Agency 3: Business Operations

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Once limited partners have been onboarded into the community by Agency 1 (Human Relations), they begin the process of setting up their businesses, with the facilitation of Agency 2 (Individual Stewardships). This involves receiving advice on the best businesses they can start, assistance with business plans, and financing options. Any agreements they need to make with other limited partners are also done here. Once their business plans have been approved by the Stewardship Agency, the limited partner now looks to lease space, equipment, inventory, and accounts receivables from Agency 3.

Agency 3 is focused on business operations, so on this page and on this site is will sometimes be called the Business Operations Agency. It is the third agency in the Village Bureau. All space, equipment, inventory, and accounts receivables are owned by this agency. The agency’s primary responsibility is to procure and manage these assets, except for those owned by districts, by the Investment Bank Agency, and by the three agencies in the Urban Planning Bureau. Through the Business Operations Agency, the community makes these assets available to limited partners, at a fee. In its operations, the agency is served by an executive presidency, and 96 village presidencies, one for each village.

Community ownership of assets

Current and historical models

For the better part of the 20th century, the world was split between two political-economic visions – capitalism, with individual ownership of property, and communism/socialism/communalism, which saw the collectivization of industry and farmland, and strong state control over production. The collectivization of agricultural land led to some of the most devastating famines in China and Russia. Peasants, forced to give up their land and animals, sabotaged production by putting in far less work than they would have done if they had control over the land. Animal owners slaughtered their animals en masse rather than give them up.

In other instances, religious organizations in 1830s America attempted to eliminate poverty and build solidarity within their ranks by enforcing communal ownership of property. These attempts quickly failed and were abandoned. A key reason why they failed was that there was no plan to boost production by pooling resources. Instead, the property was simply divided up and consumed, leaving the people poorer than they were before.

Capitalism, on the other hand, was markedly more successful than communism in spurring economic growth. How, the concentration of resources in the hands of a few, especially access to capital, use of intellectual property, and other factors of production meant that the rich became ever richer, leading to a huge gulf of inequality. The hoarding of resources also meant that full employment was impossible to achieve.

The NewVistas approach

The NewVistas model appreciates that these two systems are incapable of eliminating poverty and boosting productivity. Under both systems, it is impossible to achieve 100% employment of resources, due to inefficiencies and lack of access. Instead, the community is designated as the capitalist. Through its elaborate infrastructure that includes the 24 agencies and the public servants who serve in various offices, the community can achieve full employment and foster access to these resources.

The pooling of resources, not only the $20,000 minimum investment but also their additional investments as they prosper over time, and their savings, gives the community enormous financial capacity by leveraging investment into the bank capital to acquire all equipment and inventory needed by the limited partners and to build sufficient space for them to live and operate from. Without individual ownership of factors of production, all limited partners can easily access the space, capital, and equipment they need to start and run thriving businesses. Instead of individuals leveraging their wealth to become even wealthier at the expense of entrepreneurs who need, but cannot access equipment and capita, the community is the capitalist, opening the doors to all limited partners, as long as they can convince the Stewardship and Village Assets Leasing agencies that their businesses have a good plan and high probability that they will work.

Saving business costs

Besides boosting access to assets needed for production, the community relieves businesses from having to undergo steep capital costs to acquire the equipment that they need. The equipment may also be used only on a few occasions, lying idle most of the time. This represents a waste of capital and diminishes the ability of businesses to operate optimally. The Village Asset Agency purchases/ develops buildings, equipment, and inventory assets. It then rents them out to limited partners and businesses as needed. This results in much higher utilization of buildings, and equipment, and therefore, higher inventory returns

Technology is rapidly changing and will continue to long into the future. Having an expensive piece of equipment that will suddenly be overtaken in use by newer, better versions is a prospect any business faces if they decide to buy equipment. The community through the Village Asset Leasing Agency removes the chances of this happening. Additionally, leased equipment is regularly serviced by contractors hired by the agency, meaning it is always in perfect working condition. This ensures that when needed, the equipment is in excellent working condition. Businesses, therefore, do not need the training to maintain their equipment.

The same advantages apply concerning space. A limited partner in consultation with the Village Asset Leasing Agency calculates the amount of space they need to live and conduct their business. They also agree on where the business should be located to improve its competitiveness and ensure it does not interfere with other limited partners’ businesses and personal lives. This way, businesses are for the most part located in the right place. Under rental agreements, rent is due weekly. This enables businesses to contract or expand their space quickly as needed.

Constructing an office is a daunting task for any business. Additionally, there is a massive waste of space in many instances, since an office may be built with the future in mind, leading to gaps between the availability of space and eventual use. By having living and work spaces that can easily be expanded or reduced as needs and circumstances change, businesses and individuals will use space more effectively and eliminate waste.

Ownership of assets in the community

Each village builds the village apartment and, in partnership with neighboring villages, the hub buildings. The village uses funds advanced as a loan by the Commercial Bank Agency, with the Capital Bank Agency (Agency #7) providing the down payment for the loan. Once the loans have been repaid, the income that the buildings generate can be used for maintenance and other village expenses. The funds can also be used to help the homeless, as well as reduce rents charged to tenants. The Asset Leasing Agency’s village presidency is responsible for the administration of these buildings, the transport enclosed breezeways in front of the village apartment buildings, and the village square in front and the gardens behind. The agency is also in charge of the mirrored villages and shared hubs that are outside the community.

Each of the 24 district buildings is owned by the corresponding district, so District 1 owns Building 1, and so forth. The district buildings’ construction and management approach is similar to that of the village buildings;  the District Assets Leasing Agency (agency 6) manages the physical assets and receives funds from the Commercial Bank Agency and a down payment from the Capital Bank Agency, which it then repays and uses further revenues as appropriate. District buildings are administered by District Assets Agency.

All equipment is procured and managed by the village or district asset agencies. The Village Asset Leasing Agency owns all raw materials, work in progress, and finished goods. The community through investment bank agencies owns the central block, which has a stadium, a mall, and other facilities that it leases to other agencies and limited partners. The investment bank offers inventory and accounts receivables loans to village asset agencies. 

Duties of the Business Operations Agency

Procure, lease, and maintain assets

The agency through its village presidencies is tasked with procuring all equipment that the community needs. The agency contracts limited partners who have logistics businesses to buy the equipment or those who develop it. The procurement patterns rely either on current demand for the equipment, or anticipated needs.

After procuring and or developing assets, the agency is charged with maintaining them. The village buildings are highly sophisticated, with many aids to help in tasks such as waste management, firefighting, and space management. These systems need to be in perfect working condition all the time to guarantee the intended high quality of living and working. Additionally, the community is keen to ensure the highest possible performance from limited partners and understands that well-maintained equipment is essential to achieve this.

After a piece of equipment has become obsolete, the agency through its 96 village agencies is expected to dispose of it. The disposal can be done through auction, where other villages that see a need for the old equipment can buy it to possibly strip it for usable parts or spare parts. In other instances, professional waste managers can be hired to responsibly dispose of the junk.

Monitor use and needs

The Village Asset Leasing Agency, through its village presidents, monitors the use of assets that it has leased to stewards to ensure proper use. It evaluates the readiness of the lessee to use the property entrusted to them and recommends training where needed to bridge any gaps. In other instances, the agency may revoke leasing agreements with limited partners if it finds the assets are being used inappropriately.

Monitoring also involves establishing whether the current equipment inventory is fit for purpose and sufficient. The community pattern is strict in terms of buildings. However, the agency can always modify them to make them better fitted to their purpose. Modern equipment rapidly evolves, requiring the agency to be keen to find out whether improvements are available, or how existing equipment could be updated to meet current and future needs.

Officing the executive and village presidents

The village presidency sits alongside other village presidencies for human relations and stewardships on the third and 5th floors of the district building. The floor has offices for 2 village boards, as illustrated below.

The executive president of the Village Asset Leasing Agency has its offices in building 3, which also has offices for the district board of District 3.

During quarterly conferences, the presidencies occupy the positions illustrated below.

The 24 agencies are organized in rows and columns. Beyond working in their bureau (row), agencies also interact extensively within their column. An overview with links to the 12 agencies in the Human and Financial Capital Department is here, and an overview with links to the 12 agencies in the Process and Property Department is here.
Representations of hierarchical- and matrix-type organizations.
The structure of a hierarchical-type organization is shown on the left, and that of a matrix-type organization is shown on the right.

Some additional notes/definitions from an earlier version of this page:

  • Having participants rent what they need, rather than buy it has a number of economic factors backing it up. The most obvious is the low initial cost of acquiring the asset, which the individual can choose to exactly match their requirements, especially with regard to specialist equipment. Such a stance also increases the variety of assets available for community participants to use (Holt-Ca15 advantages to renting equipment versus owning it. 2019. 16 06 2019).
  • A more immediate reason why the community favors owning the goods is to eliminate the inequality that such assets may bring. By having each participant rent what they need, each person having the same space to live, and equitable allocation of working space, it is difficult to use physical assets as a source of advancing one person over another. Instead, the community focuses on skills and work ethic to succeed (Deininger, K. and P. OlintoAsset distribution, Inequality, and Growth. Policy Research Working Paper;No. 2375. Washington, D.C.: World Bank, 2000).
  • There is a direct and positive impact of training on performance and efficiency. When the district presidents train the participants on how to use the system, it will then be possible for them to derive the maximum benefit from it, and alert the agency on any aspects of the system that do not operate optimally. It will also be possible to save district president’s time, which could otherwise be tied trying to guide participants through it (Afroz, N. “Effects of Training on Employee Performance – A Study on Banking Sector, Tangail Bangladesh.” Global Journal of Economics and Business 4.1 (2018): 111 – 124).
  • Just as witnessed with BYOD approaches, having the organization own all the assets used for production levels the playing ground, and may be a positive factor in motivation. For the community, it will also ensure that the community does not scare aware talented people, who may be unable to afford or access the assets they require to live and work in the system (Ranger, S. BYOD: 10 reasons it won’t work for your business. 05 07 2012. 17 06 2019).
  • Automated talent vetting systems, such as those used in e-HRM, have several advantages. They are better equipped to be objective, collect and retain more data, and enhance the communication process. When working properly, their chances of erring are nil.  In some instances, they may not have the human touch needed to make particular judgement calls, given a unique set of circumstances. In such instances, the district president will step in to evaluate and offer guidance (Nawaz, N. and A. Gomes. “Automation of the HR functions enhance the professional efficiency of the HR Professionals-A Review.” International Journal of Management, IT and Engineering 4.2 (2014): 364-373).
  • Asset management policies are aimed at protecting the organization from loss while enabling those given the rights to use them derive maximum value. In the community, policies will be formulated to protect the community’s assets (especially equipment), and the people using them against loss, including third party use, and mitigating any risks (USQICT Information Management and Security Policy. policy document. Toowoomba: University of Southern Queensland, 2018).
  • In the case of space, it is important to have clear guidelines to guide tenants’ use of property. This will reduce loss, as well as the risk of any misunderstanding between the two parties. The guidelines also contain some guidelines for the “landlord”, in this case the Leasing Agency. They include a duty to keep the premises habitable, fix any maintenance issues promptly, and regularly monitoring the property (FindlawLandlord Tips for Managing Property. 2019. 15 07 2019).
  • Setting rent rates can be considered as a pricing strategy. Through the community’s different stages, it will want the rent rates to reflect and aid its overall strategy on attracting or limiting membership into the community. Where it needs to attract more, it will adopt penetration pricing, lowering the price relative to the market average. As it grows in prestige, it may aim to make a premium of its superior product, and adopt value based pricing. In all instances however, it must consider its cost of production (cost pricing) (Baker, R. Implementing Value Pricing: A Radical Business Model for Professional Firms. Hoboken: John Wiley & Sons, 2010).
  • While not widely embraced, training tenants on effective property use is an important part of a property owner’s strategy to protect their assets. In the community, the participants will be trained to properly use assets, in order to avoid liability, and ensure the property is in the best possible condition to help them (ChrisHow To Train Your Tenants to Respect Your Property. 2011. 16 06 2019).
  • NANCC: The Village/Hub Asset Leasing Agency also liaises with Agency 24 – the Asset Management Agency to ensure that assets procured or developed by the community are enough and fit for use. The two agencies also liaise as the Village/Hub Asset Leasing Agency facilitates the formulation of and later implementation of regulations guiding asset use. The Leasing Agency provides the Asset Management Agency with the information needed to plan on what the community needs, in line with economic considerations, as well as participant entry considerations. For instance, the Leasing Agency may recommend the purchasing of more equipment suited for welders, if the community needs to attract more people with such skills.