WSJ's The Experts

Why Companies Need Strong ‘Lines in the Sand’

Without a conscious redesign of any part of the organization, the organization will reorganize itself.

Par James Allen

First published on août 28, 2015
min


This article originally appeared on The Wall Street Journal's The Experts blog. To all staff: In the past month, we lost two points of market share in product A. We failed to act on customer B’s complaint within 24 hours. We just lost a sale to competitor C. If you work for an entrepreneurial company, you will immediately recognize the gravity of these statements. They represent “lines in the sand” that have been crossed. You probably can add one or two lines of your own that you live by daily. Lines that cannot be crossed without consequence are common among companies that operate at a high metabolic rate. For leaders, drawing lines in the sand also is a far easier way to focus employees and management that trying some sort of reorganization when you feel your company losing speed. And speed is often the greatest asset of growing companies as they compete against large incumbents. Learn More Founder's Mentality Fast-growing companies can become global leaders without losing the values that helped them succeed. Bain’s research explores how large incumbents can also reignite their growth by recapturing their Founder’s Mentality®. Lines in the sand must be properly implemented, of course. People need to know that if they don’t deliver on a specific metric, the leadership team will take immediate action—to recover, to reallocate resources, to coach and if warranted to reprimand. Everyone needs to know the drill: How employees report the information, who responds, what resources fund the response, how to monitor progress and how lessons from the breach are used to help train employees and executives alike. That allows you to recover quickly from breaches of the lines. Many companies lack a drill—or don’t even know a breach has occurred. Consider the declaration that the company will never lose market share on its core products. If you draw that line and declare that any team responsible for loss of share must join a call with the full executive team, two things will happen. First, with little action required on your end, everyone will make it a priority to stay on the right side of the line. Second, executives quickly will start to hear about the strategic issues that people fear will cause them to cross the line. Without a conscious redesign of any part of the organization, the organization will reorganize itself. James Allen is co-leader of the global strategy practice at Bain & Company.

This article originally appeared on The Wall Street Journal's The Experts blog.

To all staff: In the past month, we lost two points of market share in product A. We failed to act on customer B’s complaint within 24 hours. We just lost a sale to competitor C.

If you work for an entrepreneurial company, you will immediately recognize the gravity of these statements. They represent “lines in the sand” that have been crossed. You probably can add one or two lines of your own that you live by daily. Lines that cannot be crossed without consequence are common among companies that operate at a high metabolic rate.

For leaders, drawing lines in the sand also is a far easier way to focus employees and management that trying some sort of reorganization when you feel your company losing speed. And speed is often the greatest asset of growing companies as they compete against large incumbents.

Learn More

Founder's Mentality

Fast-growing companies can become global leaders without losing the values that helped them succeed. Bain’s research explores how large incumbents can also reignite their growth by recapturing their Founder’s Mentality®.

Lines in the sand must be properly implemented, of course. People need to know that if they don’t deliver on a specific metric, the leadership team will take immediate action—to recover, to reallocate resources, to coach and if warranted to reprimand.

Everyone needs to know the drill: How employees report the information, who responds, what resources fund the response, how to monitor progress and how lessons from the breach are used to help train employees and executives alike. That allows you to recover quickly from breaches of the lines. Many companies lack a drill—or don’t even know a breach has occurred.

Consider the declaration that the company will never lose market share on its core products. If you draw that line and declare that any team responsible for loss of share must join a call with the full executive team, two things will happen. First, with little action required on your end, everyone will make it a priority to stay on the right side of the line. Second, executives quickly will start to hear about the strategic issues that people fear will cause them to cross the line. Without a conscious redesign of any part of the organization, the organization will reorganize itself.

James Allen is co-leader of the global strategy practice at Bain & Company.