A technical framework for sense-and-respond business management
Author: IBM Systems Journal

An on demand enterprise is able to adapt to a rapidly changing business environment. When faced with intense competition and changing customer preferences, this type of enterprise can preserve or extend its competitive advantage. In order to make timely, well-informed decisions its executives must have a window into the operational health of the business and suitable decision-support tools.

The sense-and-respond organization

Haeckel suggests that when customers' needs change faster than the company's ability to respond to them, the company must re-engineer itself to become a sense-and-respond tSaR) organization. (1) The same conclusion would be drawn if the company's product life cycle lagged behind that of its competitors. In Haeckel's view, the organizational hierarchy should be replaced by a dynamically configured network of modular capabilities. He defines capability as an organizational subsystem whose governance is based on context and coordination by people in roles accountable for outcomes rather than by command and control. The process of re-engineering the organization can be summarized as follows:

* Set the context--Identify your stakeholders (customers, investors, suppliers, employees) and define your goals with respect to each of them. This represents your company's reason for being. Define the five to ten principles your employees need to follow in order to ensure the continued existence of the organization in that form.