Dedicated to Joseph P. Wisdo (1951-2013) Colleague, Friend and Humanitarian
“Ideals are like stars; you will not succeed in touching them with your hands. But like the seafaring man on the desert of waters, you choose them as your guides, and following them you will reach your destiny.” – Carl Schurz
Since the early 1980s, many organizations suffered wild swings between a starboard of success and a port of failure1; others sailed a steadily if variable course one leg at a time2. Like well-run ships, they steered successfully avoiding the shoals and sandbars of social, economic and turbulent business change, as wealth and production began to migrate to newly industrializing economies abroad. We must accept the fact that rapid change is a constant companion with us today. If your enterprise is not agile enough to respond to the change, it won’t survive. Persistent vision along with consistent leadership are the guides needed in an agile enterprise to keep it safely on course to success and knowledge is the key to being operationally effective.
First let’s talk about some of the aspects of change. There are many waves in the ocean of change that we are being subjected to such as social, environmental, economic and technology. For example, the rapid changes in computing technology alone were present since the 1980s and still are rampant today3. This single factor alone has had a dramatic influence. In many ways, though this change has been astounding, it is not unpredictable as we see in Moore’s Law4. Personal computing has exploded since it’s birth. The IBM 5150, the first model of the IBM PC, was released in 1981. Following on its footsteps, the Commodore 64, had sales of more than 17 million units in 1982–1994. The Macintosh 128K, the first commercially successful personal computer to use a graphical user interface, was introduced in 19845.
Now we have technology like laptops that use special turbo boosts and sport high-end clocks at 3.0GHz with Intel i7 Core processors6. A single laptop like this has almost 70,000 times more computing power than the computers that were used aboard the Apollo mission spacecrafts which operated at only 0.043MHz and had a paltry 64Kbyte of memory7. Pundits are now predicting that even this technology is archaic, and talk about 2013 as the end of the laptop8.
While change is essential to growth, it doesn’t mean you are a piece of flotsam adrift on a wild economic sea. You need the guidance of a strategic vision and the consistency of leadership to implement it9. How do you develop a realistic vision for your enterprise? You simply answer the question: “What will your company be known for and how will the public judge you?” Your vision should cover what your organization values. Values motivate everything in an organization by incubating culture. Cultures drive policies and priorities and provide a framework in which decisions are made. They also paint a picture of how the business wants the world in which it operates to be.
A vision’s focus is on the future, a destination that is never actually achieved10, only steered towards. It is the inspiration that causes employees to want to do their best. The vision must cover beliefs that are shared amongst all the stakeholders of an organization. All good visions have two components that are shining stars to navigate by. The first is the concept of mutual success for employees and clients as well as the business. The second is an unflagging commitment to ethics and quality. We have seen some drastic failures and even implosions from people11 and companies12 who have lost their way because they did not have these values as their strategic guides.
From the meltdown of Enron13 to the lapses at Toyota14 many companies of all sizes have run aground. Even whole industries like the automotive15 and financial16 industries suffered almost complete failure. Some claim this was due to the mismanagement of executives. Yet these very same people are often lionized as business high flyers and economic geniuses17. Yet others18, piloted19 by fiscal prudence, sailed through these waters seeming unscathed by the sharp corals of change that gutted so many other large seemingly unsinkable businesses. The benefits of managerial agility must be balanced by strategic vision if you actually intend to arrive at a destination. How many organizations during the internet boom could have survived had they followed these principles? This is a very important concept and something too many businesses forget. There is some contention that only a small organization can be agile20, yet this is an inherent aspect of politics rather than size.
Regardless of size, your organization should be a lean21 one with a low management contingent. Wages and salary costs for management, professional and other related items were 69.5% in 201222. That’s far too much for an agile organization. A good rule of thumb is, if you draw a line through your organization’s compensation costs separating management from the rest of the work force and your management costs are greater than 20% you are not empowering or engaging your employees. The bottom line is you are not agile. Your ship, regardless of size, must be lean in order to be a nimble and agile one.
There are also some significant advantages in being nimble to keeping your enterprise in the private sector or to taking it back there, if it has gone public. It interesting to note that at this time even some very large companies in the information technology market, like Dell23, are looking to return to their privatization roots. You do need a certain critical mass to tackle large projects or technically sophisticated endeavors. You can achieve this, however, by means of a virtual corporation instead of a single brick and mortar company loaded with hierarchy and bureaucracy.
Now let’s talk about the importance of knowledge. While you must remain nimble you also need to know how to respond quickly and directly to a client’s changing needs. This is a knowledge centric era of today, where it is all about having the right person in the right place at the right time doing the right thing24. That requires ubiquitous knowledge and organizational fluidity. For businesses that operate in the higher strata of knowledge working, it is even more important for your future to also build a level of both sophisticated and raw intellectual power, that is unbounded by political hypocrisy and organizational hierarchy.
What is the “knowledge centric era25”? The answer once again goes back to the internet’s infancy. For the last 30 years the information services and technology business has strived to evolve its knowledge. Information Technology has advanced as much as or more so than any other industry in our history. This quest for knowledge was a splendid example of feedback. It serendipitously drove the quest for knowledge itself, namely via the internet26. Ah the wondrous internet… let’s take a step back once again to the early 1980s when I first started working in business. Back in 1982, the Internet protocol suite (TCP/IP) was standardized on and the world-wide network of fully interconnected networks called the Internet emerged.
ARPANET27, the world-wide web’s father, was expanded in 1981 when the National Science Foundation (NSF) developed the Computer Science Network (CSNET) was the first iteration of the internet. Then in 1986, NSFNET28 provided access to supercomputer sites from US based research and education facilities. Later on commercial Internet service providers (ISPs) surfaced throughout the late 1980s and early 1990s. Finally the Internet was commercialized in 199529, when the last restrictions on the use of the Internet to carry commercial traffic were removed.
2 That’s an agile principle small iterative steps in an every refined directions versus massively committed “Hail Mary” plays.
10 Things that are actually achieved are covered by goals and objectives.
19 A consistent vision along with unshakable ethics keeps an organization on track. Believe in what you do, have fun, take care of your customers and then make some money. Often those business people who put the last item first end up not achieving financial success strategically. By not pursuing profit at the expense of your ethics you can enjoy financial success strategically.
21 Yes, I have said I am not sanguine about lean. I was referring to methodology not organization structure.