article 4 final

7/31/2019 Article 4 Final

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CHANGES FORCHANGES SAKE

By Freek Vermeulen, Phanish Puranam, AndRanjay Gulati


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Group Members :-

Ashish Mittal

Kunal Nagrani

Mayur Chatwani

Prakash Sahu

Rohit Rajpurohit

Tarak Chauhan Group :- 11


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Table of Contents :-

Introduction

When and How to change?

The Formation of silos

The Deadening Impact of Routine A REGIMEN FOR CHANGE

The Emergence of Entrenched interests

Knowing When to change?

Bibliography


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Introduction:-

Why There is need to change?

Competitive Landscape

External and Internal Environment

Human Dynamics Forming new Network

Creativity, Innovation and Adaptability

Resource allocation


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When and How to change?

FosterCommunic

ation

Use informal networks to compensate for limitsof the formal structure

Be prepared for Repeatedly process

BuildingAgility

problem

Expose people for new aspect of tasks andopportunity

Be prepared to accept a constant state of milddisruption

Breakingup

entrenched interest

Change the dimension along which resources

are allocated Be prepared for disenfranchise and even lose

certain people


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The Formation of silos :-

Companies are organized around a single criterion :

Product, Geography, Function or Market

Drawback to Organize as a matrix is blur accountabilityand slow down decision making.

Periodically reorient is the best solution around adifferent criterion.

Functional example of CISCO

Three lines of business : Marketing, Sales and R&D. Separate unit and customer focus.

Centralization in R&D.

Cost effective technical innovation.

Exchange idea and Collaborate.


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Contd

Foster economies of scale and streamline productoffering.

Possibility of losing touch with customers, so formalstructure and informal networks and culture eventuallyrealign.

In 2004, creation of three Business Councils : Cross-functional and Cross-technology solutions.

Feedback on strategy, products and services.


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The Deadening Impact ofRoutine :-

Exploitation drives out Exploration.

Product example of HEWLETT-PACKARD

Centralization of function of sales, marketing and

product development and their subsequentdecentralization into product groups.

Companys performance suffered due to exchange.

Changes to be taken place :

Emphasize individual performance. Rearrange office space.

Grouped by function instead of customer segment.


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A REGIMEN FOR CHANGE

Structure, Reward and Process

STRUCTURE : How is your business organized?

Function, Geography, Customer type, Product

REWARDS : What is emphasized in performancereviews and compensation?

Individual, team, or companywide incentives

Open versus confidential appraisals

Short-term performance versus long-term development

Revenues versus value-added

PROCESS : How do you carry out your work?

Decision rights (Who decides what, reporting lines)

Distribution (Centralized or Decentralized)

Location (Which process sit next to each other)

Focus (Customer or Product)


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Geography example of GEHEALTHCARE :-

Increased focus on services and customer

Three geographic centers, move towards combinedequipment and services

Forward looking performance system management andincentive system

Two position :

Enterprise General manager to look after major

account Enterprise development Executives for building

customer partnership


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The Emergence of Entrenchedinterests

Inefficient at allocating resources, so assigning largerproportion of its resources and power

Centralized corporate fund to subsidize cross-unitcollaborative project, so its opportunity to strengthen theweaker unit.

MARKET Example of JLS, jones lang laSalle(globalcommercial real estate company):

In the business of leasing, commercial propertymanagement and provision of services related todevelopment of new buildings

Company was unit measured, three departmentalhead made decision


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Contd

Organized into Three division:

Tenant representation Group

Corporate property services

Project and development services


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Problem was units were not equally strong in specificgeographic market, so collaborate to develop fastgrowing and profitable market for the provision ofintegrated services to large multinational firm is

necessary.

Replace the three units with new structure organizedaround client for relationship with clients and market fortransaction in large metropolitan areas.

Effect was share price was tripled and grown at 25%rate.

The changes are

Time consuming

With high cost


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Knowing When to change?

A CORPORATE CHOLESTEROLE TEST

1. The quality of communication and collaboration

Do employees interact only with people from their own

group? Y/N Are there strong subcultures that align with business

groups or divisions? Y/N

Are there breakdowns in communication caused by the

formation of silos? Y/N Has collaboration between groups decreased over the

past five years? Y/N

Total Yes Answers ___


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Contd

2. The capacity to adapt Are many people uncomfortable with

change? Y/N

Do people and groups operate according towell-established routines? Y/N Has it been a long time since your firm

developed a significant new revenue stream?Y/N

Has the percentage of revenue from newstreams decreased over the past five years?Y/N



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Contd

3. The balance of power among groups

Do influential groups or individuals use most of thecompanys resources? Y/N

Is it difficult for people outside the companys centralgroup to obtain resources? Y/N

Do influential groups or individuals impede decisionmaking? Y/N

Have the groups or individuals that were influential fiveyears ago extended their influence? Y/N



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Contd

Final Score

02 yes answers

Theres no need for change just yet.

37 yes answers Its the perfect time for a change.

812 yes answers

Youre late already; your company needs

substantial change.


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change is not easy, [but] you cant

dodge it. it is with you. and youdbetter embrace it.

Alfred West


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article 4 final

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