Change, Learning and Leadership

By Guy Higgins,

I was reading an article recently, Principles for an Age of Acceleration. The basic premise of the article was that everything is changing so fast that we can’t keep up with it. That change is driven by the pace of advances in technology – all kinds of technology, not just information technology. Driven by, but not isolated to, technological change. Technological change is enabling or forcing changes in society, health, governance, and ethics (and, maybe, everything else). I was disturbed by the article. Will artificial intelligence create massive unemployment? Will we find ourselves in an ethical swamp as we use genetic manipulation to grow replacement organs in pigs (and yes, that’s something being pursued today)? What will society look like when humans are no longer a necessary part of the economy? Continue reading

Organization and Re-Organization

By Guy Higgins

I just finished reading a very long post titled, Functional vs. Unit Organization. First, I think that it is an excellent discussion of the two ends of the organizational spectrum – functional and unit (or program or product). I urge the Noble Reader to read it.

I, however, want to take (sort of) issue with one point. The post discusses organizational structures and where problems arise – whether it’s a functional or a unit organizational structure. Those are important things to talk about. Even better, the author foot stomps that, before any work is done on the creation of an organization, there must be a problem statement – what is the problem (or are the problems) that are to be solved. This foot stomp is, I think crucial. But the next question that needs to be asked (my question) is, “How do you want people to work to solve that problem?” Continue reading

Knowledge is Power – Or is It?

By Guy Higgins

A generation ago, when I transferred from my last squadron to Washington, DC, I recall hearing a slightly senior officer repeat the phrase, “Knowledge is power,” in reference to working within the federal bureaucracy in DC. He went on to explain that if you knew something that others did not, then you were in a position of power – power to influence events in the direction you wanted. The phrase has been attributed to Sir Francis Bacon who included it in his 1597 book, Meditationes Sacrae and Human Philosophy. In the context of the book, Sir Francis meant that the more you knew, the more you could influence events – not quite the same thing that the slightly senior officer meant. From the senior officer’s perspective, secret or restricted knowledge provided power. From Sir Francis’ perspective, power accumulated with increasing knowledge (which implies not only facts but understanding) – the more a person knew and understood, the greater influence that person could wield. Continue reading

Centralized or De-centralized?

By Guy Higgins

Organizations seem to continuously grapple with a single important issue – how to create a structure that has the consistent performance of a highly centralized structure while retaining the agility and responsiveness of a highly de-centralized structure. Based on my experience, actual organizational structure is a function of organizational size.

Very small organizations tend to be inherently responsive – there simply is almost zero impedance to either communication or decision/direction. One apparent price for this speed/agility is a frequent lack of consistency in the quality and strategic alignment of the decisions/directions. This lack of consistency is a result of the absence of stringently implemented and enforced processes. Action is taken by the “right person,” but said action is aligned with that person’s perspective of “the right thing to do” and his understanding of the organizational strategy. So, very small organizations react very quickly – sometimes well, sometimes not so much.

Very large organizations tend to achieve very consistent performance (although that performance may be significantly poorer than possible). One apparent price for that consistency is the loss of speed/agility. Both the consistent performance and the loss of speed/agility are the result of the creation, implementation and enforcement of processes (processes are good things, but they do take time). These processes seem to require (or are required by) layers of management – parts of the organization to execute the processes. Each of these parts of the organization uses time to complete “its” steps in the process. When the output of the process reaches the decision maker, it is in a consistent format with all the expected information (all the blocks are checked). The decision maker can then quickly absorb the information and then either make the decision or convene a meeting to discuss and debate the situation/information and then reach a decision. None of this is bad, but it does have unwanted characteristics.

Am I implying that very small organizations cannot be consistent or that very large organizations cannot be agile and responsive? I don’t think so. Before I get further into that, I want to take a short trip down history lane.

The very first known organization chart, and therefore the first purposefully designed organization (as opposed to an ad hoc organization), was developed by Daniel McCallum for the New York and Erie Railroad in 1854. The organization (and its chart) was highly de-centralized (each railroad line was physically independent and run independently). Decisions were made by the men at the stations and on the trains – the men actually running the railroad. In that age of telegraphic information, they were also the men with the best, most current information. The railroad had a common set of processes that were enforced – but enforced at the “local” level, the level at which time-sensitive decisions were made. In this instance, “time sensitivity” means that the time available in which to make and execute a decision, the time required to obtain the information needed to make the decision, and the time available for the action to be completed all align.

Seventy-five years later (say about 1930), organization charts were commonplace, but little thought had been devoted to the question of centralization vs. de-centralization. Most companies were organized with central control. I suspect that this was largely the result of the Status Quo Bias (humans are reluctant to change the existing situation) not some considered decision. The greatest discussions about organizational structure addressed the question of whether they should centrally organize around focused efforts (products, programs, projects) or technical skills (engineering, finance, manufacturing). In fact, these discussions are continuing today as companies swing, pendulum-like, between strong program structures and strong matrix structures.

I’ll assert that large companies suffer from this oscillation between strong matrix structures and strong program structures, and that has resulted in the centralization that is common among these large companies. Similarly, it is the absence of any matrix-like influence in very small companies that results in the decentralization and lack of consistency.

I think that the information technology available today can enable both very small and very large companies to operate with both consistency and agility.

For small companies, the key to consistency is process. These companies can, with much less effort than feared, expected or projected, document the ways that they will do business – that documentation is their processes. The documentation need only be as detailed as necessary to achieve acceptable consistency of performance. It’s always important to remember, when documenting/creating processes, that the goal is to get the job done, not to create the process. The process is a tool, not an end objective. Very small companies are, commonly, project-oriented by nature – this puts the decision making in the hands of the people doing the work, which in turn creates responsiveness/agility. Information technology makes it simple to create the processes and make them available to everyone in the company.

Very large companies, however, have the opposite problem; they have lots of processes, but they also centralize the decision making at very high levels (to ensure that consistency across the entire organization). These companies need to invest much more effort in achieving agility than does the very small company in achieving consistency. To achieve agility in a process-dense environment, very large companies need to:

  • Establish a common vocabulary to facilitate effective communication across the company
  • Commit to the creation of a culture that puts the decision making at the “pointy end of the sword” so that the people who most need quick decisions and are most able to make those decisions are invested with that authority.
  • Invest in the development of leaders at all levels of the company – people who speak the common vocabulary, understand the business, understand the “non-user-friendliness” of the real world, and are practiced in leading and making decisions.
  • Trust leaders throughout the organization and accept the inevitability of mistakes and failures. Mistakes and failures should never mean the end of a career.

These activities will move a company from being highly centralized to being more de-centralized. That leaves very large companies with the problem of ensuring consistency in a more de-centralized organization – similar to a small, de-centralized company. This is where modern information technology again comes riding to the rescue. Networks allow the nearly instantaneous publication and updating of processes throughout the organization – and it also facilitates continuous improvement of those processes – two-way (up and down the hierarchy) process management.

It takes much more work to change the direction of a very large company than it does a very small one just like it takes much more effort to turn a glacier than it does an ice cube. That doesn’t mean that all companies should not be investing effort in being both consistent and agile.

Thoughts?

Organizational Complexity

By Guy Higgins

I recently finished a book, The Collapse of Complex Societies, by Dr. Joseph Tainter.  Dr. Tainter is an anthropologist and historian.  His stated goal is to uncover a general principle that governs or, at least, influences societal collapse – and he proposed to uncover that principle by considering various theories previously proposed in the light cast by the collapse of three historical societies: The Western Roman Empire, The Mayan civilization in Central America, and the Chacoan society in the Southwestern U.S..

I’m not going to go into his thoughts on societal collapse, but I want to focus on a couple of his ideas and/or insights: Continue reading

Organization and Survival

By Guy Higgins

I was recently scanning some news, and Bloomberg BusinessWeek had a short piece on al Qaida (AQ).  It said that experts are talking about how AQ has been beaten down but is re-grouping.  That got me to thinking.  In Guns, Germs and Steel, Jared Diamond hypothesizes about (among other things) why the Spanish invaded the Aztec and Inca Empires and destroyed them almost overnight but were completely unable to subdue bands of nomadic Apaches.  The Spanish moved into Apache country expecting to subdue the natives just like they did the Aztecs and the Incas.  Well, that was the theory (interesting thing about “theory,” it seems to work best in theory).  Two hundred years later, there were virtually no Spaniards in Apache territory and the Apaches were doing just fine, thank you very much.

Mr. Diamond notes that the Aztecs and the Incas, like the Spanish, had highly evolved and sophisticated central governments.  The Spanish were able to attack and destroy those centralized governments (in the persons of Atahualpa-inca and Montezuma).  The Apaches didn’t have a central government – or even a widely recognized high chief.  The Apaches (actually, individual small groups of Apaches) recognized wise men who put themselves forward to accomplish some specific goal or aim.  That’s how Geronimo became a war leader of the Apaches. Continue reading

Dysfunction and Change

By Guy Higgins

I just finished reading through the comment thread to a question that was posted in one of the discussion groups that I belong to (grammatically following the lead of Sir Winston Churchill who said, “A preposition is a terrible thing to end a sentence with.”).  That thread was started with the question, “Why is it so difficult to change even obviously dysfunctional organizations?”

A most interesting question, and the twenty or so comments were equally interesting.  They addressed a number of topics, issues and problems surrounding the question.  I won’t deceive myself in thinking that I have THE answer, but I want to ramble about the question and see if I can find some useful insight. Continue reading

Organizational Alignment

I came across a posting recently that asserted “… organisational (sic) alignment is the key to performance.”  That made me recall the following quotation: “We trained hard, but it seemed that every time we were beginning to form up into teams, we would be reorganized.  I was to learn later in life that we tend to meet any new situation by reorganizing, and a wonderful method it can be for creating the illusion of progress while producing confusion inefficiency, and demoralization.”  (This quote is continually attributed to good old Petronius Arbiter, a Roman satirist during the reign of Nero.  However, I think it actually falls into the, “Gee, I wish I had said that” category.) Continue reading