From the Ground Up: Six Principles for Building the New Logic Corporation

"When we look around the business landscape, we see many giant corporations that were once very successful-General Motors, Westinghouse, IBM, Kmart, Digital, and Sears-trying to regain their glory days. At the same time, we see much younger corporations such as Compaq, Wal-Mart, Intel, and Microsoft competing with them and thriving. How did these successful giants of the 1960s and 1970s end up with major competitiveness problems in the 1980s and 1990s? The answer is both simple and extraordinarily complex. These once very successful corporations remained good at operating well-managed, bottom-line-oriented hierarchies, and as a result they continued to make small improvements in performance. Their fiercest competitors, on the other hand-often other U.S. companies-were, and still are, redefining the rules for business success and achieving dramatic improvements in their performance. Until recently, many of these formerly very successful companies have stubbornly clung to the old ways of doing things and refused to accept that a new era of management thinking what I call the 'new logic' of organizing-is beginning. As a result, the IBMs, Westinghouses, and Sears Roebucks of the world are behind in the race to reinvent themselves and the way they are managed" (from the Introduction).In this context, Edward E. Lawler III firstly outlines and contrasts the most important assumptions and elements of both the traditional logic and the new logic appproach as following:I- The Six Old Logic Principles:1. Organization is a secondary source of competitive advantage.2. Bureaucracy is the most effective source of control.3. Top management and technical experts should add most of the value.4. Hierarchical processes are the key to organizational effectiveness.5. Organizations should be designed around functions.6. Effective managers are the key to organizational effectiveness.II- The Six New Logic Principles:1. Organization can be the ultimate competitive advantage.2. Involvement is the most effective source of control.3. All employees must add significant value.4. Lateral processes are the key to organizational effectiveness.5. Organizations should be designed around products and customers.6. Effective leadership is the key to organizational effectiveness.Then, after introducing a new way of organizing and managing based on the new logic principles, he focuses on applying the six principles to the organizational elements in order to create a high-performance organization within the context of the Star Model-it has a pentagonal shape with a five-pointed star inside. It depicts the key features of an organization: strategy, structure, rewards, processes, and people.Highly recommended.

From The Ground Up: Six Principles For Building The New Logic Corporation offers an approach for corporate development that is designed around job functions and departments as it focuses on management rather than leadership. Author Edward Lawler presents the "new logic" in six easy-to-understand principles for organizational redesign and a hands-on plan for putting them in place. Lawler draws upon real-world examples from Motorola, Home Depot, #M, and WalMart to illustrate how these new logical principles can affect positive change in streamlining company processes, improving customer service, boosting employee morale, tackling time-to-market issues, defining business strategies, and outlining mission statements. From The Ground Up is highly recommended reading for corporate managers at all levels of responsibility in today's highly competitive and global marketplace.