0:02 Who are you and where are you going? What do you want? [Music] Hello and welcome to Business Lessons from the Military. I'm your host, Kevin Bemel, and I'm here every Tuesday morning at 10:00 a.m. Pacific time to talk about military history, doctrine, and the practices of great military leaders so that we can distill from them lessons that we can apply to our
0:38 businesses and professional practices. So today I'm going to be talking about um Napoleon Bonapart's core organization. core as in COPS, Army Corps organization and how this applies and makes the case for crossf functional business units which which allows our businesses to run uh more effectively, more efficiently uh and and um and gives us the opportunity uh to to
1:15 pivot and and respond to the market in a in a much better way. So, um I I think I've talked about Napoleon aspects of Napoleon before. Uh Napoleon Bonapart is of course one of the greatest military leaders in human history. Uh he um uh he lived around the uh from the well he lived from the late 18th century into the roughly mid 19th century. So se late 1700s to mid 1800s
1:54 and he was for on on two occasions he was essentially the the the dictator of France. Now France was called a republic uh when uh Napoleon was was dictator um but uh in in in reality he controlled uh really what happened in in the government. Uh he has somewhat of a a a mixed history. If you read um western history um the English uh despised him
2:29 uh because he was so effective in fighting them uh during the early 1800s. One of the things that parents would do to uh scare their children into obedience was tell them if you're not a if you're not good bony will come to get you. Bony was the uh name they used in an insulting way for Napoleon Bonapart. Um on the other hand uh to have been a Jew in France uh during during the reign of Napoleon Bonapart um meant you had
3:04 extraordinary uh religious freedom uh during that time. Uh Napoleon was very respectful uh to the Jews. There is um an apocryphal story told about him that he was walking through the streets of Paris uh one evening with some of his staff and he walked by what turned out to be a synagogue and he heard crying and wailing going on inside the synagogue and he was very concerned about this. It it was, by the way, around this time of year in what's
3:39 called in the what's called the three weeks uh in in the Jewish calendar. It was actually on a the the last day of the three weeks known as Tishaba, the 9th of the Hebrew month of Av. And so he sent one of his staff into the synagogue to find out what was going on. And uh a little while later, the staffer came out and he said, "You know, my emperor um the the the Jews are mourning the loss of their temple." And Napoleon was a little bit puzzled by this. He said, "Their their their
4:14 temple." He said, "Yes, my emperor." He says, "I need details." So he sent the man back in to get details. And and a little while later, the uh the staffer came back out and and he and Napoleon said, "What is this temple about?" He says, "Well, they're mourning the loss of their temple in Jerusalem 1,800 years ago." And Napoleon supposedly uh replied by saying, "Any people that can still mourn so deeply the loss of the central place
4:50 of their faith uh merits to be eternal." And it the the reason this story is told is is to show the kind of respect that that uh Napoleon Bonapart had uh for for Jews in France at this time. Um the French themselves there were many Bonapartists in France at the time uh of Napoleon's reign and and they they they sincerely loved him and admired him. There were there was also an anti-bonapartist faction um many of whom
5:26 collaborated with the English in the eventual defeat and overthrow of Napoleon Bonapart. So a a very interesting character uh in in history especially in French history. He was of course known for carrying his hand in his in his vest. I I I don't know that that's historically accurate, but uh but in any event, uh um he was an innovative military commander. There's there's no question about that. Uh and at the at the time that he came to power,
6:01 um which is the late 18th century and and coming into the early 19th century, military structures were very rigid. So they were an absolute uh commanddown uh um model of of operations. Um which which made them very rigid. Um and what what Bonapart figured out was by creating his core system, he could decentralize
6:37 authority to to a a a pretty significant extent, especially given the times. Um and dramatically increase the both the size and the effectiveness of of his army. And and so what what he did was ar Napoleon reorganized the French army into independent cores w each of which was essentially a mini army of roughly 20 to 30,000 troops and instead of
7:12 having one infantry corps and one cavalry corps and one artillery corps what he did was he created an integrated core each of which had its own infantry, its own cavalry, its own artillery, its own engineers, its own logistic support. Okay? So, each core was self-sufficient and could fight on its own at least for a short time. And each core was led by a commander who had autonomy to direct his core in battle. um but he operated under
7:50 the overall strategic direction of of Napoleon of of the emperor. So what that did was it created a system whereby Napoleon could could again set the strategy but then pardon me depending on the local conditions and how the individual battles developed. The core commanders could respond to these differing situations much more quickly. they didn't have to send up information
8:25 to higher echelons until it got to the senior commander who then decided what to do and sent it back down the chain of command. So, as a result, the these these core had uh greater speed and flexibility. They could march on different roads. They could converge quickly to create a more powerful force, but they could also disperse faster in order to take advantage of what was happening in the battle and and operate much more agile than a single large army. Um they also
9:01 also they had decentralized execution. So Napoleon would set the objectives but the core commanders had the flexibility as to how they would achieve those objectives. And and the last thing and and and this is important as well is by creating an army made up of a number of core the the army itself had greater resilience. So if one core got, you know, wiped out, the armies could still live on to fight another day. And so and also if if if one core
9:38 got, you know, badly mauled, so another core could be moved in behind it uh to carry on the battle as opposed to the entire army feeling like, oh, I you know, we've been defeated. we're, you know, going to retreat and and and there and therefore the morale of the entire army collapses. So I I I will say that if you if you look if you continue to look forward into history um and you get all the way to World War II for example, so this same system
10:13 was reflected in the army organizations of both the allies and the axis uh during World War II. World War II was really the last time there were you know major armies in the field. there was to a lesser extent in the Korean War in Vietnam, but but nowhere near uh the the the scope that that World War II had. And so uh in World War II, you had core commanders with a great deal of uh independence who then reported to the army commanders. So for example uh George Patton who was the commanding
10:49 general of third army he had a number of army corps within his structure and that was one of the reasons why he could be so effective is he set the objectives and then his core commanders de developed the operational plans and then lower echelons developed the tactical plans necessary to meet the objectives and that left patent-free to be out in the field seeing how the battle was developing and And as as he watched that, he could alter his objectives or in many cases just set further objectives based on how quickly the the
11:27 battle was developing and how fast his army was able to gain gain territory. So Napoleon's core system became the organizational system of armies in in the west uh for for for certain. So so then so let's let's now take a look at uh what are core I'm I'm sorry what are um crossf functional uh business units. you you may not be familiar with this term uh and and and it's you know
12:03 obviously this show is about comparing uh Napoleon's core system to CFBU's core cross functional business unit. So understanding the two are important. So a crossf functional business unit is a multidisip disciplinary team within a company. So if you think how if you think about the way that most companies are organized, you have the uh the the the seauite or the sort of leadership part of it and then you have you have manufacturing and you have marketing and
12:38 you have sales and you have finance and each one of these departments operates you know as as part of the overall company. Okay. in a multi in a um a uh crossf functional business unit. Okay. Within the company you have this multidisciplinary team where it has its its own um its own marketing, its own sales, its own leadership team, its own finance. Okay. So it it oftentimes has its own you know
13:15 engineering team. It may even have its own uh manufacturing team. I'll give you some examples of uh crossf functional business units in a minute. So, but the idea of the crossf functional business unit is it has autonomy within the larger company or corporate structure. So it can make decisions without necessarily having well not not without uh relying on uh you know headquarters you know corporate to approve every move. Okay. So again
13:52 senior leadership sets the objective and the CFBU really has has autonomy to figure out how it's going to meet that objective. Okay. and its focus is typically around delivering value to a specific consumer uh segment or a specific product or a specific region. I I'll give you some examples of those in a minute. And then finally, it has its own accountability metrics. So, you know, it it it often is responsible for its own profit and loss, for its own sales growth, for its own
14:29 market penetration, etc. So it it really operates as um an autonomous unit within the larger corporate structure. So I'll give you a I'll give you three examples of of CFBUS. So um within Amazon which is of course one of the largest companies in the world. So the Amazon Prime team is a cross functional business unit. It has its own engineers to build the platform features. It has its own marketers who acquire and retain
15:04 uh subscribers. It has its own data scientists to analyze and optimize recommendations. It has its own customer service people. It has its own product managers in finance, right? And um Amazon Prime operates as it's sort of a a it's a division of Amazon, but it's a self-contained division. Okay. So, this is one that um you would say is is is probably designed around a particular customer segment. Okay. And it's been an enormously successful program. I I I've
15:40 been an Amazon Prime subscriber for gosh 20 years, I think, since shortly after the the program was developed, right? and and and it's it it's because of the perks that I get uh for that, you know, somewhat nominal subscript subscription fee. Okay. So, so that's one example. An example around a product is Apple's iPhone product unit um which is also a crossf functional business unit. So, it has its own hardware developers, software developers, designers,
16:15 marketers, supply chain managers, okay, and finance. They all operate in a single dedicated unit that focuses specifically on the development and enhancement of the iPhone within the overall um Apple company structure. Okay. And again because they can focus on that one product. Okay. they they can move much more quickly uh and and and and surely in terms of uh making the
16:50 iPhone uh successful. Okay. And then finally an example of a of regional CFBU. So uh Unilver uh has organized itself geographically. So for example, there's a a Latin America unit in in Unilever, right? And it handles all the aspects of um the product portfolio for that re for that region. Uh research and development, local marketing, local distribution, local finances. And the reason Unilver does that is so it can respond to local
17:26 tastes and needs, right? So what people in Latin America want is different than what people in China want, for example, right? They have very different uh consumer tastes, different taste buds even, right? So uh this allows Unilver to be much more responsive worldwide by having uh regional CFBUS to to handle its business um you know focused on a particular you might say
18:01 it's a particular customer segment but it's really in this case it's geographical. Okay let's take a quick sponsor break. America is a maritime nation. Our freedom and security depend on strong sea services. The Beverly Hills Council of the Navy League stands with our Navy, Marine Corps, Coast Guard, and Merchant Marine through community support, education, and advocacy. For over 120 years, Americans of all walks of life have heeded our call. No prior military services required to join our mission.
18:38 The Beverly Hills Council of the Navy League of the United States. Help us support those who serve at sea. Visit navyleague.org. Okay, we're back. I'm This is Business Lessons from the Military. I'm I'm your host, Kevin Bemmel, and we're talking about the case for crossf functional business units. Uh and and I'm using as an a as sort of the predecessor, if you will. uh the emperor Napoleon's core system that he developed in the early 19th
19:14 century that revolutionized the way that wars were fought uh and and and and made made Napoleon one of the most successful generals or he was actually a field marshal of all times. Okay. So uh I I I talked about uh what the core system was and what uh um crossf functional business units are. So why do we use crossf functional business units? Well, we use them to be more more uh responsive to customers and markets. We use them to improve innovation speed and
19:51 execution. uh we also create them to to to demonstrate clear ownership of a product or initiative right so going back to uh the uh Apple's uh CFBU of the iPhone right so the the iPhone team and and and when I say team you we're talking about of course a huge number of people but the iPhone team they own the success or failure of the iPhone okay so there's there's greater accountability and then lastly it it it um reduces internal
20:28 friction across departments right so the iPhone has its own marketing people its own um R&D etc we I talked about that before before the break now the thing is and this is this is another aspect of using crossf functional business units and that is just because a CFB U has its own let's say marketing people that doesn't mean they are completely siloed off from the marketing department at the corporate level. To the contrary, they
21:04 have that marketing department to reach back to for consultation, for specific expertise that that they may need on a short-term basis or they may have that that the corporate marketing team to available to work with and in order to do cross marketing functions with other CFBUs. Okay. So it's not that it's not that a CFBU is completely siloed off from the corporate unit. It's that it has a great deal of
21:39 autonomy uh even as it has the ability to reach you know sort of out to the corporate level when it needs those resources to be more effective. And that's exactly how things worked with Napoleon's core system as well. So it wasn't that his core commanders could not interact. It's not that they had no connection to, you know, two uh command headquarters for the entire army. They did. It's just that they had a lot more autonomy in in the field and execution.
22:16 Um and they could call upon higher headquarters for the support they needed as opposed to having it dictated to them. And so that back and forth made them much more effective than armies had been previously. Okay. So talk about the relevance of uh the the um Napoleon's core system to cross functional business units. So modern business as you know faces challenges of speed, adaptability, responsiveness. Okay. Just like an army in the field.
22:54 And I' I've mentioned this a number of times on this show, but I I I think this is a good a good time to remind I I don't look at business, you know, as a warfighting function. Okay? Business is not the existential uh human endeavor that that war is. Having said that, there are aspects of business and and how leadership works and and and how things function that that are very similar to how militaries function even in wartime. Okay? Of course, that's the basis for the show.
23:29 But uh I I again I don't I don't view business as a cutthroat, you know, kill or be killed uh you know, endeavor. uh quite to the contrary I view business as a collaborative uh um endeavor. Okay. So uh so so let's look at some analogies then between crossf functional business units and Napoleon's core system. So first of all um there's autonomy with alignment. Okay. So, so the core that
24:04 that that the core that made up Napoleon's army, they were independent, but they operated under his overall strategy. Okay? And so, while CFBUs have their own product managers and and and marketing departments and and development and operations, etc. So they c they can act quickly still they follow the overall corporate company strategy and their goals align with the goals of
24:39 the company. Okay. So they're somewhat autonomous from but not completely independent from the the corporate structure. Right? So the idea is to give them a much greater level of independence in pursuing their goals, but they're not they're not detached divisions oftentimes. Okay. So so that's the first thing, autonomy with with alignment to the larger goals and objectives of the company. Okay. Uh next
25:14 is endtoend capability. So core had the ability to fight independently. Um they had their own infantry, their own artillery, their own logistics, their own cavalry. Okay? So um they, you know, they they could fight as integrated units. They didn't have to rely on higher headquarters, for example, for artillery support, which is how things were generally handled prior to the development by Napoleon of his core system. So uh C CFBUS
25:49 also have endtoend capability. So they're not reliant for any function on higher headquarters on corp the corporate uh part of the company. They have all everything they need within their unit. Okay. Now again as I mentioned a few minutes ago that doesn't mean they can't reach back to corporate if if they need some additional support. Okay. That certainly is the case. But generally speaking, they they are self-contained and they they have endtoend capability. That's what gives
26:24 them the autonomy and the flexibility that they need to respond to the challenges of whatever they're you know the thing thing on which they're focused. Okay. So endtoend capability. Next, number three, they have decentralized decisionmaking ability. Okay, so core commanders could issue orders and and could launch uh um um offensives, could go on the defensive, whatever was required without
26:59 waiting for orders from higher headquarters. Okay. And so at the same at the same time that you know they could take advantage of a breakthrough and push forward more quickly without waiting for you know permission from you know Napoleon's headquarters to do so. Also if they were facing a situation where they were likely to maybe be you know badly mauled or wiped out. So they could also uh retreat without waiting for uh um permission from higher headquarters in
27:34 order to maintain the integrity of their core and live to fight another day. Okay? Now that isn't to say that um you know higher headquarters couldn't order them to do something. Of course they could. So as Napoleon watched an overall battle develop, he, you know, he could issue an order to a core saying, you know, I need you to stand and fight no matter what, right? And and and since the core commander has can see his part of the battlefield, but generally does not see the overall battlefield, you
28:09 know, he may, you know, he's going to respond to what he knows. Uh but there were times when the the most senior commander Napoleon who did have cognizance over the overall battle uh you know would issue orders that you know that the core had to follow and that's why the core had uh operational authority um and and and tactical authority but strategic uh strategic direction was held by Napoleon um at at higher headquarters. So um crossf functional teams too one of the major
28:45 reasons for forming them is that they can make faster decisions without bureaucratic delays. So they don't need to wait for uh you know corporate approval of a particular marketing initiative. Okay. So they they can they can make their marketing plans, they can make their sales plans, they can make their product development plans without everything getting approved at at a higher echelon. Okay. Now again, that's not to say that they're never told that they need to do something. So there may be, you know, some kind of cross
29:20 promotion going on with say iPhones and iPads, okay? And so uh you know a directive like that might come from corporate headquarters. Okay? in which case they they'll need to cooperate with the C um CFBU for the iPad let's say okay um and then there may be a coordinating function by corporate okay but in general uh crossf functional business units are designed to make faster more agile agile decisions without the bureaucratic delays of having to get approval at a
29:55 higher level. Okay, next is number four, scalability and flexibility. So depending on the the the threats and the conditions on the larger battlefield, Napoleon could move or combine core in order to best meet the objectives that he was seeking to to attain. Okay. So, you know, by having these um these essentially autonomous units, he could kind of mix and match them to more
30:31 effectively uh um uh to more effectively deal with the developing battle situation. Okay? And uh and and CFBUs can be handled the same way. So um they can be scaled up, they can be scaled down, they can you know resources can be redeployed, they can be realigned to address market market changes and and they you know they can just be much more flexible than having to turn the entire company. Okay.
31:07 And that's why this concept was developed uh you know within the business world the the the cross functional business units. Okay. So that the the ability to for them to evolve or even revolutionize you know how the business is approaching its market okay is much greater with a CFBU than it is for the company as a whole. And then finally uh number five um accountability and performance. So uh Napoleon knew that with his core system,
31:44 okay, he could hold a core commander responsible for the success or failure of that core's uh you know of of that core's u fighting within the overall battle. Okay? So, you know, a core commander could not uh, you know, turn back to to higher headquarters and say, well, you know, I was told to do X, Y, and Z. I did it and, you know, it did it didn't work out, but I'm not responsible. No, it didn't work that way. So, part the key to the core system was
32:20 the core commander would be given objectives and then he was responsible for meeting them. if he didn't meet them, then Napoleon could fire him and uh um and um promote a a new core commander. Okay. And and the idea of of sort of building this meritocracy of leadership within armies was something new for its time. Okay. So and and and it really created a sort of um dispersal
32:55 of authority and accountab account accountability within the way an army was organized. So and and again I'll go back to the example of of Patton, right? if he had had uh you know a a core that wasn't doing what it needed to do, he would he could fire that core's commander and appoint someone else. If there was a division within the core that was not pulling its weight so the core commander could um could uh fire
33:30 that divisional commander and and replace him. it because you know he was accountable for his division's performance and so on down the line regiments battalions companies uh even down to platoon. Okay. So the the the whole system of of accountability based on performance came out of uh came out of Napoleon's core system. Okay. And and so you see the same thing in CFBUS in in the in these crossf
34:05 functional business units. So corporate headquarters can have you know president of the you know um iPhone uh BF uh P CFBU right and the president of that business unit that crossunctional business unit is responsible for its its success or for its performance. If it does well hey good. if it doesn't do well, he'll most likely be fired or reassigned and someone who can produce better performance um you know will uh
34:41 will will take over, right? And so having this greater accountability within a business structure is very valuable because um I mean you can you can structure uh compensation plans based on it and you can also demonstrate to uh people within the CFBU that their their individual performance really matters within the larger your CFBU structure. Okay. So, they will be
35:17 held accountable and they'll be rewarded, you know, for success and they'll be held responsible for lack of success. Okay. So, the the the two are as closely aligned. the two meaning Napoleon's core system and crossf functional business units are uh you know as aligned as they can be in terms of how they can make on the one hand an army and on the other hand a company more effective now you may be listening this and thinking to yourself well wait a minute I I I don't have a huge corporate structure I have just a small
35:54 company and and I you know I I I can't have you know multiple marketing departments. Gotcha. I I'm there. Right. I'm I'm a small I'm a small businessman myself. However, even with a in a small company, maybe you have a team of of of I should say a marketing team of three people, okay? And maybe, you know, maybe your entire company is uh 20 or 25 people. So, it's a relatively small business. Okay? within that you could still develop I
36:30 wouldn't call it a a crossf functional business unit but maybe a crossf functional business team right where where maybe you take one person from each department and create an an autonomous or semiautonomous team within your company that focuses for example on new product or new service development or focuses on a particular ular uh customer segment or client segment, right? So, it can this same system can be scaled down based on the size of your
37:06 company and it can be enlarged as your company grows. Okay? So, you know, I I've been talking of course armies, you know, we're talking about, you know, hundreds of thousands of people. And in fact the you know the armies that took the field in World War II you know have an army of a million soldiers. Okay obviously there the core structure is in in the context of modern warfare is essential. You you you you could never operate an army of a million people
37:41 effectively with with the old 18th century command structure. Okay. But um you know you see the same thing happening in armies that I was just describing uh for for the civilian world. So you'll see for example SEAL teams, right? SEAL teams are are they're kind of like a crossf functional business team within the military. They're small. They have integrated capabilities that allow them to do things quickly, effectively, agile. Okay, with a dispersed command
38:18 structure. Okay. And so within our companies, we can develop, like I said, I I would call them uh CFBTs, crossf functional business teams, and they can create uh a a situation that allows our company to be more agile, to develop new products and services more quickly, to respond to market conditions uh more agile. Okay. So even for even for a relatively small business you know 15 20 30 uh you know
38:55 person business this concept can be adapted and used very effectively. So uh I I I thank you very much for joining me today. If you have any comments, thoughts, please post on our social media. All the links will be in the show notes after the the show posts on YouTube. And uh do me a favor uh if you like the show uh tell your friends about it. Um you know let them know that this is a place to come for for ideas uh that can make their businesses better
39:30 and also learn uh something about the military military history and doctrine and command structure. Uh and uh and and I'd really appreciate that. Um, so thank you to my live viewers, including I I I hope I'm not mangling your name, uh, Dikusa, uh, Moses, who's watching live from Uganda. Um, cheers. And, um, I thank you all very much for joining me. Uh, real quickly, tomorrow at 10:00 a.m. Pacific time is my show, People Making Money. And then on Thursday at 5:00 PM
40:08 spec Pacific time is my every other week show, Jiggers's Place, where we talk about all the things in life that are nonfinances related. So I hope you'll join me on Thursday 5:00 p.m. Pacific time for a cocktail and a schmoo as I like to say. And then next week on Monday at 10:00 a.m. Pacific time will be my show Trust and Estates Weekly. And then a week from today, I'll be back for the next edition of Business Lessons from the Military. So, I thank you very much again for joining me and signing off as I always do. Marie Darling, you
40:44 are my bell. Courage at all times, my friends.