Mobilizing Minds: Creating Wealth From Talent in the 21st Century Organization (Hardcover)

by Lowell L. Bryan (Author), Claudia L. Joyce (Author)
Key Phrases: banking division, global securities services, superclass companies, Global Bank, Long Island, New Jersey (more...)

Editorial Reviews

Review

Considering so many of us are supposed to be working in something called the “knowledge economy”, it is absurd how stupidly designed so many businesses and organisations actually are.

Matrix structures are piled on ad hoc reorganisations, divisions are divided, parcelled up and then redivided all over again. No wonder accountabilities get blurred, employees are confused and performance suffers.

A key problem in this digital age has been the failure to adapt the way businesses are organised. Few leaders see their company as a complete system. Instead, they try to carry out partial running repairs, leaving a fundamentally outdated structure in place.

This is the argument put forward by McKinsey’s Lowell Bryan and Claudia Joyce in their ambitious new book, Mobilizing Minds.

The authors believe that the great majority of businesses are underperforming precisely because their most important intangible assets – the ideas and creativity of their knowledge workers – are unwittingly suppressed by the way in which these businesses are set up to operate.

“Trying to run a company in the 21st century with an organising model designed for the 20th century places limits on how well a company performs,” they write. “The plagues of the modern company are hard-to-manage workforce structures, thick silo walls, confusing matrix structures, e-mail overload and ‘undoable jobs’.”

Having studied the performance of the most successful businesses, Bryan and Joyce conclude that “thinking-intensive” companies do best when they unleash talent rather than constrain it. And looking at a new measure, profitability per employee, is a useful discipline towards raising overall levels of performance. “Profit per employee is a good proxy for earnings on intangibles,” the authors say.

It should become the most important measure of success, ahead even of returns on capital. That should be looked at “just to ensure that they are sufficient to cover the costs of capital,” Bryan and Joyce say.

The authors know what success looks like. It involves a virtuous circle of productive activity: knowledge being exchanged, reputations being built, relationships being established and developed, “competencies” growing stronger. And, all the while, profits per employee climb.

The numbers involved are not trivial. “If a company with 300,000 employees can add $13,333 of “rents” per employee (that is, earnings requiring no additional employment of capital or labour), by reducing unproductive complexity, it can add $4bn in additional earnings,” the authors argue. They estimate that this could add as much as $40bn in market capitalisation.

Leaders have failed to grasp the possibilities of the digital era. “The trial-and-error period of discovery has been under way for over a decade now,” Bryan and Joyce say. (At which point you have to ask: so what have the strategy consultants been doing all this time?) Business has botched the introduction of new technology. “In cities the problem is congestion. In companies, the problem is unproductive complexity.”

So much for the – extremely good – diagnosis. What about the cure? Bryan and Joyce advocate a radical overhaul of the way organisations are designed. For example, even the largest organisations need no more than four layers of management from top to bottom. Front-line managers, like military captains, should be free “to make tactical decisions close to the front line”, within the context of a strategy set by top management.

There should be “one company governance and culture”, supported by a partnership ethos at the top. And a “portfolio of initiatives” approach would lead to more dynamic management, while maintaining the discipline of meeting earnings targets.

There are other, more radical suggestions for practical steps here concerning the management of people. Formal networks will help spread good ideas. There should be “talent marketplaces”, with capable employees free to plot their own career path internally. New performance measurement is required to reward people’s contribution to team as well as individual success.

This is a densely written, powerfully argued book. Cynics will interpret the call for organisational redesign as a make-work scheme for management consultants. But even they would have to concede that this critique of organisational stasis is very well done indeed. (Financial Times )

Product Description

Based on a decade of exclusive research, Lowell Bryan and Claudia Joyce of McKinsey & Company have come up with a simple yet revolutionary conclusion: Your workforce is the key to growth in the 21st century. By tapping into their underutilized talents, knowledge, and skills you can earn tens of thousands of additional dollars per employee, and manage the interdepartmental complexities and barriers that prevent real achievements and profits.

This can only be accomplished through organizational design and redesign. That's the new model for survival in the modern, digital, global economy. With the right design, your organization will have the capabilities to pursue whatever strategy is necessary to compete on any scale, react to any market change, leverage any opportunity, and sail past the competition.

In Mobilizing Minds, the authors distill their research into seven strategic ideas that shatter the complexity frontiers, have the potential to unleash enormous profits, and enable long-term success for every company. Bryan and Joyce outline innovative principles that enable corporations to:

• Manage complexity, bureaucracy, and redundancy
• Use hierarchical authority to strengthen the authority of key managers and drive performance
• Deliver operating earnings while implementing wealth-creation strategies
• Allow formal networks, talent, and knowledge marketplaces to work in a large company
• Motivate and reward wealth-creating behavior
• Pursue organizational design as a corporate strategy
• Increase worker satisfaction

It is imperative for corporations to put the same energy used for new products and processes into organizational design. That's where the money is. That's where the opportunities lie. That's the key to surviving and prospering in the 21st century.

(20070712)

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Product Details

• Hardcover: 300 pages
• Publisher: McGraw-Hill; 1 edition (May 29, 2007)
• Language: English
• ISBN-10: 0071490825
• ISBN-13: 978-0071490825
• Product Dimensions: 9.1 x 6.3 x 1.2 inches
• Shipping Weight: 1.4 pounds (View shipping rates and policies)
• Average Customer Review: 3.5 out of 5 stars See all reviews (4 customer reviews)
• Amazon.com Sales Rank: #145,429 in Books (See Bestsellers in Books)

Customer Reviews

Most Helpful Customer Reviews

6 of 8 people found the following review helpful:

5.0 out of 5 stars Weak Five for HR Wonks, Distill to One Page for CEOs, July 2, 2008

By	Robert D. Steele (Oakton, VA United States) - See all my reviews (TOP 50 REVIEWER)

I was tempted to give this book three to four stars for lack of context and for lack of a solid literature review (the entire book is a McKinsey love fest and somewhat albino in its incestuousness) but because I read a Harvard Business Review article today on how HR is the new new thing for Harvard MBAs, and the book speaks very well to HR folks I rate it a weak five for HR, four for all others. The smart HR person will find a way to distill the book to one page for the CEO. The basic premises are not new, but they are valid.

My annoyance first (minus one star):
- Neither ethics nor the environment appear in this book.
- True costs and the triple bottom line do not appear in this book.
- Customer minds do not appear in this book [see BW "The Power of Us"]
- The authors make facile assumptions, e.g. Exxon and GlaxoSmithKline are top "performers" by their account, but the authors are--with all due respect--clueless about the fact that Exxon did not make $40 billion in profit, it externalized $12 per gallon and stole that money from the public commonwealth now and into the future; similarly, GSK is profitable because the US Government is not allowed to negotiate, 50% of the health system is waste (see PWC report), and they are allowed to charge 100 times what the same medications cost in any given Third World country (different lowest cost country for each of the top 75 medications).
+ The bibliography is marginal, a form of McKinsey pablum.
+ The authors make facile reference to "complex adaptive systems" and to Wikipedia as well as blogs, but fail to provide a proper bridge to the "wealth of networks" or to Generation 2.0/Digital Native mindsets and methods.
+ They significantly exaggerate and misrepresent the relative value of "distinctive" and proprietary knowledge in relation to giving employees access to public knowledge in the external environment as well as internal knowledge that is not secret (see images under book cover).
+ The publisher puts the lead author's Harvard MBA right after his name, while relegating the second author's degree to the last line of her bio. As an admirer of the book What They Don't Teach You At Harvard Business School: Notes From A Street-Smart Executive I found this substantially OFFENSIVE. I hate feminazis, but in this instance, if the second author would like the publisher fire-bombed, I'm there for her [metaphorically speaking].

My irritation aside, this is a good book and I recommend it. Let me start with a few quotes that captured my respect:

p 13 "The plagues of the modern company are hard-to-manage workforce structures, thick silo walls, confusing matrix structures, e-mail overload, and 'undoable jobs.'"

p 24 "Surveys confirm the symptoms of the disease, which include e-mail and voice-mail overload, task forces hat go nowhere, pointless meetings, delays in making decisions because of scheduling conflicts, too much raw data and not enough information [or sense-making aka decision-support], and challenges in getting the knowledge one needs because of organizational silos.

p 26 "Interaction costs involve searching for information and knowledge, coordinating activities and exchanges, and monitoring and controlling the performance of others within the same firm." [credit by the authors to Ron Course, 1937]

p 239 "Today, the most valuable capital that companies can use in the 21st century is not financial capital but 'intangible capital.'"

Duh. Okay, a bit more of my irritation, but the book stays at four to five stars. Here are the books the authors did not read in reinventing the wheel:
Organizational Intelligence (Knowledge and Policy in Government and Industry)
The exemplar: The exemplary performer in the age of productivity
The Knowledge Executive
The Wealth of Knowledge: Intellectual Capital and the Twenty-first Century Organization
Information Payoff: The Transformation of Work in the Electronic Age

There are others, but I need to save four links for the close of this review. Now on to what I did find worthwhile, which is to say, at least 75% of the book (the negative reviewers dismiss this work too quickly).

+ Minds of virtually all employees are grossly under-utilized
+ In emphasizing human brains, authors run counter to the machine learning fad that permeates the meta-web crowd, and that is good
+ "Unproductive complexity is the common enemy"
+ Profit per employee is a useful measure [but I would emphasize, not in isolation, see my damnation of Exxon and GKS above]
+ Existing financial reports *block* internal collaboration
+ Economies of scale and scope undermined by complexity, HR and IT can help regain momentum
+ It's not enough to pick good people, have to change corporate context, capability, and the culture (collaboration instead of competition)
+ Informal networks cannot be *managed* [authors' emphasis, heavens!]
+ Decisions on not making numbers versus future-oriented investment need to be pushed to the top of the corporation
+ Few CEOs understand the legacy front line, need to interview and listen
+ Valuable pages for the HR wonk emergent on alternative performance measures and alternative economic incentive plans

9 ideas fully discussed in this book:
+ backbone line structure (3 layers instead of 7)
+ one company governance and culture
+ dynamic management (portfolio of risks)
+ formal networks
+ talent marketplace (HR as broker)
+ knowledge marketplace (internal wikis, blogs)
+ internal motivating economic incentives
+ role-specific performance management
+ organizational design as strategy: who you hire *is* your future

I put the book down satisfied that it was worth the time it took to read; that the points above are important; and that the CEO of the future needs to elevate HR to the high table.

By the same token, neither of these authors is at a CEO level of strategic holistic perception--everything about the world has changed, to include the establishment of the World Index of Social and Environmental Responsibility (WISER), and the emergence of global social networks capable of breaking the backs of companies that continue to export jobs, leverage sweatshops, import toxins, and generally steal from the commonwealth. The book reflects zero understanding of, to use my remaining four links:

No Logo: No Space, No Choice, No Jobs
Here Comes Everybody: The Power of Organizing Without Organizations
Blessed Unrest: How the Largest Social Movement in History Is Restoring Grace, Justice, and Beauty to the World
Collective Intelligence: Creating a Prosperous World at Peace

Bottom line: within their niche, worth listening to. They don't know what they don't know, and that is why CEOs have a job (in theory--most CEOs and flag officers receive biased, incomplete, late information, and could really use help thinking about trransformation in a transformative environment--this book is a fraction of the total, perhaps 20%).

7 of 10 people found the following review helpful:

5.0 out of 5 stars Not grounded but thought provoking, good read, September 2, 2007

By	Alan Fryer "frydaz.com" (Portland) - See all my reviews (REAL NAME)

I recently became interested in defining my own role and wanted to ground my ideas in what is out there in the corporate world. I was also interested in hearing what a McKinsey person had to say, as our company has hired some former McKinsey consultants.

To me this book had three stages:
- the sales pitch - boring but thankfully brief. I did buy the book already...
- brief discussion of existing organization theory. - A little brief for me. I would have liked a little more introduction to conventional corporate structures and thinking. Perhaps I am also not representative here, as this may be old hat to some.
- their ideas for how to build an organization for the 21 st century. This is the bulk of the book and where the meat is. Overall, I found it very interesting and had a hard time putting the book down. I do wish it was a little more grounded in what was in actual practice with more case studies from existing companies that have excelled in certain areas. Instead, they tried to propose a new organization but are very honest in saying no current company implements all there ideas.

My biggest complaint is that they choose to focus on approaches that work for mega corporations and often want to focus on how their ideas scale up rather than scale down. While, the complexities of running mega-corporations may require new approaches to truly scale, it seems like innovative, radical approaches would be first adopted in smaller organizations.

Some of the high-lights for me include:
- Clear separation of the duties and responsibilities of the different layers of management. Empowered Line management responsible for operations and shorter term initiatives. Senior and Top - Level management responsible for shared utilities, strategic planning and putting in place a one-company culture.
- Strong use of hierarchy for clear decision making while at the same time, providing a framework for incorporating Teams at the top. In particular, I liked the idea that teams at the top would extend beyond the C-Level board and reach down lower level people. I agree with the premise that this will not only help train and retain promising talent but will also result in better decision making and planning.
- Top down leadership towards mutual accountability.
- The concept of portfolio of initiatives and the need to fund them out of corporate and top level management to avoid long-term planning and improvements being starved by more immediate line management needs.
- Formal networks and Talent Networks were interesting but some of the concepts shared in knowledge networks were particularly interesting to me. Some of the concepts of Knowledge may be the easiest for smaller organizations to start putting in place.

Thus, for me, this was a very good book and one that has certainly wetted my appetite for further reading. Perhaps, the authors could write another book focusing on grounded, shorter term improvements with an eye to smaller companies....

1 of 5 people found the following review helpful:

1.0 out of 5 stars Not worth the money., February 21, 2008

By	Matthew - See all my reviews

I can't see this book being of much help to anyone. I'm actually not sure why it was written. It reads like a 300 page advertisement for McKinsey. It's sparse on details and the quality of writing is inconsistent. Sorry I don't have anything positive to say about this one.