Fluid Dynamics

Fluid Dynamics

Enterprise dynamics fill a gap between strategy and tactics

Changing dynamics involves changing enterprise capabilities

Conventional management thinking evolved to handle a business environment of relatively predictable change and competition. During the past decade, though, this stability has been supplanted by accelerating change in business and technology, causing the traditional notions of strategy and tactics to be less effective. Management thinking is evolving again, adding a new dimension as executives learn to lead in an environment of constant change.

Enterprises compete in a changing environment by planning and executing their change plans. These plans, and the actions they cause, reflect three underlying principles:

  • Strategy has the potential to change everything all at one time.
  • Tactics concentrate on changing one thing in an operation at a time.
  • The sum of the tactics will realize the goals of the strategy.
In today's environment of accelerating change, these principles are increasingly seen as incomplete. Growing customer demands and complexity expose weaknesses in enterprise performance that neither strategy nor tactics can address. A new way of thinking is needed.

During the past few years, CIOs have been leading project initiatives that change the way their enterprises work. They look like enterprise dynamics projects. Changing dynamics involves changing enterprise capabilities.

An enterprise capability is the collection of results created by a set of business processes, workforce skills, rules, information and applications, and other technologies. A capability may encompass one or more organizations or operations. For example, "product delivery" can involve product development, management, and sales and customer service organizations. Business processes often provide shape to a capability, such as customer service or product development.

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