There is a painful paradox in trying to separately optimise every part of a firm

Firms work on the basis of the interaction between different people, or groups of people. No single person in an organisation can deliver business results without having to rely on another person. The same applies to interactions between processes and systems.

Firms thrive on interconnectivity, interaction and interoperability.

This is why running optimisation / efficiency / target setting exercises (typical management activities) on discreet parts of the organisation often spells doom. Most insidious if performance measurements are done on discreet basis as this creates silos, and functional / individual mercenaries.

The firm may have every part meeting its targets and expectations, but the whole organisation failing in its purpose and strategic objectives.

This Harvard Business Review article describes this paradox best: Optimizing Each Part of a Firm Doesn’t Optimize the Whole Firm

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