The Organization of the Future
Transformations are tough. Especially when you’re not sure of exactly what you’re changing into. This is, in a nutshell, the problem faced by many organizations today. Top managers know their companies must morph to stay competitive, but they’re not always sure of how to reorganize or even what business they should be in.
Today’s best guess is that corporations will need to become more “web-shaped.” As Business Week recently reported in a series of articles on the 21st-century corporation, the organization of the future is likely to have a “flat, intricately woven form that links partners, employees, external contractors, suppliers, and customers in various collaborations.” The idea is that companies will become more dependent on one another’s know-how, focusing on their core competencies as they outsource other business activities to other types of experts. In such an organization, management becomes the art of weaving and maintaining a complex network of partners and employees.
Other predicted features of future organizations are that they’ll stay flexible and be able to change quickly. They’ll be global organizations that focus like a laser on customers, and they’ll often leverage information technologies to provide “mass customization,” tailoring products and services to each client.
These organizations are likely to come in all sizes. On one hand, information technology can make it easier for a firm to gain economies of scale. Bank of America, for example, is reportedly using information technology to manage a nationwide bank as easily as it did a single state bank. But an enormous workforce isn’t a given. Despite all the mergers of the last 10 years, the 100 most valuable U.S. firms today have slightly fewer employees than their counterparts did 10 years ago, and yet their collective market cap has skyrocketed by 500%.
The most successful firms will be able to use new technologies to dramatically ramp up productivity. For example, a typical bank transaction costs $1.25 when handled by a teller but just 2 cents when processed over the Internet, representing a huge savings and productivity boost of around 6000%.
What will the workforce look like in future organizations? It will probably be a combination of contingent workers (many of them professionals who work as free agents) and talented core employees packed with loads of valuable company-specific knowledge. It will be critical to attract and retain core workers because intellectual capital is fast becoming the most valuable corporate resource. These people will need to be more than well paid; they will need to be well challenged and well led. Indeed, companies will put a premium on leaders who are masters of change, motivation and teamwork. “The next generation of corporate leaders will need the charm of a debutante, the flexibility of a gymnast, and the quickness of a panther,” writes Diane Brady of Business Week. Some experience abroad, a good sense of humor, and an understanding of technologies will also help.
The workforce will probably be much more diverse in lots of different ways: ethnically, culturally, nationally, sexually, and in terms of lifestyle. Some employees will be freelancers who value their rugged independence, and others will want to be coddled inside a secure corporate cocoon. Employees from across the globe will use networks and interactive software to work together in international project teams.
And what of HR? The forecast is mixed. On one hand, web-shaped organizations will probably automate and outsource much of traditional personnel administration. Many HR departments may shrink as HR productivity rises. On the other hand, the strategic aspects of HR’s job may well become more crucial in an age when intellectual capital is the organization’s most valuable resource. HR may increasingly be charged with analyzing data from HR information systems, managing relationships with HR- service vendors, forming strategies based on human-capital analysis, developing global diversity training and learning systems, and tending the all-important 21st-century talent network.
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A seminar entitled "How Will Work Be Organized in the Future?" will be held at The Westin Riverwalk Hotel in San Antonio, TX, on October 19, 2000. The guest keynote speaker will be Dr. Karen Stephenson, an internationally recognized authority in network theory and practice.
Business Week recently published a fine series of articles entitled "The 21st Century Corporation". Please see
http://www.businessweek.com/2000/00_35/b3696001.htm
Today’s best guess is that corporations will need to become more “web-shaped.” As Business Week recently reported in a series of articles on the 21st-century corporation, the organization of the future is likely to have a “flat, intricately woven form that links partners, employees, external contractors, suppliers, and customers in various collaborations.” The idea is that companies will become more dependent on one another’s know-how, focusing on their core competencies as they outsource other business activities to other types of experts. In such an organization, management becomes the art of weaving and maintaining a complex network of partners and employees.
Other predicted features of future organizations are that they’ll stay flexible and be able to change quickly. They’ll be global organizations that focus like a laser on customers, and they’ll often leverage information technologies to provide “mass customization,” tailoring products and services to each client.
These organizations are likely to come in all sizes. On one hand, information technology can make it easier for a firm to gain economies of scale. Bank of America, for example, is reportedly using information technology to manage a nationwide bank as easily as it did a single state bank. But an enormous workforce isn’t a given. Despite all the mergers of the last 10 years, the 100 most valuable U.S. firms today have slightly fewer employees than their counterparts did 10 years ago, and yet their collective market cap has skyrocketed by 500%.
The most successful firms will be able to use new technologies to dramatically ramp up productivity. For example, a typical bank transaction costs $1.25 when handled by a teller but just 2 cents when processed over the Internet, representing a huge savings and productivity boost of around 6000%.
What will the workforce look like in future organizations? It will probably be a combination of contingent workers (many of them professionals who work as free agents) and talented core employees packed with loads of valuable company-specific knowledge. It will be critical to attract and retain core workers because intellectual capital is fast becoming the most valuable corporate resource. These people will need to be more than well paid; they will need to be well challenged and well led. Indeed, companies will put a premium on leaders who are masters of change, motivation and teamwork. “The next generation of corporate leaders will need the charm of a debutante, the flexibility of a gymnast, and the quickness of a panther,” writes Diane Brady of Business Week. Some experience abroad, a good sense of humor, and an understanding of technologies will also help.
The workforce will probably be much more diverse in lots of different ways: ethnically, culturally, nationally, sexually, and in terms of lifestyle. Some employees will be freelancers who value their rugged independence, and others will want to be coddled inside a secure corporate cocoon. Employees from across the globe will use networks and interactive software to work together in international project teams.
And what of HR? The forecast is mixed. On one hand, web-shaped organizations will probably automate and outsource much of traditional personnel administration. Many HR departments may shrink as HR productivity rises. On the other hand, the strategic aspects of HR’s job may well become more crucial in an age when intellectual capital is the organization’s most valuable resource. HR may increasingly be charged with analyzing data from HR information systems, managing relationships with HR- service vendors, forming strategies based on human-capital analysis, developing global diversity training and learning systems, and tending the all-important 21st-century talent network.
====================================================
A seminar entitled "How Will Work Be Organized in the Future?" will be held at The Westin Riverwalk Hotel in San Antonio, TX, on October 19, 2000. The guest keynote speaker will be Dr. Karen Stephenson, an internationally recognized authority in network theory and practice.
Business Week recently published a fine series of articles entitled "The 21st Century Corporation". Please see
http://www.businessweek.com/2000/00_35/b3696001.htm