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National and Global, United States

Thursday, October 29, 2009

Extinct: A Return to Normal Business

Understandably, there are still some traditional executives who are waiting for things to return to "normal." It's not going to happen. Constant change is the new norm. You just can't decide to do it better. You've got to do it differently, whatever it is you do. The economy will not bounce-back in the traditional sense of 20th century corporate thinking. If you don't recognize that fact, you have a problem. You need to contact me.

That translates to an entirely new business model, taking into consideration the 'openness' of the digital age, with all its pluses and minuses. It's a redefinition of how business conducts itself, from research, to strategy, to tactical implementation.

It goes further to a transformation to a customer-focused perspective. Most companies say that they are 'customer focused' but in reality, they are not. Take a look at the airline industry, for example. Most companies don't embrace new CRM technologies. They say they do...but they don't. Take a look at the management consulting industry.

Companies still focus 'inside', when they need to be 'outside looking in'. They have no concept of expanding their capabilities, through strategic partnerships, for instance or sub-ventures within their own organization, tied to it, but independent of it.

Companies historically look at their skill-sets, and push them out, rather then looking outward at skill-sets and pushing them in. They retain their comfort zone, rather then asking their customers what they need and want, and going out and getting exactly that. That's uncomfortable for organizations. They are not good at bringing in that 'value add' that extends their brand and increases the effectiveness of what they do. They will tell you they do. They just don't.

In this regard, companies need to open up internal space for new ventures and new ideas. A subset of their core competencies. Instead, what normally happens is that any 'new' venture starts to look like what's been done in the past, rather then what is needed for the future. It still needs to fit the square peg in the square hole. And that, in this new business age, is a death knell for these companies. They think they 'do it' but they don't, and don't know how.

If you take a look at Lockheed's Skunk Works you'd get the picture. A subset of the corporation with a separate place of business and little ties to the parent. I worked as a consultant for 12-months for a satellite communications company in an attempt to work outside the company structure in developing markets and products for IPTV. They even called it 'skunk works'. But it wasn't. When the bottom fell out of the economy, this project was one of the first to go. And even when it was an on-going effort, little attention was paid to it, because the managers assigned to it were all internal, and had other priorities.This was not one of them. It should have been. That company will remember the day, they walked away from the 'skunk works'.

What the initiative needed was more space which would have offered the venture more freedom to move in new and different directions, but it became difficult to bring that learning and expertise back to the core organization because that group had no 'buy in' to the venture itself. They were responsible for it, but were distant from it.

The fact is, that if an organization is to move towards a true, transparent transformation, leadership must understand the pressures, commitments, and changes that need to be made to achieve that goal. Lip service won't do it. Lack of decision-making won't do it. And certainly not pro-actively allowing that decision-making to be addressed outside the traditional 'management box' surely won't do it.

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