CHANGING THE ROLE OF TOP MANAGEMENT - BEYOND STRUCTURE TO PROCESSES

The hierarchical organization based on the strategy-structure-systems doctrine of management no longer delivers competitive results. While a top-down structure of corporate divisions gives managers tight contro l and allows companies to grow, it also fragments resources and create s a vertical organization that prevents small units from sharing their strengths with one another. Structural fixes, such as skunk works, al liances, and acquisitions, have not solved the problem. Based on a stu dy of 20 companies with vanguard management styles, the authors predic t a managerial revolution that will focus on horizontal processes rath er than vertical structures. The job of management will be to promote three core organizational processes: frontline entrepreneurship, compe tence building, and renewal. Companies must shift from top-down direct ion by managers who set the company vision and instead should encourag e bottom-up initiatives from operating units, which are closest to cus tomers. Managers must balance discipline and support to create a self- disciplined organization. Similarly, managers must trust operating uni ts with creating competencies and limit their own role to seeing that those strengths are shared throughout the company. In addition to prov iding direction, managers must sometimes disrupt organizational equili brium - for example, by stretching the company with increasingly chall enging goals, using contingency-planning exercises, or allowing parall el product development. To prevent their companies from becoming too r igid, they must create an environment that asks employees to challenge conventional wisdom.