LOB, operates practically as a separate unit within a larger organization, allowing a focus on a particular business domain.
Practical Example of Line of Business
To better understand how LOB can be effectively implemented, let’s look at a case study that successfully used this approach to manage its complex operational structure.
Customer service is conducted on multiple fronts (branches, contact centers) and through various channels. Outbound traffic can be directed to customers, and customers also have the option to initiate calls or schedule remote meetings. Contact division is based on competencies in all successful business structures– each group has assigned goals and tasks. There are groups of consultants serving retail customers, another group for corporate customers, and a group serving wealthy clients.
As you can see, this segmentation forces operational specialization and creates further challenges. Each group needs a different configuration to fulfill its tasks and business needs. What should be done in such a situation? Of course, you can purchase separate tools to support each group – however, the organization incurs increased costs.
Using LiveBank LOB, businesses can create enclosed spaces customized according to their needs. Simply put, LOB is like separate rooms, accessible only to individuals with the appropriate access keys.
Designing Organizational Structure
Introducing LOB in your organization is associated with designing the organizational structure where each LOB is treated as a separate unit. It’s crucial to determine which areas of activity will constitute separate LOBs and then establish the management structure and responsibilities for each of them. Also, LOB implementation often requires investments in appropriate technologies. Information systems, analytical tools, and project management software can significantly facilitate monitoring and managing individual LOBs.
Enhanced Data Separation: Enjoy the confidence of data separation, ensuring that users can access only the information relevant to their specific Line of Business. Your sensitive data remains secure, and privacy is paramount.
Effortless Collaboration: Promote collaboration and cross-departmental synergy. Whether it’s insurance, private banking, or retail banking, our SaaS product empowers your teams to work together seamlessly, boosting productivity.
Lower Licensing Costs: Pay for what you need and when needed. With our flexible licensing model, you can reduce the cost per user while maximizing the utility of our product across your entire organization.
Advantages of LOB in Complex Organizations
Adapting to the ever-evolving business landscape with LOB
The use of Line of Business can be a pivotal element of success for complex organizations operating in various business areas and subject to different legal and financial regulations. This strategy helps build a “wall” between different areas while providing focused specialization, better control, and regulation compliance.
By implementing LOB, organizations can manage their resources more effectively and operate flexibly in a changing business environment. It will lead you to higher levels of efficiency and competitiveness.
In conclusion, Line of Business is an approach worth considering, especially for organizations with diverse and complex operations. It offers the opportunity to increase efficiency, control, and regulation compliance, which can translate into long-term success and organizational growth.
