Wednesday, January 14, 2009

Nothing endures but change - Heraclitus 535-475 B.C.

There was more change last century than in all previous centuries, combined. Information has grown exponential. 100 years ago the problem was to get enough information. It was a scarce resource. Today we are overwhelmed with information and our problem is to find what's relevant to us. A recent estimation is that we will see more change in the next 14 years than we did in the entire last century. Holy cow! Can you imagine that?

This means that the information overload will be extreme. We have not yet begun to develop systems and structures for this information boom. Even more important, our organizations are not ready to handle it. People are not ready to handle it. Managers and leaders are not ready. As the level of change accelerates uncertainty will increase. A natural reaction is to try to increase control, which many companies are doing today, but that goes against nature so to speak.

Change is inevitable and the only way to deal with it is to "go with the flow". Another way of putting it is to have an agile, flexible organization that quickly reacts to the changes. It also means changing our values from control to adaptability, openness, transparency, trust and real empowerment. Here we come to the point I'm trying to make in my book; this is only possible by removing the dominant hierarchies as they are built for control and efficiency.

The structure cannot be ignored in organizational design as it puts limits on the content. The structure also states the rules of the game in the organization.

By building hierarchical organizations we immediately know who has power, who will make decisions and what people are supposed to do and not do. Great for control and efficiency.

If, and this is fundamental, the problems are simple. Research has shown that as problems get more complex hierarchical organizations lose both control and efficiency. So, that is why I talk about leaving the industrial paradigm once and for all in order to open up our thinking to the question that need to be addressed today; how do we design organizations that fit our present business environment and our present organizational purpose. Cause it's not about control and efficiency anymore. That's for sure.


  1. Hi "Paladin" (cool name!)
    I was just reading your post and I wonder what you indicate by "industrial paradigm"?

  2. Hi,

    :) Well James Bond was taken so...

    That's a valid question. I guess I should have mentioned that. By the industrial paridigm" I mean the way our organizations are built and the underlying assumptions.
    - dominant hierarchies. CEO, managers, employees. Chain of command.
    - Information flows to the top where decisions are made.
    - No transparency. Employees get information on a need to know basis (based on what management thinks are needed).
    - work specialization and departmentalization.
    and more to be covered in later posts.

    The basic features of the industrial paradigm, control and efficiency, comes from the mass production era. Efficiency was defined as minimizing mistakes as production stops were very costly.

    The underlying assumptions were that workers were lazy and untrustworthy. Hence supervision was needed (theory x). I will go into more detail on this subject as well in coming posts. Thanks!

  3. Great point -- one that most managers don't get. Control makes them less anxious, even if it doesn't help them solve any problems. It's so easy to assume that problems are simple, when they rarely are.

  4. Thanks Sandy, exactly my point!


Your comments are highly appreciated. I want this to be a living blog with lots of conversations as this is a great way of learning.