After my previous post on “The end of IT alignment“, which was really a post about capability-based governance models, I get this little gem in my inbox this morning:
Second, creating meaningful differentiation requires capabilities that are almost always cross-functional. For example, building a competitive global brand requires more than a marketing skill set. It requires a plethora of competencies, including managing digital media and tracking consumer insights (both of which involve IT), relationship building (which requires good customer service and interface design), ethnographic insight and employee engagement (enlisting talent and HR), highly targeted product design and development (engaging R&D), and more.
Third, functions have a natural tendency to become isolated organizational silos, focusing on their own excellence and performance instead of the company’s strategy. The specialists’ natural imperative—to be excellent in everything they do—leads to incoherence. Many functions have devoted a significant part of their budgets over the years to initiatives and technologies that make them world-class, but that have very little to do with the true drivers of the company’s success.
Although all these problems can be addressed in small ways, none of them can be fully resolved under the current functional model. In that context, it seems increasingly likely that the functional model is obsolete. But if so, what might replace it?
Read it all here.