Proposed 2-Hour Presentation connecting the Science of Strategy with the Financial Crisis start with Bailout
I propose that this presentation covers the following points.
1. The 20th century was the era when success depended on mass planning, mass organization, mass transportation, and mass communication. During this period the primary focus was systematizing internal operations and creating dependable results. Retail success meant building chains to replace mom-and-pop operations. Manufacturing success meant creating complexly design manufacturing process to build cars, planes, and computers. Distribution success meant organizing large warehouses, customer lists. The economies of scale were amplified by mass communication and advertising that created national and international brands.)
2. During this era, organization centralized, top-down decision-making and training people to follow policy to enforce operational standards. Competitive success depended on getting to market first with a brand so as to achieve scale, cost-efficiency of organizations, and quality of operations. It didn’t depend on the day-to-day decision-making of employees at every level, especially not on the front-lines.
3. That era is done. It reach a point of diminishing returns n the eighties, when new business started to be based on creativity rather than organization. The computer and especially the worldwide network changed everything, replacing mass planning, mass organization, mass transportation, and mass communication with networked planning, networked organization, networked transportation, and networked communication. Most importantly, it replaced the “worker who follows orders” with “the worker who makes decisions.” In these new networks, strategic competitive decision-making isn’t made only at the top but throughout the organization, especially at the front lines in the marketplace. Speed and adaptability replaced size and dependability as the hallmarks of a successful organization.
4. This current financial crisis was created by 1) the “diseconomies of scale” as the “mass market” top-down organizations (manufacturers and financial institutions) grew too large to connect strategic decisions at the top to realities in the street where value is created, 2) the speed of the market, enabled by the new networked society, made planning less and less predictable as more and more people in society adapted to changing realities more quickly, and 3) the failure of government regulation and old models of financial rating to keep pace with the increasingly dynamic global market, creating both false guarantees and regulations like Sarbannes Oxley mark-to-market, which were built from the perspective of much slower moving market places.
5. The brave new world: A faster moving, more competitive world in which people do not have time, like the old generation of corporate executives, to learn from their mistakes and must instead learn from other people’s mistakes. This is a world in which people throughout the organization must speak the same competitive language and understand how strategic decisions are made.
6. Sales pitch for how training on strategy is the only solution to this problems.