In my last post, Defining the Next Generation Enterprise (NGE) – All Hands on Deck!, I kicked off an effort to begin an open, collaborative dialog in the Web 2.0 world on defining an NGE and providing a roadmap for NGE transformation. This post, Next Generation Enterprise – The What and Why – is the first in this promised series of blog posts, and will focus on the topic of providing a simple definition of what an NGE is, and a set of compelling reasons why the shift to NGE is necessary.
First, here are a couple of ground rules, disclaimers, and credits for this overall series of posts on NGE:
- Remember, this is a discussion, so I’m eager for feedback – please provide it whether positive or negative. Treat this as NGE version 0.1 with a goal of getting to a version 1.0 – once there, I expect that we’ll already be discussing NGE version 2.0 (but not now).
- What will be presented in this blog post series is a collective picture of BSG Alliance’s view of NGE, written by me and hence presented through my point of view. So, many of my BSG Alliance colleagues should and will be credited with this content and the ideas behind it, but it may be presented differently by me – for better or worse.
- We’ll course-correct along the way, and in fact, you may (I hope) see my colleagues debating or restating content that is presented by me here. Some of these posts may move onto lives in other collaborative communities.
Good enough … what follows for the remainder of this post is a proposed definition of an NGE and our point of view on the reasons why NGE transformation is necessary now. I’ll try to be short to encourage comments, participation and debate.
First, here is some pre-work if you have not done it already. Bob Morrison from our BSG Concours division authored an excellent Boardroom Imperative on NGEs to kick-off our NGE transformation efforts. This Boardroom Imperative is a must-read for this series of posts, which I hope will build upon Bob’s work.
Let’s start with a definition of an NGE. We have not yet formally codified a definition of an NGE internally at BSG Alliance. Here is an initial shot below; this may be a moving target, but we’ll try to form a definition that can stand the test of time, even as fast as time moves in the NGE world.
A Next Generation Enterprise is an agile organization that operates a highly collaborative, open, network-based business model with fully engaged constituencies, and executes with high-velocity, On Demand, in delivering world-class experiences and desired outcomes for its customers and constituents.
Note the key descriptors in the definition. Our point of view is that you cannot be NGE without each being a characteristic of your enterprise:
- highly collaborative
- engaged constituencies
- On Demand
- world class experiences
Many of these characteristics are nearly direct opposites of a traditionally organized business over the last half-century or so! Companies are typically thought of as:
- structured & hierarchical, not agile and highly collaborative
- closed and private, not open and transparent
- having a daisy-chained value chain (supplier-manufacturer-distributor-retailer-consumer) not networked ecosystems
- the ones which initiate the engagement, not as a participant in a two-way engagement process with constituents
- operating with discreet strategic planning and budgeting cycles, not in continuous high-velocity On Demand planning and execution mode
- delivering products and services, not experiences and outcomes
Why is such an extreme re-architecting of the traditional hierarchical organization with the buyer/supplier execution model required? Our belief is we are at the cusp of a series of fundamental shifts in the global economy which necessitate the transformation to NGE for competitive advantage and most likely enterprise survival. Some industries are seeing this change now and others will not see it for some time, but we do believe this is a 20 year transformational shift and a major disruption in global business. From a Schumpeter-based point of view, we will be undergoing massive creative destruction, which in the end will be a significant benefit to the global economy and those companies that embrace NGE transformation will not only survive, but thrive.
In my next post, I will explore these fundamental shifts in the global economy which are driving the need for NGE transformation.