Saturday, March 1, 2008

Seeds and fertiliser – how to build a firm

American visitor: “How come you got such a gorgeous lawn?”
Lord: “Well, the quality of the soil is, I dare say, of the utmost importance”.
American visitor: “No problem”.
Lord: “Furthermore, one does need the finest quality seed and fertilisers”.
American visitor: “Big deal”.
Lord: “Of course, daily watering and weekly mowing are jolly important”.
American visitor: “No sweat, just leave it to me!”
Lord: “That’s it”.
American visitor: “No kidding?! That’s it?!”
Lord: “Oh, absolutely. There is nothing to it, old boy, just keep it up for five centuries”.

What many firms, trying to grow fast or add scores of acquisitions, often fail to realise: Organisations work much the same way as a lawn. You can buy the machinery, lease the building, hire the people, acquire the assets pretty quickly and relatively easily, and put them together. But this does not mean that you will have a working organisation.

An effective firm requires that the various elements of its organisation - both the "hard" factors (such as its structure, incentive system, etc.) and the "soft" elements (such as the culture of the place, informal communication patterns, etc.) - are fine-tuned, interact and reinforce one another. Building such an organisation implies more than just "owning the parts"; it takes continued dedication, hard work and, most of all, it simply takes time.