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Not Just Talk

September 16, 2012 • BUSINESS & INNOVATION

By Boris Groysberg & Michael Slind

A new source of organizational power has come to the fore. Our term for that power source is organizational conversation.#

Not so long ago, power within organizations emanated from the commands of top executives. Those leaders drove organizational performance by devising strategic objectives, which they translated into directives that passed down through a hierarchy before reaching employees, whose job was merely to take orders and to act on those orders. Today, that model of organizational life has essentially fallen apart. At more and more companies in more and more industries, leaders recognize that driving their company in a traditional command-and-control manner doesn’t work anymore.

To an ever-increasing degree, people—and the energies and capabilities that lie inside them—are the ultimate source of optimal performance and sustainable competitive advantage. Yet the kind of value that people now deliver to an organization isn’t the kind of value that leaders can leverage simply by issuing orders from the executive suite. In an environment where employees have that much power to determine the success or failure of an organization, the ability of leaders to command grows weak and their sense of control grows weaker still.

For most leaders, that story will have considerable resonance. Even those who retain a firm grip on the main levers of activity within their organization will sense, deep down, that their ability to harness the creative and operational energy of their people has grown more tenuous over the years. Yet, as familiar as the loss-of-command story has become, leaders continue to grapple with the question of where that story ends—or, more pertinently, the question of what comes next.

 
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