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November 08, 2007

« When a Place Gets Boring ... | Main | Hollywood and the Creative Economy »

I've been thinking about this for some time now. The whole middle part of Rise is about it, and my earlier work including two books with Martin Kenney, The Breakthrough Illusion and Beyond Mass Production dealt with management and organizational models. We're going to launch a project on it at the Prosperity Institute. And I gave a talk on this yesterday for Spencer Stuart, where I had the opportunity to benefit from the thinking of leading HR and talent management executives. So was I beyond pleased to come across this remarkable interview with Gary Hamel and Lowell Bryan (co-author of Mobilizing Minds) in the McKinsey Quarterly (free access but registration required). I'll be thinking and posting more on in this in the coming weeks and months. Here's Hamel:

[W]e’re on the verge of a post-managerial society. The idea that you mobilize human labor through a hierarchy of overseers and bureaucrats and administrators are going to look extraordinarily antiquated a decade or two from now. These thinking-intensive people are increasingly self-directed. In fact, they’re directed as much by their peers as they are by supervisors. The management challenge is akin to urban planning. The art of it is that you must enable people to make thousands and thousands of individual decisions about how to live and work, but you have to create the infrastructure to make it easy for them to do so. You’ve got to have the sewer lines, you’ve got to have the four-lane highways, you’ve got to have the pedestrian malls thought through in a way that individuals find it natural and easy to work either by themselves or with others. There’s a danger too of creative apartheid. ...

Too many executives seem to believe that while a few people in the company may be really clever and creative, most folks aren’t. When you look at companies like Toyota, you see their ability to mobilize the intelligence of so-called ordinary workers. Going forward, no company will be able to afford to waste a single iota of human imagination and intellectual power. The necessary innovation is to adapt the specific organizational-design ideas that enable individual companies to perform better. So it might be bringing talent or knowledge marketplaces inside a company or building formal networks or introducing dynamic management principles to a company. These are all ideas that have been tried somewhere; they just haven’t been integrated together, at scale, in very many companies. The outlines of the 21st-century management model are already clear. Decision-making will be more peer-based; and the tools of creativity will be widely distributed in organizations. Ideas will compete on an equal footing. Strategies will be built from the bottom up. Power will be a function of competence rather than of position. In terms of the future of management, we’re at the beginning of what will be a fairly long journey.

Richard Florida ... argues that some of the most bruising battles that will be fought over the next 15 to 20 years will pit the forces of organization against the forces of creativity. One model is not going to simply surrender to the other. Frederick Taylor often talked about the need for a mental revolution when he was trying to move organizations from the craft-based model to the factory model. Today we need a new mental revolution. ...  The thing that really stops innovation is risk. CEOs can be terrified of organizational disruption because it can put at risk a company’s ability to meet quarterly earnings, which in turn is often what causes CEOs to lose their jobs. So part of what you need is a bridge so that they can be innovative but also keep their jobs. ...

The real opportunity that companies have today is to take control of their own destinies and begin to consciously innovate. They need to take on strategic initiatives and organizational initiatives at the same time. The scarce resources in any company today are discretionary spending, talent, and the ability to focus. You need the ability to focus in order to be able to allocate the resources. Like it or not, in order to really create any innovation and scale it, you’ve got to deploy some resources. How do you do that? The issue is not just raw innovation; it’s actually being able to scale the innovation through at a large company. That’s where the wealth will be created. In this experimentation it’s critical to have the voice of the user very much front and center—the individuals, throughout an organization, whose work is heavily influenced by a company’s core management processes. These people know which processes choke off innovation, impede adaptability, and frustrate employees. Assuming the company is well managed, the direction that most companies need to go in is improving how they enable their people to collaborate with one another at much lower cost by dramatically reducing unproductive search and coordination costs. And that means deploying such devices as talent marketplaces, knowledge marketplaces, and formal networks to make intangible assets flow throughout the company, as opposed to going up and down vertical chains of command.

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Comments

Alison Kemper

When I read this (deperately distracting and interesting) blog post, Richard, I thought back to the old STS literature. Who still speaks of sociotechnical systems? who thinks that self-organizing teams and complex adaptive systems are relevant in org theory? Not too many people, it seems.

A quick glance at the literature revels lots of publications in the mid 1990's and plenty of citations, but little published in the standard management journals since 2000.

Did the bursting of the dot com bubble also burst interest in creativity and org theory? Did the rise of the MBA president and his command-and-control VP mean a shift in management orthodoxy so that fewer people were working on org design for creativity?

Is it time to look again at complexity theory, self-organizing systems and sociotachnical systems theory?

Jon Husband

Well spotted, Alison. I've been arguing for about 5 years that the OD and STS work from the '70's and '80's is very pertinent to the emerging 'wirearchical' world in which we are beginning to live and work (disclosure .. I have been working on a concept called 'wirearchy' outlined on a site at www.wirearchy.com)

i have been surprised, thus far, that there is not more interest in a field which I believe will become very important that I have termed eOD.

Do you (and Richard) know of the work of Dave Snowden and his colleagues around the globe (Cognitive Edge - http://www.cognitive-edge.com) directed at complexity, narrative and sense-making ? It pulls together complexity science, strategy and OD / org change in compelling (in my opinion) ways.

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