Fundamentals of Level Three Leadership

102. Background Factors

Concept

Every organization exists in a context that includes regulatory environment, labor markets, competition, macro and micro economic climates, political backdrop, and many other factors. When one begins to design or redesign an organization, one ignores these factors at their own risk.

Economic conditions will affect numerous elements of design including capital structure, borrowing capacity, investment opportunities, and much more.

Labor markets will affect the ability of the organization to find the kind of employees needed to populate the business.

Proximity to corporate headquarters will affect a plant’s ability to innovate new processes.²⁵

Awareness of the competitive environment in the company’s industry will ...