Book Excerpt: The Corporate LatticeCathleen Benko and Molly Anderson
…Workplaces aren't what they used to be. Organizational structures are flatter, challenging traditional talent development models that rely primarily on upward progression. Knowledge and service work dominate the economy. As a result of technological advances and globalization, workers are less tethered to traditional offices and set hours. And the makeup of work is changing, too. Companies use forty times as many projects now as they used twenty years ago, heightening the need for teamwork. Work is changing so fast that the U.S. Department of Education estimates that 60 percent of all new jobs in the twenty-first century will require skills that only 20 percent of current employees possess.
The workforce isn't what it used to be either. Family structures have changed markedly, with profound implications for a corporate ladder model predicated on a household arrangement that, by and large, no longer exists to support it. Until the 1960s, two-thirds of U.S. households were traditional, defined as Dad going to work while Mom stayed at home. That number now is down to 17 percent.
Women constitute half of the U.S. workforce and are the primary breadwinners for nearly 40 percent of families. Men in dual-career, dual-caregiver couples now cite more work-life conflict than women do. What's more, younger generations are bringing different attitudes to work at the same time that older workers are looking for options to stay in the labor market. Almost two-thirds (70 percent) of baby boomers and 92 percent of Millennials cite career-life fit as a top priority. And along almost every dimension, employees are more diverse.
These seismic shifts leave companies struggling to meet the challenges of the changing world of work. They signal the end of traditional assumptions about what it takes to achieve and sustain a high-performance workplace.
LATTICE WAYS TO WORK, PARTICIPATE AND BUILD CAREERS
In mathematics, a lattice is a three-dimensional structure that extends infinitely in any direction. In the corporate world, the lattice model organizes and advances a company's existing incremental efforts into a comprehensive, strategic response to the altered corporate landscape. The [lattice] metaphor also describes the changes in work as virtual, dynamic, and project-based. Its grid resembles nodes on a network, each with the possibility of connecting "anywhere, anytime" to the others to form teams and communities.
This trend is fueled by a combination of globalization, cost cutting, and technology advances that provide radically different options for when, where, and how work gets done. Tanya Clemons, senior vice president and chief talent officer at Pfizer, sums it up this way: "In the era of the knowledge worker, it's just a totally new game now in terms of how work gets done and even what constitutes work these days."
Companies that do invest in improved work options to meet employee demands are finding that the company also benefits through improved performance. This is what Frontier Communications, one of the largest rural local exchange carriers in the United States, learned when it implemented a comprehensive remote work program.
While consolidating the operations of several call centers, Frontier negotiated with its union a provision that displaced call center workers could work from home. "We took a 'Let's try it and see' attitude and were very surprised with how well things worked out," says Frontier chairman and CEO Maggie Wilderotter. "What was intended as a concession in a union negotiation turned out to deliver significant productivity improvement."
Indeed, 30 percent of Frontier's customer service agents now work from home, and, on average, these workers are 25 percent more productive than those who work in call centers. Retention of work-at-home agents is also 100 percent better than retention of agents who work at the center.
With its strong horizontal as well as diagonal and vertical supports, the visual picture of a lattice describes organizational relationships, interactions, and communication unconstrained by top-down hierarchy. Broader participation enables people to interact, get involved, share ideas, and spread knowledge throughout the company, regardless of their level on the organization chart. That's what AT&T is experiencing with one of its social media experiments. John Donovan, AT&T's chief technology officer, was looking for a nonhierarchical approach to harness the rich depth of knowledge and creativity inside the multibillion-dollar firm. Leveraging social media, Donovan created a mass participation approach to innovation that, by design, would not replicate the company's existing functional or hierarchical organizational structure.
This approach features a Web site that allows anyone (and Donovan is quick to underscore anyone) to contribute an idea, become a collaborator on someone else's idea, provide encouragement and critical feedback, assess a concept's marketability, challenge its engineering and affordability, and the like. Each employee can also vote on the caliber of the insights and rate additional postings of suggestions and comments, earning the contributors reputation points. "This is meritocracy at its best—a highly diverse set of people, in every sense of the word, crowd-sourcing and crowd-storming," says Donovan.
By the end of its third quarter, the site had more than twenty-four thousand members, two thousand ideas, and more than a million page views and was still growing. The first season's winners have been funded and are moving from PowerPoint to prototype.
The lattice depicts employees' career paths as multidirectional, with moves across and down as well as up. The lattice metaphor does not offer a universal view of career success but rather a multiplicity of ways to get ahead—and more than one way to define what "get ahead" means.
Nonlinear careers are becoming the norm. Two polls of more than 250 human resource executives revealed that two-thirds to three-quarters of respondents had made some kind of lattice-like move during their careers.
A lattice organization operationalizes career customization, making it part of the way the business runs. The finance division of a large consumer technology company showcases the changes lattice firms are making as they increase personalization, career enhancement, and career-life fit.
The division has recently crafted a development approach that acknowledges it is a "flat organization where career development and growth opportunities occur horizontally through new learning experiences and vertically through promotions," says Betsy Rafael, vice president of finance. Finance aims to build professionals who have a big-picture view of the business and can lead in outside areas. For this reason, it moves people around laterally so that they become knowledgeable about all aspects of operations. The approach also attracts, retains, and engages employees who want to be challenged professionally, something Rafael has found particularly important to many high-potential individuals…
We've shown that the lattice isn't a hypothetical case; it's already on the horizon, and there are clear benefits for companies that intentionally evolve toward it. A handful of companies are already modeling the new thinking required to profit from the evolution from ladder to lattice. Their successes illuminate the path ahead.
Excerpted fromTHE CORPORATE LATTICE: Achieving High Performance in the Changing World of Work, by Cathy Benko and Molly Anderson, Harvard Business Review Press, Hardcover, August 3, 2010, www.thecorporatelattice.com
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.