The Individualized Corporation

Sumantra Ghoshal and Christopher A. Bartlett’s The Individualized Corporation, published nearly three decades ago, was a compelling vision of a future where organizations transcend bureaucratic control to engage each employee’s unique potential. Returning to this book in the context of the modern business landscape—dominated by globalization, technology, and shifting work patterns—elicits deep reflection. The fundamental concepts of individualization—empowering individuals, fostering open communication, and developing leadership—remain incredibly relevant, even though the path to realizing the ideal has been complicated and multifaceted. Here, I address The Individualized Corporation’s prevailing themes, evaluating the timelessness of its observations while highlighting the current dilemmas organizations face in pursuing individualization. The general thesis of Ghoshal and Bartlett’s article—away from the “administrative man” towards the “resourceful individual”—resonates even more strongly today.

Traditional control-based and extrinsic motivation management theories are losing their applicability in a knowledge economy. The new generation of workers seeks purpose, autonomy, and an opportunity to learn, which aligns exactly with the authors’ theory of intrinsically motivated workers seeking to contribute their skills and competencies. To align with this shift, organizational structure, processes, and leadership styles must all change.

Such change must start at the top of the organization, among the three leadership functions that Ghoshal and Bartlett outline — the institutional, entrepreneurial, and developmental leaders. The institutional leader, responsible for articulating organizational purpose and values, remains essential. In a world of rapid change and uncertainty, institutional leaders must create a shared sense of identity and direction, so vital to fostering belonging and alignment. Leaders such as Percy Barnevik at ABB, who developed trust during large-scale restructuring, are testaments to the worth of this function. Yet, the context has shifted. Institutional leaders today must navigate a stakeholder landscape that includes shareholder value, social responsibility, environmental sustainability, and ethics. The entrepreneurial leader, emphasizing identifying and pursuing new opportunities, is possibly even more critical now than before. The acceleration of the rate of technological change and market disruption demands agility and openness to change.

Jan Timmer’s case at Philips highlights the importance of empowering business unit leaders to drive innovation. Today, entrepreneurial momentum must pervade the organization, building a culture of entrepreneurship where all employees are empowered to pursue new opportunities—an increasingly important source of competitive advantage. The developmental leader, however, represents the most demanding and longest-lasting challenge. Ghoshal and Bartlett emphasized that these leaders promote individual employee growth, playing the roles of coaches, mentors, and facilitators.

This role is the linchpin to unlocking the potential of the “resourceful individual.” Yet, over the past three decades, a discrepancy has emerged between the developmental leadership ideal and its practical implementation. While most companies claim to value employee development, few actually institutionalize it in their leadership practices. This transition from command and control to mentoring and coaching takes a profound mindset shift and new skill sets—a challenge many companies still face. Corporate culture is instrumental in enabling the individualized corporation. The authors’ comparison of Matsushita’s hierarchical culture with Honda’s decentralized approach remains a stark illustration. A culture that fosters individual initiative, open communication, and collaboration is the key to building the “resourceful individual.” But such a culture does not happen overnight. Deeply embedded hierarchies, fear of becoming vulnerable, and an absence of psychological safety often close down open communication and feedback.

Establishing trust and mutual accountability requires leaders to model the desired behaviors, actively solicit feedback, and create a safe environment for employees to share their thoughts and concerns. Internal communication (IC), the lifeline of the individualized corporation, has been transformed by technological change. While the authors’ concept of a “communication architecture” remains valid, the requirements have undergone radical changes.

Today, businesses can access various communication tools, including email, instant messaging, video conferencing, and social media. However, simply having these tools available is not enough; deploying them effectively to promote meaningful interactions is the real challenge. A notable example from the past is ABB’s global communication networks. Modern organizations operate in a complex digital landscape, often prioritizing engagement and inclusiveness over efficiency. The issues that remain relevant since the publication of The Individualized Corporation highlight several ongoing themes. The dilemmas between organizational control and individual autonomy continue a fundamental tension. However crucial the empowerment of individuals is, organizations must ensure alignment with strategic goals and impose necessary coordination. This will require clear communication and a culture of accountability. Another challenge we still face is developing effective developmental leaders. Transitioning from a command-and-control style to a coaching and mentoring style requires significant investment in leadership development and training. More than acquiring new skills, this transition requires cultivating a mindset that views leadership as facilitating the development of people, rather than merely directing tasks.

The shift in work—with teleworking, the gig economy, and increasingly diverse workforces—poses new demands on the individualized corporation. Engaging a geographically dispersed workforce by providing equitable development opportunities demands new approaches. Traditional management practices must be completely reimagined.

Finally, alignment in a decentralized organization is a persistent challenge. Decentralizing decision-making and empowering individuals can lead to coordination issues and diffused efforts. Alignment requires good communication, which conveys a clear vision and underscores the organization’s values.

In conclusion, the Individualized Corporation offered a powerful vision of the future of work. While the journey towards achieving this vision has been complex and multifaceted, the core principles of individualization remain profoundly relevant. As I reflect on the past three decades, which have spanned the course of my career in organizations, I see both progress and persistent challenges. Organizations have made strides in empowering individuals and fostering more open communication. However, the development of effective leaders, the creation of truly trusting cultures, and adapting to the changing nature of work remain ongoing challenges. The quest for individualization is not a destination but a continuous journey, requiring ongoing reflection, adaptation, and a sustained commitment from leadership to create organizations where individuals can truly flourish and contribute their best work. The insights provided by Ghoshal and Bartlett continue to serve as a valuable guide in this ongoing pursuit.

Disclaimer: The ideation and outline creation for this essay were supported by Google’s Gemini platform. The cover image was generated with Leonardo AI. All opinions expressed or implied are solely my own.