The key to survival for tomorrow’s organisation

Today organisations are being shaken by differences between the X, Y and Z generations and by the need to adapt to ‘digital natives’, those who have grown up in an online world.

 

But even this generational shift could be just one element in the widescale change that has to take place within organisations intent on retaining their leadership position.

What can larger organisations learn from start-ups?

The 21st century organisation is characterised by its response to advances in technology and the way in which digitalisation creates business value by shortening decision cycles and enabling the client or customer to be placed right at the heart of the organisation. It’s all about staying competitive and thriving in an operating environment that demands greater agility in adapting rapidly to change.

 

This applies as much to start-ups and small and medium enterprises as to large global organisations. Indeed, nimble start-ups are natural players in a dynamic economy, and they are nipping at the heels of larger organisations that are slower to adapt.

 

 

Nimble start-ups are nipping at the heels of larger organisations that are slower to adapt.

 

The boards of large organisations recognise the risks of losing out to their more agile competitors and the inherent danger of becoming too dependent on revenue streams that may one day dry up. The most critical question of digital transformation is how to evolve into an organisation that enables change, fuels growth and thrives in a climate of uncertainty.

 

Much corporate restructuring is about creating business units or profit centres that aim to respond to changing market conditions quickly, with shorter decision cycles, in order to stay attuned to market requirements.

 

Small and medium enterprises – the new benchmark

In markets where being agile nets great rewards, small and medium enterprises often show themselves to be the most able to react quickly to create new value. Their operating model has qualities that larger organisations could usefully adopt when rethinking their business models.

 

Small and medium enterprises can also give leaders and managers greater freedom to put their entrepreneurial flair into action than is often the case in larger organisations.

 

The downside is that the risk of failure may be heightened in smaller enterprises, as they lack the financial resources of their larger rivals.

 

 

Flattening the pyramid

The convergence towards a flatter, more collaborative, more project-led structure is a leading characteristic of tomorrow’s organisation. It’s an evolution that has the power to influence managerial and cultural change far beyond the generational differences mentioned at the start of this article.

 

Digitalisation and new technology are bringing about the end of the 20th century organisational model. This transformation is all about a change in the decision structure.

The previous business models and command process came in the following order:

Order > Command Chain > Control > Planning

 

New business models may look more like this:

Conceive > Initiate > Collaborate > Project > Engage > All centred on the customer

 

The leader’s role is to create the vision that will give the business shape and direction. Their responsibility is then increasingly focused on promoting interactions that put the client or customer at the centre of the organisation, as well as engaging staff and encouraging them to become self-directing.

 

The convergence towards a flatter, more collaborative, more project-led structure is a leading characteristic of tomorrow’s organisation.

 

Such new models, typical among SMEs, can be the engine of executive and managerial aspirations. As such, re-working the larger organisation into a collective of networked SMEs can represent an opportunity to create an agile ecosystem and provide a fresh approach to today’s challenges.

 

This ‘extended enterprise’ can take on the features of a start-up to enable agility, while capitalising on its own size and relationships with partners and suppliers.

 

Recruiting executive talent – breaking the mould

Until now, organisations of all kinds have sought to hire executives with the same academic and career background. But those days have gone. To find executive talent with entrepreneurial skills requires a new approach to recruitment, using more diversified channels.

 

Successful recruitment is no longer just about assessing hard skills and judging the strategic competencies of executive talent. It is worth bearing in mind that according to a number of recent reports, up to 50% of today’s known jobs won’t exist by 2025 as a result of further automation and with digitalisation revolutionising the way business is conducted. A candidate’s hard skills may soon be almost irrelevant.

 

Instead, the recruitment process should explore candidates’ readiness to join entrepreneurial projects and their ability to drive the vision.

 

The true question for in-company executive recruiters is whether they themselves are able accurately to assess a candidate’s expertise in adding new value beyond traditional models and focusing actions and behaviour on the end customer.

 

The recruitment process should explore candidates’ readiness to join entrepreneurial projects and their ability to drive the vision.

 

In conclusion

In today’s world, it’s “adapt to survive” and this makes it timely to re-think the organisational vision. In recruiting a new breed of leaders, what matters more than traditional competencies going forward is a passion for leading change and an ambition to be the one who writes the next chapter of the organisation.

 

KEY TAKEAWAYS

  • Smaller businesses are often faster on their feet than larger organisations and able to adapt better to changing market conditions
  • Large corporates have much to learn from the way SMEs structure their business for agility
  • Recruiters need to assess not only candidates’ traditional competencies but their entrepreneurial spirit and skill in driving change

 

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