Nokia Essay

5884 Words24 Pages
Organizing to Deliver Solutions Prepared for Special Issue of Organizational Dynamics May 2002 Jay R. Galbraith Center for Effective Organizations Marshall School of Business University of Southern California Los Angeles, CA 90089-0806 (213) 740-9814 Jay R. Galbraith Page 2 Organizing to Deliver Solutions BY JAY R. GALBRAITH Executive Summary Many companies today are adopting strategies to package products and services into solutions. However, several well-managed companies are experiencing difficulty in transitioning from stand-alone product offerings to solutions. These difficulties stem directly from the organizational challenge. This challenge derives from the necessity to create a customer-centric unit or units and integrate it into the existing organization. The existing organization usually consists of product-centric business units. The leadership task is to create the management processes with which to manage the resulting inevitable conflict. This article defines what is meant by a customer-centric unit. It then identifies the different solutions strategies that will determine different degrees of customer-centricity and different forms of organization. The article concentrates on the structure and management processes that are needed to implement reasonably complex solutions. The recommended structure is the front-back hybrid model that has been adopted by IBM and Nokia. The five key processes that need to be added are customer strategy, product portfolio planning, solutions development, solutions ordering and pricing, and the assembly and disassembly of teams. These key processes are the primary vehicles through which the leaders manage the tensions between product- and customer-centric units. In addition, the redesign of reward systems is mentioned. To complete the organization, the issues of developing and selecting

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