by Randal Godden, Chairman and CEO, at TEC South Africa
This article was first published in Real Business, a supplement
to Business Day which appears on the third Monday of every month.
Perhaps the greatest challenge for leaders in an organisation is
cascading innovation and change while maintaining the current effectiveness
and efficiency of the business.
When a business or business unit commences, it is the entrepreneurialism
(“E”) which predominates by taking the dream or ideal and
turning it into a product or service – the production (“P”)
function.
To enable the business to grow, new products or services need to
be developed and accordingly the “E” must be constantly
in vogue or it becomes subsumed by the task orientation, or the “P” function.
In many businesses it is the founder or original entrepreneur who provides
the “E” almost exclusively. They hire an army of task oriented
soldiers who focus on short term production and delivery issues, and
are not developed in the E function at all.
As the business grows it becomes apparent that in each functional
area of the business there is both a production (P) element and also
a developmental, or E, element to make the business efficient and effective
in both the short and long term.
Some examples of the functional E and P are as follows:
- Sales is
the today function (P) servicing today’s customers
with today’s products, while marketing is the E element
responsible for developing new products
or services and finding new markets or customers.
- Personnel is servicing the current needs of employees while Human
Resources Development (the E) plans career development,
performance management, succession planning and future employee needs.
- Production is the daily responsibility for current products and
orders while Manufacturing plus Research and Development
- the E - look at production improvements, efficiency and process improvements
plus product innovation.
- Similarly the delivery function (P) is ensuring today’s
products and orders are delivered on time, while the Distribution
function looks at new techniques, new delivery methods and shared resources
for improved efficiency and effectiveness.
- The same principle applies to accounting and finance, maintenance
and engineering, management information systems and Information
Technology.
In the early infant stages of a business, the P functions dominate
to a large degree and the E requirement in every functional area effectively “delegates
upwards” to the owner or CEO. As the business grows it is critical
that specialist “E” talent is brought into the organisation
so that the business can grow and improve in all areas. Where “cascading” of
E does not take place, the business is, usually, either kept relatively
small so that the E from the owner or leader is sufficient to sustain
growth, or, alternatively, the business becomes uncompetitive and struggles.
The overriding concept is that ideas, new products and functional
improvements developed today are the products and improved services
of tomorrow, that is “today’s E is tomorrows P”.
It is a great challenge for many entrepreneurs to introduce and
cascade new entrepreneurial talent, balanced with appropriate “P” skills.
But finding the balance is the only way the organisation can grow and
prosper.
Ends |
