When Steve Smith joined Zayo as CEO, he found himself at the head of a company that was a Frankenstein of 46 acquisitions. And while the company’s decentralized approach had served it well in the early years, Steve saw an opportunity to take the company further. This time — and almost paradoxically — through centralization.
Zayo is a communications infrastructure company that ensures its customers have the fiber bandwidth they need to achieve their missions. They are a respected team with a business model that’s not going out of style. But they hit a wall in their own development. Find out on this episode of Business X factors how Steve married their decentralized approach with a centralized one -- all while still empowering the innovation and creativity that defines the company.
Main takeaways:
- Have a Plan for Centralization: If you decide to centralize the processes of a business after acquisitions or mergers, slogans like “think global, act local” or “create a lean but activist center” may sound good, but they do not provide a recipe in all circumstances. The Boston Consulting Group has identified four principles to create a value-adding corporate center. It includes careful assessment of the situations in which the center genuinely adds value and those in which it does not. Emphasizing strategy over structure; letting the business drive the center — not vice versa — and BCG advises companies to be self-critical about central capabilities. Be prepared to revisit and revise choices when circumstances change.
- Listen, Learn, Lead: When the heat is on, rally the team or troops around a common mission or a change in strategy. Don’t scare employees into working harder with threats and blame — inspire them to do battle together to succeed. Anchor the organization by focusing on what people need to do differently and lead people into thinking how they can play a role. Encourage employees to speak frankly without finger-pointing, listen to ideas on how to better collaborate and innovate and be clear you are open to two-way conversations.
- See Around Corners: Risk assessment typically exposes only the most direct threats to a company while indirect ones are neglected. McKinsey has found that while it is not easy to anticipate how risk cascades through a company or economy; executives who systematically examine the way risks propagate across the whole value chain can foresee and prepare for second-order effects more successfully. Investigate competitors, supply chains, distribution channels, customer response and the full impact of a major risk on a company and think about how your risk cascades to gain insight into what is around the corner. ---
Business X factors is produced by Mission.org and brought to you by Hyland.
For over a decade, Hyland has been named a Leader in the Gartner Magic Quadrant for Content Services Platforms, leading the way to help people get the information they need when and where they need it. More than half of 2019 Fortune 100 companies rely on Hyland to help them create more meaningful connections with the people they serve. When your focus is on the people you serve, Hyland stands behind you. Hyland is your X factor for better performance. Go to Hyland.com/insights to learn more.