How Winning Competitors Organize

Leading companies share certain organizational characteristics, according to the Hay Group which surveys over 4,000 executives about 1,400 firms every year in partnership with Fortune Magazine to create a list of the World’s Most Admired Companies (WMAC). In 2009, Hay’s research included questions on the how the WMACs were organized compared to their less admired peers.

Three characteristics emerged:

WMACs Have Significantly More Robust Operating Models

"’If the organization structure describes how the company is supposed to work, the operating model is the wiring that makes sure that the work gets done as expected,’" explains [project manager Katie] Lemaire,. For example, WMACs have more dynamic operating models that allow them to operate differently in high growth markets than in developed markets without changing the organization design. This creates a unique competitive advantage that is hard to replicate.”

WMACs Support their Leaders More Effectively

“WMACs do more to enable their leaders to be effective. They provide the tools and better equip their leaders to work in this more cross-functional, horizontal way. "’Why else would 83 percent of MAC executives feel that they manage the matrix organization effectively, compared to only 58 percent of the peer group?’ says Hay Group's David Tait, who also worked on the research.”

WMACs Retain Winning Strategies Longer

“WMACs change their strategies less often, which enables them to build out and refine the organizations that they have, rather than continuously change them. Like a tree with a strong trunk that supports flexible limbs, the world's most admired companies are simultaneously solid and supple, with a strategy that provides firm roots and a dynamic operating model that enables them to weather strong storms.”

These are high level characteristics, but could be better defined with best practices research. Think about how your organization ranks on these three issues vs. your key competitors. Investigate if your rivals have any best practices that you can adopt to move closer to these ideals.