Definition

adaptive enterprise (or adaptive organization)

An adaptive enterprise (or adaptive organization) is an organization in which the goods or services demand and supply are matched and synchronized at all times. Such an organization optimizes the use of its resources (including its information technology resources), always using only those it needs and paying only for what it uses, yet ensuring that the supply is adequate to meet demand.

The adaptive enterprise is said to have several advantages over enterprises that are less adaptive. In traditional businesses, large inventories may be built up, tying up capital. Conversely, lack of foresight can result in spot shortages. Adaptive enterprises strive to eliminate unproductive or redundant labor, information, and materials. Cash flow is improved. Sudden crises, caused by a cutoff in the supply of a single item or resource, rarely occur. Adaptive enterprises adjust operations quickly and smoothly to meet rapid changes in the market, the introduction of new technologies, and shifting business priorities. Over time, this attracts and keeps a loyal client or customer base. In the long term, adaptive enterprises evolve with changes in the global economy so that their products or services never become obsolete.

The concept of the adaptive enterprise has been widely used by Hewlett-Packard in marketing its products.

This was last updated in November 2005
Posted by: Margaret Rouse

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