CHAPTER 15Resource Fluidity Match Resources to Opportunities

Perhaps the most famous example of the platitude that generals always fight the last war is the Maginot Line. Influenced by the success of defensive tactics in World War I, French Minister of War André Maginot had a line of impressive fortifications and gun installations built along the country’s eastern border during the 1930s. Military experts hailed the work as genius. But, during World War II, with so much of France’s military power locked in place, the Nazis just sent tanks around the edge of the line and the Luftwaffe over it and reached Paris in no time.

Generals have learned the lessons from the Maginot Line and have developed ever more mobile capabilities, but businesses are still mostly fighting the same old battle because too many of their resources are locked in place.

One reason for the lack of flexibility is that businesses assign resources to business units, and it’s hard to ever get them back (possession being nine-tenths of the law). That control in the business units would be fine if the external environment would just stay as it is. But it doesn’t. In fact, the outside world is changing faster than ever, so whatever assignment of resources is made today soon will be out of phase with the market. Companies try to coordinate across business units to adapt to the changing environment, but the effort is complex and time-consuming and often doesn’t even work because the units guard their resources so ...

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