Technology Has Changed the Operational Fabric of Successful Corporations
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Over the course of my consulting career, I have found many similarities in the problems facing many corporations. One reason why there is a “repetitive theme” to the types of problems I encounter is that most large organizations I consult to still are very “hierarchical” in structure. This is a popular form of organizational structure that has been prevalent for many decades and has been particularly effective in manufacturing organizations. A key reason for the wide use of this sort of structure was that, for many years, information systems had difficulty in supporting more flexible organizational structures.
Today however, relational systems, client /server technologies, virtual computing environments, Cloud Computing, and the Internet explosion as a whole has made it easier to share information across geographically distributed organizations; to market the organization globally in concert with social media platforms and 3rd party interfacing, new object-oriented development approaches have improved the flexibility of applications to better meet the needs of more end users and customers; and data warehousing/data mining, imaging, EDI and workflow technologies have made it easier to dramatically improve internal business processes, provide better business modelling and forecasting capabilities, and reduce operating costs.
In the past dozen years or so, a paradigm shift has taken place in the way people think about corporations. Project and process teams are replacing divisions; decisions are being made at all levels of a corporation as opposed to management only; management structures are flattening with managers becoming more like hands-on coaches working alongside other team members rather than monitoring and controlling from the top; and workgroup/account manager structures are replacing segmented ‘task’ based structures where each employee is asked to do only a few components of the process before handing units of work off to be completed by others in the chain. Benefits organization are reaping through this type of restructuring are enormous and are eliminating a large number of inefficiencies that are inherent to hierarchically structured organizations including:
· Customer service is improving dramatically – no longer are customers shunted from department to department to get answers, now they are able to establish relationships with individual ‘account managers’ who can answer all their questions, make decisions on their behalf, and provide them with all the support and comfort they desire.
· Decisions can be made much more quickly, usually within the process teams as each team is represented by personnel from different parts of the process cycle. This type of fluid structure can greatly reduce new product and service development times, as approvals no longer have to go through multiple channels in a number of departments.
· The quality of products and services increase as people are no longer being asked to make decisions or approve product designs/service offerings with only very focused frames of reference. Through daily exposure to other team members, they can now make decisions based on a much broader understanding of the issues making their own individual expertise much more useful.
· No longer are divisional performance objectives obtained at the expense of the total enterprise. Managers are no longer more concerned about achieving results in their own departments than they are in achieving corporate profitability and service targets.
· Empowered employees are now much more useful to the corporation. As they are now being asked to contribute their knowledge to project teams instead of being asked to perform only simple tasks, the corporation know has a much broader knowledge base upon which to improve corporate effectiveness.
· Facilities costs and direct internal marketing expenses are reducing as more and more corporations are enabling staff to work from home. Many organizations now also contract out many of their services to stay at home entrepreneurs – such as “social media” marketing of their products, independent testing and reviews of their products, making use of 3rd party “sales channels” to build advertising and distribute it, etc.
The above are just a few of the benefits that corporations who have gone through the pain of transformation have experienced. Organizations including Sony, Google, Ford, WalMart, IBM, Dell and General Motors to name just a few have all undertaken these transformations and have greatly improved their competitiveness and profitability as a result.
To conclude, it is evident that organizations need to build ongoing process re-engineering into the fabric of their organizations and that Marketing and IT departmentally and knowledge-wise need to become equal partners in the vision and direction setting activities that a corporation undertakes.
Corporations ignore the power of social media, the Internet and today’s rapid technological innovation in the marketplace in general at their peril as today, these are not just strategic competitive weapons; they are corporate survival itself – and corporations need to constantly adapt or get left behind.