A business environment characterized by speed and flexibility cannot afford to be constrained by the boundaries imposed by traditional departmental barriers. Business decisions must be made quickly and made from an enterprise perspective, considering implications for all aspects of the business. For this very reason, companies increasingly use cross-functional teams on tasks such as new product and service development, systems implementation, and process improvement. These companies have become more organized around their products and services, and less organized around the functional areas within their organizations. For many firms, responsibilities are dispersed among a variety of staff. It is not at all uncommon for someone with financial expertise to be involved in what have traditionally been marketing issues or for someone with marketing expertise to be involved in quality management.

As businesses continue to break down functional barriers, functional experts will continue to take on broadened responsibilities that relate to business processes, rather than department functions. For business functions like operations, marketing, finance, accounting, and information systems, departmental affiliations will continue to become less meaningful than the needs of the organization. The functional responsibilities and tasks must still be accomplished, because they are part of an important business process. That process, however, will be the focal point instead of the department. As these trends continue we will see all business functions take on new shapes and new roles in the business.

Value derives from processes. A process is an accretion of resources. The resources necessary to create a value-adding process often come from different parts of the business. Amazon.com provides an excellent example of how differentiating capabilities emerge from bringing together very different resources. Amazon's ability to provide a book (or other product) at a very low price and do it very quickly sets it apart from competitors. There is no need to go elsewhere, because if the book exists, Amazon can get it. An examination of all the processes required to take the order, process the credit card information, and deliver the book to the customer shows that resources from many different parts of the company have to come into play: marketing and information technology experts develop the customer interface; financial, accounting, and computer experts develop the mechanisms necessary to handle the credit card transactions online; purchasing and contract experts develop relationships with suppliers; logistics and operations experts design and maintain the outgoing flow of products. Amazon could be broken into a series of small processes, but they must all interact with each other. Without any single piece, the differentiating capability doesn't exist.

The interaction among processes makes it particularly important for all managers to have a basic knowledge of all business functions. As transaction speeds increase, and as companies interact more directly with customers, the need to see across boundaries and recognize potentially valuable resources will increase. An employee who can recognize resources in other areas of the business that can be combined with resources of his own to form new processes has mastered one of the most difficult and valuable aspects of new product and service development. Without the knowledge of how all functions interact in the business, ideas will be limited to very narrow applications of resources. There is little remaining “low-hanging fruit” in the area of new products and services. The lack of an enterprise perspective limits the firm's potential for success, and it limits the career potential of its employees as well. A business student's differentiating capability, which separates her from her classmates in the eyes of a recruiter, will not be her major. Even when she compares her preparation to that of any other business major, the difference is only 10 to 15 percent of the courses taken. The differentiating capability is something special: Any ability a student has that enables her to perceive the business from a broader perspective will set her apart.