During a recent seminar, I was asked to summarize the challenges
facing companies in the '90s. Here's how I responded.
- The end of hierarchy.
At the half-billion dollar Wisconsin printing firm,
Quad/Graphics, just two layers of management separate the chief
executive and the new hire. Wal-Mart, The Limited and Benetton
zapped traditional retailers for many reasons - but their very flat
organizations top the list. The pyramidal organization is fast
changing into a network without a clearly defined ``top,'' or even
- The corporation as a network of subcontractors.
Kao, Japan's leading package goods company, induces $5 billion
in sales from about 6,000 employees; a typical American
counterpart, with only twice Kao's sales, has 100,000 people on its
payroll. The difference: subcontracting. It amounts to an overall
reconception of the corporation as a network of the best providers
of services - plant watering, manufacturing, research and
development - brought together to perform a marketplace mission. A
whole new idea of equality in relationships with outsiders
accompanies the change: The corporation shifts from the traditional
``I-centered'' (I call it pre-Copernican) approach to a
- A horizontal/project orientation.
Routinely working across functional barriers becomes ``the way
we do business around here.'' Careers are a series of projects.
Professional service firms (lawyers, accountants, consultants),
which have traditionally used project teams, are emerging as the
best organizational models.
- Continuous improvement/continuous learning a way of life.
Workers, ensconced in self-managed teams, will be expected to
make things better each day, not just ``show up.'' Smart leaders
will reconceive the corporation as a (ital) university (end ital),
dedicated to worker learning from day one until retirement.
- Information technology changes everything.
``IT'' is altering all products - from ``smart'' cars to
``smart'' buildings. And for the likes of retailers, sophisticated
data bases are as important as the right location. Moreover, IT
upends every organizational relationship: Inside the firm, it
permits instantaneous communication between functions and demands
the empowerment of people at the front line; outside, it fosters
seamless connections with vendors, distributors and customers.
- Time-obsessed competition as the strategy for the '90s.
In their book ``Competing Against Time,'' the Boston Consulting
Group's George Stalk and Tom Hout observe that 95 to 99.95 percent
of the time that we spend ``working on'' something is wasted. ``It
takes 20 days to process an application around here,'' we say; but
the real ``action'' amounts to more like 20 minutes. …