Business transformation is a topic that’s been top of mind for many executives in the last few years. Part of this comes from concerns around disruption, and part comes from the new adage that every company is, in some ways, a tech company.
Problem is: the shift to “agile” and other ways to transform how your business functions is a legitimate, very time-intensive business transformation for a lot of companies. Organizations mostly have operated on command-and-control, rank-and-yank, products-and-processes, hierarchy-as-a-deciding-factor for about two generations now.
There are dozens of terms for the era we’re living in — Sharing Economy, Knowledge Economy, On-Demand Economy, Third Industrial Revolution, etc. — but in reality, a lot of it comes back to “it’s time to think about people and how we organize them.”
A second tier of issue: Many executives at midsize to large companies miss the idea of what “profits” are. They think profits and share prices are the goal of organizational action. No. Profits are the result of organizational action. That’s straight from management guru/legend Peter Drucker, and while it sounds like semantics, it’s really important. If you think profit/revenue is the goal, then you act a certain way around your business. If you think the goal is to please your customers/end users and provide a service or product to them, and then revenue/profits emerge from that, your behavior and actions will line up differently.
It all comes back to this lesson: business transformation isn’t about money. It’s about people.