WHAT DOES IT TAKE FOR A LARGE, established business to be as responsive to changing market conditions as the startups in its industry are? That question is a vital one for leaders seeking to move nimbly to address new customer demands and competitive shifts.
The answer often lies in a single word: empowerment. Startups typically empower their teams to make quick decisions, take risks, and explore novel ideas. These nimble teams operate with a level of autonomy that enables them to rapidly sense and seize opportunities that arise from changes in technologies, competition, and customer needs. In doing so, they iteratively move toward achieving their strategic objectives.
But for large organizations, adopting these practices isn't quite as simple. With scale and complexity come layers of decision-making, risk aversion, and the need for operational efficiency and strategic alignment across diverse business units. So while greater empowerment is necessary to drive organizational agility, it also needs to be rooted in a level of coordination that keeps the organization moving cohesively toward its strategic objectives.
This is the challenge I'd like to address in this article: How can large organizations foster empowerment in a way that maintains organizational coherence and strategic alignment? I have studied this question for the past five years and found that what's most required are four decision rights guardrails that define constraints around an organization's purpose, data, policies, and allocation of resources. Like the barriers on a highway, these guardrails provide a zone within which employees can act autonomously, enabling their organizations to operate faster, reduce risk, and keep teams headed in the right direction.
Ultimately, my research suggests that these guardrails give large, established organizations the potential to be just as agile - if not more so than their startup counterparts.
Bu hikaye MIT Sloan Management Review dergisinin Fall 2024 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Giriş Yap
Bu hikaye MIT Sloan Management Review dergisinin Fall 2024 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Giriş Yap
Avoiding Harm in Technology Innovation
To capitalize on emerging technologies while mitigating unanticipated consequences, innovation managers need to establish a systematic review process.
Make a Stronger Business Case for Sustainability
When greener products and processes add costs, managers can shift other levers to maintain profitability.
How to Turn Professional Services Into Products
Product-based business models can help services firms achieve greater scale and profitability. But the transformation can be challenging.
Do You Really Need a Chief AI Officer?
The right answer depends on the strategic importance and maturity of AI in your company.
Where To Next? Opportunity on the Edge
Doing business in regions considered less stable or developed can pay off for companies. But they must invest in working with local communities.
Make Smarter Investments in Resilient Supply Chains
Many companies invest in resilience only after a disruption. Applying the concept of real options can help decision makers fortify supply chain capabilities no matter the crisis.
The Three Traps That Stymie Reinvention
Organizational identity, architecture, and collaboration can be either assets or liabilities to pursuing growth in new sectors.
What Makes Companies Do the Right Thing?
Vaccine makers varied widely in their engagement with global public health efforts to broaden access to COVID-19 immunizations. Ethically motivated leadership was a dominant factor.
Build the Right C-Suite Team for Your Strategy
CEOs can foster a more effective leadership team by understanding when to tap senior executives' competitive instincts and when to encourage collaboration.
A Better Way to Unlock Innovation and Drive Change
A strengths-based approach to building teams can win employee commitment to change and foster an inclusive, agile culture.
