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Kasper Zülow

Nadler, D. A., Tushman, M. L., & Nadler, M. B. (1997). Competing by design: the power of organizational architecture. Oxford University Press.

Competing by Design: The Power of Organizational Architecture is a book written by David A. Nadler, Michael L. Tushman, and Mark B. Nadler in 1997. The authors argue that the success of an organization is largely determined by its design or architecture, which encompasses its structure, systems, processes, and culture. The book presents a framework for designing and aligning these elements to achieve strategic objectives and gain a competitive advantage.

The first chapter of the book introduces the concept of organizational architecture and explains why it is critical for success in today’s complex and dynamic business environment. The authors argue that organizations must be designed to fit the demands of their environment and strategy, and that a misalignment between the two can lead to suboptimal performance and even failure. They also introduce the idea of “fit” among the various elements of organizational architecture, emphasizing the need for coherence and consistency among them.

In the second chapter, the authors delve into the elements of organizational architecture and how they interact with each other. They identify five key elements: structure, systems, processes, culture, and strategy. They explain that structure refers to the formal arrangement of tasks, authority, and communication channels within the organization. Systems include the information and control systems that support decision-making and coordination. Processes are the routines and procedures used to carry out tasks and manage activities. Culture encompasses the shared values, beliefs, and norms that shape behavior and attitudes within the organization. Strategy refers to the direction and goals of the organization, and how it plans to achieve them.

The third chapter focuses on the importance of strategic alignment in organizational architecture. The authors argue that an organization’s architecture must be designed to support its strategy, and that strategy must be formulated with an understanding of the organization’s architecture. They introduce the concept of “design thinking,” which involves a systematic and iterative approach to designing and refining organizational architecture. They also stress the importance of continuous monitoring and adjustment to ensure ongoing alignment between architecture and strategy.

The fourth chapter provides a detailed framework for designing organizational architecture. The authors identify four key steps: diagnosing the current architecture, specifying the desired architecture, designing the transition, and implementing the new architecture. They explain that the diagnosis should involve a thorough analysis of the current architecture and its alignment with strategy, as well as an assessment of strengths and weaknesses. The specification of the desired architecture should involve defining the optimal structure, systems, processes, culture, and strategy to achieve strategic objectives. The design of the transition should consider the challenges and risks associated with implementing the new architecture, as well as the need for communication, training, and support. Finally, the implementation should involve a phased approach with clear milestones and metrics for success.

The fifth chapter focuses on the role of leaders in designing and managing organizational architecture. The authors argue that leaders must be able to understand and shape the various elements of architecture, as well as align them with strategy. They introduce the concept of “meta-leadership,” which involves the ability to bridge different perspectives and interests within the organization, as well as across external stakeholders. They also stress the importance of building a culture of continuous improvement and learning, and the need for leaders to model this behavior.

The sixth chapter provides several case studies of organizations that have successfully used organizational architecture to gain a competitive advantage. These include IBM, Nestle, Hewlett-Packard, and McKinsey & Company. The authors highlight the different approaches taken by these organizations, but also emphasize the common themes of strategic alignment, design thinking, and meta-leadership. They conclude the book by summarizing the key insights and lessons learned, and calling for a more systematic and intentional approach to organizational architecture.

Overall, Competing by Design: The Power of Organizational Architecture provides a comprehensive and practical framework for designing and aligning organizational architecture to achieve strategic objectives

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Kasper Riis Zülow