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The hidden value of organizational health--and how to capture it

Execution Edge

Organizations that follow the Execution Edge recipe focus on implementation, frontline execution, elimination of wastage of time and resources, and optimal utilization of data for efficiency.

They also use technology to foster better communication, last-mile delivery, and overall efficiency.

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The hidden value of organizational health--and how to capture it

The hidden value of organizational health--and how to capture it

https://www.mckinsey.com/business-functions/organization/our-insights/the-hidden-value-of-organizational-health-and-how-to-capture-it

mckinsey.com

7

Key Ideas

Organizational Health

According to a decade long research, the health of an organization is based on alignment with a robust strategy, deep-rooted culture, and a clarity of vision.

The health of an organization can also be defined as the capacity or ability to deliver superior financial and operating performance.

Better Health = Better Performance

Extensive Data studies have found a link between the health of an organization and its performance.

Robust health is crucial to an organization's long term success.

The Four Organizational Recipes

Companies aligned with one of these four organizational recipes are more likely to be healthy and to deliver strong, sustained performance than those following random management styles:

  • Leader Driven
  • Market Focused
  • Execution Expertise
  • Talent and Knowledge-based

Leader Driven Organizations

Leader-driven organizations have the presence of great leaders, who are talented and are free to figure out ways to deliver results while being accountable for the same.

Leader-driven organizations have an open, trust-based culture, where creativity is valued.

Market-Focused Organizations

Market-focused organizations have a strong orientation towards competitors, business partners, and the community/marketplace.

They focus on where the innovation is, where the market trend is going, and like to stay ahead of the competition, making innovative products while ensuring the response is profitable.

Execution Edge

Organizations that follow the Execution Edge recipe focus on implementation, frontline execution, elimination of wastage of time and resources, and optimal utilization of data for efficiency.

They also use technology to foster better communication, last-mile delivery, and overall efficiency.

Talent and Knowledge Core

The talent and knowledge core recipe is generally found in professional service firms, in various sectors like sports, consultancies, and entertainment.

They have star performers, and high-quality talent (physical or knowledge-based) to differentiate themselves and be profitable with the branding.

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