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The new deal at the top.
Harv Bus Rev. 2007 Jun; 85(6):98-104, 142.HB

Abstract

What makes a company strategically agile--able to alter its strategies and business models rapidly in response to major changes in its market space, and to do so repeatedly without major trauma? Three years of in-depth case research on a dozen large companies worldwide showed the authors that one key factor is a new leadership model at the top. Senior executives at agile companies assume collective rather than individual responsibility for results. They build interdependencies among units and divisions, motivating themselves to engage with one another, and carefully manage their dealings to promote collaboration that is frequent, intense, informal, open, and focused on shared issues and the long term. Challenges to conventional thinking are encouraged. This is the new deal, and it's not easy to strike, because it requires executives to act in ways that are far from comfortable. After all, the corporate ladder at most firms favors independent types with a deep need for power and autonomy. At executive meetings, disagreement is suppressed or expressed passive-aggressively, eroding any real sense of belonging to a team. Switching to the new deal almost always requires a huge shift in the company's culture, values, and norms of interaction. The authors describe three approaches to making the shift: Executives can be given formal responsibility not for a business unit but for different stages in the company's value chain. This worked well for SAP, which has a relatively focused business portfolio. When a company's portfolio is less uniform, like Nokia's, business and functional units can be organized to crisscross on a matrix. And when a company is widely diverse, like easyGroup, it can emphasize the learning opportunities that units with common business models may share.

Authors+Show Affiliations

Global Technology and Innovation at Insead, Fontainebleau, France. yves.doz@insead.eduNo affiliation info available

Pub Type(s)

Journal Article

Language

eng

PubMed ID

17580652

Citation

Doz, Yves L., and Mikko Kosonen. "The New Deal at the Top." Harvard Business Review, vol. 85, no. 6, 2007, pp. 98-104, 142.
Doz YL, Kosonen M. The new deal at the top. Harv Bus Rev. 2007;85(6):98-104, 142.
Doz, Y. L., & Kosonen, M. (2007). The new deal at the top. Harvard Business Review, 85(6), 98-104, 142.
Doz YL, Kosonen M. The New Deal at the Top. Harv Bus Rev. 2007;85(6):98-104, 142. PubMed PMID: 17580652.
* Article titles in AMA citation format should be in sentence-case
TY - JOUR T1 - The new deal at the top. AU - Doz,Yves L, AU - Kosonen,Mikko, PY - 2007/6/22/pubmed PY - 2007/7/12/medline PY - 2007/6/22/entrez SP - 98-104, 142 JF - Harvard business review JO - Harv Bus Rev VL - 85 IS - 6 N2 - What makes a company strategically agile--able to alter its strategies and business models rapidly in response to major changes in its market space, and to do so repeatedly without major trauma? Three years of in-depth case research on a dozen large companies worldwide showed the authors that one key factor is a new leadership model at the top. Senior executives at agile companies assume collective rather than individual responsibility for results. They build interdependencies among units and divisions, motivating themselves to engage with one another, and carefully manage their dealings to promote collaboration that is frequent, intense, informal, open, and focused on shared issues and the long term. Challenges to conventional thinking are encouraged. This is the new deal, and it's not easy to strike, because it requires executives to act in ways that are far from comfortable. After all, the corporate ladder at most firms favors independent types with a deep need for power and autonomy. At executive meetings, disagreement is suppressed or expressed passive-aggressively, eroding any real sense of belonging to a team. Switching to the new deal almost always requires a huge shift in the company's culture, values, and norms of interaction. The authors describe three approaches to making the shift: Executives can be given formal responsibility not for a business unit but for different stages in the company's value chain. This worked well for SAP, which has a relatively focused business portfolio. When a company's portfolio is less uniform, like Nokia's, business and functional units can be organized to crisscross on a matrix. And when a company is widely diverse, like easyGroup, it can emphasize the learning opportunities that units with common business models may share. SN - 0017-8012 UR - https://www.unboundmedicine.com/medline/citation/17580652/The_new_deal_at_the_top_ DB - PRIME DP - Unbound Medicine ER -