Zero-Based Organization

LATEST THINKING

Disruption is pushing companies to rethink their businesses. Yet, capabilities and talent are not pivoting fast enough. The workforce is performing tasks in ways that have been passed down from previous generations. So, employees are often performing work that no longer contributes to valued or strategic outcomes.

This organizational inertia is deadly. ZBx (zero-based mindset) is a new way to drive profitability that emphasizes the future over the past. A critical component of ZBx, ZBO (zero-based organization) designs the organization from a clean sheet, shifting talent toward work that contributes to the distinctive capabilities, operating model and outcomes needed to fuel growth.

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KEY FINDINGS

ZBO requires organizations to abandon “always done” mindsets and think and work in new ways:

A question of identity
Serious soul-searching is a prerequisite for ZBO approaches. Leaders must question what is happening in their company and use it to feed clean sheet design. Not just in moments of existential angst, but also when things are going well.

Control your own destiny
ZBO frees companies from first quartile benchmarks and rear-view mirror peer analysis. They design as digital natives for a “should cost” approach by clean sheeting every line item to create transformational savings rather than incremental reductions.

Boundaries have disappeared
The right people doing the right work is critical to fuel profitable growth. Yet talent is a fluid ecosystem of fixed and variable human labor, bots, virtual and cognitive agents, crowdsourced talent, and customers and suppliers. ZBO designs for this boundaryless ecosystem.

Only one quarter of executive thinks their company's operating model has evolved quickly enough to align to their strategy.

RECOMMENDATIONS

These are the no-regrets fundamentals of reaping the rewards of ZBO:

Be who you aspire to be

ZBO is rooted in the future work routine. That’s why the pre-work of revisiting the strategy is so important. If the strategy is wrong, it doesn’t matter if the work is right.