Saturday, September 19, 2020

Improve Business Balance and Growth Cycle Horizontally and Vertically

 The whole business ecosystem needs to communicate, negotiate, reciprocate, and cooperate with each other to harness change and improve the business balance and growth cycle both horizontally and vertically.

Rapid change, complexity, and uncertainty are the new normal, digital organizations have to self-adapt and self-renew itself, be able to reconfigure the organizational structure, and change their own behaviors for improving their responsiveness and flexibility. 

They can improve and accelerate organizational balance and growth cycle both horizontally and vertically, develop differentiated business competency to accomplish defined change, and make a seamless digital paradigm shift.

Horizontal pull and vertical push: In face of frequent disruptions, organizations today need to constantly “push themselves” out of their comfort zone to improve business agility, see change as an opportunity, and manage risks effectively. From top-down, “pushing” creates a sense of urgency to change -business leaders take the time to look at every situation from multiple points of view, and push for multiple solutions. However, “pushing" only is not efficient to drive digital transformation as you can manually change people’s behavior, but often cannot sustain change for the long run. As the old habit continues to bounce back, even causing change fatigue. Collectively, driving transformative change requires enthusiasm, belief, determination, and commitment as well as a good business case.

To strike the right digital management balance, it’s also critical to create a need for or find a need for a “pull” - pulling all necessary business resources to develop innovative business solutions and cultivate a culture of change, pulling all sorts of talents to build a high-performance team, or pulling all critical business elements to form the unique business competency, etc. Balance is the key: It is about leveraging the “push & pull” business forces to orchestrate a smooth digital transformation.

Horizontal unification and vertical accountability: Digital transformation is driven by both visible (hard) and invisible (soft) forces, from multiple directions. To run a high-performance business and unlock the collective human potential, it’s critical to break down overly rigid silo processes and organizational pyramids which cause bureaucratic management redundancy. The hierarchy must balance the freedoms, welfare, and responsibilities of the subsystems and total system and enforce vertical accountability. Accountability goes hand in hand with the delegation of authority or power. What's fundamentally changed is that management no longer gets to sit on the sidelines, they need to be fully engaged in helping the team deliver the most valuable things for the organization. A digital-ready organization can approach the flow zone when the positions in its hierarchy have clear and accountable tasks.

To deal with today’s complex problems and overcome challenges, individual work and group work cannot be done without horizontal unification. Cross-functional collaboration is the new normal. Business Architecture is a great tool for enterprise leaders to orchestrate the organizational interrelationship between people and process, streamline information and idea flow, enforce business communications, and foster innovation. Striking the right balance of centralization and decentralization. There must be enough central control to achieve coordination toward the large-system goals, and enough autonomy to keep all subsystems flourishing and functioning for achieving high-performance.

Horizontal linkages and vertical penetration:
Digital means exponential growth of information, limited hierarchy works best in a creative environment in which the free flow of information nurtures ideas and enforces vertical penetration. Overly rigid organizational hierarchy perpetuates bureaucracy and causes stagnation. There is silo spreading in the different layers of the organization; and the overly rigid hierarchy creates bottlenecks that prevent information flow and slows down business speed. With the fitting structure and people, information exchanged is free flow, penetrates into different layers, and is accessible to all group members and you are able to solve problems collaboratively.

As the digital world becomes hyperconnected, interdependent, and dynamic, horizontal linkage enables the business to streamlines information flow across functional borders and lead to faster decision making and easier idea access from people anywhere in the organization. The goal for optimized organizational design is to get the mass collaboration. It’s no surprise that we will see more cross-functional, cross-industrial, and cross-disciplinary sharing for solving complex problems and overcoming common challenges collaboratively.

To make a seamless transition from inside-out to outside-in, from static to dynamic; from industrial-segregation to digital modularization, the whole business ecosystem needs to communicate, negotiate, reciprocate, and cooperate with each other to harness change and improve the business balance and growth cycle both horizontally and vertically,


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