{"id":124716,"date":"2024-03-09T13:31:00","date_gmt":"2024-03-09T17:31:00","guid":{"rendered":"https:\/\/www.shortform.com\/blog\/?p=124716"},"modified":"2024-03-22T13:32:08","modified_gmt":"2024-03-22T17:32:08","slug":"what-is-a-business-operating-system","status":"publish","type":"post","link":"https:\/\/www.shortform.com\/blog\/what-is-a-business-operating-system\/","title":{"rendered":"What Is a Business Operating System? A Company&#8217;s Outline"},"content":{"rendered":"\n<p>What is a business operating system? How does accountability improve a company?<\/p>\n\n\n\n<p>Claire Hughes Johnson notes that your operating system\u2014the set of underlying norms that outline how your company functions\u2014allows your company to function effectively. She discusses three subsystems that are essential to your operating system: constructing strategy, ensuring accountability, and fostering communication.<\/p>\n\n\n\n<p>Here&#8217;s more on the three subsystems of a business operating system.<\/p>\n\n\n\n<!--more-->\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-subsystem-1-strategy\">Subsystem #1: Strategy<\/h2>\n\n\n\n<p>What is a business operating system&#8217;s first subsystem? First, Hughes Johnson explains that <strong>companies need a dedicated system for determining their strategy<\/strong> because they\u2019re liable to run amok without such a system. At its core, a company\u2019s strategy involves decisions about where to allocate resources (especially people and money) by deciding which potential sources of growth deserve more or less focus.&nbsp;<\/p>\n\n\n\n<p>To make these decisions, Hughes Johnson advises company leaders to reflect on their financial status and goals for the next year. Then, leaders should make projections about the potential costs and returns of different projects to decide how many employees, and how much money, to allocate to any given project. For example, if Meta expected its virtual reality platform to generate 10% of the company\u2019s revenue, it might not be strategically prudent to allocate more than 10% of its total budget to the virtual-reality team.<\/p>\n\n\n\n<p>(Shortform note: In <a href=\"https:\/\/shortform.com\/app\/book\/the-infinite-game\" target=\"_blank\" rel=\"noreferrer noopener\"><em>The Infinite Game<\/em><\/a>, <a href=\"https:\/\/www.shortform.com\/blog\/simon-sinek-biography\/\">Simon Sinek<\/a> offers higher-level advice for those creating a company strategy. He argues that <a href=\"https:\/\/shortform.com\/app\/book\/the-infinite-game\/introduction-to-finite-and-infinite-games#business-is-an-infinite-game\" target=\"_blank\" rel=\"noreferrer noopener\">executives should treat business as an <em>infinite game<\/em><\/a>\u2014one with no fixed rules and no endpoint, like politics\u2014rather than a <em>finite game<\/em>, which has rules and a fixed endpoint, like chess. Executives who conceive of business as an infinite game, he argues, are more likely to make decisions that keep their companies afloat in the long term (even if that means accepting financial risks in order to <a href=\"https:\/\/shortform.com\/app\/book\/the-infinite-game\/guideline-4#pivoting-lets-you-blow-up-your-company-before-someone-else-does\" target=\"_blank\" rel=\"noreferrer noopener\">proactively pivot the business<\/a>), whereas those who treat business as a finite game are more likely to make short-sighted decisions that are only helpful in the short term.)<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-subsystem-2-accountability\">Subsystem #2: Accountability<\/h2>\n\n\n\n<p>To best implement your strategic plans, Hughes Johnson points out that <strong>you need clear accountability standards that identify who\u2019s responsible for which aspects of a project<\/strong>; otherwise, task assignments won\u2019t be clear, leading to shoddy execution. For instance, if Google\u2019s self-driving car team didn\u2019t clearly delineate who was responsible for which aspects of the project (such as the software, the lane assist, and the steering), the team would be in disarray.<\/p>\n\n\n\n<p>(Shortform note: Clearly assigning responsibilities within a project can create a strong hierarchy and boost accountability. However, some experts warn that <a href=\"https:\/\/www.indeed.com\/career-advice\/career-development\/hierarchical-structure-definition-and-examples\" target=\"_blank\" rel=\"noreferrer noopener\">strict hierarchies can create problems<\/a> when there\u2019s not enough communication between subteams. For example, if Google\u2019s lane assist team members talked only to their manager and not to members of other teams, features that require cross-team coordination\u2014such as the use of lane assist <em>and<\/em> automatic steering to keep the car in its lane\u2014may be slower to develop.)<\/p>\n\n\n\n<p>Further, to retain strong accountability throughout the course of a project, Hughes Johnson recommends that you <strong>meet with your team each week to review progress<\/strong>. She explains that such meetings are pivotal for keeping team members in the loop, as well as affording the team a chance to re-evaluate their approach if the project is proving unsuccessful.&nbsp;<\/p>\n\n\n\n<p>(Shortform note: Business experts offer a <a href=\"https:\/\/www.forbes.com\/sites\/theyec\/2021\/08\/02\/10-tips-to-make-weekly-meetings-useful-for-your-whole-team\/?sh=7f6bab085d75\" target=\"_blank\" rel=\"noreferrer noopener\">wide array of tips<\/a> for optimizing the effectiveness of these weekly check-in meetings. For example, they recommend keeping the meetings concise and targeted because employees\u2019 time is valuable. They also suggest helping employees prepare for the meeting by clarifying the specific items that employees need to report on ahead of time.)&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-subsystem-3-communication\">Subsystem #3: Communication<\/h2>\n\n\n\n<p>Just as team meetings keep members on the same page,<strong> company-wide forms of communication keep your entire company up to date on key developments<\/strong>. Hughes Johnson explains that by creating clear lines of communication, you can cultivate trust from your employees because they won\u2019t fear missing out on important information. And although she acknowledges that every company has different communicative needs, she asserts that candid, easily accessible information is essential to every organization.<\/p>\n\n\n\n<p>(Shortform note: Although Hughes Johnson offers general advice for communicating with your team, she doesn\u2019t discuss specific mediums of communication. Business experts point out that different modes of communication\u2014such as <a href=\"https:\/\/www.forbes.com\/sites\/forbesbusinesscouncil\/2022\/08\/25\/five-ways-to-communicate-in-business\/?sh=6283bb7051ab\" target=\"_blank\" rel=\"noreferrer noopener\">face-to-face, email, or instant message<\/a>\u2014are appropriate in different settings. For example, because most employees\u2019 email inboxes are swamped, it can be better to communicate via a direct message platform if you need an immediate reply. Additionally, face-to-face communication is preferable for conveying crucial information when it\u2019s important to avoid any ambiguity.)<\/p>\n","protected":false},"excerpt":{"rendered":"<p>What is a business operating system? How does accountability improve a company? Claire Hughes Johnson notes that your operating system\u2014the set of underlying norms that outline how your company functions\u2014allows your company to function effectively. She discusses three subsystems that are essential to your operating system: constructing strategy, ensuring accountability, and fostering communication. Here&#8217;s more on the three subsystems of a business operating system.<\/p>\n","protected":false},"author":14,"featured_media":124717,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[45,14,30],"tags":[1427],"class_list":["post-124716","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","category-management","category-work","tag-scaling-people","","tg-column-two"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v24.3 (Yoast SEO v24.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>What Is a Business Operating System? 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