The great value added by some organizational consulting firms.

In the past we required a consulting firm to redefine the general scheme under which the organization was operating. We would find a big prestigious international firm, and would entrust them with the task of creating the structure needed to address the future. The first thing that was clear to me, was that their abilities basically lie on a complex science: define the organization chart.

Their ability to define little squares, rectangles, circles and connecting lines in a way that look really intelligent was evident, considering how hard it is to find and propose such imaginative names for each labor position.

I expected them to understand our type of business and what elements would vitally improve the present and the future…and I am still waiting! After inquiring over and over again about whether they really knew how our business operates, and what aspects of the knowledge-era our business should be in, their response was always affirmative, without losing sight of being politically correct.

Finally I understood why their job was so bad but always successful. They managed to, as the Italian author Lampedusa describes in his novel, Il Gattopoardi: ¨things will have to change in order that they remain the same ¨. It is enough to ensure that those who have the power maintain it or increase it, and that way their projects end up always being applauded.

In his book ¨Designing Dynamic Organizations¨ Jay Galbraith has a magnificent and clear summary of what an organizational design should be like: ¨Organization design is the deliberate process of configuring processes, structures, reward systems, and people practices and polices to create an effective organization capable of achieving the business strategy". Here the main point is: if you start assuming that the hierarchy is unavoidable or you don’t even see it because it is implicit to everyone, then there isn’t much to design.

If you believe that the firm you want to build, the business you are in, and what will make you successful depends only on knowledge; you are in serious trouble, because you will have to change aggressively the way you think and everyone else’s around you. The type of organization you need to build hardly exists; it doesn’t look like anything that is around and thus cannot be easily copied.

All industrial companies are very similar; however, companies that are knowledge-based businesses can be totally different from the others. If you are brave enough to face this…even to prove to your parents that you are on the right path, you might be able to create a modern company with great possibilities of achieving and fulfilling its strategy. If you are not ready, better settle and go on with what you have, it will be a disaster anyway, but at least you will have the excuse of doing what almost everyone else does.

Now let′s review a little bit of history. At the height of the industrial era the key element was capital and things were very simple: there were the laborers and they made, others where sales-people and they sold; and there were the managers who had the knowledge and organized everything that should be done (owners of the capital and/or in some way close to it).

The sales-people are also expendable for the same reasons exposed before, but at least they have a system of variable income according to their results. For the ones that gain knowledge and experience, it could mean better income; but for the sales-person the laborer is also expendable, he is lower in the hierarchy scale and he is only only interested on someone giving them the right product that they have to sell, and in that way keep the manager satisfied with the sales numbers.

The previous review can sound quite stereotyped; however it is not really far of what happened at that time. The sad part of this subject is that I am sure that the great majority of the readers are will feel that this is not far from what it’s now happening in their organizations.

An overwhelmingly number of organizations proclaim to be from another era, but they talk, publish, lie to their customers and members of their own team and still, make decisions and act as if they were a simple factory.

That interesting topic will be expanded on our next post of this blog, starting with the analysis of areas of support…which do not support!!