We’ve all experienced chaos. You are tootling down the freeway and without warning brake lights slam on ahead. Your stock portfolio dips and rises, and no one can satisfactorily explain why. Your customer journeys look more like a child’s scribble than an orderly funnel. Your campaign goes wild after months of average results — or suddenly fails.
Like traffic and the stock market, marketing is complex. It constantly changes, and outcomes are uncertain. Unpredictability can be annoying, exciting or horribly frightening. It’s no wonder that many leaders’ impulse is to tighten controls.
Centralization Fails in Fast-Moving Complex Situations
When I ran IDC’s CMO Advisory service, I found the centralization vs. decentralization tug-of-war to be frequent theme in the marketing organizations who were my clients. Centralization improves spending control, message consistency and efficiently manages resources.
However, centralization is a poor strategy for environments with constant change. Marketing gets its complexity from the interactions of many independent agents (e.g., consumers, brands, partners, agencies, competitors and governments) that influence results.
Niels Pflaeging, author of Organize for Complexity: How to Get Life Back into Work to Build the High-Performance Organization, says, “In fast-moving markets, the center loses its knowledge superiority. Central steering and any system that relies on central decisions collapses. Such systems become dumbed-down and numb.”
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Empowering Edge Teams Boosts Adaptivity
To respond more effectively under conditions of constant change, leaders in turbulent environments, such as military theaters and operating rooms, empower the teams at the edge where the organization meets its stakeholders.
For marketing, anyone who directly connects with customers, whether interpersonally or digitally, is on that vital frontline. Empowered teams make important decisions and act quickly without going up a chain of command.
General Stanley McChrystal in his book Team of Teams: New Rules of Engagement for a Complex World found that the only way the military could respond to the shape-shifting Al Qaeda was to empower task force teams embedded in the Iraqi landscape. The traditional hierarchy was too slow and despite huge intelligence structures, too ill-informed.
A surgical team is one example of an organization built for a fast-changing situation. They respond in the moment to each patient’s needs. A surgical team is multidisciplinary, and the various specialists work collaboratively. This team approach is highly effective. “When implemented correctly, (multidisciplinary agile teams) almost always result in higher team productivity and morale, faster time to market, better quality and lower risk than traditional approaches can achieve,” according to Harvard Business Review. Examples of such teams in marketing include agile marketing, account-based marketing, and demand teams that span aspects of marketing and sales.
Decentralization Is Risky Business
Empowerment can sound like a disastrous free-for-all. People acting unilaterally can result in duplication of effort leading to cost overruns; confusion leading to delays and paralysis; and lack of coordination and inconsistency.
However, the question of centralization vs. decentralization need not be a fork in the road where the choice is to take one path or the other. Leaders in turbulent environments demonstrate that a hybrid path can be forged, with empowered edge teams guided by a supporting network.
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Guided Decentralization Is the Middle Path
A surgical team doesn’t work in isolation. Nor were General McChrystal’s task force troops running around doing whatever they pleased. The optimal organization is loose enough to be agile and linked enough to stay coordinated. According to McKinsey, a dynamic and collaborative network of teams is an excellent way to approach the complexity that businesses face.
Here are some of the most important linkages in a network of teams.
- Shared mission. Surgical teams collectively hold the stakeholder-centric mission of ensuring the patient’s safety and health. Edge marketing teams need a similar customer-centric purpose. Internally benefitting metrics such as revenue and productivity ensure balance but aren’t the mission. Jeff Bezos, founder and executive chairman of Amazon, says “I strongly believe that missionaries make better products. They care more. For a missionary, it’s not about the business. There has to be a business, and the business has to make sense, but that’s not why you do it.”
- Accountability. Empowerment without accountability is high risk. Leaders determine the “why” and “what” by setting the mission and performance metrics. Edge teams determine the "how" and "when" works gets done and are reasonably accountable for results.
- Intelligence. The edge and network core share trusted, real-time information to develop and maintain a sense of what is happening and, where possible, anticipate what comes next.
- Organizational bridges. To prevent damaging silos from forming, everyone in the organization connects to others outside their immediate team via formal and informal ties such as lattices, communities of practice, guilds and interest groups.
- Common tools. Balance efficiency with flexibility. Standardize where commonality eases work and aids coordination but watch for the point at which standardization tips into rigidity. Marketing elements that benefit from commonality include architecture (e.g., journey maps, content standards, brand elements), operations (e.g., meeting formats, checklists, recommended practices) and infrastructure.
Technology Provides Connective Tissue
Technology is a significant reason why the battle between centralization and decentralization is unnecessary today. Technology connects the organization’s brains — human and machine. Technology aids agile operations and intelligence by monitoring, discovering, testing, analyzing and predicting complex patterns. It can work like a GPS. Technology encodes organizational memory encompassing information from past efforts and strategies that pioneers determined worked well.
It can provide guardrails to help the edge teams stay on course. Responsiveness in complex situations benefits from speed because fewer changes are likely to happen between receiving feedback and acting. Technology removes lag time and shortens distances when teams can’t physically be together. Technology enables community.
Social capital, such as trust, norms, and reciprocity, help diverse groups work together. People who feel attached are more likely to voluntarily act to further the team’s mission.
Leaders in turbulent environments demonstrate a way forward for the complex marketing world. Forge a path between central and decentral. Empower edge teams and link them to a guiding network. Use technology to scale the links.
General McChrystal says of the complex challenges facing our world, “These issues can be solved only by creating sustained organizational adaptability through the establishment of a team of teams.”