Thursday, November 27, 2014

Three Key Factors for Organization from Good to Great

There is no magic formula from good to great, first things first, doing these fundamental things right.

Every organization, from industry bellwether to fast-growing niche player, or even startup tries to figure out the magic formula from good to great, besides talent, what are the other key factors that contribute to the business’s long-term success? 
Vision: First an organization must have a vision that is well articulated and communicated through its ranks. Leaders should actively make decisions that are in concert with the vision. There’s also a collective belief in the organization’s vision for the future, that this vision can and will be a success. This vision should drive all decisions, both those taken by the leaders and their subordinates and their subordinates. If we all work towards one goal (be that increased profits, a greater customer experience, a more efficient service, etc.), it becomes far easier to achieve. Machines work best when their cogs turn together in the same direction. Though the modern business is more like a living body, only through seamless collaboration from each part, it can function at an optimal level.

Culture: the people in the organization must be empowered with decision rights relative to what they are responsible for. Empowering people to make decisions, take actions, and innovate is crucial. A 'fear of vulnerability' can appear if people are not encouraged to try new things or are punished for making the wrong choices. To avoid 'fear of vulnerability,' employees must not only be empowered to make decisions but trusted to take risks and given the support to learn from any mistakes. After all, we learn from trial and error. If you don't have the chance to error, how can you innovate?
Measurement: Effective Performance management is important as well. You can only manage what you measure. The team must be rewarded appropriately both intrinsically and extrinsically for their contributions. The effective performance management is both art and science, not only shall you measure the tangible or quantitative result, more critical for the long term, you need to assess the VIRTUE or shared VALUE, which directly impacts organization’s culture and brand, virtuous people, and virtuous actions are necessary for the business’s long-term success. Sustained business success depends on good virtues such as professionalism, positives, teamwork, trust, empathy, and loyalty, etc. You might call these shared values or a belief system.
Digital organizations today are more organic than mechanic, hyper-connected and always-on, in order to achieve the long-term business vision, they have to continue to refresh their collective mindset – corporate culture, they have to build the learning capabilities, empower their talented employees to make effective decisions, and measure the right things (both tangible productivity and intangible factors such as virtue and value) and measure them right (following S.M.A.R.T principle). There is no magic formula from good to great, businesses just have to experiment and learn, first things first, doing these fundamental things right. 


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