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Closing the Hidden Gaps in Organisations - Four Groups
 

Closing the Hidden Gaps in Organisations - Four Groups

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This article describes how a tool developed by Four Groups, 4G can be seen as a foundation or bridge which links typically hidden organisational gaps and issues. By systematically understanding and ...

This article describes how a tool developed by Four Groups, 4G can be seen as a foundation or bridge which links typically hidden organisational gaps and issues. By systematically understanding and addressing intangible and ‘people based factors’, it is possible to close these gaps, make more informed decisions and enhance the chances of a redictable and successful outcome to management initiatives.

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    Closing the Hidden Gaps in Organisations - Four Groups Closing the Hidden Gaps in Organisations - Four Groups Document Transcript

    • Closing the Hidden Gaps in Organisations Linking Behaviour to Bottom Line Performance Closing the Hidden Gaps in Organisations This article describes how a tool developed by Four Groups, 4G can be seen as a foundation or bridge which links typ- ically hidden organisational gaps and issues. By systematically understanding and addressing intangible and ‘peo- ple based factors’, it is possible to close these gaps, make more informed decisions and enhance the chances of a predictable and successful outcome to management initiatives. Management initiatives Table 1 Initiative Impact on Values, Processes and Resources (VPR) When considering the factors that drive Change initiatives Depending on scope, all components of VPR are an organisation’s success, the combina- impacted. It should also be noted that changing the tion of its values (both financial and values of an organisation is harder than the process- es, which is equally harder to change than the people based1), processes and resources resources2 go a long way to explaining Growth through acquisi- Merging with another firm or organisation is likely to variance and contrasts in outcome. Put tion require the full integration and understanding of val- ues, processes and resources, the exception being the another way, the ability to successfully partial divestiture of acquired assets manage and lead an organisation’s val- Innovation and new Processes and resources are nearly always impacted ues, processes and resources plays a market offerings by new innovations, the more significant the innova- tion, the more likely it will impact on values in the critical role in realising specific objec- shape of a revised business and/or revenue model tives. Table 1 illustrates these ideas. Organic growth Assuming a constant business model, optimised organic growth requires the alignment of all of the VPR components Through the examples above, it is easy Outsourcing Outsourcing tends to focus heavily on processes and to see how much of an impact man- resources, generally leaving values intact agement initiatives have on an organi- Reducing costs and At a minimum, cost reduction and efficiency drives sation’s values, processes and restructuring will impact resources and to a lesser extent processes. More dramatic measures are likely to impact values resources. By extension, there exists a The competitive land- Depending on the nature of competitive forces, any large number of management tools3 scape response is likely to encompass elements of values, which aim to deliver and help imple- processes and resources ment the various objectives detailed above. Generally speaking, such tools resources and the gaps and silos they Values attempt to measure and quantify create. The article then goes on to illus- aspects of an organisation for the trate how, via 4G, it is possible to close The majority of management tools deal express purpose of making it easier to these gaps, helping an organisation with tangible inputs. Put another way, effectively manage. To this end, the achieve its goals more efficiently and ‘what gets measured, gets managed’. remainder of the article explores some consistently in the process. Further to this, management tools tend of these management tools, their to focus on one aspect of an organisa- impact on values, processes and tion’s values, processes and resources,
    • Closing the Hidden Gaps in Organisations rather than looking at all three togeth- often to the detriment of values and/or such as behaviours, relationships and er. For example, Strategy and Financial resources. Rather like squeezing a bal- culture. On the one hand, these intan- Planning tends to focus on financial loon, putting pressure or focusing on gible factors often support and ensure values, leadership and wider macro one specific area is likely to see other the success of a particular initiative, issues and only as a consequence of areas expand and get out of control. while on the other, ignoring them is that do they impact other parts of the often the cause of greater problems organisation’s processes and resources. Resources further down the line. To be successful however, Strategy and Financial Planning needs to be consis- The same principles apply to resource Secondly, managers use different tools tent and aligned with the underlying focused approaches such as for different jobs. Whilst this allows culture and values of the organisation, Competency Frameworks and Talent managers to choose the right tool for along with its processes and available Management for example. These activ- the job, it is worth remembering that resources. This example and the gap ities tend to focus on human resources, management tools tend to focus on a between strategy and its implementa- skills and behaviours and place less single element of values, processes or tion is explored is greater detail by emphasis on the wider organisational resources. By extension, such tools Kaplan and Norton who write about the perspective such as how individuals generally fail to acknowledge the other ‘Office of Strategy Management’4. interface with processes, financial and two components of the VPR view, leav- cultural values, key relationships and ing these untouched and creating gaps Processes the nature and quality of communica- or silos between different parts of the tion between teams and departments. organisation. Popular tools such as Total Quality Management (TQM) and Six Sigma Organisational gaps The diagram below illustrates this idea tend to focus on processes such as and in particular how management workflow and operations, requiring the The point of highlighting values, tools tend to focus on a single aspect of gathering of large amounts of tangible process and resources is two-fold. the VPR perspective, rather than linking and verifiable data in order to optimise Firstly, organisations can and do suc- them together in a unified manner, cre- performance. This focus, particularly cessfully implement change programs, ating organisational gaps or silos in the with regards to Six Sigma, leads to new initiatives and targeted strategies process6. understandable criticism. Six Sigma has with the help of management tools. been criticised by commentators who However, these tools can overlook key Closing the gaps note that it can stifle creativity, radical aspects of organisational behaviour. thinking and innovation5. By extension, This is particularly so with regards to As the saying goes, ‘management this focus on ‘process perfection’ is intangible and interlinked elements problems are people problems’. While Leadership Values Processes Resources Delivery Balanced BPR 360 Degree Strategy Scorecard CRM Feedback Gap Gap Gap Vision Five Forces ERP Competency Strategic and Six Sigma Frameworks Financial TQM Talent Planning Management Management Tools While there are a great many management tools in existence, they tend to focus on one of the discrete categories above7
    • Closing the Hidden Gaps in Organisations business tools have their advantages, Table 2 many problems or the failure of man- 4G Component Aspect of an Impacts to VPR agement initiatives often come from Organisation it Assists the hidden gaps that exist between val- Social Profiles Better understand indi- Resources ues, processes and resources. Such gaps vidual behaviours Develop and enhance or silos then tend to show up as ‘peo- people’s potential ple issues’, for example poor communi- Know how people react to and deal with change cation, frustrating relationships or unwanted and unpredictable behav- Social Relationships Improve communications Processes & group dynamics iours. Increase process efficien- cy Predict and optimise rela- To close these gaps and resolve these tionships and workflow intangible issues, Four Groups have cre- Social Groups Align financial and Values ated a methodology called 4G. 4G lets human values Manage culture in line managers predict, optimise and link with objectives behaviours, relationships and cultures Optimise organisational design together with greater confidence and accuracy. By addressing intangible link back to values, processes and ‘people issues’ in a systematic manner, resources. managers can exert greater influence over the productivity and effectiveness Building on table 2, the second diagram of individuals and groups. The linking of shows how 4G links values, processes intangible variables to tangible tools and resources together, removing and initiatives then goes a long way to organisational gaps and silos in the closing the organisational gaps already process. mentioned. Table 2 illustrates this idea and shows how elements of 4G then 4G Social Groups Social Relatinships Social Profiles Leadership Values Processes Resources Delivery Balanced BPR 360 Degree Strategy Scorecard CRM Feedback Vision Five Forces ERP Competency Strategic and Six Sigma Frameworks Financial TQM Talent Planning Management Management Tools
    • Closing the Hidden Gaps in Organisations Conclusion In conclusion, 4G complements other management initiatives and tools because it provides tangible informa- tion about aspects of the organisation which are by nature hard to quantify and manage during periods of change. By providing this information in a replicable and systematic form, man- agers can implement initiatives which take account of and ultimately resolve the problems generated by organisa- tional silos and the inevitable gaps that exist between values, processes and resources. Four Groups Ltd 5 St. Johns Lane London EC1M 4BH, United Kingdom Tel: +44 (0) 20 7250 4779 Email: contact@fourgroups.com www.fourgroups.com © 2008 Four Groups Ltd, 5 St. Johns Lane London EC1M 4BH, United Kingdom. All rights reserved. No part of this document may be reproduced without Company Number: 4650494 express written permission from Four Groups Ltd. VAT Number: 817 7962 85 Registered in England and Wales
    • Closing the Hidden Gaps in Organisations Footnotes and references 1. The contrast between financial and people based values is explored in more depth in this article http://tinyurl.com/6xhvse 2. For more information on values, processes and resources, see Christensen’s Innovator’s Dilemma http://tinyurl.com/69qm3v 3. While it is beyond the scope of this article to offer a comprehensive review of all management tools, further infor- mation on this can be found in the ‘Managing Intangibles’ article at http://tinyurl.com/5s6jb9 4. http://tinyurl.com/67ce6k 5. http://tinyurl.com/5hmesm 6. Further to the examples in the dia- gram, it is possible to further segment management tools around functional disciplines such as strategy, sales and marketing, operations, manufacturing and HR, amongst others. 7. More information and extensive examples of various management tools and their discrete focus can be found at http://tinyurl.com/5g2yx9