Executives must often manage nonroutine projects, such as integrating company mergers, filling market gaps that fall between current business units, rolling out large-scale IT systems and developing innovative solutions to new customer needs. For such pioneering work, a company’s installed business processes are frequently ineffective because they’ve been designed and optimized to execute routine activities. As such, organizations often experience much difficulty handling novel initiatives, particularly when important work needs to be coordinated across different business units, functional groups or geographic locations.
Problems with horizontal coordination are not necessarily a sign of bad management. Instead, they are nearly inevitable in any complex organization with multiple, specialized divisions. Business subunits adapt and fine-tune their metrics, language and incentives to excel at their required tasks. This very specialization, however, increases the difficulty of integrating activity across units.1 Salespeople talk past manufacturing engineers, and neither understands the scientists in research and development. The standardized work and information flows that cut horizontally across an organization can help coordinate action, but such flows work best when executing routine activities. In fact, their very reliability and efficiency limit their flexibility in doing new things.2 How then should companies perform nonroutine activities that require cross-unit coordination?
From our research, including case work at more than 100 organizations, we have found that managers can better execute novel initiatives... To read the complete article, login or sign-up using the form below.
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