Ideally, all enterprises should carry out their daily work exceptionally well. When they succeed in the short term, they should also, to the fullest extent possible, observe their goals and strategies to pursue longer-term opportunities and conquer or avoid threats. Such behavior will require management vision and considerable resources, infrastructure, and dedicated personnel. It is often anticipated and expected that all employees —and in the aggregate, the enterprise itself—always will act effectively, and “do the right thing.” Everyone should make sense of challenges, find the best approaches to handle situations, anticipate outcomes, inform all concerned, implement decisions effectively, and so on. Unfortunately, few employees and enterprises, if any, live up to such expectations. Worse yet, only rarely is there an explicit and shared understanding among any of the enterprise’s employees—or managers—of what “acting effectively” might mean in practice, although most would agree that such behavior would be highly beneficial. It also is difficult to determine what is required to make behavior more effective.

Enterprises are complex, and it is hard to manage the intangible and less visible functions associated with human intellectual work and application of structural intellectual capital. The complexity may appear deceptively simple since the operational and structural functions can only be partially observed and understood, and it is tempting to focus only on what is readily apparent —what is directly observable. Nonetheless, the interplay of individual factors cannot be reduced to the study of separate elements. The interrelatedness requires that the systemic effects be considered to the greatest extent possible.

The effective enterprise can be described by many observable characteristics such as:

Philosophy, Leadership, and Strategy

1 The management and operating philosophy focus on creating environments and practices that promote the best possible performance.

2 Top and middle management act as leaders and provide behavioral examples and role models and practice governance with integrity, purpose, and consistency.

3 Rank-and-file employees are competent and effective leaders within their purviews.

4 Goals and strategies are realistic, reachable, and competitive. The whole enterprise works to implement them.

5 People at all levels share a common understanding of enterprise management and operating philosophy, purpose, strategy, and the general service paradigm.4

6 Employees, departments, business units, and the overall enterprise deliver the desired service paradigms.

Resources and Efficiency

1 The enterprise is well structured to allow its people, functions, and operations to implement strategy successfully.

2 The enterprise has adequate financial, physical, personal knowledge, and structural IC resources.

3 The enterprise utilizes its resources efficiently and minimizes waste in all forms.

Innovation, Quality, and Renewal

1 The enterprise and its employees constantly innovate, renew, and maintain personal knowledge, IC assets, and other resources.

2 Innovations and experiences are captured, communicated, and applied, and employees are recognized for their contributions.

3 Everybody is motivated to perform their work competently, with appropriate task knowledge and metaknowledge to tackle work and challenges naturally and with relative ease.

4 The enterprise regularly obtains outcome feedback on how well products and services perform —in the marketplace and within the enterprise —and uses these measures to monitor its performance.

5 People consistently act in a timely fashion, and delays are rare.

6 Employees consistently “close the loop” by communicating to the originators that messages or requests have been received, understood, and are being pursued.

7 To minimize the risks of acting on inappropriate assumptions, employees clarify assumptions before proceeding.

8 The enterprise creates, produces, and delivers superior products and services that match present and future market demands.

9 Individuals, teams, units, and the enterprise itself deal competently with unexpected events, opportunities, and threats.

Motivation and Engagement

1 Everybody understands what their role is in implementing enterprise strategy and why they personally benefit from making the strategy work.

2 Employees are noticeably motivated and engaged in their work.

3 Interpersonal work is performed through effective coordination, cooperation, and collaboration.

4 Undesirable personal or systems behaviors are controlled.