With the news today about Penske breaking off talks with GM on their deal to buy Saturn, I thought it would be fun to revisit my post on this topic from back in July. Given the over abundance of car brands, and the lack of differentiation in the market, take a look at this idea and see if you want to invest. I really think it could work!
If you are interested in organization design, you should read Beyond Detroit in the 17.06 issue of Wired magazine. Chris Anderson offers a great introduction arguing that a new era of global business (long heralded) is really here. The point is, that with the Big Three disintegrating, it’s time for the “little guys” to proliferate in a market of automotive technologies that includes many, many more players and will produce much better results.
Despite the deep malaise in the auto industry and the lackluster efforts by the federal government, articles like this show there is light at the end of the tunnel with practical ideas and solid advice. I thought I’d join the fray with an idea for how GM might move forward to a better place. I’m not claiming to be an auto industry expert, but my distance from it might be an advantage (at IDEO we call this the “naïve mind”).
Awhile back, I shared a framework for organization design inspired by the animal kingdom. Fundamental to that approach is the concept of biodiversity in an ecosystem. Changing circumstances require entities within the system to evolve and adapt or they will die. And evolution is about letting an existing trait emerge and thrive when new conditions emerge and demand it. See this interesting blog post by Robert Patterson for more on this line of thinking.
While GM has had dozens of brands and even some difference in their range of businesses, they have sought to keep everything operating on the same model and use scale as a lever to create efficiencies. This “no variance” strategy crushed Saturn, one of their best hopes for survival.
So a mortal enemy of a sustainable organization is homogeneity, and GM is the poster child of homogeneity. Using this framework, we can explore how GM might diversify their organizational structures to be more successful in four different consumer categories, with four different auto brands. It’s likely that these different consumers want different things from their cars, so the organizations should operate differently to meet those needs.
Below you can see four GM brands plotted on the “organization ecosystem” model to guide our exploration. Based on their unique brand attributes, and the demands of the market and consumers of those brands, each of the companies could be structured and operate quite differently. It’s funny to me that two of these brands are being jettisoned in the current restructuring actions.
Check back here for my next several posts and deeper descriptions of each example.
Are all animals hierarchical by nature? Are humans? Bob Sutton posted a great topic comparing managers to baboons. And of course the easy inclusion of the Office character Michael Scott shows the ubiquity of our “dominant mindset” thinking about organizations. It is clearly the case that most organizations we know are hierarchical.
Some of you may know about biomimicry and how it can inspire great design. I read the Starfish and the Spider and had a few chats with Ori Brafman awhile back and it got me really interested in the idea of organizations as animals. With animals there are thousands of strategies for “survival of the fittest” and many of them don’t involve hierarchy. So couldn’t there be many types of organizations that don’t involve hierarchy? What advantages would the organization have if it was built from a different fundamental structure?
The real lesson from biomimicry here, is that animal adaptations come from interacting with the environment. That is, they are not internally developed as a strategy, but they are externally evolved based on the forces around them. So given the business environment you are in, what animal could inspire your organization design so you could succeed better?
By the way, this is not like adopting a mascot because it’s cool or cuddly, it’s about understanding the different mechanisms that help animals function and thrive and (wait for it, a big word is coming..) making isomorphic design choices for your organization.
Here’s a design device that provides three ideas to stretch your thinking about systems, tools, processes, and behaviors, using three animals for inspiration: