Welch's bid to make GE a "boundaryless" organization itself has no frontiers. Whether a boundary is inside or outside the company, it limits performance. Individuals unwittingly set their own bounds, limiting what they achieve. Challenge all barriers and seek to tear them down. And set stretch targets for your company and for yourself.
Examining the boundaries
When Welch took over GE, the company structure included nine layers of management, from the CEO to the shop floor, each forming a boundary. Welch took out whole layers, but delayering affects only vertical boundaries: there are two other types.
The Three Types of Boundary
1 Vertical
The hierarchical steps that separate different layers of management.
2 Horizontal
The barriers between different functions, departments, country units, operating units.
3 External
The frontiers between the business and its suppliers, customers and competitors.
Breaking down internal barriers
The fewer internal borders there are to cross, the better for the overall efficiency of your company. Tackle vertical and horizontal barriers by implementing the following practices:
* Scrap inhibitions about crossing a layer — encourage managers to talk to the subordinates of other managers, and vice versa.
* Use development programmes and task forces to mix different vertical levels in a non-hierarchical setting.
* Use cross-functional, interdepartmental teams to break down horizontal boundaries.
* Ask people who interrelate with other areas of the company to provide assessments of the service they receive; link rewards to the ratings given.
* Mingle purposefully, positively, and often.
* Encourage people to visit others from whom they can learn.
Breaking down external barriers
The most dramatic moves towards boundarylessness are external, and not confined to the inner workings of a company. To optimize your business you must optimize the whole business system by bringing in the key outsiders: suppliers and customers.
The business system
Remove barriers and strengthen links between each element in the business system to achieve unproved company performance and greater satisfaction.
Strengthening links
Encourage the fall of barriers between the company and the outside world. Go to see customers and find out what improvements you can make for their benefit, and implement findings wherever possible. Work with suppliers to reform the business system to achieve shared gains, form alliances, even with competitors, to take advantage of any complementary strengths. Then take the following systematic steps with your new "allies":
* Customers: involve in product development, encourage "self-service", and obtain and act on feedback.
* Distributors: integrate with supply, and turn into inventory holder — even subcontractor.
* Producers: link production to outside suppliers, distributors, and customers; make to order.
* Suppliers (external): link to production/distribution, supplying daily, just in time.
* Design staff: involve suppliers and customers, to build in value, quality, and superior performance.
Ask yourself: "Am I helping my colleagues, customers, and suppliers to get the best from me?" and "Am I working to get the best from them?" Make sure you get the right answers.
