A breath of fresh air changes the corporate climate
Companies need to change the atmosphere from stultifying to crisp. A new book tells how it's done, writes Roger Trapp
Sunday 16 November 1997
As Lynda Gratton, a professor at London Business School, said in a presentation last week, there is much rhetoric but little action. Why this is so is suggested by Sumantra Ghoshal, her colleague, who has published a book with his collaborator Christopher Bartlett.
Their thesis, set out in The Individualized Corporation (HarperCollins), is that business is operating by outmoded models. Reliance on strategy, structure and systems was fine early in the century, when Alfred Sloan and other engineers laid the foundations of modern management, but is not enough in an age when knowledge rather than capital is the important resource.
The authors argue that the three Ss should be supplemented, though not replaced, by three Ps - Purpose, Process and People. Heeding such matters as well as traditional fundamentals is, they argue, what sets apart the likes of 3M, Canon and ABB. Such organisations create atmospheres encouraging the initiative, creativity and commitment on which business success seems to depend.
Though Mr Ghoshal, professor of strategic leadership at LBS, uses the traditional armoury of charts and diagrams to make his points, the sense of what he and Mr Bartlett, a professor at Harvard Business School, are saying is best expressed through an analogy.
A true internationalist, Mr Ghoshal is an Indian who formerly worked at Insead, outside Paris. He visits his native Calcutta with his family every July because that is the only time his children have enough holiday. At that time the city is extremely hot and humidity is close to 100 per cent; so stultifying that Mr Ghoshal spends most of the time indoors, much of it in bed.
He contrasts that with spring in the Fontainebleau forest around Insead's base. The atmosphere is so clear and crisp it is, he says, "impossible just to go for a walk in the woods". You want to jog or jump up to touch the branches, so invigorating is it. Most companies, he says, are like "Calcutta in July" when they should aspire to resemble "Fontainebleau in spring".
They should do this by moving beyond strategy, structure and systems to purpose, process and people. Perhaps the most critical is the shift from systems towards people. As Mr Ghoshal and Mr Bartlett point out, the problem with the traditional approach is that, while top managers see systems as their vital link with operations, front-line managers regard them as "shackles" binding them to their desks and keeping them in their place. "In a service-based economy in the midst of a knowledge revolution, the old assumption that top management could define priorities and monitor operations through sophisticated information, planning, and control systems has become an illusion. The old-style corporate emperor has no clothes."
- 1 Finland schools: Subjects scrapped and replaced with 'topics' as country reforms its education system
- 2 The West has it totally wrong on Lee Kuan Yew
- 3 Watch: Man takes selfie every mile of 2,600 mile hike, creates amazing timelapse video
- 4 #FreeTheNipple: Women in Iceland bare breasts in solidarity with trolled student
- 5 Scientists have discovered a simple way to cook rice that dramatically cuts the calories
Germanwings captain Patrick Sondenheimer tried to break into locked cockpit door 'with an axe' as plane was descending
Amanda Knox murder conviction: Italian court overturns verdict for US student and Raffaele Sollecito in the killing of Meredith Kercher
Saudi Arabia says it won't rule out building nuclear weapons
The battle for the Middle East's future begins in Yemen as Saudi Arabia jumps into the abyss
Jeremy Clarkson 'could be given minder' ahead of a potential Top Gear return
Nigel Farage brands LGBT activists 'filth' and 'scum' and accuses them of scaring away his children after they invade his local pub
Ukip supporters are 55 or older, white and socially conservative, finds British Social Attitudes Report
JK Rowling responds to fan tweeting she 'can't see' Dumbledore being gay
Russia threatens Denmark with nuclear weapons if it tries to join Nato defence shield
Jeremy Clarkson sacked live: Alan Yentob 'wouldn't rule out' ex Top Gear host's BBC return
Revealed: Putin's army of pro-Kremlin bloggers
iJobs Money & Business
Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...
Negotiable: Recruitment Genius: You will be the first point of contact for all...
£18000 - £24000 per annum + benefits: Ashdown Group: HR, Payroll & Benefits Of...
£35000 - £38000 per annum + benefits : Ashdown Group: A highly successful, int...