Verticalisation, Matrix and other organizational changes
On ISTT: I said
"I have been following the debate on the verticalisation of IT firms and thought I'd just point you all out to a model that has been around a
long time and whether we can look at this approach in a new light.
I am talking about Larry Greiner's model 'Evolution and Revolutions in Organizational Growth' that was published in the early 1970s in the HBR
Griener's model is suited for organizations that grow from small entreprenuerial firms and in time grow in size and markets.
Griener says that an organization experiences a crisis point in various stages of its life and takes certain decisions to negotiate that crisis, which in turn leads to another crisis in the future.
The firms typically try structural changes to crises, and verticalisation, centralisation and decentralisation are examples of these efforts which are suited for that point of time.
Here are the various stages of Griener's model
1. Creativity - which runs into a crisis of leadership when the founder is no more around.
2. Direction - which runs into a crisis of autonomy
3. Delegation - which runs into a crisis of Control
4. Co-ordination - which runs into a crisis of red tape
5. Collaboration - and we still don't know what crisis this will run
into :-)
Check out the model here
Nov 14, 2003
Nov 10, 2003
On ISTT I wrote about ITES in India
The ITES industry leaders can make a difference if they are thinking about further growth, ready to tackle the emerging challenges in the field from players like Phillipines, China and a whole lot of others. For reasons of Business Continuity and Risk Management Indian ITES segment would also need to slowly become global and maintain data centres across the world
Coming to the HR issue in ITES the situation is quite similar to the pre-Y2K days of the IT services firms. The team sizes are large, the work is monotonous and the average project cycle is long (similarilites with maintenence work)
As soon as organizations can reorient business models to take into account niche outsourcing work and work becomes more project oriented
(shorter projects, more value added , like compiling reserach reports for global research firms, and giving recommendations) more people with high end skills (PhDs, MBAs etc) will move into the operations functions of the ITES sectors.
For example at a payroll outsourcing centre data miners and business analysts would slice and dice and analyse data to come up with recommendations for a new compensation systems based on trend analytics.
The quality of this work will invariably pass on skills to the fresh graduates who do the 'maintenence' version of the job and as companies seek to ramp up their skills with facilities like part time or satellite studies as a buffer for the scarce high end skills they will result in better and higher wages.
While now the work is coming for a cost arbitrage model as soon as these skills become more numerical maybe the very low end data entry and answering calls kind of jobs might migrate to cheaper countries (which has still not happened in the IT services industry, there does happen some amount of gravity :-) their ability to duplicate these kind of skills will be very low (qualitatively or quantitatively)
There will happen some kind of shakeout after this boom, when people who have entered this industry just to make hay while the sun shines, who do not concentrate on quality and customer understanding will go down the way of the hundreds of small time IT firms which vanished mid 2000 ...but they would have created a talent pool from which the bigger players will select and become still bigger.
My Monday morning hopes about the creation of a sustainable industry :-)
The ITES industry leaders can make a difference if they are thinking about further growth, ready to tackle the emerging challenges in the field from players like Phillipines, China and a whole lot of others. For reasons of Business Continuity and Risk Management Indian ITES segment would also need to slowly become global and maintain data centres across the world
Coming to the HR issue in ITES the situation is quite similar to the pre-Y2K days of the IT services firms. The team sizes are large, the work is monotonous and the average project cycle is long (similarilites with maintenence work)
As soon as organizations can reorient business models to take into account niche outsourcing work and work becomes more project oriented
(shorter projects, more value added , like compiling reserach reports for global research firms, and giving recommendations) more people with high end skills (PhDs, MBAs etc) will move into the operations functions of the ITES sectors.
For example at a payroll outsourcing centre data miners and business analysts would slice and dice and analyse data to come up with recommendations for a new compensation systems based on trend analytics.
The quality of this work will invariably pass on skills to the fresh graduates who do the 'maintenence' version of the job and as companies seek to ramp up their skills with facilities like part time or satellite studies as a buffer for the scarce high end skills they will result in better and higher wages.
While now the work is coming for a cost arbitrage model as soon as these skills become more numerical maybe the very low end data entry and answering calls kind of jobs might migrate to cheaper countries (which has still not happened in the IT services industry, there does happen some amount of gravity :-) their ability to duplicate these kind of skills will be very low (qualitatively or quantitatively)
There will happen some kind of shakeout after this boom, when people who have entered this industry just to make hay while the sun shines, who do not concentrate on quality and customer understanding will go down the way of the hundreds of small time IT firms which vanished mid 2000 ...but they would have created a talent pool from which the bigger players will select and become still bigger.
My Monday morning hopes about the creation of a sustainable industry :-)
Nov 5, 2003
Defending Consultants on Ryze
Actually Witch Doctors goes beyond just consultants and calls 'management science' itself an 'immature discipline' lacking both academic rigor or research !
That is true if viewed from the lens of traditional academic disciplines...the lines between practitioners, academics and consultants in the world of management is very blurred...what, for example, would one call Gary Hamel or Micheal Porter ? They have their own consulting shops and they also teach...
Having said that, I'd like to do the difficult...try to analyse the bad press that consultants get.
Most of it is due to what OB gurus call the "theory of attribution" that human beings justify the good they do by attributing it to themselves and the bad by attributing it to external factors (environment, other people etc)
The same I think is true for organizations...if they succeed its because of themselves and if they do badly then they blame suppliers, markets, the appreciating rupee and consultants :-)! A steel company in Eastern India and an Auto Company in Western India and a two wheeler company in North India have been consistently beating market averages in terms of growth and new products ...and all of them have had upwards of more than 3 consulting firms in their factories at any given time ! We don't hear these firms (or the media) heaping praise on their consultants for the superlative performance...
"Dangerous Company" that you quote also has case studies when firms have used consulting firms well, the case of Dave Ulrich being one in point. The book also points out some points to manage consultants (they are any other resource!)
- Most firms come in awe of big global consultants and give them a carte blanche to create magic...that is a recipe for disaster and designed to burn a hole in the balance sheet
- A firm must project plan a consulting assignment and put its best people to manage the consultants.
- These days consultants are no longer taken for just advice but to buttress a temporary skill that a business lacks and therefore are not just advice-givers but also implementors.
Consultants can be of two types:
An Expert Consultant will have specific expertise in a certain field of business. Their knowledge will be specific to the task in concern and they will usually do the job without your input. They will be employed until the task has been completed and are usually consulted to solve short term problems. For example, it may be the set up of a computerized stock control, or completing parts of your marketing plan that you have little knowledge about.
A Process Consultant will have a general business knowledge and so they can be used in most cases. They will offer and share their advice to all those in the business and will also get involved in solving the issue. Process Consultants can be employed as an ongoing long term solution to a task and so they are particularly useful for developing and changing your business.
Hope this helps and adds some perspective...
Actually Witch Doctors goes beyond just consultants and calls 'management science' itself an 'immature discipline' lacking both academic rigor or research !
That is true if viewed from the lens of traditional academic disciplines...the lines between practitioners, academics and consultants in the world of management is very blurred...what, for example, would one call Gary Hamel or Micheal Porter ? They have their own consulting shops and they also teach...
Having said that, I'd like to do the difficult...try to analyse the bad press that consultants get.
Most of it is due to what OB gurus call the "theory of attribution" that human beings justify the good they do by attributing it to themselves and the bad by attributing it to external factors (environment, other people etc)
The same I think is true for organizations...if they succeed its because of themselves and if they do badly then they blame suppliers, markets, the appreciating rupee and consultants :-)! A steel company in Eastern India and an Auto Company in Western India and a two wheeler company in North India have been consistently beating market averages in terms of growth and new products ...and all of them have had upwards of more than 3 consulting firms in their factories at any given time ! We don't hear these firms (or the media) heaping praise on their consultants for the superlative performance...
"Dangerous Company" that you quote also has case studies when firms have used consulting firms well, the case of Dave Ulrich being one in point. The book also points out some points to manage consultants (they are any other resource!)
- Most firms come in awe of big global consultants and give them a carte blanche to create magic...that is a recipe for disaster and designed to burn a hole in the balance sheet
- A firm must project plan a consulting assignment and put its best people to manage the consultants.
- These days consultants are no longer taken for just advice but to buttress a temporary skill that a business lacks and therefore are not just advice-givers but also implementors.
Consultants can be of two types:
An Expert Consultant will have specific expertise in a certain field of business. Their knowledge will be specific to the task in concern and they will usually do the job without your input. They will be employed until the task has been completed and are usually consulted to solve short term problems. For example, it may be the set up of a computerized stock control, or completing parts of your marketing plan that you have little knowledge about.
A Process Consultant will have a general business knowledge and so they can be used in most cases. They will offer and share their advice to all those in the business and will also get involved in solving the issue. Process Consultants can be employed as an ongoing long term solution to a task and so they are particularly useful for developing and changing your business.
Hope this helps and adds some perspective...
On Mavens and Connectors or How Ideas Spread
Tipping point a book written by Malcolm Gladwell talks of two kinds of people who when they connect together can help ideas to spread (interestingly Gladwell started off by trying to do research on how epidemics spread)...
These two kinds of people are:
mavens - People who know things more than other people
Connectors - People who know lots of other people (more than average)
But interestingly the internet and social software can erase the differences between these two types of people :-)
On the net mavens can become connectors, when face to face interaction is not necessary:
Check out this article !
Tipping point a book written by Malcolm Gladwell talks of two kinds of people who when they connect together can help ideas to spread (interestingly Gladwell started off by trying to do research on how epidemics spread)...
These two kinds of people are:
mavens - People who know things more than other people
Connectors - People who know lots of other people (more than average)
But interestingly the internet and social software can erase the differences between these two types of people :-)
On the net mavens can become connectors, when face to face interaction is not necessary:
Check out this article !
On emerging Organizational Structures
My post on ISTT
The last century was dominated by the thinking of organization as
machines and view of organizational processes as mechanistic process
(where the job of the employees was to "manage" only, and terms
like "Value chains" originated - organizational metaphors )
This way of looking at organization still permeates our thinking
today, but there are emerging a new type of organizational system
that do not follow these models.
The question I want to ask is, do you think these reflect a
fundamental shift to how organizations are understood and managed ,
and point to a new age...or do you think these are only exceptions
and the organizational structures that the majority of us work and
make meaning for our lives will remain unchanged ?
<< The following links and text courtesy Dr. Madhukar Shukla
Gautam >>
Visa International:
(in fact, I will also recommend that you explore the chaordic.org
site - it is pretty interesting - and is founded by Dee Hock, the
founder and CEO emeritus of Visa International... another article on
Dee Hock can be found at Fast Company )
Mondragon Community:
A $5bn cooperative in Basque country (Spain), with 120 different
companies, 42,000 employees, which runs its own schools, colleges,
banks, credit unions, etc. since last 50 years.
http://www.ping.be/jvwit/Mondragon.html
http://www.sfworlds.com/linkworld/mondragon.html
(this last link has many links on articles/ resources on Mondragon)
To the best of my knowledge, one of the first companies to adapt this
perspective was Toyota, in their production systems (we call it JIT,
Kanban, etc. nowadays - focus on its efficiency, while forgetting its
foundations). Taichi Ohno, who designed the Toyota Production System
(in a book by the same name - wrote):
"A business organisation is like a human body. The human body
contains autonomic nerves that work without regards to human wishes
and motor nerves that react to human commaand to control muscles. The
human body has an amazing structure and operation; the fine balance
and precision with which body parts are accommodated in the overall
design are even more marvellous...
At Toyota, we began to think about how to install an autonomic
nervous system in our own rapidly growing business organisation. In
our production plant, an autonomic nerve means making judgements
autonomously at the lowest level; for example, when to stop
production, what sequence to follow in making parts, or when overtime
is necessary to produce the required amount.
These decision can be made by factory workers themselves, without
having to consult the production control or engineering departments
that correspond to the brain in the human body. The plant should be a
place where such judgements can be made by workers autonomously."
Needless to say (and I might as well admit:0))... that underlying
these, there is an ideological/value dimension (viz, business is a
part of society/communnity, and not the otherway round; that wealth
can be created in more comprehensive ways other than making just
profit/dividends, etc.)... In case, you are intereted in exploring
this perspective, check out:
http://www.pcdf.org/living_economies/
and then
http://members.tripod.com/~taodesigns/index.html
and then
http://www.context.org/ICLIB/IC41/Rowe.htm
etc. etc.
<>
My post on ISTT
The last century was dominated by the thinking of organization as
machines and view of organizational processes as mechanistic process
(where the job of the employees was to "manage" only, and terms
like "Value chains" originated - organizational metaphors )
This way of looking at organization still permeates our thinking
today, but there are emerging a new type of organizational system
that do not follow these models.
The question I want to ask is, do you think these reflect a
fundamental shift to how organizations are understood and managed ,
and point to a new age...or do you think these are only exceptions
and the organizational structures that the majority of us work and
make meaning for our lives will remain unchanged ?
<< The following links and text courtesy Dr. Madhukar Shukla
Gautam >>
Visa International:
(in fact, I will also recommend that you explore the chaordic.org
site - it is pretty interesting - and is founded by Dee Hock, the
founder and CEO emeritus of Visa International... another article on
Dee Hock can be found at Fast Company )
Mondragon Community:
A $5bn cooperative in Basque country (Spain), with 120 different
companies, 42,000 employees, which runs its own schools, colleges,
banks, credit unions, etc. since last 50 years.
http://www.ping.be/jvwit/Mondragon.html
http://www.sfworlds.com/linkworld/mondragon.html
(this last link has many links on articles/ resources on Mondragon)
To the best of my knowledge, one of the first companies to adapt this
perspective was Toyota, in their production systems (we call it JIT,
Kanban, etc. nowadays - focus on its efficiency, while forgetting its
foundations). Taichi Ohno, who designed the Toyota Production System
(in a book by the same name - wrote):
"A business organisation is like a human body. The human body
contains autonomic nerves that work without regards to human wishes
and motor nerves that react to human commaand to control muscles. The
human body has an amazing structure and operation; the fine balance
and precision with which body parts are accommodated in the overall
design are even more marvellous...
At Toyota, we began to think about how to install an autonomic
nervous system in our own rapidly growing business organisation. In
our production plant, an autonomic nerve means making judgements
autonomously at the lowest level; for example, when to stop
production, what sequence to follow in making parts, or when overtime
is necessary to produce the required amount.
These decision can be made by factory workers themselves, without
having to consult the production control or engineering departments
that correspond to the brain in the human body. The plant should be a
place where such judgements can be made by workers autonomously."
Needless to say (and I might as well admit:0))... that underlying
these, there is an ideological/value dimension (viz, business is a
part of society/communnity, and not the otherway round; that wealth
can be created in more comprehensive ways other than making just
profit/dividends, etc.)... In case, you are intereted in exploring
this perspective, check out:
http://www.pcdf.org/living_economies/
and then
http://members.tripod.com/~taodesigns/index.html
and then
http://www.context.org/ICLIB/IC41/Rowe.htm
etc. etc.
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