For the good of society – [inlinetweet prefix=”@mgriffin_uk” tweeter=”@mgriffin_uk” suffix=”null”]18 leadership lessons from organised crime[/inlinetweet]
Preface
In Part 1, “Ambition” we set the scene.
According to Interpol, the UN and WTO the organised crime industry is one of the worlds largest with quantifiable revenues of at least $3 Trillion per year and despite trillions of dollars worth of investment to counter act their growth the industry is growing faster than ever leaving a trail of devastation in its wake.
In a world first we reveal how Syndicates, some of whose annual revenues top $200 Billion use influence, resources, technology and vision to build global empires and translate it into a business language that philanthropists can use to build prosperous companies that can help repair some of the societal damage by creating new jobs, simplifying international expansion, building engaged workforces and creating new, selfless collaborative cultures.
During our investigation we uncovered 18 categories, to read them just click on the link below:
- Ambition
- Customer Service
- Bribery and Corruption
- Devolved decision making
- External Problem Resolution
- Internal Problem Resolution
- Local Touch
- The Lean Team
- Consistency
- Loyalty
- Perks
- Disruptive Innovation
- The Flight to Favourable Jurisdictions
- React to Real Time Events
- Process as the Enemy
- Spying on the Competition
- Emigres Clusters
- Trust, Faith and Openness
(4) Devolved decision making
What this means to the Shadow Industry
In the past syndicates were ruthlessly managed and orchestrated from a single location and geography. Executive orders were followed without question and if there was a question then that became a problem and problems had a way of disappearing…
Syndicates however were among some of the first organisations to embrace the opportunities that globalization presented and since the early 2000’s we have witnessed a transformation in the way that the transnational syndicates make decisions. They have modernized and flattened their organisational structures and devolved every day decision making to in country and empowered individual groups and cells by giving them complete autonomy while still expecting them to operate beneath the syndicates Codes of Conduct and Vision Statements – not that either of these specifically exist on paper of course… Not only has this strategy removed some of the command and control links, making it harder for security organisations to dismantle the syndicates, which in itself removes some of the competitive pressure and frees up resources within the organisation but the downstream effects include dramatically improved productivity, organisational agility, service localization and an improved ability to execute and experiment with new directions. Together these factors have combined to propel the Shadow Industry to new revenue highs.
What this means to legitimate industries
While the Street might like organisations that are predictable and stable it’s often these two traits that are responsible for those same organisations eventual stagnation and death. Your competitor’s ability to predict your next move makes it easier for them to defeat and out manoeuver you in your core markets and the longer your organisation resists changing the deeper and more lasting the damage is going to be.
In a world where increasing Shareholder Returns and Earnings Per Share continue to dominate the board agenda and influence policy making ironically it’s often the market leaders who are most at risk of losing their competitive edge. Not only do these organisations not see the need to – or have the desire to transform but they are more often than not the happiest with the Status Quo, meanwhile their staid corporate culture is often reinforced by the organisations need to produce stable, consistent returns for their shareholders which all too often translates into adopting low risk, low cost strategies. Over the past five years countless Blue Chip organisations have fallen into this trap and while there are too many to mention the notable examples include Blackberry, Dell, HP, Kodak, Microsoft and Nokia.
Traditional organisations that implement devolved decision making successfully do much more than just regionalize their key decision making capabilities and increase their agility they transform their business model – from a Centralized one to a Regional one but even as these organisations transform they face new threats from the next generation of billion dollar startups such as Uber, Hailo and Airbnb who are leveraging the power of the internet to create the next generation of disruptive Peer to Peer business models.
While there are challenges associated with each type of business model the final two are more autonomous and have two profound benefits – implemented, resourced and focused correctly they can dramatically reduce the likelihood of your organisation being disrupted by your competition and similarly they can be the launch pad that you use to disrupt your own competition.
Takeaway
The world is changing faster now than at any point in its history but the type, mechanism and velocity of change varies region by region, as a result leadership teams in one country should avoid forcing wrong fit strategies onto leadership teams in other countries.
The key takeaways are:
- Work to understand how regional variations can benefit your overall business
- Implement a universal Governance and Code of Conduct Framework
- Give your regional territories a high degree of autonomy
- Evolve your business model for competitive advantage
