Articles

The NOW Revolution: Making the idea of “People First” a 21st Century Success Story

The new model of free enterprise reflects a move away from an industrial model towards a knowledge-based model which emphasizes a highly skilled workforce and is more focused on research and development than on the more mundane aspects of manufacturing and sales.

The twin engines of this model are 1) Globalization; and 2) Advanced technology. Companies locate and relocate around the globe in search of locations with both a highly skilled workforce and high-tech infrastructure to create new advanced technologies and/or processes to help them take advantage of as yet unexploited markets. This is why outsourcing and economic development through innovation go hand in hand.

Innovation is the Key to Success

Companies today have been forced to adapt to the changing economic environment by embracing innovative approaches to finding solutions to business challenges. This is true around the world. Innovation is critical to success. Companies who do not innovate will not survive.

Innovation can mean developing and implementing technical change. Innovation can also mean developing and implementing process changes. It can and does mean anything and everything in between.

Innovation can mean identifying a niche market for either products or services. It can mean identifying internal company strengths and focusing on these and outsourcing company functions that are not strengths.

Under the old form of capitalism, vertical companies tried to do everything. For example, Bethlehem Steel, once one of the largest steel companies in the world, tried to do everything, tried to own every step in the process of manufacturing and selling steel, owning the land where the ore for steel was dug up, to owning the rail transportation companies that transported the raw materials, to having its own marketing department. Unfortunately for Bethlehem Steel, it was only really good at manufacturing the steel. It was not a marketing company. It had no expertise in marketing. And so the cost of maintaining subsidiary departments like the marketing department drove the company to bankruptcy.

Bethlehem Steel no longer exists today.

So let me repeat, companies who do not innovate or who cannot innovate will not survive. Companies need to be able to innovate to be successful. Whether they are in the United States or Romania, it makes no difference. In 2005, for example, both Johnson & Johnson and Wyeth, two giant pharmaceutical companies, located production facilities in Ireland because Ireland high school students possessed the technical knowledge they needed to find skilled employees.

Locating a division or a company where the talent lives is an innovative solution to a workforce challenge. And what companies need to be able to do is also true for the people of those companies, from the CEO at the top to the manager in the middle to the front-line people on the sales floor or in the manufacturing plant.

In today's economic environment, companies need to be flexible, adaptable, and able to shift strategies and priorities to meet new emerging challenges and demands of the marketplace. So do the employees of these companies.
In order to maximize opportunity and maintain success, companies need to empower their people to take action and provide an environment where collaboration and passionate discussion flourish. So do the people of these companies.

Companies must also be able to move resources as needed where they are needed most. And the most important of these resources is Human Capital, which also means that employees must be able to go where and when they are needed.

Procter and Gamble, for example, wanted to create a new perfume and decided to locate its research and development division in Japan because Japanese women are the most discriminating consumer of perfumes in the world.

The most successful companies in the new knowledge-based economy create success because they embrace a horizontal, team-focused organizational structure which facilitates a collaborative spirit. Investment is still a critical factor in the growth of particular industries, but more importantly, the new capitalism is defined by an understanding of how to create and exploit new advanced technologies through the collaboration of people who share a common vision.

Bill Gates is the epitome of the new capitalist.

A People First Business Culture; A chance for success

Today, companies that share an innovative belief that future success will depend upon more than simply selling products, have more chances to successfully compete in the market. The focus of the company's strategic vision should be centered on the belief that future success is based on:

1) a fundamental understanding of how to use new technology to create a network of business partners and be a driving force to open up new markets (which is one of the characteristics of a successful company in today's global economy); and

2) acknowledging the value of empowering its workforce to take the initiative to create future success (which is another characteristic of successful companies in the information age.

The Role of Management to Drive Transformation

To ensure that the People First business culture becomes a permanent part, a company needs to engage and reward leadership and initiative at all levels.
Leadership at the top executive level must work with middle management to clearly articulate the practical short-term and long-term goals of a People First business approach and then give its middle management teams the authority to take initiative and implement local or project specific policies that will drive success.
Middle management, in turn, must:
1) encourage sharing of ideas, facilitate collaboration among employees in their divisions;
2) be ready to shift strategic priorities as economic needs change;
3) be engaged in a constant dialogue with their employees about the short-term and long-term goals of each project and the role of each employee in helping to successfully implement each project;
4) recognize that the value of a "team" approach rests on how well the members of a team work together
5) adopt the role of mentor, coach and supervisor in working with employees at all levels of their division to build trust and confidence in the ability of the "team" to get the job done.

To be able to create this kind of success; managers need the following skills and abilities in addition to their operational skills (accounting, data management, etc.):
a. People Management Skills (performance appraisal skills, training needs assessment skills; recruitment skills)
b. Communication Skills (negotiation skills, conflict resolution skills; presentation skills)
c. Personal Development Skills (assertiveness skills, time management skills, critical thinking and problem-solving skills)
d. Leadership Skills (coaching skills, listening and counseling skills, motivational speaking skills)

The Future of Success

The future success of any company that operates in this new business environment depends upon the ability to implement these new management ideas and create a responsive, "People First" business climate that exceeds the expectations of customers, of partners, and of employees. People must work diligently and persistently to exceed the limitations of the preconceived ideas of what success means if truly hope to become an innovative leader. The time for this revolution of thinking is now. And if no action takes place today a competitor will act and the opportunity will be missed.

References:

Bellis, P. (2006, September), The role of workforce development in stimulating economic growth. White paper prepared and presented at the Future of Maine's Economy Summit 2006 (September 21-22, 2006).

Kotter, J. P. (1996), Leading change. Cambridge, MA: The Harvard Business School Press

Thurow, L. (2003), Fortune favors the bold. New York, NY: HarperCollins