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7 Organizations in the twenty-first

century: the value-added
organization

Introduction

In this chapter I seek to present a set of practical tools to assist you in rethinking
your own organization along the lines set out in Chapter 3. Throughout I com-
bine some explanatory text with a sequence of exercises and instructions. It is
intended to help you to think through and apply the ideas set out in the book.
You may wish to return to this chapter as you work through the book. The work-
book has been designed on the assumption that you are seriously engaged in a
process of organizing around the flow of value to customers and intend to adopt
‘cluster’ structures. However, the techniques can be applied even if you do not
propose to apply those specific ideas.
The global business environment is changing faster than ever. We are living in
an era where businesses constantly need to reshape their ideas merely to survive.
But to achieve sustained success it is not sufficient merely to manage existing
operations better: businesses need to do things radically differently to secure an
advantage over their competitors. Thus, in the future, we shall need to focus not
on re-engineering processes but on re-engineering markets, not on restructuring
the organization but on transforming it.

If you recognize one of more of the following pressures increasingly impacting
on your organization, then the need for radical transformation could be just
around the corner:
■ The transition from growth to maturity in developed economies, leading to
overcapacity, more competition and fewer larger players.
■ The need to compete against global leaders, even in once secure local markets.
■ The challenge of managing a shift from a wide competence/local market focus
to a narrow competence/international market focus.
■ The entry of small, aggressive competitors into niche segments, using these as
a springboard to challenge the leaders.
■ The shift from integration (ownership or control of all elements of the value
chain) to specialization (leveraging capability in one key element of the value
chain).

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