Much has been written and said about driving for growth and driving for market share, usually in the context of market driving strategies that are led by the marketing or sales departments. Recently, I have been thinking about the organization, how it is led, how it is structured and how it makes management decisions, impact on growth and market share.

I spent most of my working life working for large organizations, specifically American multinationals. The first multinational company I worked for was Richardson Vicks, now a part of the Procter & Gamble conglomerate. Vicks was a small organization but surprisingly, for its size, it was not very entrepreneurial. In fact, it was quite structured. Processes were well defined. The decision-making and approval process was highly centralized. Documents followed required templates. Vicks Philippines was a highly profitable company but it was slow growing. As a young marketer, I quite enjoyed the structure Vicks provided, having come from San Miguel, which was much more fluid and unstructured. In Vicks, I knew exactly what had to be done.

When I moved to Avon Philippines, I found the organization was quite entrepreneurial. In contrast to Vicks, it was a large organization.
Avon worldwide was very entrepreneurial, to the point that majority of Avon countries had their own unique product line. When the new Avon CEO came on board, she called Avon a company of “a thousand flowers blooming.” With the new CEO, Avon moved from being highly entrepreneurial to a highly structured and numbers-driven organization. Decisions took time because of the financial analysis needed before a decision could be made. Resource allocation and reallocation was the norm. Both sales and profitability grew robustly.

After I retired from Avon, I joined ABS-CBN. In terms of revenue, Avon and ABS-CBN were the same, but the ABS-CBN business was more complex. What amazed me was the fact that decisions were made quickly with minimal financial analysis. In fact, many times I misread cues and only belatedly realized that decisions had already been made during meetings. I was so used to having robust financial analysis before a decision could be made. As I reflect on this type of management style, I now realize that it was precisely this management style that allowed the organization to weather and survive the crisis of Wowowee. The organizational was used to making decisions and moving quickly and used this experience to weather the crisis.

Today as a management consultant, I have worked with many different types of organizations and witnessed different
management styles and have come to the following conclusions:

·         Structure is necessary. Both large and small organizations benefit from structure. Structure facilitates control. Structure helps ensure resources are well utilized.
·         Processes can be enabling but they can also be show stoppers. When processes are enabling, employees have clarity in what needs to be done and how things need to be done. When processes become static, they stifle creativity and allow employees to abdicate responsibility and ownership of decision making.
·         Both structure and processes should be continually reviewed and updated. What was good a year ago is no longer as good today. Better to continually revamp and make small changes to structure and processes than to send the organization into chaos with dramatic change.
·         Organizational nimbleness should never be lost. Organizational nimbleness can be facilitated by structure and processes because they clarify what needs to be done and how things need to be done. But when structure and processes becomes a “sacred cow,” nimbleness is lost. Often the result of loss of nimbleness is declining market share particularly if the industry has young, hungry, entrepreneurial competitors.
·         Lastly, financial analysis should not drive an organization. Financial analysis should facilitate decision making; it should not be the “be all and end all.” Now as the owner of a small mom-and pop business, my husband and I use financial analysis to clarify but also use history and experience, together with intuition, to make the final decision.
 
 

Ms. Dy Buncio is the chief business development strategist of Mansmith and Fielders, Inc., (www.mansmith.net). For inquiries on our programs, please call (63-2) 584-5858/412-0034, text 0918-81-168-88 or e-mail info@mansmith.net.