Our mental models for how we comprehend the world of business matter. They shape how we think and what is possible. Yet, some core ideas overstay their welcome. The “go-to” corporate model for how companies have managed their workforce – the corporate ladder –has overstayed its welcome and is fast becoming an artifact, as the world, and how we work has evolved.
"The Corporate Lattice: Achieving High Performance in the Changing World of Work," published last year by Deloitte’s Cathy Benko and Molly Anderson, chronicles the changing world of work and introduces the corporate lattice, the corporate ladder’s successor.
Unlike the linear ladder, the multi-dimensional lattice is more adaptive and, as such, a better fit with the changing norms, needs, and expectations of today’s workplace and workers. The lattice unlocks economic value by creating more connected and more virtual workplaces. It engenders the flow of ideas, development, and recognition along horizontal, vertical, and diagonal paths, which enables more collaborative and customized ways to structure work, build careers, and foster participation.
The workplace isn’t what it used to be. Organizations are flatter. Knowledge and service work dominate. The workforce is more diverse – gender, generation, culture, background, experience – than ever before. And, technological advances and economic trends mean work can be and is increasingly virtual, globally dispersed and team-based.
While technology is a critical enabler, mindset, management practices, and culture are equally important. Lattice organizations support rewarding professional experiences and better career-life fit for employees, and greater agility and higher performance for their organizations.
The lattice applies in what Benko and Anderson refer to as the three lattice ways.
Ways to build careers. Keeping pace with the rapid rate of change and the skills needed to succeed requires agility, and continual focus on growth and development. Today’s flatter organizations provide fewer options for developing people “up” the ladder. Lattice organizations broaden career paths multi-directionally, enhancing employee development opportunities, versatility, and strategic flexibility. This helps employees keep their skills relevant in a fast-changing marketplace – a key to job security – and provides expanded career options for better career-life fit.
Ways work is done. Work has transformed from a place you go to something you do in a dynamic, increasingly virtual workplace. Technology enables new possibilities for the where, when, and how of work. Globalization, virtualization, modular job and process designs, and team-based project work, among other workplace advances, leverage technologies in innovative ways. The significant benefits of virtual work include lower real estate costs, greater workforce productivity and retention, shorter cycle times, improved business continuity, and a “greener” footprint. Individuals gain with increased flexibility and more choices for how they do their work.
Ways to participate. Unleashed from top-down hierarchy, lattice organizations function as networks... They share information transparently, create communities, and provide more collaborative, inclusive, and meaningful options for employees to contribute -- regardless of their organizational level. These new ways of fostering participation enable organizations to effectively address the rise of non-routine and project-based work, which require greater collaboration. Lattice organizations find ways of working across the invisible borders of geography, hierarchy, and function.
The shift from ladder to lattice is already happening. One example is Thomson Reuters’ transformation of the decentralized finance functions of its more than 40 portfolio companies. “FinancePlus” transitioned work from individuals to global shared service centers. In the redesigned organization, the typical manager has 40% of direct reports who work in another country. This approach is enabled by a focus on results over face time and training in virtual work practices. High potential leaders are now developed by moving across the finance organization, as well as up.
Communications are more transparent, interactive, and productive. For example, teams working on suggestions from an employee “pain points portal” significantly improved the monthly close process over several months. This effort has yielded approximately $50 million in annual savings to date, helped business leaders make better decisions with improved forecasting and planning, and improved employee engagement.
While examples of lattice applications are prevalent, many are ad hoc and uncoordinated, an indication that external technology and demographic trends have prompted changes that have gotten ahead of corporate policies, many of which remain constrained by outmoded ladder norms and practices.
Taking action on all three lattice ways and connecting them to each other transforms the multitude of incremental, disconnected company activities and investments into a comprehensive and strategic response to the technological, demographic, and economic trends changing the workplace. This coordinated response benefits the organization and its employees by providing greater flexibility, increased communication, a sense of community, and opportunities for cost savings, all while better managing risk.
From the perspective of finance leaders and practitioners, there is clear upside in embracing the corporate lattice, and moving beyond the ladder and linear approaches. The lattice is critical to how finance careers and people are developed (think zig zag, not straight up), how work in the finance function is organized (think teams and networks, not just roles and divisions), and how finance practitioners participate in a growing array of new initiatives (think task forces, social media communities).
Whether using these lattice ways to advance your division, company, or career, the power of the lattice is amplified by the compounding effect that occurs when all three lattice ways reinforce one another to improve productivity, innovation, and the ability to build careers and to develop, retain, and engage appropriate talent.
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Jeff Schwartz is a principal with Deloitte Consulting LLP's Human Capital practice. Jeff is the co-leader of Human Capital’s global talent initiative and the U.S. leader for all client talent services and solutions.