In his book The Future of Management, Gary Hamel poses the significant question on the existing management practices which have gone unquestioned before. Most of the modern management models were stemmed from the industrialization of the late 19th and early 20th century. In that time, they were highly efficient management methods in dividing up employees’ tasks and responsibilities, building up hierarchies along with rules and regulations. These practices led to high productivity. However, since the change has accelerated over the past few decades, organizations which hold to the past practices have failed to keep the pace with the times.
It all begins with management innovation.
Hamel argues the importance of management innovations to overcome the unprecedented challenges of the world where corporate based on existing management now recognizing themselves competing with new- innovative companies ; a world where the immergence of the internet and the digitalization of media have moved power from the producer to the customer; and a world where decrease price for communication and the globalization leads every company to confront with increased competition in the market.
Hierarchy of innovation
Hamel points out that companies can enjoy long-term competitive advantage only via the innovation of the management which is hardly imitated. This is the fully new way of managing, orienting, constructing and organizing staffs and groups. Such a way differs from operational development, which can be duplicated easily, or a development of new products or services, which can be commoditized. And a distinctive business model (strategy innovation) is more easily decoded and counteracted than a heretical management system (p.33)
Figure: the innovation stack
(http://www.emeraldinsight.com/content_images/fig/2610380301001.png) 1. Operational...