Transforming the Traditional Functional Mindset

In far too many organizations, senior management's traditional functional mindset represents one of the most significant barriers to change. Indeed, there is reason to believe that the traditional functional paradigm has done more to impede customer focused, business performance improvement over the past two decades than almost any other factor.

This way of thinking stands in the way of executives understanding and improving the flow of cross-functional activities which create enduring value for customers and shareholders. It promotes the type of thinking that impedes the effective deployment of enabling information technology. It promotes also 'silo behavior' and turf protection, and an undue pre-occupation with organization structure. This mindset contributes to the mistaken belief that if it was somehow possible to properly define the boxes on the organizational chart, and fill in the names of the "right" people in the key boxes – then the organization's performance will automatically improve. Yet, little is further from the truth.

Further, it encourages a distorted view of performance measurement and executive rewards, shifting focus away from meaningful measures such as the timeliness and quality of services provided to customers, and towards less significant measures around functional departmental performance.

It reinforces a task focus and traditional command and control behavior, where questions such as 'What is the scope of my responsibility?' 'What tasks I execute?' and 'Who are the key subordinates who can help me look good?' are foremost and top of mind.

Agile Management

For some time, management thinkers (and thinking managers) have been stressing the urgent need for radical new approaches to the corporation. In this paradigm, the bottom line cedes its pre-eminence to the top: the corporation concentrates on developing new revenue streams from new products and services, while optimising income from existing lines through innovative marketing and rapid exploitation of changing customer needs and tastes. The new kind of corporation is, above all, 'agile'.

The dictionary defines 'agile' as 'nimble or active: quick-moving and supple'. For decades, the big business has been compared to a supertanker, which can only be turned at lugubrious speed. Top managers fret about the lack of creativity and innovation beneath them, below the supertanker's decks, but their own decision-making processes and command structures stultify efforts - even ones which they themselves have promoted - to develop the new and rejuvenate the old.