Strategy 5.0? - Defining the Appropriate Organization Design for a Digital Future

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Strategy 5.0? is the strategic planning approach Group50? Consulting uses with its manufacturing and distribution clients who want an organizational design that will:

1.??????Realize the potential of Industry 5.0

2.??????Optimize the business at the intersection of people, process, technology and cobotics

3.??????Excel at operational innovation

4.??????Maintain corporate entrepreneurship

5.??????Create a scalable and sustainable future for the company

To achieve those objectives, everything, including organizational design must be reconsidered. ?The diagram shows how people, process and cobotics are built upon an information backbone and are fully directed by that backbone.?Competitive advantage is at the intersection of these. There is nothing we do today, either personally or in business that isn’t influenced by technology.?Technology influences our thinking, guides our decision making, actuates business processes, manages our cash flows, predicts future outcomes and everything else in our lives. Technology will continue to permeate our lives, our businesses and everything else we do, like it or not.

Given that, our view in Strategy 5.0? is that organizations should be designed on top of the technology base implying that the functional organization as we have known it is no longer an appropriate organizational structure.? The majority of our clients don't leverage the capabilities of the technologies they have invested in, because they continue to view it as a tool rather than a business platform to build from. Technology is no longer a tool for each function to use as they see fit, it is the base on which the company operates, generates competitive advantage in the marketplace and create stickiness with its customers. Each functional discipline must learn to master the technology base and leverage its capabilities. In order to do that, the classic organization structure should be rethought and restructured. n the diagram below, we have defined three business process groups:

1.??????Market Facing: The set of activities that is responsible for leading the “Where to Play” part of a company’s strategic plan ?and who owns the primary interfaces with customers

2.??????Value Added: The set of activities that is responsible for all value add to the company’s products and services. This group plays a major role in realizing the company’s “How to Win” strategies

3.??????Technology: The collection of software and hardware which forms the business platform that interconnects all stakeholders (vendors, employees, contractors, temps, customers, end users, 3rd party providers) and drives behaviors across all stakeholders through the entire product lifecycle: raw materials to end of life in the field.

In order to optimize the intersection of People, Process, Technology and Cobotics, the organization structure needs to be focused on those three process groups with a senior leader for each one:

1.??????Chief Revenue Officer

2.??????Chief Value Add Officer

3.??????Chief Technology Officer

We should be able to agree that each of these process groups have unique requirements for the people in them, including finance, HR, engineering, ?quality, management. Each discipline will require a unique set of skills maps or learning maps in order to do the job. An example is the quality function. Quality Assurance and Quality Control are significantly different in each process group. The Market Facing group needs to focus on the quality of product, service and OMNI channel systems. The Technology group is focused on software quality and system uptime and the Value Add group is focused on vendor, component and process quality.?The function is the same but the skill sets are so different.

So, while there still may be leaders for finance, HR, and quality at the senior lever, the day-to-day resources will report to their respective process groups.?The senior level leaders will be responsible for policy and governance at the corporate level and provide guidance to their functional peers. The heads of the process groups will focus their efforts on optimizing each group at the intersection of people, process, cobotics and technology: the tenants of Industry 5.0

This organizational approach will seem radical to the 76% of companies who don’t have an Industry 5.0 strategy and it will open the eyes of the 43% of companies whose digital transformations have failed. Because of the complexity of this journey, it is critical that companies work closely with an outside organization to help them ask and answer the questions that will allow them to think differently about their business, their people and their marketplace. Strategy 5.0? provides the what and Group50?’s Business Hierarchy of Needs? provides the how companies can plan and implement their movement to a fully digital future for their company and inside their customer base.

We have put together the tools and the subject matter experts to be a company's partner in this journey. If you want to learn more, go to Strategic Planning 5.0?, give us a call at (909) 949-9083, or request more information here.

About the Author:??Jim Gitney, CEO and Founder, started Group50??Consulting in 2004 with the focus of working with companies to significantly improve their performance by leveraging?people,?process?and?technology.

Jim has held C-suite and Board positions in large and small companies (GE, Black & Decker, Sunbeam, Rain Bird, Pankl Aerospace and others) both privately and publicly held. His subject matter expertise includes Industry 5.0, strategic planning, strategic execution, operations, supply chain and restructuring.?He has taken best practices from around the world, worked closely with clients and other Group50? consultants to create Group50's Strategy 5.0? strategic planning framework, the Business Hierarchy of Needs ?, a change management framework and many more strategic planning and execution tools. Group50? Consulting consists of consultants from every functional discipline who have spent their careers in corporate America developing strategic plans and rolling up their shirt sleeves to get it done.??