An organization's ability to learn, and translate that learning into action rapidly, is the ultimate competitive advantage.
Long time GE Chairman, CEO and visionary, Jack Welch, coined the term “boundaryless organization”. When he began his tenure as GE’s top dog, he began to define a new culture to break down GE’s bureaucracy. In his alternative universe, GE would be boundaryless, an organization that is not defined by, or limited to, the horizontal, vertical, or external boundaries imposed by a predefined structure.
It’s a wonderful concept and many a corporate leader has striven to achieve it. Few have truly succeeded.
I never had the privilege of working for Neutron Jack. I learned about the boundaryless organization from Captain Billy.
At the ripe old age of 23, I was Chief Engineer of the USS Alacrity, a Navy minesweeper based in Charleston, SC. Our Commanding Officer (CO) was a Mustang Lieutenant named Billy G. Taylor. Captain Billy, as he was called when he wasn’t in the room, was from Waco, TX and brought all bluntness and country wisdom that origin implies to the job of being the CO.
During a minesweeping exercise off the Atlantic coast one sunny afternoon, we experienced a bearing failure on the minesweeping cable reel. I won’t bore you with a technical explanation. Suffice it to say that it was a big honkin’ reel that let out and (theoretically) retrieved a cable that was about 6 inches in diameter and several hundred feet long. When a bearing fails, it’s not very easy to retrieve that cable. When we opened up the gearbox, it was clear that salt water had fouled the oil that kept this machinery working right.
It was also clear that the planned maintenance for the equipment hadn’t been done. As you can imagine, it wasn’t long before a young sailor appeared at my side to tell me the Captain wanted to see me.
Climbing the ladder to the Captain’s quarters, I got my all my arguments (some would say excuses) straight in my head. “What happened?” said Capt. Billy.
“Well, I don’t know, sir,” I started. “That equipment is the responsibility of the deck department and…” I didn’t get to finish.
“You’re the Chief F___ing Engineer. Anything on this F___ing ship with more than two moving parts is your F___ing responsibility.”
A boundaryless organization.
Six months later, we won the squadron award for engineering efficiency. I got the message!
About 20 years ago, global corporations began to eliminate layers of management. Information technology had enabled senior managers to get quantitative information about the performance of their companies. They no longer needed (or desired to have) qualitative information from their middle managers. It was the beginning of the evolution of the “big box” model. The term is more often applied to retail stores – as in Big Box Retail. However, it applies to many industries that pursue a similar management model.
Over a generation, sophisticated systems have allowed multi-billion dollar corporations to wring out much of the cost that used to be required to run a large enterprise. That same trend has reduced the level of service.
We can no longer go to a bank and expect branch personnel to serve all of our needs. They now refer us to the call center and the dreaded voicemail tree. Retailers staff their stores with people who can tell you where the products are located but rarely offer qualitative advice. Flight attendants deliver standardized service. Their authority to make the customer happy is limited by the cost structure that is imposed on them by their corporate masters.
Customers complain but they have only themselves to blame. As a nation of consumers we have consistently stated a preference for low price over good services.
For the 21st Century Corporation, what this inexorable trend has meant is that fewer and fewer managers understand the concept of the boundaryless organization. Ever wonder why there are so many choices on the voicemail tree? Because functional specialization drives down costs. You can talk with someone in customer service about the mistake the bank made. But, to get the credit to your account, you need to talk to someone in another department. No judgment allowed.
My point of reference is generational. I am a baby boomer. We grew up in a world where we were coached by our mentors to develop business acumen and good decision making skills. I wonder how the next generation will develop those skills. How will it be possible for them to run a global enterprise when their perspective is limited to the narrow function they have learned to manage?
Let me put it this way……
WHO WILL LEAD?
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