By Dr. Ben Gilad, ACI Faculty
A recent working paper by the Harvard Business School revisited the FBI’s reorganization efforts post 9/11. A summary of this case can be found at Forbes(search under Harvard Working Knowledge, “How the FBI reinvented itself”).
The remarkable discovery from this paper is that the FBI under Mueller has been smarter, more strategic and more effective in its transformation than most Fortune 500 firms with which I have worked. Think about it: When the Fortunate reorganize, they hire the Big Consulting, pay them millions upon millions to show up with the MBA teams and smooth 200 slides shows, and end up with such disarray, the next CEO is likely to reorganize the reorganization (think HP, Kraft, Novartis, AOL, Sears/Kmart, and so many other restructuring blunders, they are too many to count…)
Yet the FBI, in a relatively short time, without the “help” of the Big Consultants completely transformed itself from a crime investigation bureau to a national security agency. While many countries separate national security from crime investigations, the FBI deliberately decided to keep them together under one roof.
How did the FBI do it and what can the Fortune 500 management learn from it?
One sentence- now that’s strategic identity
Mueller did it with one sentence. He redefined who the FBI was by pushing, relentlessly, and against field resistance and old guard’s skepticism, the new identity as:
“Intelligence-led, threat-based national security agency.”
Think about it: From a completely different focus on crime solving, the FBI’s CEO succeeded in transforming the huge organization by putting intelligence first.
This is the equivalent of Pharma transforming itself from insular research-based gamblers to a strategic healthcare player, or software companies transforming themselves from sales-driven, short-sighted operations to strategic marketers.
I have never thought the day will come where I say: maybe business can learn from government? And for the most part I still have no reasons to say it. But the parallels between what the FBI went through during this transformation phase and how the “CI revolution” played out in Corporate is too striking not to at least try and learn some things.
Mueller hired an outsider and established a new Directorate of Intelligence. This executive made several organizational design changes. He placed the new analysts in field offices, not at headquarters, in units called FIG (Field Intelligence Group). There was no standard operating procedure, so some analysts conducted high-end strategic analysis while others supported tactical needs of the field agents such as “analyzing the telephone calling patterns of suspects”.
Sounds familiar? Many corporations throw their CI people in business units and each BU decides how to use them. The prevalent mode: they do everything, from strategic analysis to being tactical errand boys (or girls).
The result? Here is the Harvard people’s conclusion: “The FIGs’ tasks were unclear. Analysts struggled to establish credibility within the FBI, and their career paths were not defined. Formal organizational arrangements, especially role definitions and metrics for intelligence success, were vague. Analysts were viewed as second-class citizens, some reporting they were told to fetch coffee for agents.”
The transformation started in earnest only when a new standard model of the FIG was put in place, integrating national security and law enforcement at a lower level of the organization. Intelligence-related practices were integrated into strategy maps (what Leonard Fuld teaches at the Academy– click on the video clip).
In companies, creating a true CI capability doesn’t start until it is fully integrated into market-facing units such as business development, marketing, customer insights, planning, and R&D, at the BU level.
What metrics can apply to intelligence? As the FBI realized, “It’s an art, not a science”.
Unlike many companies that foolishly substitute production matrices (how many reports, how many management questions were answered, how satisfied the customers were with the product), the FBI instead started a series of strategy performance sessions where Mueller reviewed the leadership teams of several field offices’ attention to threats in their domain, plans to fill intelligence gaps, and resource allocation choices. In other words, the CEO himself measured the use of intelligence, not the product!
This is several magnitudes more advanced than 99.99% of the CI functions out there in the Fortune 500!
Do you have such commitment from your CEO?
In contrast to law enforcement, the new identity called for a Bureau in which recognition was given not only to field agents but also to desk-bound analysts. Intelligence personnel had to be patient, expecting little closure or acclaim. An intelligence analyst was likely to have a graduate degree in a field requiring critical thinking rather than experience as a police officer.
Eerie. Think line managers and competitive intelligence analysts. For a long time corporate appointed information specialists (basically “search technicians”) and called them “CI professionals”. Only in recent years, with the expansion of the CIP, we see companies focus on critical thinking skills as the main job requirement. And still, I have to fight at times with management whose idea of CI is “inquiry desk.”
Says one FBI executive: “The new field intelligence model challenges us to begin a new way of thinking about ourselves….This is not the job of one “side of the house,” but of the entire Bureau.”
Now this is the way I teach my managers to approach CI in their company. It is not just “good to know” distribution of “competitor minutia” by low level information professionals. It is the new way of thinking about who the company is, what’s its direction, and where lie the strategic threats and the breakthrough opportunities. With successful large companies this continuous self-examination inevitably breaks down over time. Many of these companies are ossified. By the time they call me to help with a war game, you can see the market changes creeping up on them.
It’s the job of top management in every commercial company to create and sustain an identity and a culture of intelligence-led, market based enterprise.
Until the Fortune 500 CEOs get it, they’ll continue to reorganize and re-reorganize in vain trying to make their companies great again..