6. Implications for Business Processes

For an organization to work, cross-boundary teamwork is essential. Corporations of "stove-pipe" independent companies, or departments of completely independent groups, may as well be broken up; they rarely generate enough synergies to justify the costs of the common oversight function.

In other words, business processes that cross organizational boundaries are how healthy organizations get their work done.

This takes more than team building and cordial relations. Effective cross-boundary processes (i.e., high-performance teamwork) require the following:

• For every project or service, a team draws together just the right people from throughout the entire organization, without regard for structural boundaries.

• Teams form laterally, without the need for top-management intervention, i.e., self-forming teams.

• People on the team have clear individual accountabilities; they may help teammates succeed, but they don't meddle in others' territories.

• People are part of the team when their contribution is needed; and when they're done, they're gone.

• Within the team, there's a clear chain of command so that differences of opinion can be resolved within the team -- i.e., self-managed teams.

Common approaches to coordinating business processes include business-process reengineering, and preaching the value of business partnership. The BWB paradigm suggests a far more effective approach: internal customer-supplier relations.

Business Process Reengineering

Business process reengineering (BPR) coordinates activities by pre-establishing the flow of work. The result is a procedure that maps an efficient series of steps taken to accomplish a given purpose. This flow chart then coordinates people's activities across organizational boundaries.

BPR invests significant effort in carefully planning the flow of work. Sufficient detail is needed before a procedure can serve as an effective coordinating mechanism.

Because the effort involved in planning a work flow is significant, BPR generally considers no more than a few major business processes. The result is an organization that's efficient at one or a few of its work flows, but less effective than ever at the remainder of its deliverables.

For example, the organization may trim the costs of its product or service manufacturing, but make it more difficult to do custom work or to introduce new products and services.

A more serious shortcoming is the rigid, assembly-line style of organization it produces. With BPR, the same team of people performs that process -- even if it lacks the unique skills required by the particular project. Because the work flow is standardized, teams may not have access to specialists who are needed by one project but not by others.

Similarly, the sequence of tasks is fixed, along with the order in which they're done. Such rigid organizations don't do well at custom work, such as that done by most white-collar organizations where each project is somewhat different.

Furthermore, BPR defines what people do, not what they sell. It focuses people on tasks, not running lines of business that sell many different things to many different internal customers. This discourages innovation in how work gets done -- counter to internal entrepreneurs who are always looking for a better way.

To compensate for this, BPR appoints a "process owner" -- one person whose job is to improve the process over time. Of course, a single mind cannot accomplish as much as everybody continually improving his or her respective processes. Meanwhile, the process owner disempowers others as he or she tells them what to do.

Cleaning up work flows may sound simple, but a professional function is not a simple assembly line where teamwork can be preordained through a flow chart. Optimizing a few work flows for the sake of efficiency risks damaging the effectiveness of the entire organization.

Business Partners

Some have said that internal service providers should consider themselves "business partners" and share authority and accountability with internal clients as equals. For example, IT should consider themselves part of the clients' business teams.

While it's believed that this will lead to good collaboration, in practice it generally leads to trouble. Accountabilities are unclear, and each party feels it has some authority over the other, leading to disempowerment and finger pointing.

Consider two perspectives:

• Staff feel they have a right to tell clients how to run their businesses, and may feel accountable for forcing changes on clients. In the above example, IT staff may feel it's their job to make clients' technology decisions for them as if they were the customer for their own services.

• Clients may feel they have the right to tell staff how to run their internal services business. Continuing the IT example, clients may feel they have the right to tell the IT members of their team how to manage their technology projects.

Respecting one another's different domains and expertise is, in fact, a much better way to build healthy partnerships without any loss of commitment to one another's success.

The BWB paradigm builds effective partnerships through clear customer-supplier relations. Again, consider the two perspectives:

• Staff respect customers' rights to make purchase decisions. For example, they present options with information about each (as in Chevrolet, Cadillac, and Rolls-Royce), then let customers decide which they'll buy.

• Clients allow staff to run their internal businesses as they see fit. They decide what they'll buy, then leave it to the internal provider to figure out how to make the chosen product or service.

Clear but distinct accountabilities reduce disputes and finger pointing. Furthermore, synergies are gained when customers and suppliers recognize their different competencies, and each contributes what he or she knows without attempting to micromanage the other.

By the way, customer focus doesn't mean that staff passively take orders with little initiative in forwarding new ideas that might pay off for the company. There are many ways that entrepreneurs are proactive without usurping the customers' right to decide what they buy:

• Internal entrepreneurs propose any new ideas they think will benefit their customers, and proactively share what they know.

• Staff can be quite innovative in evolving their product lines, while still respecting customers' right to decide what they'll buy.

• Staff proactively invest in their own businesses -- in process improvements, technology innovation, and new products -- to remain competitive.

The BWB Approach

The BWB paradigm suggests a powerful approach to cross-boundary work flows, one that applies within a department as well as across an entire corporation.

For each project or service, a clear organization chart should identify the one and only group that sells that deliverable. This group is considered the "prime contractor."

The first job of the prime contractor is to acquire needed help from subcontractors, i.e., from peers anywhere in the corporation.

Entrepreneurs have an incentive to draw others onto their project teams because they are more competitive when they utilize the services of specialists rather than attempt to do everything themselves.

Meanwhile, people have an incentive to help each other since internal customers (peer groups within the same department) are customers nonetheless, and it's important to please them.

Of course, subcontractors can, in turn, buy from other peers -- their subcontractors. As each business within a business buys what it needs from its peers, teams form automatically, without the need for management intervention.

Since entrepreneurs only buy what they need for each particular project, teams draw on just the right people at just the right time. Business processes are clearly defined, and yet they're flexible and dynamic.

Even better, people buy products and services from one another, not just "warm bodies" to work on the project team. Thus, everyone takes responsibility for his or her individual deliverables, the sub-modules of the project.

Subcontracting for deliverables rather than people distributes the workload of managing the project. Subcontractors are project managers of their respective deliverables, and take responsibility for coordinating their own work as well as for arranging their suppliers.

This way, the prime contractor doesn't need to direct the detailed activities of everyone on the project team, an impossible challenge on large, complex projects. Instead, each layer coordinates only the next layer. Project management becomes much more feasible and reliable.

The BWB approach also enhances the quality of collaboration. People agree on what they can expect of one another; they respect others' skills and prerogatives; they refrain from micromanaging peers or stepping on others' territories; and they willingly support peers who are their customers.

Internal buy-sell transactions need not be bureaucratic with extensive paperwork. A simple memo of understanding can clarify who is buying what from whom, and is always good business practice.

Also, the BWB approach does not assume or require an actual transfer of funds (i.e., chargebacks). With or without chargebacks, there's nothing to prevent each group from thinking in the terms of being a business within a business.

In summary, treating peers as customers and suppliers builds flexible but explicit cross-boundary work flows, clear individual accountability, healthy collaboration, and close partnerships based on mutual interdependence.