Transform Your Management Processes to Gain a Competitive Edge

Management Processes: The root of success and failure

In a world where strategic positions can collapse overnight, the single most decisive factor for the success of an organization might be the quality of the management processes.?

Management processes are collaborative activities of understanding information, creating decisions, allocating resources, and steering actions shaping the organization's performance. Who takes part in decisions and how is information aligned to make them? How does coordination work, and how are capacities aligned? How are results evaluated? How are these processes being improved?

Management processes MP create the hidden competitive advantage. When you look under the hood of exceptional, successful organizations, you usually find well-carved-out management processes rooted in explicit principles that guide their evolution—just think of Amazon’s 16 management principles.

How can leaders of organizations shape management processes collaboratively to quickly contribute to overall performance?

The organization′s neural system

Management processes make organizational strategies and structures function. They align the skills and knowledge of various individuals. MPs form the neural system, the software of the organization, shaping its capabilities. ?The organizations know how embedded in the management processes that link people in making decisions. Management processes are continuous and dynamic, as they adapt and learn.

Signals for failure

When strategies or entire organizations fail, invariably management processes have been failing for some time before. Management processes lost the capability to align people to solve the pressing business problems.

When management processes start to lose their effectiveness, they do so silently, with dispersed symptoms. ?No alarm goes off. First, results may show deficits: Deadlines are not being met, products do not work out, and operational firefighting eats up capacities. Management, feeling they already do their best, suspects faulty execution or overwhelmed capabilities of their people, needing tighter control and some measures from HR.

Organizational frictions ensue. Complaints about management style and leadership come up: About lack of orientation, poor decision-making unclear expectations, unrealistic demands, no or unhelpful feedback. All the while people feel not fully productive, upheld by procedures, torn between conflicting priorities, not heard, and undervalued by management.

Then people lose confidence in contributing opinions and the interest to listen to others. The organization, seemingly well-structured, is losing traction. But the signals seldom indicate the cause.

The imperative to rewire

Management processes, as the neural system of the organization, adapt like a brain that constantly rewires with learning. Science here speaks of plasticity. ?The brain, being very reactive at a young age, tends to lose plasticity with old age, unless it is constantly stimulated to rebuild synapses.

Looking at young organizations must “hard wire” management behavior that gives them stability to expand their capabilities and scope. Mature organizations must loosen up, rewire, staying vigorous by continuing to adapt the way they manage themselves.

What is the process for evolving and adapting management processes?

?A requirement often overlooked

The process of developing management processes is often neglected. There are reasons for that to happen:?

-??????? Management processes seem not as tangible a discussion point as strategy and structure.

-??????? Hierarchical perspectives see the shaping of management processes as a cultural intervention preserved for top management, a display of power and order - just think of many budgeting processes.

-??????? Management processes often are misunderstood as tools and methodologies that are just instrumental and belong in the sphere of management training, like problem-solving or quality monitoring. ?Such “systems” seem available from outside vendors.

Common dead ends

A consequence is that management processes are either left to evolve freely, without being directed towards purpose, or monitored for effectiveness. Thus, they may be productive in the short term but cannot generate sustained competitive advantage.

Or another dead-end solution is to delegate the design of management processes to outside experts who tend to transplant processes they know from other cultures. ?Imposed, these become rigid procedures that clog ways of organizational collaboration.

Creating Awareness for Management Processes

Awareness starts with the desire to look at management processes. This needs somebody to introduce the topic into the proceedings of the top team. It is the business leaders’ role to draw the top team into a common process of perception and diagnosis. There are several ways to achieve this, for example:

·??????? Include the state of management processes in the assessment of strengths and weaknesses during the strategic planning cycle. Are our management processes an asset of competitive advantage? https://www.dhirubhai.net/pulse/strategic-situation-analysis-must-include-culture-thomas-leder-gxase/?trackingId=n0nPUJmBSdi8d1Dtgwtbrw%3D%3D

·??????? Look at the pronounced values of the organizations. Do our values materialize in our management processes? Do our values define observable guard rails that are embedded in management processes?

·??????? Trigger self-surveys of management teams’ effectiveness, helping them to observe the state of operating together. What are our default ways to decide, act, and evaluate success? ?What bottlenecks and hurdles limit the quality?

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The step from awareness to energetic change

Transforming management processes involves change of behaviors and attitudes. As everybody has lived through personally, awareness is just a first step. To act differently, humans need emotions and feelings of success with early steps. On the level of management processes, this needs to be a collective experience of the participants, that evolves with practice.

Options of Approach

Some organizations embark on overall programs that generate large scale management processes. A recent example is Bayer AG, re-shaping management processes like budgeting or talent deployment in a context of short-term cycles (called DSO). Building large scale experiential change takes a high level of top management determination, aligned management resources, and comprehensive planning. This usually happens when the was a recent change of leadership.

A more evolutionary approach is to transform management processes with the actual course of the business - hands-on when tackling specific business tasks which challenge the established approach or are new to the experience organization.

Management Process Evolution

Identify challenges at the frontier of the business, like targeting customer needs that are silently evolving, or leap-frogging business procedures, examples, where existing management processes obviously create bottlenecks. Use these challenges to find solutions and simultaneously invent the most supportive way of decision-making and self-directing collaboration.

1 Assemble a team of Process Architects. ?They own the management process systems. Their task is to carve out decisions about MP advancements and bring them on the to the attention of top management. The team should represent relevant knowledge, values, and perspectives: Business leaders, organizational and HR experts, IT or people like AI developers.

2 Select the business task as a platform for MP development. Suitable tasks are strategically critical, stretch existing capabilities and are an example for the future requirements of the market, so that they must be executed outstandingly well. Examples are launching a new product, developing a new sales channel, or finding a new level of customer benefit.

3 Assign the Task Team that will tackle the business problem, looking to reach a new level of performance, like speed to market or impact of innovation. The team’s commitment to the task motivates them to look for the best ways of planning, making decisions, and coordinating action.

Collaboration with other units will spark ideas. The collaboration with the management process team will help to articulate MP ideas and to shape solutions that can be scaled.

4 Creative interlocks of Process Architects and Task Team form the hot shop for MP solutions. The task team experiments with process solutions according to the specifics of the situation. For example, a product development task team set up their research process to understand the upcoming production technology of their customers and for that integrated external expertise. They also created a decision-oriented cost-calculating method.?

Based on the task team’s experience the joint Architect Team and Task team submit the existing MPs to rigorous scrutiny – does our way of working help to achieve the result? ??All perspectives of team members apply.? Through focus on the task, defenses go down and innovative exploration goes up.

Eventually, the joint MP team can design solutions for organization-wide use. In this case, the organization defined three types of product development teams, each with their configuration of roles, resources, and authorities. All three developed speed to market as a competitive advantage.

5 Scaling Management Process Solutions

To transform the localized experiments into systemic organizational capabilities, Task Teams formulate experience-based suggestions. Management processes that have been proven by actual practice, and helped tackle real business challenges are the candidates to be scaled across the entire organization.

However, suggesting change will trigger tensions. MPs are loaded with notions of power and values, often rooted in beliefs. Questions like what role internal market units have in strategic planning, whether customers should be part of it, or how success should be tracked, can cause emotionally loaded discussions.

Two tactics have helped to consolidate a common view:

·??????? Form and apply management principles?

Higher level principles that set direction for management processes can give criteria to evaluate the options. As Amazons’ renown leadership principles (e.g. “customer obsession”,” invent & simplify”,” learn and be curious” etc.) exemplify, values can turn into specific guidelines for management processes. Even in the published and then neglected value statements some viable principles can be found.

Otherwise, the Process Architects can formulate principles while evaluating the Task Team’s solutions: Which would be a principle that this suggested MP would promote? Through this perspective, the team would think through the cultural impact of solutions. Secondly, management processes offer a test of whether the principles have practical meaning. Applicating principles and specific process solutions simultaneously assures that the last.

·??????? Keep focusing on business results

The ultimate value add of management processes is their contribution to results. Too much emphasis on processes alone can lead to overengineer them or engaging in philosophical loftiness. To keep the MP sharp, they need to be assessed according to their contribution to the business: Has the process of goal setting helped to access the target customers? Were decisions made fast, did they set valid assumptions, and how were these tested?

Only engaged business task teams can answer these questions, only they can suggest practical improvements to management processes, assuring their relevance.

Getting Started

Support existing business tasks by sharpening the management processes that the task needs. Any business arena of the organization can serve as a frontrunner. When a Task Team and Process Architects join to take ownership of shaping them, the organization begins building itself.

It all starts with giving Task Teams the power to influence the way the organization works.

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