Organizational blindness

organizational blindnessIn 1970, the scientific journal Nature published a small but important article by Colin Blakemore and Grahame F. Cooper, two neurophysiologists from the University of Cambridge. The article, titled Development of the Brain depends on the Visual Environment, described the results of experiments in which they have raised kittens in a environment in which they were confronted only to horizontal or vertical lines, but not to both. In this context, when growing up, these cats became virtually blind to lines orthogonal to the direction they were exposed to, as their brain adapted to the particular nature of their environment.

Broadening of the Hierarchies

Hierarchies may be as old as the world itself. Yet, whereas primitive societies of hunters-gatherers were egalitarian, their social organization involved many transient hierarchies, allowing them to delegate authority to specific individuals or groups, according to ongoing necessities. The causes and rise of the status hierarchies that are so typical to our societies and organizations isn’t easy to decrypt. In Human Evolution and the Origins of Hierarchies, Benoît Dubreuil has developed an interesting theory linking them to the development of large-scale societies, triggered notably by the development of agriculture, in an era when human beings didn’t have the cognitive faculties necessary to deal with them in an egalitarian way.

Whether we do subscribe to Dubreuil’s theory or not, fact is that power-based hierarchies (where status, as mean of social or economic dominance, becomes a synonym of power) are key to the dominant paradigm that today prevails in most organizations, and that, far from being contained inside the companies’ boundaries, drives most of the production-consumption relationships between businesses and customers. The “we produce, you consume” motto, born in the age of industrialization and mass-markets, is nothing but a generalization of hierarchies, in which customers gave up their ability to think critically over their real needs and to decide on their own consumption patterns, for an accumulation of goods and services manufactured on (or notwithstanding) their behalf. From companies point of view, they became the last link in the production command-and-control chain, with almost no opportunity given to provide feedback (toll free numbers didn’t exist before the end of the 60s) and the single and straightforward “buy” order given.

While shifting from a product orientation to a marketing orientation after World War II, businesses haven’t untied customers from these hierarchical bonds. Quite the opposite, by focusing on and teasing customers’ aspirations, they induced further hierarchical behaviors among them, discretionary economic power translating into conspicuous consumption patterns and social tension. For the sake of growing business and developing companies, the cornucopia unsealed during the Glorious Thirties has become a tyranny of consumption, under which reign has the rigid mindset prevailing in organizations been extended to the customer world. An attitude perfectly symbolized by Patrick Le Lay, CEO of the French television channel TF1, as he stated in 2004 during an interview: “what we are selling to Coca-Cola is minutes of available human brain.”

Dealing with complexity

In the meantime, the world has changed. Drastically. Yesterday’s certainties have disappeared behind arrays of possibilities and fuzzy choices, weaving complex environments in which there is no simple path, no really secure option. Constant streams of information are flowing around us, requesting, to make sense of it, a level of judgment and of knowledge more and more out of the reach of individuals. At the same time, technology allows us to connect and interact with practically no limits, reshaping our consumption behaviors through collaborative learning and distributed intelligence. As complexity increases, we rely more and more on our connections to meaningfully screen and qualify information. Our networks have become our filters.

Organizations, too, have evolved. Mass production has become, for many companies and in many sectors, a shadow from the past. Technology opens new possibilities to better listen to customers, to segment them according to economical, behavioral and social patterns, at the near-individual level, and to craft new channels allowing deeper and more relevant interactions and information exchange.

Yet…

Yet organizations still consider their customers as if they were the bottom level of their internal hierarchies. They keep on believing that, while stuck in a paradigm built on silos, hierarchies, and denial of power to the front line, they can tame customers’ will and expectations. As in Blackmore’s experiments, they act as if, born and grown in a world where hierarchies were the most convenient structure to drive profit and maximize performance, they became unable to see how much the world around them has changed. They behave as if workers were insulated from the outside world, and impervious to the changes that affect us all as human beings. They operate as if rigidity and boxed expertise were able to compete with the imagination and nimbleness of networks of prosumers.

Playing by new rules

In a world where your customers are smarter than you, you are left with no other choice than playing by their rules to survive. Despite what some say, the present rise of a so-called collaborative economy might not represent the future of work, as most of these new companies still operate in a traditional centralized and heavily capitalizing way, harnessing the power of external networks mainly at the advantage of a narrow hierarchy. However, it clearly shows that any industry, every company is now at risk of being disrupted by newcomers able to answer real customers’ needs, as deeply rooted in networks.. From music majors to car rental, from hotels to real estate, the list of such examples is growing day after day.

It is a strange world out there. Trust and credibility are the cornerstones upon which we are processing information, weight suggestions and create knowledge in the midst of our networks. Unless organizations become aware of this new reality, they won’t be able to take advantage of it. What worked in an era of hierarchical production mindset has become irrelevant. Creating value for networked customers requires being able to dive into their networks, and to adhere to their rules and principles, to avoid running the risk of being thrown out like foreign bodies out of a living organism.

For most organizations, it won’t be an easy task. Decades of centralization in search for efficiency, years of capitalistic formatting in search for profit, have ossified their structure into blind hierarchies and one-way chains of power. For them, relying on technology will only enforce the status quo, falling short of enabling any kind of transformation. The solution lies in the power of people. As customers, as human beings, we know how to connect, how to co-create value, socially as well as economically. We are able to do the same as workers. It requires to trust us, to relinquish control, and to commit to build supportive structures. It -only- requires to open the eyes, and to learn how to bear the harsh light of our new reality.

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What Have They Done to My Song, Ma

broken organization

credit: Erwin Schoonderwaldt

“Look what they done to my song ma
Look what they done to my song
It’s the only thing I could do alright
And they turned it upside down
Oh ma, look what they done to my song”
– Melanie -

We know the importance of experience, of the accumulation of tips, tricks and shortcuts that nurture our curiosity and our ability to adapt to new situations. Yet, we judge the skills and capabilities of one’s life mostly upon curriculum and diplomas, upon a period of five to eight years. Is that reasonable?

We value creativity, experimentation and intellectual curiosity, yet we ask our youth to abdicate the most creative and innovative part of their life to conform to a formal yoke that we call education. Can we really adapt to an ever changing environment while enforcing such a mechanistic process?

We aim at economic growth. Yet the resources we rely on are finite, if not decaying. The only infinite resource at our disposal is knowledge, yet we leave more and more people, thus more and more sources of knowledge, on the side of the road. Is that sustainable?

We look for, encourage and measure individual performance. Yet, any sport coach knows that collective efficiency is what matters, and that individual performance often gets in the way. Is that sane?

We value our customers. Yet we keep on feeding them with products they don’t need, with the false premise of making their life better, when what really matters is our income. Is that honest?

The world we used to live in no more exists. Yet, all the mechanisms and beliefs that prevailed during the industrial era are still the ones that rule our education system, our organizations, our life. We are still playing the same old song with new lyrics and new instruments, while the need to change the melody becomes more and more obvious. We don’t need new performers anymore. To thrive in today’s world, we need new composers.

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Return of Venn – Looking at the Future of Business

My last post sparked a few amazing comments. Looking back to the little exercise I attempted – representing organizational structure as Venn diagrams – I realize that my view was a bit enterprise-centric. “Customer”, as a concept, is quite reductive when considering the relationships between individuals and organizations. What if, instead of focusing on the world of work inside companies, we considered the larger context in which work takes place? Work, in fact, is the human activity of producing artefacts – goods and services, of course, but also capital, or knowledge – to allow for exchanges to happen. These kinds of transactions – non-market, if we consider exchanges of knowledge as transactions – have existed since the dawn of humanity, amongst the first tribes of hunters-gatherers, encompassing both physical and symbolic transactions between individuals and the community they belonged to. A straightforward world…

Well, not quite. Starting from the first cut stone, technology has always played a major role in magnifying and extending human capabilities. If we can illustrate the initial transactional context as follows…

The real initial world of transactions

… as we navigate in time from prehistory to history, individual interests more and more lost their importance in favor of the collective. Technology began to allow completion of more sophisticated tasks, often requiring more than one individual for being completed. From one-to-one or one-to-many transactions, production mechanisms, fueled by the growing division of labour, turned into many-to-whatever, giving rise to the need for formal structures to optimize technology driven production.

Productivism and organizational disease

With the Industrial Revolution came an important shift: most of technological breakthroughs didn’t empowered individuals, but required a collective structure to deliver. Not only were firms the logical outcome of economical evolution, but they were a natural fit for the rapid evolution of technology occurring during the XIXth century. It would be childish to say that large corporations are born by technological necessity, but fact is, in this pre-unionist era, that most of the resistance to the world of work taking shape wasn’t caused by deteriorating conditions of working, but directly linked to technology, as François Jarrige describes in Face au au monstre mécanique : Une histoire des résistances à la technique. The Luddite uprisings from 1811 in Great Britain is one of many such examples.

At the same time, another major change took place: the emergence of the nation state. By providing a symbolic as well as practical context in which most community-based exchanges could take place -administration, law, education,… – and securing the identity of communities through a distinct and infrangible territory, it freed corporations from their duties toward the communities they belonged to, allowing them to pursue an economical only mission. The complex dynamics of interpersonal relationships involved in traditional transactions, implying reciprocity and feedback loops, disappeared, replaced by markets only dynamics. In this emerging paradigm, people began to be considered according to a dichotomic prism: they became either employees, for the sake of production, or customers, for the sake of transactions. In the most cynical cases, this duality was meant as an autonomous circle; Henry Ford famously raised his employees’ wage, so they could afford to buy his cars.

Building on the diagram from my previous post, here is how we might represent business in the industrial and post-industrial ages:

the industrial world of transactions

From this diagram alone, it is easy to deduce the symptoms of today’s organizational disease that we witness around us:

  • Disengagement from work. Productivism isn’t a human ideal. By reducing employees to production tools, by protecting work from the rest of human activities, organizations have created conceptual and functional strongholds. The premise of recurrent wages isn’t a stirring enough purpose to trigger and sustain involvement in such isolation.
  • Hardcore individualism. Customer is king, of course, but propelling consumerism for a century has flattered our ego in unprecedented ways. Businesses have operated in an apparent paradox: to propel mass-production, they have pandered to -an created- individuals’ needs and expectations in a more and more targeted way, encouraging conspicuous consumption and fostering devious hedonistic behaviors. By playing sorcerer’s apprentices, organizations have have allowed this individualistic mindset to blossom inside their walls, facilitated by hierarchical structures and concentration of power.
  • Ethical chasm. By disregarding the collective, corporations have grown in isolation from the issues impacting human communities, in some -many?- cases worsening them: environmental degradation, wealth imbalance, cultural inequalities,…

Toward a new world

Yet, a totally new breed of technology has appeared, disrupting industrial age behaviors even faster than precedent technological milestones have helped in shaping them. For the first time in history, a device, the personal computer, when associated to the internet, has become both a tool of production and a tool of consumption, challenging the producer-consumer relationship on which the industrial paradigm was based, erasing the lines carefully drawn between work and other activities, freeing individuals from this dichotomy, allowing them to think differently over their own role and to relentlessly connect with each other.

As no surprise, most of the technologies built upon this breakthrough derive from this awareness and share common traits:

  • They are personal. Unlike technologies from the industrial age, they are built for the individual, and don’t require heavy infrastructure or strong coordination to be operated. Organizations, in fact, struggle when trying to adapt them to their own command-and-control mindset, stifling their outdated notion of productivity.
  • They are adaptive. As Manuel Castells explains, the networks that information technologies enable doesn’t warrants by itself their superiority over centrally structured hierarchical organizations. Their advantage comes from the flexibility, the ability to adapt to changing environments to “de-center performance and share decision making” according to the context they allow.
  • They are multi-purpose. These technologies are themselves networked and modular, giving individuals unprecedented ways to make them fit any purpose, and to use them to address goals beyond production or consumption only. Unlike precedent technologies, their impact on the society is not predetermined, and lies on the will of those who use them, for better or for worse.

Hyper-connectivity and dynamic reallocation of resources based on trust are the main characteristics of the new, networked, world unveiling in front of our eyes, allowing the rise of micro-markets and the re-appropriation of production by individuals , who have become both producers and customers.

the collaborative world of transactions

Our society’s infrastructure, fitted to the precedent centralized paradigm, is slow to adapt. Our compensation-based world of work, backed up by an omnipotent banking system, is curbing our ability to fully embrace a network-based economy. Our nation states which, after having favored the domination of the mechanistic corporation, could paradoxically be a key actor in the rise of a prosumer world, are now too weak to take over this role.

Yet, it is only a matter of time. In our recessing economies, the movement toward individualization and self-determination is hitting the job market, as part-time and contractual work make up a growing part of the workforce. The future of business is about an organization’s capability to create value from, for, and inside networks. The kind of linked structures businesses are more and more forming in the midst of their ecosystem is not flexible enough to avoid the risk of being disrupted by emergent outcomes from the rising collaborative economy. To avoid this disruption, organizations have little if no choice. Internally, they have to behave as networks to adapt to their environment, thus to embrace the organizational principles of wirearchy. Externally, they must act as nodes in the larger networks making up our communities as well as our society: purposeful, supportive and trustworthy. For many businesses, it is a long way to go. But it is the kind of world we, as human beings, have already started living in.

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Venn’s Adventures in the Future of Work

A few weeks ago, I was invited to speak at BPM Conference Portugal by Alberto Manuel, its chairman and delightful host. My talk focused on the inability for business processes to adequately address real world problems, either from a knowledge worker’s point of view, or from a customer’s point of view. In that sense, organizations, workers and customers live in different worlds, each with its own language, its own behaviors and expectations.

During a chat on the next day while waiting for our planes, Chris Potts, who delivered a brilliant presentation on enterprise architecture, made me a great suggestion: why not summarizing these three conceptions of work through a Venn diagram? This moment of truth made a long way into my thinking: what would be the best representation of business-as-a-Venn-diagram?

Representing the pre-industrial world of work is quite straightforward.

pre-industrial business

With the industrial revolution, the world of work, under the influence of key technologies and of fast growing corporations, transformed itself rapidly. These technologies allowed for unheard performance boosts, and for heavy rationalization of products and services. With the need -and will- to standardize the means of production, came the for standardizing work itself. Here is what organizations in a transactional world look like.

industrial age business

Today, the game has changed. In a world riddled with complexity and drowned in hyper-connectivity, shaken by the emergence of collaborative cultural and economic consumption patterns, this diagram is definitely outdated. Yet how do we represent the present world of work, fragmented by technology, torn between a leadership ideal and productive necessity? Have a look on how many of enterprise 2.0 and social business protagonists and thinkers represent the forces at work in today’s businesses.

outdated business

Problem is… this representation is definitely flawed, for at least two reasons.

Where is the customer gone?

This Peter Drucker’s quote couldn’t be enough repeated: “There is only one valid definition of business purpose: to create a customer.” Customers aren’t only the purpose, but also the engine and the gas of organizations. The force behind most of the changes that organizations are facing today comes from the consumer world; not only have they now to cope with new consumption behaviors, but they more and more run the risk of being disrupted by their own customers. Whether they want it or not, customers are now organizations’ main stakeholder. If businesses don’t transform themselves, their customers will do without them; they are already creating new ways to make, share and consume.

Technology is not a subject, or rather not the one we think

Facilitating the adoption of new technologies and the emergence of work behaviors enabled by these technologies seems to be the lingua franca of transforming organizations. But let us step back for a while. Can we seriously admit, without challenging our assumptions, that the people who struggle to use collaborative platforms in the course of their work are the same who casually play with more computing power than what was available at NASA twenty years ago? I am not talking here of some happy fews, but of more than 1.7 billion smartphone owners, who routinely jump over the trough of disillusionment as over an annoying gutter. If technology has become such an important hurdle in the evolution of the business world, it might well be not because people struggle to adopt the behaviors we expect in an enabled workplace, but because we don’t provide them with the tools they really need.

The real topic related to technology lies at the interface between the company and its customers. Automatization has streamlined a myriad of transactional operations and, as more and more objects get connected – according to Gartner, the Internet of Things will grow to 26 billions connected objects by 2020 – most of these operations are taking place without human interaction, raising a new challenge for organizations.

Maintaining homogeneity in all these machine-to-machine interactions and providing the components for a transparent, seamless customer experience in a self-service world will become increasingly complex, leveraging the need for tightening authentic and meaningful conversations with customers. The heart of organizations doesn’t beat in their center, but at their boundaries. The necessary transformation they will have to undergo to thrive, or simply to survive, will take place at the interface between their structure, their people and their customers. If the future of work is a Venn diagram, here is what it looks like.

the future of work

If you are interested, here is my presentation from the BPM Conference.

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Employee Engagement: Beyond Workplace Psychosis 2.0

psychosis 2.0

I always have been an ardent supporter of true qualitative research. Yet, data IS interesting, specially when, considered under the right angle, it helps shedding a light on otherwise unnoticed facts and behaviors.

A number is a number is a number
Emanuele Quintarelli, when presenting the results of the Social Collaboration Survey he recently conducted among 300 Italian companies, exposed such numbers, which curiously were barely commented, during the recent Enterprise 2.0 Summit (you can have a look to his presentation here). He, and his colleague Stefano Besana, found out that middle management is not the problem we all thought it was. On average, it represents a problem for less than 20 percent of companies having undergone a social business initiative. Wow… A fast and dirty interpretation of this finding would be to correlate it with the now (in)famous prediction from the Gartner Group saying that 80 percent of social business efforts will fail, and to assert that old thinking — introducing social with a project mindset, something easily understandable and actionable at middle management level — fails in reshaping businesses to adapt to our new hyper connected reality.

While intellectually flattering, as it nurtures our believing in the necessity for a cultural and behavioral change, making such a correlation would be a fraud. 80 percent of middle managers seing value in social means that part of them are adopting new leadership traits in their behavior (Emanuele’s survey in fact shows that half of companies, on average, think that their culture fits social initiatives). If so, how may we interpret the dreadful level of disengagement (63 per cent worldwide) among employees reported by Gallup?

When structure trumps culture

More than culture, organizational structure imposes constraints on our behaviors. Going even further, organizational culture might be defined as the set of behaviors which develop over time along the interplay of these constraints. As John Wenger insightfully pointed out:

“I’m often fascinated by how people, when they walk through the door of their workplaces, adopt behaviors akin to the symptoms of Stockholm Syndrome. Despite knowing in our hearts and in our guts that much of how workplaces operate is nonsensical and even anti-human, we maintain the charade that it’s the best way of doing things. As Alan Moore points out in No Straight Lines, industrial systems were not designed with human needs at their heart, yet we still organise workplaces along such lines. We go along with the deceit that doing things in a mechanistic, command-and-control way is the right way to do things.”

In many cases, the “victimization” of unengaged employees isn’t caused by, or targeted toward colleagues and managers, but toward the system itself, which structure embodies a deterministic set of constraints. Restoring goodwill requires much more than changing management’s mindset, it calls for a reweaving of the formal structure of organizations. Structure and culture are intimately linked, and at the end of the day, they all relate to relationships between people. As Dan Pontefract wrote in Flat Army:

“… organizational culture is defined by one criterion, and one only: an organization’s culture is defined by the manner in which employees are treated by their direct leader.”

I won’t discuss here the superiority of networks over industrial era hierarchies as organizational model, many others have brilliantly discussed it, you can for example read these recent posts by Jon Husband or Oskar Berg. Yet, a crucial question remains: does a networked organizational structure intrinsically trigger employee engagement?

Sadly, the answer seems negative. There are still few plausible case studies of companies exhibiting —and living— this kind of structure: Gore, Valve, Automatic, and some others, but they all share a common attitude toward employee engagement: they hire individuals who fit their internal culture, and are particularly cautious about the personality and mindset of new hires. When setting up the right structure, they tend more to protect the corresponding culture than to assimilate dissent elements. Indirectly, they all prove that, if a network-based structure enables engagement and collaboration by leveraging trusted relationships, it doesn’t help that much in restoring motivation from disengaged employees.

Workplace psychosis 2.0

Companies’ culture is evolving; in some cases, their structure is beginning — albeit slowly — to change, but the level of disengagement keeps on increasing. To counter this inexorable trend, some companies are beginning to adopt new behaviors: ROWE human resources approach, BYOD policies, better work-life balance,… but is there any tangible evidence that those are really enhancing engagement?

In a parallel to the rise of industrialization, in our Western societies, the XIXth century has seen our lives being more and more tightly structured and partitioned: work, family, religion, leisure, have grown into social and behavioral “boxes” which, for many people, were largely disconnected one from another. This social, moral, and ontological evolution even reflected itself in the thinking of the time. For example, in Ancient Society, Lewis Henry Morgan, one of the founders of anthropology, described social evolution as a set of patterns belonging different domains: technology, subsistence, marriage, family and political organization.

Today, all, but one, of these personal, social and political boxes which prevailed in the XIXth century have disappeared, in a global transformative movement, accelerated by the internet and the rise of networks. Technology is now pervasive, and affordable to anyone. Family is no more the infrangible nucleus it was hundred years ago, and marriage is no more the reference point of human lives. Political minorities take now their own voice, whichever it is, and the class struggle is merely memories in hedonistic and individualistic societies. Work, instead, has remained the last “reserved” domain, in which people still think and behave differently than in any other situation of a life characterized by social and cultural continuous hybridation. This fracture is less physical, as telework and freelance contracting develops, than psychological, as work codes greatly differ from the ones from our private life, as the nature of work moves away from its outcomes, and gets more and more abstract.

This situation sheds a new light on the lack of engagement, in organizations attempting to adopt more flexible internal rules and to entice employees to bring more of their personality and creativity into the workplace. Being a more complete self in a disconnected, self-contained, workplace, while living a more and more demanding and connected life externally, exhibits all the traits of a split personality disorder. In other words, organizations trying to socialize processes tailored (Taylored) to an industrial-era operational mentality, or to add a social layer to an otherwise closed system, are, slowly but steadily, growing workplace psychosis 2.0.

The nature of the firm, redux

Isn’t there any hope left, beside a radical erase-and-redesign move? Yes, there is. Beside culture and structure, and even beyond them, organizations have to rethink about their nature. I have previously written that the dominant transactional purpose of organizations, famously explained by Ronald Coase, is becoming an economic nonsense. For more than a century, they have grown on top of our society, draining tangible and intangible resources for their own sake, up to the point they have become totally closed systems, subject to growing entropy.

Instead of fighting for a shrinking piece of profit, organizations have to learn how to be useful again to the society which nurtures them, beyond shareholders’ interests, and to become the thriving engines of a global circular economy. To regain sustainability in the new world we see emerging, companies must rethink their own purpose, and will have to switch from an onward, quasi parasitic, to an outward, symbiotic, attitude. The schizophrenia route is definitely a no go. Instead of requiring even more from employees, they are urged to open the doors, and to show them that they care about the world, the society, the city, the life in which they operate.

For sure, most people want to get their work done the best they can, but this only if this work gives sense to their life, and if they are able to feel that this sense is shared among coworkers. Instead of trying to weave socializing behaviors with obsolete business mechanisms, let your employees know you care about your customers, and give them tools to support this. Let them know you care about broader, deeper issues, and help them getting involved in resolving the problems they tackle in their real, external, life. This was the lesson that my friend and colleague from Change Agents Worldwide Céline Schillinger brilliantly gave us during the Enterprise 2.0 Summit: her “Women in Sanofi Pasteur” internal movement grew on the premise of helping to solve the gender balance issue at work, a problem which isn’t limited to the internal corporate world, and the initiative flourished through external recognition. Her success shows that, in order to get more from their employees and contractors, in order to re-engage them, organizations must, simply, give them more. Not as employees, but as human beings. Not in the workplace, but in their life. Let us open the doors of the confined world of work, it needs fresh air. Right now.

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