Tuesday, July 3, 2012

The lost decade at Microsoft.

Vanity Fair has recently released a preview of an upcoming article about the decline of Microsoft. The preview exposes bureaucracy and destructive internal incentive evaluation systems. It also makes me wonder, what is the right level of "order" in a company?

What I mean is, many of us have an instinctive need to organize and make things more efficient which taken to its extreme tend to breed bureaucracy in an organization and thwart creativeness, innovation and even peoples ability to actually execute the job they were hired for.

This question of balance, between "order" and creativity/innovation, is a tough one, not only in large organizations like Microsoft. 

Startups often face this problem very early on, just as they hit their first growth spurt and grow larger than 10-20 people. Organizations smaller than that can usually all be a "team" based on the fact that they are so few and everybody can have a decent understanding of what everyone else are up to.

Growing larger, in combination with new challenges for a startup, such as including customer support, sales, new products etc, makes this problem of "order" return time and time again as a company progresses. 

Are really additional or more detailed processes the answer? You often hear in larger organizations that the success of this project/unit/whatever "can not rely on any one person" (implying that there must be a process which people can follow in order to actually be able to execute if someone quits, gets promoted or is unable work).

I understand that this is reality for many people in large organizations, but how does this affect creativity, speed and growth in companies that are exposed to rapid technological change or competitive pressure? 

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