Flexibility can also be seen in the networked culture's archetypal approach to job responsibilities. Job descriptions may exist somewhere in the organization (probably within the human resources department), but again, no one really pays attention. People are, of course, expected to fulfill their job responsibilities, but if someone in distribution has a terrific new idea for how to
improve the company's raw-material sourcing, for example, he is allowed to explore it, and even to make it happen. We saw several examples of this kind of flexibility in our work with Heineken. In one case, a woman who had begun her career as a secretary showed flair in her public relations skills and was promoted first to a regional role and subsequently to senior director at the corporate office. As in all positively networked organizations, she was helped along the way by friends and colleagues who wanted her to succeed. The pattern was common: Informal relationships were an important way for individuals to build their skills and broaden their experience.
The story, incidentally, raises an important point about flexibility in a networked organization—and its impact on career mobility. The secretary who rose to become a senior director at Heineken is an example of how far people in networked cultures can take their careers, but it also shows who is responsible for that journey. In networked organizations, career paths are usually the responsibility of the traveler. It makes sense, after all, that when a culture is built on who you know, you are in the best position to determine where you go in the company and how fast. This is what is implied by the rule Your career belongs to you. That is, it belongs to you and your network.
It makes sense, then, that in networked cultures people need to spend a lot of time building and maintaining networks. This can, indeed, take time away from work. But in many cases this is a small price to pay for the competitive advantages the form delivers.
In a company held together by friendships and connections, information and ideas flow freely. And today, in an economy increasingly driven by knowledge, this sharing can translate into a powerful competitive weapon, especially when it occurs across functions, borders, and teams . 6
In networked organizations, creativity is also enhanced because creativity flows more freely out of situations characterized by trust and openness. Imagine how hard it would be to float an
"out-of-the-box" idea at Tystar—for instance, that the company forge an alliance with a competitor instead of trying to annihilate it? Who would dare be shot down? But at a company like EmChem, you could test your "crazy" idea on receptive friends and colleagues and build support for it without fear of ridicule or scorn.
Flexibility also means agility. Networked companies, for all their talk and consensus building, sometimes get things done very quickly. That's because end runs are permitted. You have a great idea—you bring it to a close colleague who is friends with a senior-level manager. Next thing you know, the CEO is calling a meeting to discuss your idea. At more rule-laden organizations, procedure and policy can get in the way of positive momentum—and good ideas.
Moreover, because networked organizations are often fun places to work, people become loyal to them. They stay, they work hard, they rally during tough times. A lot of this behavior is driven by commitment to colleagues—not the organization. But if the outcomes of these behaviors are good, why differentiate?
The networked culture has other more subtle, but equally important, competitive advantages. First, the networked culture is a powerful complement to organizations in which the value chain is complex. And linked with that, the networked culture is highly appropriate when time frames are long and outcomes uncertain.
Some explanation: In many business situations today, it is simply not possible to know quickly what should be done—the problem to be solved is extremely complicated, for example, or the product's path between raw material and consumer is long and elaborate, or the technology involved is new and evolving. Consider what goes into the making of a new cancer drug. The scientists involved in the process come from the disciplines of oncology, biology, chemistry, and toxicology, among others. The marketing and finance departments have an important role in the process, as do the managers who interface with the FDA. All
in all, the process can take ten years or more, with stops and starts, long and frustrating months of testing, and periods of great promise. In this environment, with its complex value chain and long time frames, the networked culture is an excellent fit. High sociability facilitates communication between groups and across functions, and at the same time, it sustains people through a difficult, complex, and uncertain process. Sometimes in the battlefield of business, he who survives the longest, and with the fewest casualties, wins.
THE DOWNSIDE OF NETWORKED
But with all its strengths, the networked culture has weaknesses too. Perhaps the most obvious is the form's tolerance for poor performance. It can be difficult for friends to criticize friends, to admonish them about a mediocre piece of work, to tell them to improve, or get to the point in a meeting. It is even difficult for a friend to say, "I'm busy right now," let alone, "I don't want to hear about your sick cat, now get out of my office so I can work, and by the way, why aren't you working too?" Thus, in a networked organization, poor performance is tolerated in silence, and many a long, useless meeting where nothing happens is endured.
Likewise, networked organizations allow their members wide berth for explaining away bad performance. As in any other kind of company, people in networked organizations do have performance targets, and they are measured against them. But in a networked organization, targets and performance standards can be, and often are, negotiated. For instance, if it becomes obvious in August that you are not going to hit your numbers in October, you start calling around. If your product is ice cream, you tell the right people, "Look, we had a wet summer, no one went out to the ice cream stores. There were fewer outdoor barbecues and parties." Basically, the message is: It wasn't my fault.
This may be true, but in a mercenary culture, you wouldn't dream of making calls—there would be no "right" people to make them to anyway. Instead, you'd melt the ice cream down and sell it as soup. That's going too far to make a point, of course, but the message is the same: There is much less covering up of bad performance in a mercenary organization. Of all the cultures, only the networked permits it to such an extreme.
High sociability has its impact on networked organizations, but so too does low solidarity. For example, networked organizations, even in their positive form, also can be overly concerned with the means instead of the ends. When an idea for a good product gets hatched, people in a networked organization don't say, "Great, how do we get it to market as fast as possible?" (This would more likely happen in a communal or mercenary organization.) Instead, they start to talk about how to sell the idea within the organization—they debate how to build consensus around the concept. "Who should be at the next meeting about this idea?" they would ask. "And how should it be presented so that we get buy-in?"
On the upside, once a networked company gets a new product to market, most everyone in the organization has accepted it—you won't find the kind of pockets of "hidden" resistance that can sabotage a product rollout in its late stages. On the downside, too much focus on process instead of outcomes can lead to analysis paralysis. You talk and talk ideas to death; either that or while you are talking, the competition buries you alive. Some suggest that this is what happened within IBM in the 1980s—its managers and planners debated every which way to approach the personal computer market, analyzing options from twenty different angles, with scenario plans for all of them. Meanwhile, Sun Microsystems and Dell all made rapid growth. But IBM is only one example of the countless companies where great analysis got in the way of great results. It is hard to know for certain whether IBM was a networked organization in this period—certainly parts of it were—but regardless, an unhealthy
focus on process at the expense of outcomes is a particular specialty of the networked organization.
One way in which this process-heavy aspect of low solidarity often plays itself out in networked organizations is pervasive disagreement about strategy, goals, and the competition. And these are major matters about which to disagree! Members of a networked organization are loyal and committed to each other first—and only after that to a vision, mission, or even a performance target.
As Ray van Schaik discovered when he took over as CEO at Heineken in the late 1980s, strong ties of affection did not automatically translate into high levels of cooperation. Although there were extensive and well-established friendships, senior executives found it difficult to coordinate activities both within corporate headquarters and between different European operating companies. One senior executive remembered, "The world was divided into regions, each represented by one board member, but they were fairly autonomous and there was little overall coordination. There was a multitude of regions and a multitude of operations within each region—but there was not enough overall direction within the company." To solve this van Schaik launched a major cultural change program—"The New Heineken Spirit." There were four main thrusts: (1) strategic focus on the premium beer sector; (2) cost leadership; (3) professional, "fact-based" decision making; and (4) open and clear two-way communication. This new vision—with supporting systems and structures— helped to promote greater solidarity across the European operating companies.