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More than you bargained for

AUTHOR: Freek Vermeulen

An article written by Freek Vermeulen, author of Business Exposed

Do you know what business process reengineering, quality circles, ISO9000 and SixSigma have in common? They’re all so-called process management systems; they help you identify the best way of running all sorts of operations in your firm (invariably referred to as “best practices”) and then enable you to make sure that everybody does it in exactly that way, setting the standard. And they can really work – if genuinely implemented – in the sense that they have increased the efficiency and productivity of many firms. Not surprisingly, herds of consultants have earned a healthy living helping to spread and implement and business books of the same ‘best practices’ titles adorn many executives’ shelves. And why not? Efficiency and productivity are nice things to have!

But there is a catch… We know from research on the topic – by professors Mary Benner from Wharton and Mike Tushman from Harvard Business School – that those firms that implement a process management system, a few years down the line experience a decrease in their rate of innovation. The system helps you become more efficient but, in the longer run, also makes the firm to come up with really exciting stuff.

And why is that? Well, true innovations are often the result of some sort of error, or at least a deviation from the standard. That is true in nature – where “innovations” are mutations in the genome – but also in business; think of the legendary example of the engineer who invented Post-it Notes: he famously was trying to make superglue – turned out that his less-than-super glue had a rather useful application after all, making it 3M’s best-selling product! Well, if you implement a rigorous process management system standardising every system, you won’t be making many “errors” and, as a consequence, won’t be creating many innovations.

That is the type of thing I describe in my book: Business Exposed. Many business decisions and management practices have unintended consequences – sometimes negative but, fortunately, sometimes also surprisingly positive! Exposing the unexpected consequences and workings of corporate life is what I wanted my book to be about.

The example of process management systems is typical for the book in another way too: I won’t just offer you another opinion or point of view – why would you believe me more than others? Instead, the book provides solid insights and hard evidence from scientific research. It exposes what really goes on in the strange business of business.

 

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