November 30, 2007

Competence Centers

This is a story told by eFACS Tutor Tim Perry, they once worked with a multi-national company who centralised everything into competence centres. The company had its accounting & finance department in the States the corporate global headquarter, procurement in Germany the region headquarter, and its operation is in U.K. The result, it was very difficult to tell the procurement and finance that they need better incoming raw materials.

By building up global competence centres in effect to some extend are building up "barriers between staff areas", which encouraged in this case "awarding business on the basis of price tag" and "management by numbers". When was the last time you hear your hardware engineer complaining that the software came from his Indian colleagues did not exactly work as expected and the managers just simply blame the hardware engineer's inability to work across different cultures?

BTW, "Management often complicate the work of the people in design by making last-minute changes in style and engineering, after the plans are submitted production is ready, leaving to the design and production engineers only a few weeks to do a year's work." Any wonders for project managers why projects are so often late by months or even years? When was the last time that the top management wanted a more stylish cabinet or body?


- 2 comments by 2 or more people Not publicly viewable

  1. Paul Roberts

    It is interesting that when you understand Deming’s philosophy and use it to analyse what organizations do, it suddenly becomes very clear the mess that some create for themselves. The biggest failing, I believe, is failing to think of the organization as a system. Vertical optimization by function will inevitably lead to system sub-optimization as every functional leader strives to be the best.

    05 Dec 2007, 08:46

  2. Just as much as in a recent channel modelling project we have in my Org led by Sales. We are still not succeding at it because Sales want to lead everybody by nose using its own criteria, All other functions are balking at their’expertise’ in their silos to bring the project down, proving Sales wrong rather than work together to progress.

    20 Feb 2012, 16:22


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