The objective of this presentation is to get to know how the organizations in the 21^st century will be . If I go on giving you my ideas , it will turn into a daydreaming exercise without any basis in reality . Also on the other hand everyone of us here can do daydreaming and can come out with many exotic ideas as needed and will be no better off than what we are now.

In my view , the theme of the presentation is much wider than that . All of us here are managers in our own organizations . We are supposed to be the change agents . We are the ones who will be ushering the new era into our organizations . We are the proactive ones . So it is not enough to keep talking about what is happening around we also have to have our own action plan . You are the people who will make things happen and that is why the outline of this presentation is somewhat different from daydreaming .

We will proceed in a logical and structured way in our analysis . Indeed the way we approach the problem also decides the outcome and so not only studying the concepts is important but also the way we learn the concepts is important in itself . We will see the analytical approach and the holistic approach . In general when we discuss the concepts which will be most of the day today we will use the analytical , static approach and when we discuss the case study tomorrow we will use the holistic , dynamic approach . If you want me to explain the concepts of analytical approach and the dynamic approach .

Analytic , structured , or static approach is so easier to understand , and easier to communicate . I am standing here and am communicating with you . If I go one thing at a time , little by little , it is easier for me to talk and it is easier for you to understand . We basically break down a big problem into its smaller and smaller components and then learn each of these components . it is like repairing a car engine . The engine is not moving . We take each part out , clean it , replace anything that we think is defective and then put the engine together . That is analytical approach in a nutshell .

But is it the same way you behave when you are in the organization ? Will your reaction be the same if three phones are ringing for your attention , you are already late for a meeting , your boss is asking you to do something now , and your shoe is biting . Will you be able to think as calmly ? No That is the holistic or dynamic approach .

During this presentation we will take a overview of the general organizations of today . We will see the changes that are occurring in the business environment and the Information Technology . Then we will see how these changes are affecting the organizations at present . This is the first part .

Now we have enough information to proceed . Then we will extrapolate from this what is likely to happen two years from now and then we come to the most important part -

What do we need to be doing in order to make things happen ?.

The first part is broken down into modules as shown in the index and please feel free to ask questions whenever you feel like . Please get each doubt clarified now as tomorrow's case study depends on this . And remember , today I am going to answer your question s but tomorrow being the last day of the seminar , I will be presenting the case study and I will be asking questions . You will have to answer the questions based on the knowledge you have absorbed during the course and your natural managerial ability. So let us begin .

Let us define what we mean by organization

An organization may be defined as a combination of individuals , structures and utilities with disparate resources, values ,goals and strengths to achieve a set of objectives that are individually unattainable .

On the ulterior level it remains a power play ( the reference is descriptive and not derogatory )where each player individually or collectively ,attempts to maximize his power position by various means available to him .

Organizational efficiency and organizational effectiveness are two different issues which are mixed up by a large number of managers . Efficiency is the ratio of the output versus the input . How much energy is put in and how much energy comes out is called the efficiency . Many of the organizations are very highly efficient . Government for that matter or bureaucracy is highly efficient in carrying out the tasks it is entrusted to . In a bureaucracy the rules are followed to the last dot , they will check each and every thing that they are supposed to check and only then will they allow you to proceed .

Let us carry out an experiment here . I have an ice cube in my hand . I will pass it on to Mr. Ghani here . Please pass it on to the person sitting next to you , and do so till it comes back to me .

…..…

See , where is the ice cube gone ? Each one of you has been at least 90 % efficient in passing the cube over . But the overall result is that the ice cube is no more . This is what usually happens in an organization . Each layer of management is very highly efficient , but there are so many layers that the work gets bigger and bigger as it goes through the layers and by the time it comes to the top management and top management responds to it the output is nil . But the organization is nevertheless efficient . It has used the resources available to it to the best possible extent . If the objective was to transport the ice cube from one place to another , each one of us has discharged his duty to the best of his capacity but the overall result has not been encouraging . Thus in this case the effectiveness is not achieved and merely efficiency is not enough . IBM kept taking proper care of their customers , the mainframe users , they kept doing the right thing as per the book , but the overall market expanded itself thus making IBM a smaller player . They were internally very efficient and still are so but the external effectiveness took a beating .

This is why there is need to define organizational efficiency in a slightly different way .

The efficiency of the organization is decided by the how much fraction of power of each unit gets

translated into fruitful contribution to the organizational objective .

Thus only the fruitful contribution counts and not anything else . In this case the efficient organization will also to some extent be an effective organization .

The effectiveness of the organization is decided by the power interaction between the organization and its environment and the extent to which the organization fills the needs of its environment's perceived needs.

Let us see what that means . Which is the most effective organization ? That organization that achieves its goals in the fastest possible time . The speed and execution are of essence here . Especially in the changing business environment of today . There is a perceived need in the environment . For example it may be communication . People in different countries want to communicate with each other . The telephone company American Telephone and Telegraph satisfied this need at a great cost some 150 years ago . That company is even today the biggest company in telecommunication . It saw a need and fulfilled it to the best possible way and thus gained benefits out of it .

As we go along we will get much clearer idea about organizational efficiency and effectiveness . Somebody has put it very succinctly -

Efficiency means doing a thing right while effectiveness means doing the right thing .

We have already defined what we mean by information technology

What are the various aspects of organization as we know it . The aspects of organization can be divided into hard aspects and the soft aspects. Hard aspects are those which are very much tangible . Incidentally most of the management literature we see , give much more emphasis to the hard aspects of organization rather than the intangible soft aspects .

Traditionally it has always been the harder aspects which have been favored . I will give you an example . If you tell your boss that you got a headache , you are more likely to get leave than if you say that today you are not in the mood to work . Actually you may be faking the headache or stomachache and not being in the mood may be the true case but what is your boss more likely to believe ?

Another example may be if you go to the company meeting and say that you want to have a grant of say 10000 USD to buy some more computers , your board is more likely to nod assent than if you ask them to pay that much money as donation to the nearby technical school from where most of the workers of the company graduate .

Even in the softer aspect itself the harder one is preferred . For example which permission are you likely to get to attend

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When it comes to HRD , recruitment is the first hit , when it comes to training and development , training is preferred , and when it comes to training skills training is the first shot . Thus you will see that over the years the maximum emphasis has been on the hard , concrete and tangible aspects . But now with the advent of Information technology and knowledge working the focus is shifting . We are becoming increasing symbolic and soft .

The number of white collar or knowledge workers has phenomenally increased . Most of the workers are turning into knowledge workers . In the US in the last year 63 % of employed were white collar workers . In Japan the number is said to be even higher . At present only 2 % people are directly employed on the farms in the US. The shift is very evident .

One of the glaring facts is that it is always the softer aspects that shape the harder aspects . It is the organizational climate that affects the strategy which in turn affects the organizational structure . It is the soft , invisible grapevine or informal organization that gets things done more often than the formal organizational hierarchy . it is the organizational politics that decides the projects undertaken .

Thus it is essential that we provide adequate attention to the softer aspects of organization. , softer aspects of Information Technology and soft undercurrents in the business environment rather than the easily visible , bland superstructures . I intend to pay more attention to the winds of change rather than the crumbling structures and monuments of yesteryears .

I am as interested in your views as you are in mine and throughout the presentation I will be stressing on views rather than opinions , images rather than so called hard facts and underlying concepts rather than surface turbulence .

There are two distinct approaches that have emerged over the years . I call them the UNIX approach that is to start big and then go small - they started with the scientists and mainframes and over the years came down to the common people by the way of Linux

The other way is the windows approach , which started with the common person , and eventually developed into windows NT and specialized multi-user systems .

I usually prefer the windows approach . Every organization starts with the individual . Every person in any organization invariably represents the organization - by that I mean he represents the organizational values ,and styles . Thus if we look at one person we can say a lot of things about the organization he comes from . In the same way , the organizational change can come from individual person . On the first day here Ashok asked me as to how it was possible to change the whole organization structure . I am not asking that . It is suffice to change yourself and be prepared . The environment will transform itself when sufficient need arises .

The different aspects of organization are
 

1.Structure

2 Shared Values - Organization Culture and Climate

3.Training and Development

4.Strategy Internal

5. Strategy External

6. Skills - technology and other skills available within the organization

7. Systems Framework

8. Staff - People

9. Bureaucracy

10. Society

11.Physical Facility Layout

12. Communication

We have something very beautiful available with us . As you will always see , some people will always be at the forefront of anything . In the same way some people have already gone ahead in trying to make organizations that are suitable to answer to the changing needs and others will follow or perish . So if we have a good idea of what is happening on the business scene and how the leaders are doing and where are they faltering we will get a much better idea of what the organizations of tomorrow will be looking like .

Structure

The organization structure as we discussed before and also see in the chart here is largely centralized and mechanistic in nature . We want our companies to be highly controlled and work smooth like machines . We do not want to be cogs in the wheel however .

This structure is not able to respond to the environmental needs as quickly as is necessary . Thus it is tending to collapse all over the place . In case of companies which have already gone into the IT business the change is very much self evident while in the case of companies which are still in the first or second stage of development , the change is yet to come . But the winds are there all the same .

The structure has gone from line organization to a weak functional organization and from there to strong functional organization . It is how most of the medium and big organizations exist today . These will further go the same way and evolve into very loosely held team base cellular organization which will be organic in nature . The approach will be team based , and the members of the teams will be ever-changing depending on the task in hand . If one grows too big to be contained in the team he starts his own team or his own separate satellite organization . Each cell is independent yet interdependent and works closely with other cells . Each cell can grow on its own and at the same time can divide and grow again . More like a tree than like a machine . The individual growth depends on the collective knowledge of the team and also on the individual initiative . Thus it is one for all and all for one .

This further grows into the vortex where the hierarchy becomes very diminished and also the boundaries of the organization become very much fuses . When a person is working from home his family necessarily impacts the outcome of his work and thus becomes a part of the extended organization .
 
Shared values - Organizational Culture and climate

As of now the organizational climate and culture are predefined and an individual has little impact on it unless he comes in at a very high level if not at the top . The organizations are highly bordered by the geographical constraints and the basic cultures of the people or the society that they come in from is similar . Thus in the company the cadres are divided by skills and hierarchy and the work they do rather than the culture .

As the geographical boundaries are being taken off , the emphasis on the culture will be different . The teams will have a culture of their own and each team will have a different culture . It will depend on the nature of the people who evolve into team leaders and their influence on their colleagues . Thus the organization will become a collection of many subcultures and will not have its own distinct identity unless high emphasis is made on this aspect , continuous movement of people across teams is ensured and effort is put into communications across the teams .

The organizational climate will become much more relaxed in terms of norms , rules and manners while the result oriented nature will increase the tensions and stresses.
 
Training and Development

Today most of the training is directed towards the skills necessary to do the job in hand . Thus it is more task based than what the individual needs . The development is generally taken for granted and is considered to be an outcome of the training . This I will call as the hard core training . In this case the company doubles up as another school and imparts you the syllabus as it was done in schools when we were young boys . Many students are passed through a structured program and they are supposed to come out much wiser and much better suited to the job in hand . Thus if you go for a marketing course you will see the door open at the end of the seminar and many mini Philip Kotlers coming out of the door or for that matter if you go for a management training session you will see many Peter Druckers coming out . What I mean is that the stress is on the tuition and not on the individual .

This will change . The skills are becoming more and more easy to adopt . The work is getting more and more knowledge based . While the information is easier to come by ; making it into knowledge is becoming more and more difficult . Thus the emphasis will shift from training to development . The skills will still remain important but changing the mindset or the individual priorities will become the biggest focus . For example even if you have the greatest ideas about improving the plant layout , if your manager is very traditional and cannot even want to look at the computer screen , what do you do . And you will meet many mangers like that . They are very knowledgeable , but insist on carrying out their work in the same old fashioned way . They represent a lot of investment for the organization . They represent the experience bank . So the organization stands to gain by keeping them inside . The organization stands to gain even more if they take to use the technological tools . These senior managers are technology shy and efforts have to be made to make them shed their fears . This is where development comes into play . Rather than skills development they will have to be sent for refresher courses . sensitivity training , and brainstorming sessions to open up their outlook . They will also need to have cross cultural understanding .
 

Strategy Internal / Management Style

As of now , control and strict control is the norm . The system is given more importance than the individual . When the individual becomes more important and represents extensive investment , nurturing will have to be the norm and team based encouragement will have to follow .

 

Strategy External

The business scene is characterized by intense cut throat competition . But we have seen what cut throat competition leads to . in general it seems it leads to creation of close structures , proprietary technology and suboptimal utilization of available industry resources. Healthy competition however goes a long way in getting the customer a good product at a reasonable price . As the investment in IT increases companies will find it much better to cooperate than compete . The competition will be in the front end while there will be cooperation on the basics .Let us take the example of Bangkok . There is a computer shop here and there is a computer shop at the other end of the city . These two will be competitors . But then let us say that some more shops come up . Here only . These shops are not competitors any more . Can you tell me why ?

 
   
Skills - Technology and other skills available within the organization

As of now the cooperation is minimal. In Japan it is said that companies cooperate with each other on a large scale in skills and technological developments . In other parts of the world they generally do not . That will change . Today the case is that inside the organization the technology changes at a faster rate than the business environment . Now you see that the picture is changing . The business environment is changing faster than the organization . The pressure is from outside . Earlier the organizations were like balloons . More pressure was inside and the balloon had to be guarded against letting air go outside . Now it is the other way round . the pressure outside is more and we have to let the air come in if we do not want to implode under the pressure . Linux which is a new operating system is getting updated much faster than windows . The reason is that windows has hundreds of paid programmers working on it while Linux has thousands of enthusiasts working on it out of pure feeling of commitment and not for monetary gains . This is the reason why Netscape is going to makes it codification public at the end of this year .

Thus you will see , the more open you make the organization the more you stand to gain from it . The more you allow your organization to interact with the environment the closer you get to the customer and the better you will serve his needs . Organizations can work as closed systems only at their own peril .

 
Systems - Framework

The framework whether inside or outside the organization is in for a complete overhaul . The laws and rules we have at the moment are at least a hundred years old and are not geared up for electronic business at all . This will change in a few years to come . Geographical boundaries do not hold any meaning anymore . Government will have to amend export import laws to reflect that .

Whether companies have web related business or not they will need to have a web presence to ensure they do not lose out in the turbulent business climate.

 
Staff - The type of people

Today's organizations are largely staffed with generic employees . In any manufacturing company almost 80 % people are general employees , meaning their skills can easily be transferred to others in a two to three months . Replacing this workforce is easy and thus hiring and firing is quite rampant .

As IT progresses , and companies become leaner and leaner , the value of each employee to the company increases and they become increasingly nonreplaceable . It is not that they are indispensable but that number of key employees increases . Thus on one hand the workforce is much better educated than before and paid more and also cared for in a better way .

Each employee will be more informed , will do multitasking , will be highly educated and will have to continuously keep on learning new skills . The all round growth of the employee will be more important and will be provided for . The organization will truly revolve around the individual . Now more will the lop service that is given to this function as of today will suffice.

On one side the demand for the specialists or consultants will increase while on the other hand the need for generalists will also increase.

 Bureaucracy - Rules of operation

The bureaucracy gets reduced and the rules gets simplified to a greater extent . The focus is more on production and productive use of resources rather than the implementation of rules . This is necessary to justify the high investments in the individuals will not pay off if those individuals keeps spending their time in complying with outdated rules .

Also due to loosened geographical boundaries , telecommuting , flexitime and the changed nature of work which is knowledge processing implementing a rigid framework of rules becomes extremely difficult .

That forms the a part of the business environment from where most of the employees come

The society is becoming increasingly permissive and the family system is breaking up . But the IT revolution will boost family as though people will be more stressed out and will be much more overloaded ; due to the facilities that IT brings about , the disposable time they have will increase .

Till now the organizations were leading the society now it is the society that is shaping the organizations . Thus the closer the organizations come to the people and the noncustomers , the better for their survival . Noncustomers matter much more than the customers . Consider the case of Cigarette companies .

  Physical Facility Layout

The office layout will have to undergo major changes . the office structure will have to be conducive to communication . More and more spaces will have to be created for people to interact on informal basis . As there is seen to be a strong tendency to hide behind the technology which hinders communication . Thus the physical layout will have to be designed to counteract this tendency .

Also as the structure will keep changing all the time the layout also will have to be of a temporary nature . By this I mean that the facilities will have to be designed in such a way that at short notice they can be rearranged .
 

Communication

This is by far the most important aspect of any organization and the most if not the only job of a manager . This is where the revolution is taking place other than the data processing ability . Communication , depending on between whom it is taking place leads to control or monitoring or nurturing .

Communication will not necessarily improve but it will be facilitated . The expenses involved in communication have come down drastically and will come down even further as the internet percolates at lower levels of the society.

Already we are getting too much information and too less knowledge . Same thing about communication There is too much noise and too less understanding . Managers will have to take special care to avoid this pitfall . Asking the right question and giving the right nurturing to the employees will be the most important aspects of the managers jobs . In fact a manager will be more like a facilitator rather than a commander and in the role of the facilitator communication is crucial .

 

Now that we have seen where we are heading let us see it once again in a table form .

What are we to do as the agents of change ? How do we prepare ourselves to face what is coming up ? Forewarned is forearmed , but if we do not do anything about it we will be only better informed and not better off . Information becomes knowledge only when it is put to proper use .
I will like to invite suggestions from your side in this regard . 

I will also throw up some ideas that I have here .