ERP Glossary - B: Book Value to Business Processes

Book Value

A theoretical accounting value arrived at by compiling all of the credit and debit entries against an asset. A production machine has a book value consisting of the purchase price plus all depreciation entries; inventory has a book value of all of the inflow values and all of the outflow values.


The machine or workstation which is the slowest in terms of parts produced per unit time, compared to all other machines or workstations in the process routing. The bottleneck operation determines how fast the entire process can run; it is of no value for steps one and three of a process to produce one hundred parts per hour if step two in the process - the bottleneck operation - can only produce forty parts in an hour.

Breakeven point

The mathematical point at which costs exactly equal revenue and there is zero profit and zero loss. If there is more revenue than costs (above the breakeven point), the company is making a profit; if there is less revenue than cost (below the breakeven point) the company is losing money.


The formal process of estimating the required expenses to operate the business in the future, normally in the next year. Budgets are used as a method of financial control, as an input to income forecast, and as a means of prioritizing capital spending.

Business Analyst

The person responsible for looking at the mathematical measurements of a business, and using those facts to construct performance assessments of how well the business strategy is working, where problems are, and what opportunities might exist. Business Analysts make frequent use of business intelligence applications.

Business Flow

Business flow is synonymous with business process, with perhaps a greater implied emphasis on flowcharting and visualization.

Business Model

The fundamental characteristics of the way an organization makes money, regardless of what product or service they sell. created a new business model by selling books over the internet. Netflix created a new business model by mailing - and later downloading - media content to your home, rather than going to your local rental store.

Business Operations

The combination of activities that results in a reasonably steady state flow of goods and services purchased and goods and services produced.

Business Processes

The individual activities - which can be flowcharted - that aggregate to Business Operations. Examples of a business process are entering a standard sales order, scheduling a work center or placing a purchase order with a vendor. A successful ERP installation must be able to facilitate all business processes.

BYOD (Bring Your Own Device)

System implemented by businesses which allows employees to use their own devices (mobile, tablet, laptop) in the workplace. These devices can be setup with self-service access portals to business systems including ERP. Often implemented to cut business hardware costs and improve employee engagement.

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Richard Barker

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Richard Barker

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