1. Whydo Multinationalslose theirpace?
Havingworkedfor20 yearsin bigmultinationalsandanother3years as freelancer,Irealized
that bigorganizationsare real schools.
You enterthemas a junior,learnhow toworkin a well structuredenvironmentwith
processes,strategies,KPIsandclearviewsof targetsandobjectives.Yougetthe best
trainingandhave a nice careerpathbasedon your evaluationandif youare luckyandgood
inyour job you climbat the topmanagement.
However,whenyouare out of thisstructuredenvironmentyourealize thatsome vital
elementsturntobe theirmajorweaknesses inall bigenterprises,exceptthose operatingin
the technologysegment.
Unfortunately,bigorganizationslackflexibilityand reactslowlytonew trends.The resultsin
periodsof recession,in mostof the casesisdecreasingturnover,dropof marketshares,de-
listingsof categoriesandalotof pressure fromthe stakeholders onthe employees. Andat
the endof the day the top managemententersintorestructuringphases,insteadof looking
intothe real problem.While atthe same time smallercompetitors,whoriskonalternative
venturesgainground
WHAT GOES WRONG?
There are reallymanyreasons butthe mostimportantones basedonmy observations
duringthe last5 yearscome fromthe inside environment.Ihighlightedsome pointswhich
have to do withthe humanassetof a company:THE EMPLOYEES:
1. Managers are engagedin lotsof meetings,conference callsandtrips. Thismeans
that duringtheirproductive workinghourstheyare blockedinabuilding/behinda
deskstartingone meetingafteranother,while theylose the opportunity toobserve
the changes in the external environment.Changesare infrontof us butwe needto
be there to realize them. Changesare inthe stores, infrontof the shelves, inthe
exhibitionswhere new trends –new products – new ideasare presented.Changes
are made frompeople whomyouhave tofindandshare yourviewsandideas.
2. Slowdecisionmaking. Let’sassumethatfinallysome of the aforementioned
managerssee whatisneededtobe done inorder toreverse the situation.The well-
structuredprocesses thenstartbeinganotherobstacle. Actionshave to be
approvedfrom2 to 3 differentmanagersindifferentlevelsordepartmentsand
meanwhilesome small competitorsalreadymove tothe nextstep.
3. Entrepreneurialspiritismissing. Smallcompanieshave tosurvive!There isactually
no “mothercompany”for themto finance new actions,paytaxes orabsorb
unsuccessful riskstaken.Thusthe ownersof these small companieshave toshow
flexibility,be fastandgrab any chance whichseemsreasonableandatlow cost to
them.
4. Ownership. Middleorevenhighmanagementinmanycasesdoesn’thave the
ownershipof the positiontheyrun.The safetyandsecurityof the companywhich
paysin time all the expenses,andthe bonuseswhentargetsare met“spoils”many
managers,whoneverfeel theirunitas theirownbusiness torun.

2. Andnowthe difficultquestion, isthere lightatthe endof the tunnel?
Definitely,thingscanalwayschange towards the direction we wanttoleadthe company
BUT onlywhenthe problemisrealized.Bigorganizationshave advantages thatmightturn
themintoreal winners.
Firstly,theyhave the financial powertosupportchangesandtake risks.Secondly,they
employeeveryskillful people,since theycanaffordto paythem.Andactuallythese
employeescanmake the difference,asIalways believe thatPEOPLEare the most important
assetof a company.
What isneededtomake thisassetefficientandeffective.
Ownership,flexibility,creativityandfair play!
How ?
Here is an ideawhichIhave beenworkingonduringthe lastmonths.
STOP restructuringSTARTbuildingcompetitiveBusiness Unitswithinthe company.Of
course BU’s alreadyexistinbigenterprises,throughthe differentproductcategoriesetc.but
the momenttheirfinancial dataare consolidatedwiththe onesof the restof the BUs, the
leadingmanagerslose the ownership.
Imagine whatwouldhappenif these BUswouldoperate ascompetitors.Leadingmanagers
wouldhave tooperate as entrepreneursandworkinwaysto make theirbusiness
sustainable.Throughthissimple model the 4weaknessesmentionedatthe beginningof the
article wouldbe eliminated.
A more indepthanalysisof the waythe differentBUswouldeffectivelyoperate underthe
same umbrellawill be elaboratedinmynextarticle.