Some thoughts on organisational effectiveness/efficiency in a capital-constrained environment

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There’s a high likelihood of a global recession. There’s an increased cost of capital (i.e., it costs more to borrow money) which means it’s prudent to protect your cash position. Many companies are shifting to higher probability bets, slowing down headcount growth (or even laying people off), and emphasising organisational efficiency/effectiveness.

Some thoughts on all of this.

“Organizational effectiveness” should account for product life cycle stages

Every product capability goes through the product life cycle: market development → growth → maturity → decline. Each stage has both different measures of success and key activities and this should affect what is considered “organizational effectiveness”.

Organizational effectiveness in market development is efficiently running a lot of experiments to find promising opportunities.

Organizational effectiveness in growth and maturity is efficiently building, scaling, iterating, and exploiting capabilities in order to maximize business value.

Organizational effectiveness in decline or commodity / hygiene capabilities is reducing total cost of ownership.

Questions to ask

• Are any teams innovating on commodity…