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“Control” At The Top While Permitting Autonomy At The Bottom

Guest post by: Todd Jamieson

Article Overview: Shortly after Lou Gerstner became CEO of IBM in 1993, he made one of the most significant decisions of his entire career. At a time when many people were calling for the IT giant to decentralize and dismantle into smaller, more flexible companies, Gertsner chose to do the opposite. He instead used IBM’s large size (and subsequent capabilities) to help customers integrate the diverse components of their information technology (IT) systems. In other words, by keeping IBM’s decision-making centralized and integrated, IBM was able to help customers with IT decisions they would have otherwise been forced to make on their own.

“Control” At The Top While Permitting Autonomy At The Bottom

Shortly after Lou Gerstner became CEO of IBM in 1993, he made one of the most significant decisions of his entire career. At a time when many people were calling for the IT giant to decentralize and dismantle into smaller, more flexible companies, Gertsner chose to do the opposite. He instead used IBM’s large size (and subsequent capabilities) to help customers integrate the diverse components of their information technology (IT) systems. In other words, by keeping IBM’s decision-making centralized and integrated, IBM was able to help customers with IT decisions they would have otherwise been forced to make on their own.

In this situation centralization was used for a specific issue at a crucial time- and it paid off -but that doesn’t mean that Gerstner is a hardcore centralization supporter. “Let’s decentralize decision making wherever possible, but … we must balance decentralized decision making with central strategy and common customer focus”, Gerstner says.The concept of “”balance” or lack thereof, is something that Tom Petershas pointed out on his blog before.Citing what he refers to as “ICD” or Inherent Centralist Drift, Peters asserts that companies intrinsically steer towards centralized organizational behaviors over time.

However, decentralized organizations are becoming more popular as the ability for organizations to decentralize increases. A decentralized organization shows fewer tiers in the organizational structure, a wider span of control, and a bottom-to-top flow of decision-making and ideas. One advantage of this structure (if the correct controls are in place), is the bottom-to-top flow of information which allows for input on decisions from all levels. This is good for business, because a well-informedand well-rounded decision is the best kind.

One simple and effective tool for keeping a sense of “control” at the top while permitting autonomy at the bottom is the use of a Customer Relationship Management or CRM. A centralized system for dealing with client data, sales leads, reports, and customer service allows organizations to maintain a consistent administrative system, while giving staff the freedom to experiment.As Peters points out “… many more (especially large, very large) companies die, or at least, shrivel or cease to lead their industries from too much control, not too little.” Modern CRMs allow companies to achieve a “centralized feeling” of control without descending into the typical centralist culture of top down management and power structures.

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Article Tags: capabilities, decisions, flexible companies, information technology
Referred by: http://www.brymarkpromostore.com



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