In order to achieve anything with others we need a lot… First of all, we need a strong leader with a vision. This leader will through his virtues and charisma create the momentum and “compel” others to work together. The vision needs to be translated by expert managers into approved strategies and plans. Hierarchies and functional specialists need to ensure that the necessary resources – including humans – are deployed according to plan. And we need to measure success at every step, incentivise people, fight corruption…
This is the industrial age way of solving the coordination and distribution problems. Works right? No. It does not.
Industrial age management is very inefficient because so much time, money and energy are lost in non value adding coordination and distribution activities. Coordination and distribution activities do not produce anything, do not service a customer and do not result in new ideas. Industrial age management is hugely expensive with many layers of managers and executives doing exactly nothing but non value adding activities. And it is not effective: A staggering 74% of projects fail (Standish Group’s 1998 report) – not achieving the benefits aimed at according to plan. And worst of all: It actually kills the companies over the long run – wonderfully depicted here: Corporate Lifecycle.
What is happening? Let’s look at the lifecycle of a corporation. We see collaboration increasing in a newly founded organisation (left side of the curve). More and more people collaborate and work with each other to produce material products, services or knowledge. The goals of the organisation are in flux – they emerge from the collaboration itself. Hierarchies while they might exist are not very strong. Coordination and distribution takes place in an almost natural manner based on what emerges as being important.
When collaboration is actively limited the company starts to decline or dies. As an example let’s look at the “Founder’s Trap”. It means that the original founder tries to force the people into following his vision and his plan. However, all the people who have joined the organisation as a whole are now much better at finding the right answers and growing the business. Collaboration proves to be the answer not hierarchical decision making. Basically, all dead ends are outcomes of collaboration breaking down or being actively undermined.
Let’s look at the stage of “Aristocracy”: An established group of senior managers has taken control of the flows of information and resources. Collaboration becomes more and more limited. It is controlled according to a few people’s beliefs about what is important. This in turn now leads to failed projects, stagnation, wrong solutions, and overall more and more ineffective practices. The company declines – unless it is able to re-establish collaboration amongst its members.
So what instead? One answer is to stop running our organisations like machines. They are not machines. We need to start to view them as living organisms. After all, organisations are made up of humans – a form of life. How then do other complex organisms and ecosystems solve the problems of coordination and distribution? How are individuals aligned in such systems and how are scarce resources distributed? The video shows some great examples.
A viable alternative to hierarchies and “mechanics” as means to coordinate and distribute is lively collaboration. Running companies as highly complex organisms or ecosystems makes everyone’s job much easier and the company more effective and efficient. Enable people to collaborate and let them work together. Let them solve coordination and distribution problems themselves.
And no. It will certainly not descent into chaos. Life is exactly the opposite of chaos and relies on collaboration to create order and progress. It has proven again and again that collaboration is key to surviving. And, if you start to let people collaborate you might achieve greater things than you could have ever imagined alone.
Why is this now more important then ever? Stay tuned…