Many large corporations depend heavily on the brilliance of their top executives for success. In board rooms markets are analyzed, trends are interpreted. Strategies are formulated, products and services are developed. Sometimes other companies are strategically acquired to complement the portfolio or gain special know-how.
The field is instructed to execute the strategy and attack their assigned markets. Scorecards and KPI’s are set up to monitor process, progress and outcomes. Success is ‘normal’ and low performers are asked to explain their (lack of) results. When necessary they need to design plans to get their results up to standard. The push goes out from the boardroom to the field and on to the market.
Every worker develops sensitive 'internal' ears to catch the right messages from hierarchy to make sure they execute on the right things, work on the right KPI’s and meet the required standards. The hierarchy is focused on getting timely and correct reporting on the numbers.
The organization is set up for efficiency. Products and processes are clearly defined and relatively simple. Management focuses on keeping people motivated and adhering to internal procedures. A smooth machine has been created, operating within the ‘push’ paradigm. The system is heavily dependent on the brilliance of top management to make the right analyses and interpretations and develop the right strategies.
The real strength of the organization lies in its ability to efficiently organize. The pitfall is bureaucracy. The challenge is getting creative ideas from the field but not too many because the system is allergic to anarchy.
These are well-established organizational principles, taught at many business schools and, let’s be honest, just common sense. Unless…markets are volatile, customer loyalty is declining, competitors seem to come from everywhere and the world turns out to be less and less predictable and more and more complex…. – end of part 1 -