Following the first five of Ten Reasons Why Big Firms Stick With 20th Century Management, here are five more reasons:
1. The Transition To 21st Century Management Is Hard Work
Stopping the momentum of the giant flywheel of 20th Century management and turning it into something more agile can involve a lot of work. Everything in 21st Century management is the opposite of 20th Century management.
The goal of the firm is now to create a continuous stream of value for customers and users. Making money is the result, not the goal. This goal requires a different structure of work to enable the full talents of those doing the work, often through small self-organizing teams working in short cycles, focused tightly on delivering value for customers. Instead of a steep vertical hierarchy of authority, there is a flat network or hierarchy of competence, in which ideas can come from anywhere.
These three principles in turn require radically different processes. Leadership has to be inspirational rather transactional, and, given the distributed nature of work, it is required throughout the organization. Strategy tends to include not only coping with competition but also creating new businesses that attract new customers. Innovation encompasses systematic efforts to find new needs and new ways of meeting them, including the creation of interactive ecosystems. Sales and marketing involve making a real difference in the lives of customers and users. Given the new role of talent, people management must attract and enable the talent required to deliver value to customers. Because the firm operates as a network of teams tightly focused on creating customer value, the budget typically reflects decisions already taken in strategy; there