Photo credit Tina Floersch
Deloitte surveyed 7,000 global business leaders and 92% of them said their number one priority was to update their business’ organizational structure. It makes sense that so many of them would identify the same issue at the same time. The simple fact is that having a great organizational structure has become a major competitive advantage.
You attract the best people when they know that their job is going to be interesting. You retain the best people when they know that their career can develop in all sorts of different ways. And if you can find a way to harness your people’s ideas and energy, you’ll dominate your market with them. This is unfolding on a global scale, and it’s unfolding the exact same way on the micro scale, in your area, in your market, between you and your competitors.
But structure’s not enough. It only addresses one side of the equation. It misses something that’s just as important.
Before we get to what’s missing, let’s look at structure. Worldwide, companies are dismantling traditional hierarchies and “forming dynamic networks of highly empowered teams.” They’re “dynamic” because they’re designed to change and adapt. As a species, we’re progressing so fast right now that every industry is open to disruption. That means putting innovation first has never been more important.
Companies stuck in a rut of hierarchical approval processes don’t stand a chance. Their mindset assumes the people at the top know everything. If that was ever true, it certainly isn’t today. A “highly empowered team” is far more likely to come up with winning innovations. In the absence of a hierarchy, the challenge for management is to set their team loose, but to hold them accountable at the same time.
To do that, you need to understand that members of the team have new needs, too. Traditionally an employee was expected to pursue a career within a department, progressing up a laddered hierarchy. Today’s workforce not only finds that boring, they think it’s nonsensical.
You can never tell how a person’s going to develop over time. You can never tell how a market’s going to develop, either. Therefore, today’s logic goes, if you’ve won a person’s commitment to your company, then your objective ought to be to get as much out of them as possible. This makes perfect sense to today’s careerists, especially Millennials, who want to give you as much as they can. Work for them is simply easier and more fun when they know they’re making a difference. Hold them back or shut them down, and you’ll lose them. Let them go, and they’ll love you.
Their needs and your competitive advantage match up perfectly. When today’s employee feels safe, certain that they’re a valued part of your company, then they will eagerly, even desperately, want to join the team where they can make their best contribution. If you let them, everybody wins.
I’ve spent most of my career working with businesses that have between fifty and five hundred employees. Companies of that size can’t afford to tell a team to “innovate” and then pay them for months while they try to “execute.” It doesn’t matter how enthusiastic or committed the team members are. Floating them for a period of time is simply out of scope.
You want “dynamic teams” because you want all their insights. You want all the energy they’re willing to give you. So the trick, for you, is setting them loose and holding them accountable at the same time.
There’s only one way to do that. First, go back and look at the hierarchy. You’ll notice that each part of it has it’s own special software application. Software grew up in a world of hierarchies, and so it fit itself into that structure. Sales has it’s software. So does Marketing. So does Finance, and Production, and HR, and every other non-dynamic “department” in your “organizational structure.”
You have to free that data if you want to free your people. Freeing all of it is not the answer. A deluge is incomprehensible. Freeing exactly the right data is the key. When exactly the right data are known by every team, then accountability becomes a non-issue. Everyone knows if things are going well. Everyone knows where the strengths are, and where the weaknesses are. When a dynamic team forms to take on a challenge, everyone will be able to track the data points they’re supposed to impact. If they do, or don’t, it will be plainly obvious.
That’s how you create accountability without a hierarchy. That’s how you set people free while keeping their eyes on the money. There’s no longer an approval process where some “superior” casts judgement. Now, the market casts judgement. It’s the shortest possible path between today and the future. It’s the most efficient way to turn your people’s commitment into success for your business. And your business’ success is, after all, exactly what your best people want.