As an enterprise grows and begins to compartmentalize into specialized segments or departments, sub-optimization, another natural negative change, will occur in the absence of clear leadership and frequent communication. Sub-optimization is the condition where a specialty area gives their own objectives a higher priority than that given to the common objectives of the organization.

The tendency is a natural phenomenon and must be managed and controlled. Where conflict exists between the unit goals and those of the organization as a whole, sub-optimization is damaging and distracting. For long-term purposeful success the organization must be consistent and proactive in maintaining harmony between the unit’s goals and those of the organization. Communication is essential in that process. A sales department’s goal to achieve quota can lead to over promising and under delivering. The legal department’s objective of protecting the firm from liability can result in one-sided unrealistic terms. A shipping department’s goal to avoid overtime can result in late deliveries to customers. The marketing department’s goal for maintaining a uniform message can strangle the organization’s efforts to reach diverse segments of the market.

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