Wednesday, February 20, 2008

Future Corporation: The organization will be a totally different animal

Donuts, Rowing Eights and Fleas. Yes, that’s how you’ll describe the corporations of the future. On a winter afternoon in Jaipur last year, the old man of management, Charles Handy was at his articulate best. What provocated a long spiel from him was, the future of organisations, a concept he had written about in many of his books. The whole world listened in rapt attention as he
illustrated his point one by one. Donut — comprising a core set of people in the middle who drive the organisation as a central force; Rowing Eight was akin to a boat rowed by eight people with a leader at the helm. And last, the Fleas,
he prophesied more and more individuals will spend more of their lives as fleas, or as members of flea organisations. Elephants can go into hibernation. Every guru worth his salt has written about the future and how it will change the organisations. Changes technology will drive, dismantling structures and emergence of truly globalised organisation would emerge. And finally, the most written about and least understood concept of the emergence of the virtual workplace.

No doubt, the future corporation will be a very different animal. Tom Peters has been propagating the idea of the ultimate virtual organization in his book Re-imagine, he says, “one which is fast, wily, flexible, and determined”. The companies will have redesigned work systems that will maximize flexibility, efficiency, and effectiveness. There are several who agree. “With the continous mindset of change, work system will demand continuous change from the same people who demand definition. And the work system is going to drive that duality,” says Smita Anand, country head, Hewitt Associates.
Whether the structure will be ‘loose tight’ or ‘amoeba shaped’ it’s too early to predict, but the organisation of the future will be structured very differently. As far as structures are concerned, a recent McKinsey quarterly article says that, the vertically oriented organisational structures, which are today retrofitted with ad hoc and matrix overlays will have to be replaced. Companies will have to create new, overlaid networks and marketplaces that make it easier for professionals to interact collaboratively and to find the knowledge they need. “In terms of their organisational structures, there will be a stronger push for flat pyramidal organisational structure and anti-bureaucratic system to make the corporation highly responsive to competitive changes and the market,” says Robert F. Bruner, Charles C. Abbot Professor of Business Administration & Dean Darden Graduate School of Business Administration, University of Virginia.

Global management consultancy, Hay Group sees what it calls, ‘horizontal leadership’ surfacing in Indian companies as
well. “We see a clear trend towards leaders use influence and collaborations to get the work done rather than through the mandate which was in the case of the hierarchy-driven traditional corporations,” says Gaurav Lahiri, Operations Manager, Hay Group.

One of the biggest factors driving the change will be technology as it demolishes traditional boundaries of time and place. And one of the biggest disruption will be led by the Internet. Tom Peters goes a step further when he preaches ‘web-everything’. He points that people will have to embrace total enterprise reinvention. “What was rocket science yesterday will become commoditised very soon, so companies will have to review commoditisation and continously innovate,” says Anand.

Keeping innovations alive will be a major challenge for future corps, it will be a necessity, in a day and age, when disruptions could vaporise businesses in a moment. And to keep up innovations, corporations will have to deal with the rebels like Sony’s Ken Kutaragi or IBM’s Michael Gorssman. “Industry revolutionaries are like missile up the tail pipe. Boom! You are irrelevant!
Think about that institionalising ‘mavericks’,” declares Gary Hamel in his book Leading the Revolution. Also since the future organisations will be ‘knowledge organisations’, it will be the rise of knowledge enterprise. Peter Drucker who coined the term ‘knowledge worker’ to describe a new class of employee whose basic means of production was knowledge. As the rise of the knowledge workers begins, the organisation will also change. The company will have jobs that require leveraging of information, skill, and knowledge (and sometimes even wisdom).

In a global village, every decision will have to be global, right from managing supply chain, to workforce, to marketing. So if you’re not thinking global, you might as well as shut shop. “Corporations of the future will be much more global in form and mindset. We will see the emergence of corporations with extensively networked systems and processes open to collaborations across networks, boundaries and geographies to generate thinking power and seamless sharing of knowledge. Their structures will constantly change to take advantage of intellectual horsepower,” says Anil Sachdev, Founder & CEO, Grow Talent, HR Consulting and change management firm.

A major change in the future organisations will be increased transparency and corporate values. They will introspect more about their place in business. According to Peter Senge, companies will have to explore the relationships between the businesses, society and the environment more deeply. “Companies will have to focus on a triple bottom line of people, planet and profits, not just the last one. The big fish in the global pond will lead the way. The big companies have a moral role to start and legitimatize these issues as important business issues and start creating different standards,” he told ETin an interview. Changing paradigm will make the ‘virtual workplace’ a bigger reality than it is today. People will work almost from anywhere and anytime. While ‘virtual workplace’ has gained ground in IT and consultancy, we shall see that gaining rapid currency in other sectors as well. “We shall see emergence of plug and play format for workplace. The scenario wherein, HR head may choose to sit at a different location than at the headquarter will become common. Interestingly even within the confines of the office, face to face physical interaction will diminish and executives will use videoconferencing, teleconferencing route to work and discussions,” says Sachdev.

Future organisations will see far more diversity amongst employees. The tough part is, managing diversity and the wide range of life experiences, perspectives, preferences, values and styles of this workforce will rewrite a lot of rules that were thought to be cast in stone. “Corporations will increasingly regard diversity as a source of competitive advantage and leverage it in the market,” says Lahiri. Quoting a French religious mystic, Jacques Ellul in his book Future Shock, Alvin Toffler says, man was far freer in the past. “Choice was a real possibility for him.” By contrast, today, “The human being is no longer in any sense the agent of choice.” And for tomorrow, “man will apparently be confined to the role of a recording device.”

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