A practice refers to a behavior pattern or procedure that has been repeated for a long time and widely accepted within a specific group for the purpose of simplifying and standardizing work (an organization's “habit”).

• Despite the positive functions of practices, “outdated practices” cause arteriosclerosis in organizations, so proactive efforts are essential to minimize their negative impact in a rapidly changing business environment (“practices also need an expiration date”).

• In 2016, the Korea Chamber of Commerce and Industry and McKinsey diagnosed the organizational health of Korean companies and found that chronic practices were widespread in terms of the way of working, decision-making, evaluation and compensation, and organizational culture, resulting in serious problems (“big company disease”).

The rise and fall of GE (General Electric), a US company with over 100 years of history, clearly demonstrates that breaking away from established practices can determine the success or failure of a company.

• The Jack Welch era (1981–2001): By streamlining the hierarchical structure, eliminating paternalistic decision-making, and removing silos between departments, Welch overcame the “big company disease” and achieved significant growth by prioritizing performance.

• The Jeffrey Immelt era (2001–2017): In an effort to eliminate the negative effects of excessive performance-oriented management from the previous chairman's era, Immelt attempted to implement inclusive leadership, decentralization of authority, and the adoption of Silicon Valley culture. However, due to consecutive crises such as the 9/11 terrorist attacks and the financial crisis, these efforts failed to take root.

Successful examples of companies that overcame outdated practices and achieved growth include IKEA and Microsoft, while failed examples include Nokia and Boeing.

• IKEA overcame bureaucratic practices resulting from rapid growth by adopting an operational approach aligned with its founding principles and the times, while Microsoft broke away from its previous wasteful practices of internal competition and established a new culture emphasizing collaboration.

• Nokia failed to overcome the negative practices born out of its arrogance as the world's leading feature phone manufacturer and fell into decline, while Boeing neglected the practice of prioritizing technology, which is the essence of its business, and continued to focus on short-term financial performance, greatly damaging its former reputation.

In order to break through the limits of growth in a harsh global business environment, the first step is to review and revamp the practices that were established during the high-growth period.

• Before deriving and implementing specific improvement programs, it is necessary to first build consensus among employees on what the chronic practices are and what their drawbacks are.

• To successfully implement a comprehensive “practice overhaul” across the entire organization and key departments, it is necessary to establish a roadmap and phased implementation plans.

• To establish the elimination of outdated practices as a routine part of organizational culture, it is essential for leadership to lead by example and encourage innovation in ideas.