strategic innovation - ibm · pdf filepart 1 - describe the four organizational building...

IBM Global Dervices and the IBM Executive Business Institute

© Copyright IBM Corporation 2005and the Executive Business Institute

Strategic InnovationInnovation Organization Capability Assessment

VN-v9

IBM Executive Development Programme

IBM Global Services and the IBM Executive Business Institute

© Copyright IBM Corporation 2005


Flow of Seminar

Tools and Methods

Business Design

Assessment InnovationCapability

Assessment

Ideas and

Customers

Action Plan




CriticalCriticalTasksTasks

PeoplePeople

FormalFormalOrg.Org.

CultureCulture

OrganizationalOrganizationalBuildingBuildingBlocksBlocks

LeadershipLeadership

Source: Winning Through Innovation, M.Tushman + C. O'Reilly





PeoplePeople


CultureCulture


InnovationsInnovationsStrategy/VisionStrategy/Vision






••Strategic GroupingStrategic Grouping••Formal LinkingFormal Linking

••RewardsRewards••Info SystemsInfo Systems

••H/R Management SystemsH/R Management Systems••MetricsMetrics

••Norms, ValuesNorms, Values••Informal RolesInformal Roles••Informal PowerInformal Power••CommunicationCommunication

NetworksNetworks

••Component TasksComponent Tasks••Work Flows/ProcessesWork Flows/Processes

••Human ResourceHuman ResourceCapabilitiesCapabilities

••CompetenciesCompetencies


PeoplePeople


CultureCulture




Source: Winning Through Innovation,M. Tushman + C. O'Reilly





PeoplePeople


CultureCulture

InconsistencyAmong These

Elements


Performance GapsOpportunity Gaps

Strategic Choices

Performance







CriticalTasks

HP - Greeley Case DiscussionCurrent State

People

-Mfg scanners

-Cost control

-Mfg ramp-up

-Quality Control

-Customer Sat

-F(x) Org

-"Bd of Directors"

-"HP Way"

-Perfection Expected

-Consensus Dec Mking

-Conflict averse

-Lots of Operationalmetrics

-R+D Knows Best

-Eng = Flat bed skills-Mkt = Mature Mkt/Eng Oriented

-Pay + Promotion based on size

-1000 in Flat Bed Scanners

-Mgmt ops focused

-$ went to FB

Formal Org Culture

Source: Harvard Business School Case Study, M.Tushman




Organizational Assessment ApproachOrganizational Assessment Approach

Step #1Step #1

••Identify Identify current current manager and and unitof analysis, and of analysis, and currentcurrent performanceperformance

or opportunity or opportunity gaps

Sources: Based on the Congruence Model by M. Tushman + C. O'Reilly in Winning Through Innovation and IBM Executive Business Institute





Step #2Step #2

••For your current organization:For your current organization:Describe current critical tasks and work processes,Describe current critical tasks and work processes,people skills and resources, formal organizationalpeople skills and resources, formal organizational

structures, and culturestructures, and culture





Innovation Organization Assessment Model - Current Capabilities

ƒCurrent Critical Tasks and Processes

ƒCurrent Formal organizational Structure

ƒCurrent People Resources and Skills

ƒCurrent Organizational Culture






Step #3Step #3

••Check for current organizational congruenceCheck for current organizational congruenceTask Formal organizationTask Formal organizationTask PeopleTask PeopleTask Culture Task Culture

Formal org People CultureFormal org People Culture





Capability Assessment Approach"YOUR BUSINESS TODAY - CURRENT CONDITION"Part 1 - Describe the four organizational building blocks of your relevant organization as they exist today.

What are the critical tasks in your business (component tasks, work flows and processes,...)?

Describe the "people" component of your organization (human resource capabilities, competencies,...).

Describe your "formal organization" (strategic grouping, formal linking, rewards, information systems, human resource management systems...).

Describe the culture of your organization (norms and values, informal roles, informal power...).

Part 2a - Rate the relationships of your organizational components to your critical tasks.Use the following scale: 1 2 3 4 5 6 7

To a small extent To a great extent1. To what extent do the skills, abilities and motives of your people fit with your critical task requirements

2. To what extent do your formal organizational arrangements fit with your critical task requirements?

3. To what extent does the culture of your organization fit with your critical task requirements?

Part 2b - Rate the other relationships among your organizational components.Use the following scale: 1 2 3 4 5 6 7

To a small extent To a great extent4. To what extent do your people and formal organizational structure support each other?

5. To what extent do your people and organizational culture support each other?

6. To what extent does your formal organization and culture support each other?





Rating #4

Rating #3

Rating #2


CultureCulturePeoplePeople

Critical Critical TasksTasks

Rating #6

Current Critical Tasks:

Current People:

Current Culture:

Current Formal Org:

Rating #1

Rating #5


What is your specific

Performance or Opportunity Gap ?




Activity:Objective:- Assess your current organizational alignment and capabilities of your current

business design using the Innovation Assessment Model (IAM). Process:- Use the questions (see next page) to analyze the organizational alignment and

capabilities of your organization today and input the answers into the IAM model. Output : - An understanding of your current organizational strengths and weaknesses per

the IAM. (Note: will be used again, in later workshops.)

Innovation Organization Capability AssessmentWorkshop #7

Timing:- Team preparation 30 minutes- Workshop discussion 15 minutes




Organizational Assessment Organizational Assessment ApproachApproach

Step #4Step #4

••Assess gaps, develop solutions and take actions,Assess gaps, develop solutions and take actions,if necessary, for current organizationif necessary, for current organization




Coffee/Tea Break -- 10 Minutes




Definition and Value of Culture Definition and Value of Culture

"Organizational culture is the pattern of beliefs

and expectations, or norms, that if they are

widely shared and strongly felt can

powerfully shape the attitudes and behaviors

of individuals and groups."

Source: Charles O'Reilly III, Stanford University




Conflictin the

Organization

LowProduction

Organization

ManagementImposedControl

The Impact of Beliefs on the OrganizationThe Impact of Beliefs on the Organization

High

Low

LowIntensity Intensity

Con

sens

us

Con

sens

us Self-Managed

OrganizationSocial ControlSocial Control





Why Do You Need Social Control ?Why Do You Need Social Control ?

This is WhereThis is WhereInnovation Occurs !Innovation Occurs !

Measure Both

MeasureBehavior

MeasureOutcomes

???Social Control

Low

LowHigh Ability to measure behavior Ability to measure behavior A

bilit

y to

mea

sure

out

com

esA

bilit

y to

mea

sure

out

com

es





CriticalTasks

FormalOrg.

People Culture

Greeley Case B Discussion

Get a product outPrice the product

Cost ...2nd for now

Functional

Roles and Resp. Take Risk

Failure=OK if learn

SpeedNew markets skills

New Tech skills

Incentives for risk

Milestones, not opsmeasurementsSeparate "quasi-div"w/in Greeley

No career risk

Source: Harvard Business School Case Study, M.Tushman





Step #5Step #5

••Identify Identify future future manager and and unitof analysis, and of analysis, and future opportunity future opportunity gaps






Step #6Step #6

•• For your future organization:For your future organization:Describe future critical tasks and work processes, Describe future critical tasks and work processes, people skills and resources, formal organizationalpeople skills and resources, formal organizational

structures, and culture for your Innovative ideastructures, and culture for your Innovative idea





Innovation Organization Assessment Model - New idea/Future Capabilities

ƒFuture Critical Tasks and Processes

ƒFuture Formal organizational Structure

ƒFuture People Resources and Skills

ƒFuture Organizational Culture






Step #7Step #7

Check for future organizational congruence:Check for future organizational congruence:Future Task Current Formal organizationFuture Task Current Formal organizationFuture Task Current PeopleFuture Task Current PeopleFuture Task Current Culture Future Task Current Culture

Rate for Difficulty of Execution of alignment:Rate for Difficulty of Execution of alignment:Formal org People CultureFormal org People Culture





""AS YOUR BUSINESS WILL BE - NEW STRATEGIC INNOVATION"Part 1 - Describe the four organizational building blocks as they will need to be for your Strategic Innovation to be successful.What will be the critical tasks in your business (component tasks, work flows and processes,...)?

Describe what the "people" component of your organization (human resource capabilities, competencies...) will be.

Describe what your "formal organization" (strategic grouping, formal linking, rewards, information systems, human resource management systems...) will be.

Describe what the culture of your organization (norms and values, informal roles,informal power...) will be.

Part 2a - Rate the relationships of your current organizational components to your future critical tasks.

Use the following scale: 1 2 3 4 5 6 7

To a small extent To a great extent1. To what extent do you believe that your people component will fit your future critical tasks?

2. To what extent do you believe that your formal organizational structure will fit with your new critical task requirements?

3. To what extent do you believe that your culture will fit with your new critical task requirements?

Part 2b - Rate the difficulty in aligning the other relationships among your organizational components with your new strategic innovation.

Use the following scale: 1 2 3 4 5 6 7

Very difficult Very easy4. How difficult will it be to get the people component and formal organizational structure to support each other in the future?

5. How difficult will it be to get your people component and culture to support each other in the future?

6. How difficult will it be to get your formal organizational structure and culture to support each other in the future?





Rating #4

Rating #3

Rating #2


CultureCulturePeoplePeople

Critical Critical TasksTasks

Rating #6

Rating #1

Rating #5

Future Critical Tasks

vs.

Current People, Org, and Culture


What is your specific

Performance or Opportunity Gap ?




Activity:Objective: - Assess your current organizational alignment and capabilities against- the requirements of your future business opportunity using the- Innovation Assessment Model (IAM)

Process:- Use the IAM questions and model to analyze what organizational capabilities will be - required for your new innovative idea, and the strengths and weaknesses of your - current organization's ability to support your new innovative business opportunity.

Output:- IAM assessment of your current organization's ability to support your new - opportunity and the gaps between your current + needed future organization- to support the new innovative opportunity.

Innovation Organization Capability Assessment – Part 2Workshop #8

Timing:- Team preparation 20 minutes- Workshop discussion 10 minutes




Organizational Assessment Organizational Assessment ApproachApproach

Step #8Step #8

••Assess gaps, develop solutions and take actions,Assess gaps, develop solutions and take actions,for future organizationfor future organization





Step #9Step #9

•• Observe response and learn fromObserve response and learn fromthe consequences the consequences




Innovation Assessment Model FocusInnovation Assessment Model Focus


PeoplePeople


CultureCulture

StrategyStrategyLeadershipLeadership

PeoplePeople


Software Hardware







PeoplePeople CultureCulture



PeoplePeople CultureCulture

An Ambidextrous OrganizationAn Ambidextrous Organization

InnovativeInnovativeOrganizationsOrganizations

OperatingOperatingOrganizationsOrganizations

An ambidextrous organization is one where An ambidextrous organization is one where both radical innovation and ongoing operationsboth radical innovation and ongoing operationscoexist side by side with the differing processes,coexist side by side with the differing processes,organizational structures, cultures, and peopleorganizational structures, cultures, and peopleoptimized for success in each area respectively. optimized for success in each area respectively.

Sources: Based on the Congruence Model by M. Tushman + C. O'Reilly in Winning Through Innovation and IBM Advanced Business Institute




Managing an Ambidextrous OrganizationManaging an Ambidextrous Organization......Managing Multiple Streams of Innovation......Managing Multiple Streams of Innovation

Operations FocusOperations FocusEfficiencyEfficiencyBetter ProcessBetter ProcessSmall ChangesSmall ChangesTodayTodayTacticsTacticsOperational MetricsOperational Metrics

Innovation FocusInnovation FocusExperimentationExperimentationLots of FailuresLots of FailuresBig ChangesBig ChangesThe FutureThe FutureStrategyStrategyMilestonesMilestones

The challenge is not ONE culture, but multiple cultures and multiple structures with different processes, values, and performance metrics.





"... it's an absolute basic that if you're going to be on the senior management team, you've got to be good at this [managing culture], or you're not going to belong."

Fred HassanCEO, Pharmacia CEO , Schering-Plough

"Making Culture"Making Culturea Strategic Asset"a Strategic Asset"

Outlook JournalOutlook Journal

Accenture WebsiteAccenture Website

strategic innovation - ibm · pdf filepart 1 - describe the four organizational building...

Documents