From Silos To Streams: The Evolving Structure of Business
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This document discusses how technological and socioeconomic forces are reshaping business structures from silos to streams. It notes that while social technology gave people a voice, changing underlying structures is also needed. The research found that business structures have shifted from vertically integrated models in the 1900s-1980s to today's virtual value chains and brand orchestrators. However, management structures still use silo approaches despite the move to real-time, distributed models online. The document argues transforming five key dimensions together - people, performance, policy, process, and platform - is needed for businesses to gain situational awareness and agility to adapt.
![STRATEGY EXECUTION
[Upstream Downstream]
Who? Promote Sell …and how it needs to continue to evolve
Where? (Marketing) (Sales)
What? Source/Make Fulfill • Convergence has many obstacles...
How many? (Purch./Production) (Logistics)
How much? Pay Collect • …so will it be worth the effort?
What terms? (Payables) (Receivables)
• It all depends on how “situational awareness” can
change the game for your business or industry?](https://image.slidesharecdn.com/fromsilostostreamsoct2012-121024100910-phpapp02/85/From-Silos-To-Streams-The-Evolving-Structure-of-Business-14-320.jpg)
From Silos To Streams: The Evolving Structure of Business
- 1. From Silos to Streams: How technological and socioeconomic forces are reshaping the structure of business.
- 2. Social Technology (Where the research started…) What is this research about? • Where I started: The Arab Spring and Occupy Wall Street puts social technology in the global spotlight… ?
- 3. Social Technology (Where the research started…) What is this research about? • Where I started: The Arab Spring and Occupy Wall ? Street puts social technology in the global spotlight… ? • Realization #1: Social technology alone cannot bring about the desired transformation without changing the Enterprise structure... Structure
- 4. Social Technology (Where the research started…) What is this research about? • Where I started: The Arab Spring and Occupy Wall ? Street puts social technology in the global spotlight… ? ? • Realization #1: Social technology alone cannot bring about the desired transformation without changing the Enterprise structure... Structure • Realization #2: The structure of business is as much, or even more of an outcome that reflects the broader socioeconomic values than it is the result of an explicit design by business architects… Socioeconomics - Society & Business (Where the research led..)
- 5. Society Business Having a voice is good. Being heard is better. • Social technology is about “giving a voice”… “having a voice” Social Technology
- 6. Society Business Having a voice is good. Being heard is better. “incumbent powers” • Social technology is about “giving a voice”… • Hope and enthusiasm ran into the reality of structure and incumbent powers… • How much of this is relevant to business? “structure” “democratization” “having a voice” Social Technology
- 8. 1900 – 1980s: Vertical Integration The enterprise structure continues to change… Ford Model-T • A 100-year perspective shows the shift… AT&T phone • …from a vertically-integrated model… 1980s – Present: Virtual Value Chains “Brand Orchestrators” • …to the virtual value chain structure that is typical of the global multinational brands… • …that are the “brand orchestrators” who design and deliver “experiences” (e.g., Starbucks) as opposed to just products and services.
- 9. 1900 – 1980s: Vertical Integration The enterprise structure continues to change… Ford Model-T • A 100-year perspective shows the shift… AT&T phone • …from a vertically-integrated model… 1980s – Present: Virtual Value Chains “Brand Orchestrators” • …to the virtual value chain structure that is typical of the global multinational brands… • …that are the “brand orchestrators” who design and deliver “experiences” (e.g., Starbucks) as opposed to just products and services. Future: ?? • In a physical sense, the “silo to stream” shift has already happened!
- 10. …but the silo approach to management has not. • The management structure is essentially a set of functional boxes organized within a pyramid… • It is a design that precedes the IT era by almost a 100 years. • Why change this? And why now?
- 11. IT structure: From snapshots to real-time streams • The first generation of enterprise systems (like ERP) largely institutionalized the “boxes within a pyramid” design… Functional Managing via Centralized Today silos “snapshots” (Enterprise-centric)
- 12. IT structure: From snapshots to real-time streams • The first generation of enterprise systems (like ERP) largely institutionalized the “boxes within a pyramid” design… Functional Managing via Centralized Today silos “snapshots” (Enterprise-centric) Virtual value Managing in Distributed Future? streams “real-time” (Network-centric) • Another architecture is emerging in parallel…one that is real-time, network-centric, and virtualized.
- 13. How the value stream is evolving thus far… • The Flow of Money (Cash Out-to-Cash In)… • The Flow of Material (Design-to-Fulfill)… • The Flow of the Buyer (Desire-to-Purchase)…
- 14. STRATEGY EXECUTION [Upstream Downstream] Who? Promote Sell …and how it needs to continue to evolve Where? (Marketing) (Sales) What? Source/Make Fulfill • Convergence has many obstacles... How many? (Purch./Production) (Logistics) How much? Pay Collect • …so will it be worth the effort? What terms? (Payables) (Receivables) • It all depends on how “situational awareness” can change the game for your business or industry?
- 16. Transformational change is multidimensional • The technology is the least of the obstacles… • The five dimensions of transformational change… Today Future Thinkers Informed and People vs. Doers empowered workers Shareholder “Shared Value” of Performance value all stakeholders Enterprise Enterprise + Ecosystem Policy perspective perspective End-to-end means End-to-end means Process order-to-cash dirt-to-dirt Platform Digital silos Digital streams
- 17. The risk of not changing the structure • Inhibitors to visibility… • Inhibitors to velocity… • Inhibitors to innovation… • Inhibitors to agility…
- 18. The big unknown… • How will the post-internet generation, the “digital natives” shape this future? • How will they reconcile the differences in their experience as digital consumers vs. corporate employee? • How will they reconcile the dissonance between their social values and the business values?