HOW TO RE-ENGINEER YOUR ORGANISATION FOR CONTINUOUS GROWTH AND TRANSFORMATION

In this article, I will show you how Entrepreneurial Management can help an organisation turn the above “missing” capability to “thriving” ability for continuous growth at scale.

By helping businesses grow over the last decade, I have come to realise that today’s organisations - both established and emerging - are missing capabilities  that are needed to thrive in  the century  ahead;  the ability to experiment rapidly with new products and new business models, the ability to

empower their most creative people, the ability to engage again and again in an innovation process, the ability to manage  innovation at scale with  accountability, so they can unlock new sources of growth and productivity. 

UNCERTAINTY HAS REPLACED STABILITY

I think most business leaders recognise that the everyday challenges of executing their core business leave little time and energy for harnessing and testing new ideas. Businesses are today operating in an environment quite different to their predecessors. There is incredible anxiety about the unpredictability of the world businesses live in. The most concerns I hear are:

•  The rise of global competitors 

•  Automation is starting to destroy the competitive advantage most businesses have set up around their product and services 

• The increasing speed of technological change and consumer preference 

•  The rise of startups in every industry that are growing into emerging enterprises

This means that traditional management tools struggle with uncertainty. The most famous 20th century management tool is forecasting. Designed by Alfred Sloan during his time at GM in 1920s. His structured approach has became the basis for all twentieth-century general management. It has become a system of accountability designed for the 20th century. It is still used in situations where it doesn’t work. Sometimes, failure to hit the forecast means a team has executed poorly. But sometimes it means that the forecast itself was a fantasy. Over the years, a new methodology has emerged to deal with situations that involves extreme uncertainty.

A NEW MANAGEMENT FRAMEWORK FOR UNCERTAINTY

When you study the definition of a startup: a human institution designed to create something new under extreme uncertainty, you realise that a startup is not just having an idea. It’s not about building a product. It is building a new organisation from scratch. One that strive to have new ideas, build new products and continue to innovate on a continuous basis as they scale.

This is, in fact, a management challenge. Over the decade, we have seen startups such as Facebook, Airbnb and Dropbox grow into established organisations that are today world leaders. Along with their rise, a new management framework has risen that is best suited for those conditions of extreme uncertainty that are startup-like. 

This new management framework is called Entrepreneurial Management. Not everything your business does is best managed by Entrepreneurial Management. However, if you are an emerging or established business and are increasingly managing uncertain situations, then here is how to install an Entrepreneurial Management that turns uncertain situations into new growth opportunities at scale.   

PHASE ONE - SETUP AN ENTREPRENEURIAL FUNCTION

Create a new business unit or function that is called “The Entrepreneurial Function”. It’s responsibility is to oversee high-potential growth initiatives that could one day become new divisions in your organisation. 

Set up this unit as a cross-functional team that can undertake a pilot project involving a portfolio of projects with high uncertainty. 

Create a growth board-type system that allows executives to make swift, clear decisions about the projects presented to them. 

Teach this team how to design startup-type experiments to help them plot a course through uncertain terrain.

Use startup-type metrics to measure the result of these experiments. 

Build a network of leaders who can help solve problems as they arise. 

When projects under this team start to perform and succeed, translate this new way of working into company specific language and tools. 

The energy required to drive this unit is for one that I call hypergrowth energy. Change usually takes place when there is a crisis. Success can be its own form of crisis. When a business create a product/service that fits a market, it is forced to grow extremely rapidly. 
 

PHASE TWO - SCALING UP

At this stage, you have proved a new management framework can handle innovation type projects and create new products/services based on evidence, experimentation and vision. You have also translated it to your company - specific culture. Now it’s time to scale this framework and deploy it to a wider group of people in your organisation. 

Review and identify challenges faced by pilot projects in Phase One.  

Develop and roll out a widespread system for working in the new way. 

Identify and make proper use of executive-level champions to reinforce the new methods.

Bring internal divisions into this transformation process. 

Create an internal coaching program and train internal units involved. 

Establish mechanisms such as Growth Boards and Metered Funding for resource allocation. 

The above steps will help you build political capital necessary to tackle the challenges you will face in Phase Three. 

PHASE THREE - DEEP SYSTEMS

Every company that has scaled successfully after the thrilling ride of turning an idea into reality and finding a place for it in the market, have a second story. 

It is a period called as the second founding. It is a new growth stage where a company goes from just another organisation into one that is the leader in their industry and is here to stay. We have seen this happen to Amazon, Facebook, Airbnb and to be more relevant to New Zealand - to Spark and ANZ. 

This is the moment where a business adopts “the new way of work” and makes new tools and training available to all kinds of teams. Not only limited to high uncertainty projects. 

They establish innovation accounting, a permanent growth board and strict accountability for senior leaders to allocate resources to this change, change policy and motivate teams to be entrepreneurial.

The above three-phased transformation will eventually build an organisations capability to thrive for continuous transformation and continue to make a long-term impact in this century ahead. 

Don’t forget to monitor the impact of ‘the new way” of working, continue to evolve the framework, change policy and adopt new ways of motivating people to be entrepreneurial.  

www.adnanbelushi.com