Review of “The Critical Path to Corporate Renewal”

chillibreeze writer — Anita Arun

Around the time that Peter Senge talked of learning organizations in the early 1990s, authors Michael Beer, Russell Eisenstat and Bert Spector illustrated the critical path to corporate “revitalization”. It was an era of dynamic economies and new business challenges and for the very first time, the realization was setting in that change was here to stay. Organizational change theories that emerged in response to these changing external environments focused on developing adaptive internal capabilities. “The Critical path to Corporate Renewal” is no different in this philosophy. Where the book differs is in the “Task Alignment” approach that Beer, Eisenstat and Spector choose to advocate.

Born out of extensive research over a period of three to five years and supported by the Harvard Business School, the book is an attempt to look at Organizational Change from a line manager’s perspective. This is emphasized by the way the authors choose to define “revitalization” itself. Successful revitalization according to the authors is the perceived positive impact of change efforts on the way the organization is managed.

A study of change efforts in six companies based on a standardized questionnaire reveal the revitalizations ‘leaders’ like General Products and ‘laggards’ like U.S. Financial and Continental Glass. Favorable financial performance is assumed to result from successful revitalization, although there has been no attempt to study this link.

If you are overwhelmed with jargon already, rest assured that there aren’t any more. After the initial pages, one gets accustomed to the academic language and case-like approach. The concepts of the book are explained in lucid language and are interspersed with uncomplicated narration of stories from the six companies that the authors studied.

The steps in the critical path, creating a suitable climate for renewal as well as possible challenges in revitalization provide a handy guide to any organizational change enthusiast, and more importantly to senior management looking to lead a change effort.

What makes the book stand apart is the concept of “task alignment” – an ad hoc structure created around critical tasks to be performed, as opposed to an organization redesign in terms of formal roles and responsibilities. Beer, Eisenstat and Spector propound a “redefinition of work roles, responsibilities and relationships within a unit” in order to enhance the coordination required for completion of critical tasks, the tasks that significantly influence organizational success. Two cases serve to bring clarity to the concept, one of which is the ad hoc structure of a quality committee in General Products’ technical center.

Task alignment asserts that meaningful work related interactions among employees can effect change in knowledge and attitudes of the employees engaged in such interaction. This is a shift from the common belief that our knowledge and attitudes shape the way we relate with our colleagues.

The authors unhesitatingly critique the organizational development approach of introducing isolated human resource programs like reorganization, quality circles, new pay programs or management training. These have been described as “false starts” to organizational change as they most often do not tie in together in purpose and implementation.

The organizational revitalization approach also focuses on small manageable units within the organization. These units become the first to witness successful revitalization, thereby serving as models of change for the other units. Experiences from the six companies explain how quality of leadership and effectiveness of unit level line managers are key to successful revitalization. The example of Continental Glass particularly illustrates how lack of top management commitment can lead to a failed revitalization effort.

However, “The Critical Path to Corporate Renewal” might be overwhelming to an organizational change leader. By the end of the book it appears that successful revitalization of an organization hinges on too many factors. Like all theories emanating from social research, this theory too necessitates a delicate balance between divergent choices. The book does engage the reader in a discussion of such divergent choices facing organizations, some of which are – cost reduction pressures vs. long term investment in human resources, hard vs. soft approach in management style, and balancing concern for task and concern for people.

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