Individualizing the Corporation.
The burgeoning global economy and the rapid pace of technological advancement have rendered traditional corporate organizations, and the techniques by which they were managed, obsolete. Many companies have responded to these changes with structural adaptations, but few have adequately realized the fundamental transformations that are required to succeed in this new environment. Sumantra Ghoshal and Christopher A. Bartlett describe the emergence of a new kind of organization in The Individualized Corporation: A Fundamentally New Approach to Management.
In their groundbreaking analysis, the authors identify three "core capabilities" that distinguish the individualized corporation: The ability to inspire individual creativity and initiative The ability to link pockets of expertise and entrepreneurial activity within the organization The ability to constantly renew the organization and its product, even if that requires making its own products obsolete.
The individualized corporation, the authors argue, requires a new understanding of the roles of both employees and managers. Rather than the undifferentiated corporate cogs of the "organization man" model, employees are encouraged to initiate new ideas and assume increased responsibility for their jobs. This new paradigm of employee behavior also requires managers to elicit, support, and coordinate these new behaviors.
Ghoshal and Bartlett profile a number of organizations that have successfully implemented this paradigm and transformed themselves into individualized corporations. Some, such as GE and Asea Brown Boveri, were once defined by the traditional corporate model and have now transformed themselves; others, such as 3M and the Kao Corporation, had never been so thoroughly defined by the old model; and still others, such as Intel and IKEA, have come into existence recently enough that they have built themselves upon the individualized corporation model from the start. All offer valuable management lessons that will be required in the next century.
In The Individualized Corporation, Ghoshal and Bartlett offer a new template of corporate organization and management that serves as a conceptual framework for managers and executives to apply to their own companies. At the same time, they offer examples of companies that have implemented this new paradigm and describe the techniques by which they have accomplished this. Finally, they consider the social role of the corporation, arguing that it is one of the last great institutions of society; the individualized corporation, they say, is the model which best satisfies this social role.