Creating New Wealth Through Organizational Design
August 17, 2008
The chief problem that companies face today is that they are using 20th century strategies to compete in the 21st century. Strategic models for the 20th century made the assumptions that capital was scarce, interaction costs were high and that vertically integrated structures were the key to efficient operation. Fast forward to the 21st century and the companies that are thriving are tapping into employees’ knowledge, relationships and hidden talents. They are using new performance metrics measuring profit per employee, rather than returns on capital. The reason for this is that in the 21st century, capital is not scarce, but talent is. The time has come for executives to develop the organization as a strategic need that will allow companies to compete no matter what the market situation. Read more… »