There are times that you wish that two separate articles were joined into one. Such is the case with two articles published by Executive Excellence.
In May, 2001, our article, "Root Causes," appeared. In it, we discussed the vital importance of probing within the organization to uncover deep organizational issues in order to strengthen your company's performance and long-term profitability.
In June, 2001, Peter Drucker's "What is Our Business?" turned up. In his article, Drucker talked about the need to look outside the organization at customer and market realities to ensure success and endurance. Times change; customer perceptions, wants, needs and ability to purchase change. And companies who fail to monitor, and adjust to, these shifts fail to survive.
It comes down to this: survival requires vigilance. Company leaders must monitor both internal and external currents. Many do neither. Most do only a perfunctory job.
Why? We find that, from our polar perspectives, we and Drucker have arrived at many of the same conclusions. In large part it is a matter of:
The hardest egos to shake are those at the helm of successful companies. Most of us live with the rule, "Don't mess with success." We tend to hold our breaths and pray that whatever it is that we, or the gods, are doing right continues ad infinitum. It is a magical route to money and happiness. When that magic goes poof, then and usually only then, do we get the attention of heretofore contented management. "Then" may be too late.
Formulas for success are like Aunt Hattie's county fair prize-winning recipe for lemon meringue pie. The pie was perfect...if...the eggs are always the same size, the humidity was constant, the oven temperature didn't vary, the lemons weren't tarter than before.... You get the picture.
Drucker figures that "few definitions of a business have a life expectancy of more than ten years." Looking at the high-tech sector today, ten months may be a more appropriate guesstimate. As for the viability of organizational design, it s efficacy lasts until the first few shifts occur in executive and employee capability and personality.
Time is a villain. Management's time is often usurped and misused. It is difficult to stitch together the requisite hours to explore anything in depth. At most, surface issues are uncovered in odd bits and pieces of time, and proverbial guns jump from hip to hand.
Drucker says that the executive "sees the inside of the organization as immediate reality and sees the outside only through thick and distorting lenses, if at all." We say that the 'reality' they see inside of the organization may be smoke and mirrors. Unless they open their eyes and ears, put out their hands and edge forward into the organizational nooks and crannies, they won't know for sure.
Only strong organizations, with energized leaders who are eager to learn and willing to change, will look inward, outward and forward, constantly directing and redefining itself in response to internal and external forces. The challenge of leadership, after all, is to ask both questions: Who are we? and What is our Business?
Organizations are personal creations. To dispassionately look at their organization, top leadership must look at itself. That takes a tough skin and a robust backbone.
Let's face it. Finding answers to Who are we? and What is our business? (much less Who should we be? and What should our business be?) is no easy undertaking. It involves a complete assessment of the company's:
In short, companies can ensure long-term success only if they pay rigorous attention to both fronts: internal and external.