The First Road of Management
The first road, taught in most business schools, is largely top-down. A central function—CMO, CSO, CBO—defines strategy and innovation, often in a product-out logic, while regions and functions execute. Control, processes, and governance ensure alignment.
This model is increasingly under pressure. It struggles to integrate local specificities and, more importantly, ideas emerging from across the organization. Execution often meets resistance. This is why startups can disrupt established players so effectively, and why large corporations find it hard to adapt.
The Second Road of Management
The second road, often seen in Japan, is ultra-localised. Each function or region defines its own action plans—a bottom-up, multi-domestic approach.
It ignores a key reality: the world is becoming more global, with cross-border trends and shared expectations. The result is fragmentation—no clear global strategy, no shared priorities, and ultimately products and services that lack differentiation. Brand messages become inconsistent and weak. This helps explain why many Japanese companies, despite excellence in technology and manufacturing (“monozukuri”), have seen declining brand value and market share.
The Third Road of Management
The third road combines the strengths of both while avoiding their pitfalls.
Like the first road, it delivers a strong, clear strategy, with a distinctive brand direction and meaningful innovation.
But unlike the first road, this strategy is not imposed from the top. It is co-created across functions, regions, and businesses. Ideas are sourced from the field, where reality, customers, and opportunities are best understood.
Once a common direction is defined, each entity takes on a global role, leading specific projects or areas of expertise based on its recognized strengths. Rather than a centralized brain disconnected from reality, the organization operates as a network of centers of competence.
Execution is then left to each entity. Instead of heavy processes—plans, budgets, approvals, controls—it relies on trust. When people contribute to the strategy, they implement it with ownership, speed, and conviction.
This is what I call “freedom within a frame.”