Thursday, August 28, 2003

The Integrated View of the Organization

Strategy is often about taking an integrated view of an organization. That means looking at how things work together.

Cathleen Benko and Warren McFarland write in their book, Connecting the Dots, HBS Press, 2003 that companies now are betting their future on a collection of projects. And often, the way you manage your business does not look at how the combination of projects you are working on work together or fight each other.

They have three big ideas:

1. In the future, companies have to think of themselves as a virtual value chain. The new management task is to manage the delivery of creation and value to your customers by putting together activities that may exist within and without your organization.

2. A useful way of thinking about business processes is "Sides". They talk about In-side, Out-side, Multi-side - the ways in which you operate internally, the ways in which you deal with customers, suppliers and consituencies. Often your organization makes it difficult and expensive for others to deal with you. For example, why should customers in a financial services organization be approached by multiple sales people when they want a single point of contact?

3. Information management projects and business projects should be managed as stages or Chunks. That way, you can terminate a project that is not delivering value, or change it in the next phase as you learn what works or how a market is evolving.

In other words, in a complicated world, you may not be able to forecast the future, but you may need to position yourself to adapt for the future.

I use the term a "reversible decision". Good decisions are often reversible.

I also like solutions that solve more than one problem at the same time. Generally, if a solution solves more than one problem at the same time, it is a good one.

Alistair Davidson

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