A Holistic View on Management Principles and Systems is Long Overdue

The issue with many management principles and systems is that they are often taken for granted and implemented selectively within organizations, without a thorough understanding of their holistic impact. Here are a few notable examples:

Consider Management by Objectives (MBO), which often emphasizes a vertical setup of KPIs (Key Performance Indicators) but neglects the horizontal, process-related dimension of KPIs. Organizations that focus solely on vertical alignment risk losing horizontal coordination, leading to silo mentalities where departments operate in isolation.

Similarly, Portfolio Management without clearly defined strategic priorities can result in a chaotic scramble for resources across the company. This environment leads to employees feeling overwhelmed and frustrated as it seems that nothing ever gets accomplished. This frustration often contributes to disengagement and higher turnover rates. Establishing a clear vision, strategy, and set of priorities is crucial before defining initiatives and calculating their cost/benefit contributions.

Company Growth without concurrent development in systems and organizational structure can hinder effective management. As companies expand, their systems and organizational designs must evolve to avoid becoming outdated and incapable of supporting intended management actions. Regular assessments and stress tests of both systems/processes and organizational design are necessary to ensure they remain aligned with the company’s growth.

Project Management that overlooks the need for proper business and IT architecture can lead to significant unforeseen impacts, necessitating replanning, rebudgeting, and rework. Plotting project objectives and scope against all relevant company components and understanding their implications are critical for successful project delivery.

Lastly, Process Optimization efforts conducted without prior capability mapping can result in duplicated efforts or actions with contradictory effects. For example, a company may invest heavily in a workflow solution to optimize HR processes without considering its impact on overall automation capabilities. This often leads to missed opportunities for optimizing other processes and leaves existing systems with automation capabilities underutilized, increasing costs and technical debt. Therefore, capabilities should be mapped first, followed by cross-mapping processes to these capabilities before embarking on large-scale optimization projects.

In summary, adopting a partial view of any management principle or system might yield short-term benefits in a targeted area but often does a disservice to other areas not in focus. These adverse effects might only become apparent over time, obscuring the root causes of issues.

It's time to recognize that a holistic view of all organizational activities is essential for sustainable value creation without accumulating technical or management debt. A comprehensive, systematic approach is long overdue!