THE NEXT BUSINESS PARADIGM
Letís take a different view of business and see what develops. Letís not start by looking at activities and how they are done over a period of time. Letís instead assume that what we are really doing is solving a problem and consider the information that must be developed to solve that problem. When we do so, a whole new world opens up to us.
We often look at DSM as an engineering tool. But we can also look at it as a more fundamental problem-solving tool. And if we consider that the business of business is solving problems, we can see how the thinking behind DSM can lead to a new business paradigm.
Business organizations have evolved through time as the problems they solve have become more complex. These organizational structures have reflected how the thinking and the doing are allocated within the organization.
Before the industrial revolution, the principal organizational structure was the craftsman. One person did both the thinking and the doing. Then there came a juncture when it was realized that it was more efficient if say saddles could be produced by having one person design the saddle and develop instructions that many people would follow to make similar saddles. Those that did the doing had only the details of their craft to think about. Thinking and doing were largely separated.
But as the product or service became more complex, another juncture in the development of organizations was reached. The amount of thinking involved became greater than one person could handle. More people had to be involved in the thinking. So organizations were structured to follow the problem solving principle of divide and conquer. A large problem was divided into smaller and smaller problems until the smallest problem could be solved. The breakdown of the problem thus took on the structure of a tree. Managers were set up at each branching of the tree to manage the sub-tree below them. This had the effect of distributing the thinking among more people. This has been the basis for the ubiquitous hierarchical organization.
Now, as we approach an even more complex and dynamic business world, we are beginning to realize that the hierarchical structure is no longer up to our new needs. It faces difficulties dealing with the more complex problems being faced today and is incapable of reacting fast enough to rapidly changing and unpredictable new situations. This complexity arises from the utilization of more complex technologies, lower transaction and communication costs due to computers that give us global outsourcing and competition.
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