Only two years ago, due to some chance, I saw some scenes, and my mind changed.

Scene 1 was at a meeting. Students from HE Tuber the business line stood up and angrily accused the "backpackers" sent by the R&D department. They were "in Cao camp and in Han Dynasty" and did not understand the needs of the business at all.

Scene 2 was also a meeting. The business boss spoke eloquently and even said he was excited. However, there was also the boss responsible for growth sitting at the conference table. He was almost unmoved throughout the whole process.

At that time, I felt that China and Taiwan might not work very well.

Sure enough, starting in 2023, those companies that took the lead in building the middle platform suddenly began to dismantle the middle platform. Now, I am afraid that some companies that have learned to build a middle platform are still in a mess, wondering whether they should continue to do so.

Let me tell you, in fact, everyone did not understand the meaning of Zhongtai from the beginning. This organizational form is not originally designed to improve efficiency. It is the power structure that enterprises need at a special stage.

First of all, the middle platform cannot reduce costs and increase efficiency for enterprises.

Although it is theoretically possible, in ecological enterprises, merging the same functional departments in different business lines with similar items does seem to avoid reinventing the wheel. For example, the same group of R&D personnel can perform development work for business lines at different stages, or departments that spend money such as growth and marketing public relations can concentrate their budgets and put them in a unified way to obtain lower prices.

But for companies in a fully competitive market, the efficiency shortcomings of the middle office are obvious, because it will cause the decision-making chain to be not only too long, but also complicated. Ultimately, people who hear the sound of artillery fire may not be able to call for fire support, or artillery fire cannot be deployed in time at critical moments of competition.

To give a simple example, in many companies, the growth department often gets a very large budget. But when the growth department is taken out and becomes a middle-office organization, one department will actually be responsible for the growth of multiple business lines. At this time, the first task of the growth department becomes to share the cake.

How much money should be spent on each business line and how to formulate a growth strategy are very technical tasks for the boss of the growth department.

Of course, the business boss hopes to give him as much support as possible. In fact, for the business, the most efficient way is to integrate all functions into one reporting line. Everyone in this chain is doing When making decisions, only one factor needs to be considered, which is whether it is beneficial to the business line. But if some functions are withdrawn, another situation will arise - an increase in internal transaction costs, because everyone no longer sits on the same bench.

So the business boss will go and communicate with the growth boss. But the reality is that there is no reporting relationship between them, and there is no question of who listens to whom. Everything has to be discussed, or decided by higher-level people on the reporting line.

Over the years, everyone has always discussed what good management is. In the final analysis, management that is in line with human nature is good management. And what is human nature? Individualism is part of human nature. Why so many companies have trust and cooperation as their values? In essence, it’s because in a huge organization, trust and cooperation are very difficult, and they need to be shouted at all the time, every month, in order to penetrate into the blood of the organization. 

Personally, I have doubts about many fashionable concepts and tools, including middle-office organizations and OKR. The concept of OKR sounds very good. Through top-down decomposition, a company can all aim at the goals of the top decision-makers, forming a pyramid structure in which strategy and execution are aligned.

If executed well, OKR can theoretically ensure a company's strategic focus and create synergy. However, realizing this scenario requires a prerequisite, that is, the top decision-maker will expose his true inner goals. This alone will probably stump 90% of Chinese bosses.

Because there is a deep shadow of Wang Yangming in Chinese business culture. Wang Yangming talked about the inner sage and the outer king, which means that the inner and outer parts of a person do not have to be unified. Of course, many bosses are actually the inner king and the outer sage. So which one should show the king's side or the saint's side? you guess.

The same goes for the middle office. When you think it requires execution efficiency from the organization, the result is not always the case because it puts people in different positions. But if the top level wants decision-making efficiency from the organization, then the middle office is a good choice.

Because the middle platform can help power achieve penetration.

If you pay a little more attention, you will find that the establishment of middle-level organizations often coincides with the transfer of power in the company.

Take JD for example. In 2018, Liu Qiangdong phased out of the business. He needed to give more authority to the management of the three major business lines at the time.

Especially for Jingdong Retail Group, Xu Lei was picked to become the CEO of this business unit that accounted for 95% of the group's revenue. As a professional manager, it should be said that there is a lot of pressure to become the successor of a company founder. In an interview a few years ago, Xu Lei told me that in the five months after he was promoted to the rotating CEO of JD, he did not issue any policy guidelines or administrative orders. "Although I know all the problems," he spent more time observing.