Call +31 (0)30 44 2 00 15,   Whatsapp or e-mail info@ipmpartners.com
How do you become a speedboat?
Share this article

How do you become a speedboat?

Traditional organizations should be very concerned. At least, if you believe the many stories about disruptive companies like Amazon and Spotify. With a new business model, a minimum of employees, and smart internet, they outperform traditional players in their sectors. V&D and Free Record Shop can attest to that.

Thought-out strategy

Although the risk of disruptive companies is often emphasized, they certainly pose a threat to businesses that cling to old business models. In the book Oil Tankers and Speedboats, Menno Lanting illustrates how companies rooted in the industrial era, represented by oil tankers, struggle to innovate. Meanwhile, new companies emerge as agile speedboats.

The question, of course, is why oil tankers are not agile. After all, they have access to the same people, the same technology, and the same sources of knowledge. Often, they even have more resources than their new competitors. One would expect them to be able to counter effectively with a well-thought-out strategy. Yet, evidently, they are not succeeding to a satisfactory extent.

Procurement, sales, and other departments have become isolated islands over time.

Peter Geleen – iPM Partners

Organogram takes the lead

An important explanation for the less successful performance of oil tankers lies in the way they are managed. The organizational chart often takes the lead in this regard. Procurement, sales, and other departments have become isolated islands over time. In these companies, the Key Performance Indicator (KPI) structure is directly linked to the organizational chart. This leads to each department pursuing its own departmental interests. Moreover, the KPIs of these companies primarily encourage short-term performance drive, such as increasing revenue quickly. Such KPIs contradict the interests of the customers.

Deficient collaboration

The flawed design of the KPI structure has another major detrimental effect. It leads to deficient collaboration between departments. Not only do customers suffer from this, but the company itself as well. A lot of time is wasted on fixing errors resulting from the lack of collaboration. Attention is then focused on completing the tasks for the day; the tyranny of the urgent prevails. There is hardly any time for creativity or innovation. This internal focus is, in my view, a major reason why oil tankers lose out to speedboats.

Abracadabra

Of course, your company is not that cumbersome oil tanker as I have described. However, you might still want to resemble a speedboat to some extent: fast, agile, streamlined, and innovative. I believe this is achievable. The recipe for that is to align process-KPIs with customer value chains and establish a good performance dialogue with your employees.

That might sound like abracadabra, but the idea is to provide you with KPIs that promote collaboration and allow employees to learn from them. This way, it becomes possible to increase engagement, empower employees with more ownership, and better utilize talent. You’ll require less management and improve collaboration. This brings about tranquility and additional time for innovation, enabling your company to become much more agile, just like a speedboat.

How exactly this works? I explain it in my book Winning with the right KPIs.

Peter Geelen

Want to know more in advance? Feel free to give me a call, and I’ll give you a sneak peek.

Back to the overview

Winning with the right KPIs

From strategy to execution; how performance indicators can help your organization.

Related articles

Blog
The Netherlands deserves more encouragement
Blog
AH vs. Jumbo: 4 tips on “exceeding customer expectations”