How effectively can YOU manage in the shark-invested waters of hyper-competition? Organizations have two tasks: to achieve today’s targets and to create the future.
Many business commentators claim that organizations need to be more agile, innovative, responsive and entrepreneurial but the reality is more complex.
To make a profit today, costs need to be managed carefully. This requires efficiency, which in turn, depends on the use of clear, widely used processes. The downside of the drive for efficiency is that innovation could be stifled. So, the challenge is to create organizations that manage to strike the right balance between efficiency and innovation. This is not easy. Creative thinkers need the freedom to make mistakes, but this is costly from an efficiency standpoint.
There needs to be different processes and structures for execution and innovation, almost parallel organizations or cultures within the same skin.
Hyper-competition also calls for fresh thinking about how organizations must work. A clear vision is not easy in such a context because rapid change and complexity make the future so unknowable.
If you were on a boat trip on a lake, you could decide your destination in advance (vision), but running an organization in a fast changing market today is like being in a boat race where the destination is constantly changing and competitors are trying to outwit you and even to sink your boat. Not easy to make many decisions about where to go and how to get there in advance. Hence the premium on adaptability and agility.
Keys to Business Success
It is important to decide for every business what is the correct balance of innovation and efficient execution. Today, few businesses can get away with little or no innovation at all.
The challenge is that those people who are good at execution are not often the same as those who are highly innovative. Not many businesses have found the success formula that manages to combine these two kinds of people effectively. As a result, we often see businesses that are better at execution and some that are better at innovation. Getting both right is an art because it means having a very mixed culture with the right balance of systems, processes and types of people.
The field of organizational dynamics studies how the various sub-components of a business work to make up a smoothly functioning whole.