The Leading Edge Isn’t

Tom Peters

The new conventional wisdom (flattening hierarchies, etc.), though far from conventional practice, is almost passe. Such is the pace of the global economy. Consider, then, these seven “beyonds”:

1. Beyond decentralization. Most big companies decentralized years ago. On paper. Yet the market’s demand for speed, innovation and responsiveness mocks yesterday’s timid “divisionalization.” There’s a “surplus of everything,” says ABB Asea Brown Boveri chief Percy Barnevik. The answer: Create spirited units obsessed with innovation. Barnevik, for example, atomized his heavy-industrial combine into 5,000 autonomous profit centers, averaging 40 people each. Harry Quadracci, CEO of the printing company Quad/Graphics, says a company president must be “the main disorganizer.” Near anarchy? Yes, but what’s the alternative when a dizzying variety of competitors are showering your market with new products?

2. Beyond empowerment. Though empowerment is still a dream at most outfits, giving workers a strong voice is insufficient. We need to turn every employee into a “businessperson,” as one exec puts it, or a “90 percent entrepreneur” in the words of another. You’ll be best served if employees forget traditional loyalty and act like Mom or Pop of Mom & Pop Inc.—i.e., assume the role of corner-store owner and take any and all initiatives to excite nearby customers.

3. Beyond disintegration. Blowing up the headquarters (perhaps literally) and excising middle management are musts. But so is hooking up to create a new form of “organization” that routinely changes shape.

Marketplace muscle is still important. But these days it rarely comes from owning all (or even many of) the bits yourself; to the contrary, it’s increasingly the product of strategic competence at creating and nurturing alliances of all kinds.

4. Beyond re-engineering. Re-engineering means linking formerly separate functions, then stripping most steps from old cumbersome business processes. But I worry that “engineering,” in any guise, implies one best way to do things. And that’s decidedly not the answer for tomorrow’s organizations.

Forbes ASAP magazine recently profiled VeriFone, the U.S. market leader in credit card authorization systems. Everybody there is part of an ever-shifting electronic network. “Tap in … or die,” says one manager, only half in jest. New-look organizations will be like VeriFone—self-designing and constantly evolving. Who knows whom from who knows where will be required at who knows when tomorrow to do whatever to solve a problem that can’t even be imagined today.

5. Beyond learning. “Learning organizations” are a hot topic these days. But even organizations that keep getting smarter fall short. Enter the curious corporation. The average company is dull as doornails, which simply will not do in a decidedly non-dull marketplace.

Inc. magazine recently featured a fictional letter from “Determinedly Seeking the Perfect Job.” It began, “I don’t want to screw around anymore in a place that’s badly managed, poorly run and so stupid I’m just wasting my time. Or a place where you have to be a vice president to get a window. I want to take my dog to work, at least on Saturdays. And if I break into a chorus of ‘Oklahoma’ at 4 p.m., I want two people to harmonize with me—not look at me sideways.”

Makes sense to me!

6. Beyond total quality management. TQM is about reducing TGWs, or things gone wrong (an important quality measure in the auto industry). That’s essential. But in a crowded market, increasing TGRs, or things gone right, is the real trick. Cutting TGWs is mechanical. Increasing TGRs requires artistry.

Is your insurance agency or computer company “neat”? How about your hospital? A Toronto seminar participant, President Marilyn Bruner of Markham Stouffville Hospital, heard me quote health-care futurist Leland Kaiser, who believes you should “have a good time” during a hospital stay. She and her colleagues recently issued a mission statement affirming “our commitment that every patient’s visit … will be a great experience.” Brilliant! These days, quality as measured by the numbers is merely a pass to the playing field. You score touchdowns by making customers (or patients) glow.

7. Beyond change. The previous six “beyonds” add up to revolution. The Financial Times recently reported on a speech to world automakers by Volkswagen’s controversial Inaki Lopez: “Kaizen is yesterday’s text. … Today’s is ‘quantum leap’ from 5 or 6 percent to 40 or 50 percent (improvement).”

The time for plodding forward is past. The moment for revolution and revolutionaries is at hand. For you and me. And for our corporations. We thought the last 10 years were wild and woolly. Ha! Wait ’til you see what’s coming.