In tough economic times, many organizations delay dealing with some organizational problems because of cost cutting, staff reductions, refocusing objectives, etc. Also, as business begins to rebound, opportunities begin to increase and growth becomes more likely, the need to focus on some key organizational problems becomes more important. There is no time like the present to improve your future.

David Letterman made the Top 10 List famous. But this is one Top 10 List that you'll never hear on David Letterman. As you begin to focus on your Business New Year's Resolutions (goals and objectives in business), consider the Goodfriend Top 10 List for Common Organizational Challenges. As January 1 approaches, consider how you going to deal with some of these? Is there one of these challenges that has been an ongoing frustration for your organization, department or business unit? Is there one that will begin to be a barrier to growth if it is not resolved?

Goodfriend's Top 10 List of Common Organizational Challenges

  • Number 10 - Department, Function or Process Bottleneck
  • Number 9 - Leaders and Key Contributors Not Ready for the Next Level of Leadership
  • Number 8 - Inability to Replicate a Great Culture as the Company Grows
  • Number 7 - Low Performance Teamwork
  • Number 6 - Conflict/Differences Between Key People
  • Number 5 - Ineffective Communication Processes
  • Number 4 - Lack of Strategic Differentiation to Achieve a Marketplace Advantage
  • Number 3 - Initiative Overload
  • Number 2 - Lack of Discipline, Accountability and Follow-Through in Achieving Excellence

And the Goodfriend Number 1 Common Organizational Challenge is ...

  • Lack of Organizational Alignment

The following describes the organizational challenges in dealing with each of the top 10:

Number 10 - Department, Function or Process Bottleneck

It is not uncommon to find one key bottleneck in an organization. For example, a bottleneck in an organization might occur if those responsible for contracts with customers cannot keep pace with the number of possible deals being closed. The delays can be seen by a customer as a symptom of poor response time and can cause them to consider looking for a provider with a faster response. It can be seen in a manufacturing facility when one manufacturing process step has more scrap and rework than others which results in delays to the schedule and big swings in capacity utilization.

In the book "The Goal" by Eliyahu Goldratt, the author uses a fable about a Boy Scout troop going on a hike where the troop's common goal was to finish together as a group on the hike - even though each person walked at a different pace. One of the slower walkers was named Herbie and the author described that the hike had many similarities in business where interdependent parts towards a common goal are affected by a part that will bottleneck the whole group. In the story, it showed that the only way to finish faster together was to to reduce the bottleneck. The troop discovered that the best way to do that was by increasing the pace of the slowest hiker - Herbie. The team's pace increased when they put Herbie in the lead while taking heavy items out of Herbie's pack and redistributing it to everyone else.

No matter how fast one interdependent part of a business process is completed, there is no realization unless the bottlenecks are reduced in other interdependent parts of the business process.

Number 9 - Leaders and Key Contributors Not Ready for the Next Level of Leadership

As an organization grows, certain leaders and key contributors from the past seem to struggle with the next stage of a company's growth. Roles and responsibilities have to become more defined, formality increases and functional expertise take on more importance. Also, those leaders and key contributors sometimes struggle with their own growth when they are promoted or asked to take on additional responsibilities. The promotion might test their ability to lead and manage when they have not had much leadership/management training. Maybe tough economic conditions put more visibility to their weaknesses in a way they hadn't been seen before.

The organization often has to make some decisions on those that are struggling to either:

  • Provide the individual with help (coaching, training, mentoring) in being successful in their role at this company stage because the company needs and values their prior organizational knowledge OR
  • Re-deploy those individuals either by hiring someone with responsibility over the individual or by moving them into a different function OR
  • "Trade-up" by terminating the individual and hiring someone with a more relevant skill set and experience

Number 8 - Inability to Replicate a Great Culture as the Company Grows

A company's culture represents the collective attitudes, values and beliefs (AVBs) in the organization. Growth Stage companies (organizations readying for the next level of success) often are faced with seeing a great culture (to which many attribute past success) beginning to disintegrate or deteriorate as they grow. Entrepreneurs and key leaders play an important part in forming these collective AVBs (what AVBs are acceptable and not acceptable) in the early stages. A positive culture begins to breakdown when people begin to see inconsistency between the company's way of doing things (based on collective AVBs) and current decisions made, new processes, communication, disciplinary actions, promotions, etc. that are not consistent with those AVBs.

An example of an AVB might be openness and open communication (regardless of title/level) about any issue impacting a customer. However as a company grows, new levels of supervision are inserted and top executives no longer seem to make as much time to have face-to-face discussions with front line personnel about customer issues. The company needs to make a choice on whether openness and open communication between all levels needs to still be a bedrock and then determine how that can be threaded effectively into a larger and more complex organization.

Number 7 - Low Performance Teamwork Teamwork

When you've been part of an outstanding team it is truly a special experience. Most outstanding teams have to struggle before they jell as a team. I recently facilitated a meeting for a project management team who just completed a $500 million plant project with some unique accomplishments. This team had so much to overcome including differences between partners, unclear project scope, etc. As they reflected on what they took personally from the experience, many talked about how much they learned about working together with people to resolve problems even when it appeared like there wasn't much hope. Many also discussed how special it was to be on a team like this that accomplished so much.

Number 6 - Conflict/Differences Between Key People

Conflict between key people in an organization can have ripple effects throughout the organization. I have seen conflict beneath the surface between two executives which caused the Development function (capital projects) and the Operations function to cut off any communication that wasn't "official." This clealy had an impact on project design as well as the handoff between Development and Operations.

This type of conflict becomes personal and very detrimentral to the interests of the organization. This type of conflict usually needs an objective individual (inside or outside the company) to intervene to help resolve the differences and build the necessary bridges for organizational effectiveness.

Number 5 - Ineffective Communication Processes

Many organizations struggle with the difference between information and communication. We have so many channels from which we can receive information. We can get information informally one-one-one, over the phone, in meetings, in internal official documents (memos, brochures), through email, on the internet/intranet, over a wireless device, etc. Also because of the pace of change and need to rapidly adapt, the volume of messages has significantly increased. At the same time, most people have less time to listen to or process the information they receive.

The challenge in most organizations is to ensure that information is received and processed. So much information is never processed - emails never read, internal websites never accessed, calls never returned, etc. I talk with many managers and executives who don't have time to read emails, attend important meetings, etc. Communication channels need to provide information that is quickly and easily accessed. It needs to be refreshed often and provide opportunities for the communication to be operationalized. The channels also need to provide self service choices where a receiver can benefit from reading an executive summary or read more if they have interest.

Number 4 - Lack of Strategic Differentiation to Achieve a Marketplace Advantage

In today's world, competitors have access to so much more information about each other. But even with so much information, those companies that effectively differentiate themselves, and execute that differentiation vigorously to an advantage in the marketplace, are hard to copy.

Take Southwest Airlines. They have differentiated themselves among the airlines with a very clear strategy of being low cost, short haul, no frills and fun. They have structured the whole organization around this strategy and have been successful at it by being the most consistently profitable airline in the industry over the last 5 years. Many airlines have attempted to copy this strategy in whole or in part but no one has been able to sustain any success because it takes an organizational commitment to being very good at however the company chooses to differentiate itself.

Number 3 - Initiative Overload

In today's changing, adaptive organization, it is expected that executives and managers identify new approaches, ideas and methods to reduce costs, streamline operations, improve safety, add new sources of revenue, etc. Every initiative requires an investment of people's time and there is a hard dollar cost to that time. However, new ideas and initiatives are "hatched" often without consideration for the opportunity cost of the time for people involved. The opportunity cost might include reduced focus on product manufacturing or service delivery, less impactful involvement on multiple initiatives instead of a more impactful involvement on one initiative, and less time with family because of the need to work later, etc. As one company vice president described it, "When the CEO comes to me with a new initiative, he often seems to forget that he had recently delegated accountability for a couple of other major initiatives. He doesn't seem to consider that an initiative or ongoing responsibilities will be compromised when initiative overload occurs."

Number 2 - Lack of Discipline, Accounability and Follow-Through in Achieving Excellence

Many organizations are quite good at developing new ideas, new initiatives or new systems but often lack the discipline, accountability and follow-through in implementation to realize the value from these new approaches. Obstacles that block discipline and follow through include not having a shared understanding of the project goal, lacking a common process to accomplish goals, lack of commitment to the project, lack of sustained focus, unclear accountabilities, poor communication and leadership, etc.

As Thomas Edison said, "Opportunity is missed by most people because it is dressed in overalls and looks like work." Goodfriend & Associates offers the Blueprint for Excellence program as a means of helping companies achieve excellence through a disciplined process for identifying and following through on improvements which will help achieve a strategic advantage. Companies can apply these concepts from the Blueprint program to achieve excellence as an entire organization, as a struggling functional department or for an important project. Our current chapter of participating client organizations are learning with each other and from each other how to become more disciplined in achieving excellence.

Number 1 - Lack of Organizational Alignment

True alignment is a constant struggle as most companies are adapting to a changing marketplace. Is your organization truly reaching towards a courageous, long term goal? Are your plans consistent with your stated differentiation strategy and do you have intermediate term milestones that will be tranistion points towards your long term courageous goal? Are your company's core values alive and well and are your corporate culture, leadership behaviors, business processes and decision making consistent with those core values? Are technology and human resource plans in alignment with overall company strategic goals? Is one department, function or business unit holding up progress from another because they are working towards different overall goals? When handoffs are required from one function to another, does the company experience a lot of "fumbles?" Are resources being provided equally to departments/units rather in a more equitable manner to achieve common goals?


Reflect over the holidays on the challenges that your organization has. Focus on one or two that need to be resolved to take advantage of improving opportunities within your marketplace. There is no time like the present to improve your future.

© Michael R. Goodfriend, Goodfriend & Associates, Inc., 2004

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