The changing nature of business

Wanted to compare the corporate and large company business models that I have seen adapt and morph over the past thirty years. Opted to use the traditional triangle, not to show organisation structure but to represent the number of people in roles.  

The1990 model

For me this is the traditional business concept, the one taught on my MBA, the one I was helped grow and my first startup.  There were roles and structures and the more senior the role was related to a higher level of understanding, experience and insight.  Yes, Peter’s principle was rife.  The exec team could mange with a dashboard as the processes and foundations of the business were linear.  Any complexity was the fun of senior management allowing the sponge of middle management to both slow down change but maintain stability.  

The Naughties “digital”

The internet pioneers were off creating new and existing models, leaving the corporates to adapt to the new.  Finding and retaining digital expertise became the mantra for the CEO’s,  the change programmes adsorbed middle management who never had these skills of transformation to focus on keeping their jobs and being paid through the delivery of the plan and KPI at any cost.  The senior leadership team took over the role of trying to manage with dashboards to simplify the complexity of everything changing, model, competition, skills, margin, value, customer, channels, processes).  Many exec teams continued based on path dependency as they did not have the skills or experience to grasp the changes.  Leaders who learnt fasts and that had the skills and experience thrived.

With noting that the emerging new growth businesses are now competing with others like themselves and those still stuck in/ with a 1990 model. 

Right Now 

Pioneers of the brave new models are winning in a data and platform economy.   The market now has players who are still operating with a 1990 model underpinned with simple linear processes, the middle sponge and executives leading with a dashboard, who are fighting with those who through one transformation to digital but did not realise it was going to be a multistage evolution.  

Data and platform business are building data and data expertise, the analysis is managed into dashboards that adsorb operations and delivery, continually looking for improvement and efficiency, more personalisation and better automation.  The senior leadership team are now deep into managing complexity, ethics, automated decision and new risk.  The senior team are deeply dependent on an ecosystem for both data and activities as they collectively deliver to customers. Pioneers are heading the businesses with vision, passion and principles, it is not about management and reporting but about crafting a direction of travel.

It is easy with hindsight to observe the differences between a corporate still tracking on a 1990 model and one that has data and platform as a foundation.

I somehow think our worst nightmare has become true with the emergence of combination of part transformed organisations!