Why companies are being forced to reshape to meet global business demands
Traditional business models are no longer relevant and companies are being forced to completely reimagine the way they work. That’s according to Deloitte’s fourth annual report, “Global Human Capital Trends 2016: The new organization, Different by design.”
“The really astounding finding is that companies are restructuring themselves away from the corporate hierarchy to be networks of teams,” said Josh Bersin, founder of Bersin by Deloitte. “Ninety-two percent of companies are in the middle of some form of restructuring. In fact, when you look at how companies are structured today, only one in four is set up with the traditional model of sales, marketing, product, and engineering. So companies are turning into networks of small teams of people that have to figure out how to work together, which is a totally different way of working.”
The change is being driven by a few factors, including a widening generational gap and rapid digitalization. Bersin says digital disruption is the biggest force behind companies restructuring to meet global business demands.
“We’re all connected to each other all the time, so the idea that in order to make a decision, we’re going to go up the hierarchy and ask a decision from an executive and come back down just doesn’t happen fast enough,” said Bersin. “So decisions are being made across the organization by connecting people together and sharing information much more quickly.”
While these changes are being seen across many sectors, the tech industry is the most affected, says Bersin. “Very few [tech] companies are functionally organized anymore.”
He notes that life sciences, health care, energy, financial services, and consumer goods are other sectors that have been forced to make changes.
The 2016 Global Human Capital Trends report is based on more than 7,000 responses to its survey in over 130 countries around the world.