The Most Important Alignment in Business
The idea of alignment is common in business, with meanings and scopes that range widely. A top executive might be preoccupied with the alignment between the company’s long-term goals and the objectives of the sales department. At the same time, the same executive might be dealing with matters of alignment between a colleague’s personal goals and the team’s priorities. However, when it comes to organizations that become and remain successful over long periods of time, the alignment between the company’s intent and its emergent way of doing business on a day-to-day basis stands out as the most important type of alignment.
Building upon the idea that a company’s approach to business is a mix of deliberate and emergent actions, the same theoretical foundation that was used to develop the game OFMOS advances the notions of Focus and Center, respectively. They are the two components of an alignment that must be maintained in order for a company to achieve long-term success.
The first concept is based on the idea of intent, which is prevalent in the management literature and practice. In this case, however, the definition is more specific. A company’s Focus refers to the deliberate or implicitly deliberate act of setting and running a company with an approach that fits with a relatively-narrow range of customer need-addressing behaviors. Driven by a certain vision or simply by the imperative of successfully taking to market a set of core offerings, companies tend to concentrate their limited resources toward developing organizational structures, go-to-market approaches, and cultures that best serve their core customers.
On the other hand, constrained by their limited resources, companies tend to develop portfolios of offerings and markets, or ofmos, that are characterized by higher degrees of synergy. As a result, a company’s ofmos tend to become concentrated in relationship to each other. And relative to the customer need-addressing behavior spectrum, they tend to form a cluster, as the company strives to maximize its revenue and profit. This cluster of ofmos is called the company’s Center, and is consistent with the notion of resource congruence. (As a side note, the alignments of ofmos featured in the game are simplified local formations that occur in a similar manner that a company’s Center would emerge.)
Nevertheless, while a company’s Focus is naturally resistant to change, the Center has a tendency of moving toward customer need-addressing behaviors that maximize the customer benefits, while reducing the perceived value of the company’s offerings. In other words, over time, the commoditizing Center tends go out of alignment with the fixed Focus. And this is the greatest challenge that companies have to deal with in the long run. Success and, at the very least, survival requires an Alignment between a company’s Focus and its Center, which can be done either by introducing and removing ofmos to adjust its Center, or by changing its Focus.