Building Organizational Fitness: Results and Implications

What were the effects on SRSD's performance? In the first year alone sales doubled and profitability quadrupled. SRSD continued to employ OFP as a core strategic management process over the next five years. During that period organizational effectiveness and performance increased steadily. Five years after OFP was introduced, the CEO of the company stated that the division had progressed from the worst to one of the best in the company.^[32] Employees saw it as a listening division in which the leadership team was now exerting effective strategic direction of the business. Moreover, members of the senior team and task force saw the experience of going through OFP as a powerful management and leadership development experience.

Research on the application of OFP in over a dozen organizations has shown that a disciplined process like OFP can produce an honest organizational conversation that reveals the unvarnished truth about the organization's fit with its business environment and its fitness to adapt. The discipline of the process helps general managers embrace the paradox inherent to building fit and fitness. The analytic frameworks embedded in OFP have produced dramatic changes in organizational design, leadership, and performance in a variety of corporate settings and national cultures.

I began this chapter by presenting evidence that corporations and their leaders fail to adapt, endangering their performance and even survival. Our program of action research, using Organizational Fitness Profiling, has shown that sustaining high performance depends heavily on the willingness of top managers to confront the fit of their organization with the demands of the competitive environment and the fit of their assumptions and leadership behavior with the needs of the organization. Managers, like those at the Santa Rosa Systems Division of Hewlett-Packard, who are willing to confront the unvarnished truth can evolve their organization and management systems to changing circumstance. But it requires humility and courage. We have, however, met just as many managers who prefer to avoid the truth about their business, organization, and leadership behavior. Courage to learn seems to be what limits organizational fitness.

Given that not all managers are ready to embrace the truth and learn, what might firms do that want to develop the organizational fitness required in the 21st century? A strong case can be made for institutionalizing a strategic change process like OFP in corporations so that CEOs and business unit managers can be held accountable for continuous learning about the fit and fitness of their organization and leadership. Candid review by the CEO with the board of directors and by business unit managers with the CEO about what they have learned about their organization, their top team, and themselves would develop a corporate learning culture that embraces paradox. It would create accountability for fit and fitness—the crucial ingredients for sustained corporate performance and survival.