Unified Business Model (UBM)

What is Unified Business Model

Unified Business Model (aka UBM) is an abstract business model which makes ERP5 fantastic. Jean-Paul Smets, the author of ERP5, innovated this idea when creating the first version of ERP5, and the model has been applied to all applications built on the top of ERP5.

Since this model was so essential and valuable, the name of ERP5 got named after the UBM, namely, ERP which is built only with 5 concepts described by the Unified Business Model, thus it is called ERP5.

What are the 5 concepts in Unified Business Model

UBM consists of 5 concepts, that is, Node, Resource, Movement, Item, and Path.


Node represents a node which is involved with business processes, such as a person, an organisation, a warehouse, a bank account and so on. It is analogous to the concept of node in graph theory, mathematically speaking.

Resource is a tangible or intangible which is transferred between Nodes in business processes. For example, a Resource can be a product, a raw material, a service, cash, and so on.

Movement specifies a move between Nodes with a Resource associated. It is similar to the concept of directed edge in graph theory. It includes ordering, deliveries, accounting transactions, payments, manufacturing processes, and so on.

Item enables the traceability of Resources. This is similar to the concept of instance in object-oriented programming, when Resource is regarded as class. Item can represent a barcode, an RFID, a subscription, or, a ticket, for example.

Path shows a possible Movement which is useful to define trade conditions, supply conditions, payroll models, etc., and provides support for logistics, supply chains, pricing, and so on.


It is useful to give you some examples, so that you can understand the model better.

Example 1

Suppose that a company A wants to sell cameras to another company B. Once both parties agree, the company A will send 10 cameras to the company B with the unit price $100.

In this scenario, the companies A and B are considered Nodes. The product, camera, is a Resource. The sales itself (ordering 10 cameras with $1000) is a Movement. If this condition, such as the unit price, is agreed between those companies, the condition is a Path. If the company A wants to trace the cameras, it can attach a barcode for each camera, and this will generate 10 Items.

Example 2

Suppose that a company A wants to book-keep information about a wire-transfer from another company B. The company B sent $1000 to the company A for a receivable.

In this scenario, the accounts accounts receivable and bank account are Nodes, physically speaking. The companies A and B are also Nodes, logically speaking. The transfer is a Movement, and the money is a Resource. Item and Path are not used here.

Example 3

Suppose that a company A wants to make 10 cameras from mechanical parts in a factory.

In this scenario, the factory is a Node. The cameras and the mechanical parts are Resources. The production consists of two Movements, one for the consumptions of the parts, and the other for the production of the cameras. For traceability, the company A can put labels to the cameras and the parts, and these will be Items. The transformation is described by a Path.

How is the Unified Business Model used in ERP5

The UBM is completely integrated into the implementation of ERP5. All documents in ERP5 are designed, according to the model, and all tools and utilities in ERP5 make use of the model to unify the implementation among various business activities, such as trade, manufacturing, customer relationship management, accounting, and project management.

This has made it feasible to rapidly develop new applications on ERP5, and lower the maintenance cost at the same time, because all data shares the same design architecture, thus the amount of code is dramatically reduced.

UnifiedBusinessModel (last edited 2009-10-12 15:06:51 by kazuhiko)