How Organizations Should Work by Dean Meyer
Revolutionising Organisational Design
Get ready to be inspired by N. Dean Meyer's game-changing book on organisation design! This book is like no other, as it doesn't just present an overview of all the available options, but instead presents a single, cohesive vision for how organisations should work. Say goodbye to frameworks that are too high-level and hello to real-world detail on how an organisation should function. And, to top it all off, the book is written in a captivating narrative format, with useful summaries included at the end.
Business-within-a-Business: A Vision for Success
So, what exactly is Meyer's vision? It's simple - every division, team, or unit should act and function as a "business-within-a-business." This might sound basic, but it's a powerful idea that can help solve many challenges facing businesses in today's VUCA world. But with this concept comes a requirement for everyone in the organisation to think and act like entrepreneurs.
The end result? A system that leads to increased empowerment and incentivises everyone to make decisions that are in the best interest of the company.
Key Features
Putting the Customer First
There's a common misconception that the only customer in business is the end-user of a product or service. In reality, every team provides something for another team or person, even if they're internal to the company. That means everyone needs to understand who their clients are, what they need to get done, what's difficult for them, and what they want to achieve. Essentially, every team must have a clear sense of its value proposition.
For example, the IT function may not have direct contact with external customers, but they can see the rest of the business as their clients. With this mindset, the IT function will act as if they were an external business where their clients could choose to go elsewhere for better value.
Unleashing Creativity with Radical Empowerment
A business that prioritises its customers also allows its leaders the freedom to arrange resources in the most effective way to serve those customers. The same goes for teams and units within a business - when empowered, they can unleash their innovation, initiative, and optimisation potential. This shifts the focus from a command and control leadership style to one where employees can bring their best thoughts, ideas, and creativity to the workplace.
For example, our fictional IT team may choose to allocate a portion of its budget to improving infrastructure, believing that performance gains will lead to a better customer experience. Or they may restructure their support team to provide faster response times.
Increased Responsibility Equals Increased Results
This model also brings an increase in responsibility, as business owners are now fully accountable for the results of their decisions. As companies grow, leaders often struggle to scale systems effectively, sometimes resorting to increasing bureaucracy to avoid making bad decisions. But with this model, accountability and authority are easily aligned. Business owners are responsible for their financial performance, whether that means balancing income and expenditure (for those serving internal customers) or hitting a target profit level (for those serving external customers).
For example, the IT function won't "waste" money on projects that no one in the business wants, because they won't be able to "sell" them to anyone, resulting in a financial loss. Instead, they may seek out better deals on external purchases to offer increased value to their internal clients.
Next Steps
Want to learn more about 'business-within-a-business'? Check out these links:
Executive Summary: The Business-within-a-business Paradigm
To find out how PerformanceNinja could help you implement the 'business-within-a-business' model, book a free strategy call.
