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Successfully Developing Triple Bottom Line Sustainability: #2

October 27, 2010 3 comments

This is the second of six contiguous Blogs dealing with TBL Sustainability to be published over the next few weeks. All these Blogs are being co-developed with my colleague and TLA Associate Tia Carr Williams. In this second Blog, differences between Sustainable Advantage (SA) and Sustainable Competitive Advantage (SCA) are explored, and the relevance and promotion of innovation are reviewed.

“It is not the strongest of species that survive, nor the most intelligent, but the ones most adaptable to change.” – The Origin of Species, Charles Darwin

How successful you become at acquiring and retaining a leading position in your niche marketplace depends critically on how you position your business relative to other businesses. Having significant differentiation continuously proposed from an engaged workforce can provide a formidable distinctive resource for promoting and maintaining marketplace uniqueness. Sustainable Advantage (SA) advocates an engaged workforce as a necessary component for continuous improvement, and this employee-centric culture becomes as much your foundational differentiation as the products or services you provide.

Organizational culture is defined as the collective behavior of a group of people aligned to a corporate vision, demonstrating shared values, habits, common working language, systems and ethos. The ecosystem infrastructure is defined as a common support environment, interwoven with processes, and underscored with the necessary technologies, where the behaviors of different individuals bring to the SA workplace uniqueness in knowledge conditioned by social attitudes. A given corporate culture invariably reflects the moral, social, and behavioral norms of the constituents of that organization, based on their values, attitudes and priorities. When efforts have been made to create a commonality of values that all can aspire to and adopt, it is provable that just the day-to-day work climate can en-culturate a population. For example, without regard for diversity, the bond forged corporately mashes the workforce under a common banner – in this case SA.

SA differs significantly from the familiar Sustainable Competitive Advantage (SCA). Both SA and SCA are based on achieving Right to Market™ (R2M™), where R2M™ involves introducing the right products and/or services at the right time in the right contexts with the right supply chains, and then continually updating, optimizing, and retiring them as necessary; however. SCA pits both employees and organizations against one another in a never ending competitive “survival of the fittest” whereas SA strategy and implementation are based on a win-win collaboration of all parties.

Innovation is vital for bringing about improved performance and efficiency, and is widely acknowledged to be a critical determinant of uniqueness, profitability and overall positioning. SA ensures that innovation is being enabled by the knowledge present across an organization’s marketplace networks, and at every level and from every departmental corner of that organization, propelling and accelerating such innovation. SCA is only qualified as a continuum of innovation to build perpetual differentiation among employees and with, and among, competitors. In contrast, SA promotes open innovation through communication and collaboration in an organization’s marketplace networks, whilst also creating conduits of continuous communication to capture contributions by collaborative employees. This co-opts commitment and buy-in from other organizations as well as every member of staff. The result is a formidable benchmark, and a peer culture of personal accountability, that underscores a daily commitment to improving how things get done. The SA ‘sweet-spot’ is quickly identified, since engaged internal and external networks provide a stream of qualified improvements – they are engaged because they invest in the high value of the ‘relationship capital’ that such broad collaboration rewards.

To grow a culture of innovation it is critical that an organization evolve an SA that instills a long-tail objective. Over what time horizon is your organization really forecasting? Beware! If it isn’t at least the next decade, your vision is short term, and your SA will be unsustainable!!

In the upcoming third Blog of this series further cultural implications of Sustainable Advantage (SA) will be explored.

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Successfully Developing Triple Bottom Line Sustainability: #1

October 22, 2010 6 comments

This is the first of six Blogs dealing with TBL Sustainability to be published over the next few weeks. All these Blogs are being co-developed with my colleague and TLA Associate Tia Carr Williams.

“We now know that the source of wealth is something specifically human: knowledge. If we apply knowledge to tasks we already know how to do, we call it productivity; if we apply knowledge to tasks that are new and different, we call it innovation. Only knowledge allows us to achieve those two goals. Organizations that are efficient and effective in applying knowledge will succeed better than their competitors” – Peter Drucker

Business as usual is no longer an option – it is obvious that traditional organizational design has not worked in today’s complex business environments. New ways of thinking and organizing are critically important if organizations are to do more with less, and ensure ongoing business growth and renewal.

Most of today’s organizations are set up like spider webs with thinking and command at the centre, and planning and control exerted through the web threads. The problem is that command and control operation is far too inefficient in terms of speed and efficiency, too clumsy in terms of knowledge management, and too lacking in variety for today’s complex dynamic business contexts. Top-down corporations need to adapt their fundamental structure to change from a command and control model to one that promotes facile communication incorporating social trust and widespread knowledge sharing – in other words to survive surging market competition organizations must decentralize.

A decentralized organization has distinct market advantages over a wholly centralized organization, allowing not only for the natural development of the key capabilities needed for the organization to operate creatively and successfully in face of today’s constantly changing circumstances and environmental demands, but equally to address the needs of a churning workforce that increasingly includes a new breed of worker – the Generation Y Millennials, the cohort born between the mid-70s and the early 2000s. Organizations challenged with three generations of employees need novel organizational strategies to accommodate employees’ varied learning requirements and to foster work satisfaction. Decentralized organizations are more responsive to market forces and employee variety, are agile in implementation, and are consistently adaptive to innovative processes that promote and empower continuous improvement at the rock face of employee daily-deliverables.

Decentralization as it is implemented today typically involves creating a starfish configuration, comprised of small hubs capable of operating, growing and multiplying interdependently of each other. The starfish model is used by innumerable organization designers around the globe today. Although it is an advance over the spider web design, and does facilitate significant strategic advantages to emerge from daily operations in ways that play a significant role in continuous improvements informing sustainable advantage, the starfish model still does not go far enough to provide a truly sustainable systemic approach to organizational design.

Genuine Sustainable Advantage (SA) demands a much more polyarchic approach, providing both independency and interdependency of all major components of organizational processes. In the SA model people become epi-central to the co-evolution and co-maintenance of strategy, structure, processes, and rewards. Human-centric organizations include employees in most of the organization’s responsibilities and decision-making, ensuring incremental investment by each member in the rigors and rewards of a profitable company.

In the second Blog of this series the critical differences between Sustainable Advantage (SA) and Sustainable Competitive Advantage (SCA) will be explored, and the relevance and promotion of innovation reviewed.