As background, Antonio Nieto-Rodriguez is the creator of concepts such as the Hierarchy of Purpose featured by Harvard Business Review. Also the Project Revolution that argues that Projects are the lingua franca of the business and personal worlds from the C-suite down. His concepts include managing your career and/or your relationships. He is also the author of The Focused Organization.
In this paper, he postulates that:
He also proposes changes in sourcing CEOs and setting their perspective on corporate management.
For over 150 years the main focus of organizations has been in excelling at running the business, i.e., the day-to-day operations, as distinct from changing it, i.e., the execution of projects. To this end, organizations have been structured and run hierarchically, with power, budgets and resources divided over departments. Management and management theory was focused on how to run and optimize the business best, i.e., on efficiency, volumes, and costs, while projects were an addition, but hardly ever a priority.
Now, this organizational model has become obsolete. My prediction is that by 2025, CEOs, senior leaders and managers will spend at least 60% of their time selecting, prioritizing and leading the execution of projects, as opposed to the 10% they spend on average today. In the past growth would come by increasing the efficiencies and scaling the business. In the new world, value will come mostly from executing successfully growth and innovation projects. This is a radical shift in the role of the CEO and the skills needed to lead their organizations.
The reality is that, in the New World, a new Organizational Management Model is required. Previously, the role of a CEO was to provide a vision and strategic direction, whilst leaving execution to their management team. What made a CEO successful was their capability to deliver business results by maximizing shareholders value through the day-to-day business activities.
But now we find ourselves in the "VUCA" world, which is being accelerated by the latest disruptions that are impacting our society and the business world. That is: robotics, artificial intelligence, shared economy, block-chain, and big data. Consequently, due to the speed of change experienced in the past decade, this past organizational model is fast becoming obsolete. Soon, if not already, automation and robots will be carrying out the day-to-day running of a business, making projects the essential part of any organization.
CEOs will need to understand how they can leverage the latest technological advances while focusing on execution of their strategic initiatives. The new core competencies required by CEOs will be their ability to turn around a business and show a successful track record in leading transformational change.
In the past, the role of CEOs was to provide a vision and strategic direction, whilst leaving execution to their management. What made them successful was their capability to deliver business results, i.e., maximizing shareholder value through day-to-day business activities. Today, due to the speed of change experienced over the last decade, this organizational model has become obsolete. The day-to-day running of a business will soon be carried out by automation and robots, if not already done. Projects are becoming an essential part of the organization of the future.
1. VUCA is an acronym used to describe or reflect on the Volatility, Uncertainty, Complexity and Ambiguity of general conditions and situations. The notion of VUCA was introduced by the U.S. Army War College to describe the more volatile, uncertain, complex and ambiguous multilateral world that emerged from the end of the Cold War. It the late 2000, after the meltdown of the financial sector, it started to be used in businesses and strategic leadership.