Organizing for diversity and complexity

I’ve been looking at ways to explain why social learning is so important for business today. It comes down to the fact that what we know and do inside our organizations is insufficient to address external complexity or to be innovative. In Leadership 2030, the Hay Group identifies six fairly obvious, but worth repeating, megatrends, all of which will require more innovative approaches to work:

  • The balance of power is shifting to the East
  • Climate change and scarcity of resources is a mounting problem
  • The war for talent rages on
  • Accommodating growing individualization, requiring more social workplaces
  • Embracing people who are digitally adept
  • Harnessing Nano-Info-Bio-Cogno technologies

Connecting the diversity of markets and society to the organization, instead of creating firewalls, is a major challenge for leadership today. How do you maintain the integrity of the organization while embracing the chaos beyond? Part of the answer is in supporting communities of practice as a bridge between external networks and those doing the work.

Project Teams do complex work (if it’s not complex, it will be outsourced & automated) which requires strong interpersonal ties. Nick Milton has a similar explanatory framework [I've used some of his terms in my revised graphic above], and notes the increase in virtual teams as well:

The fourth level [project teams] is where the business needs actively to work with people from elsewhere as part of a short lived co-located team, or a longer lived virtual team.  It needs the skills and input and judgment and effort from the others, and the outcome is co-created with the others.

At the far end are external networks, where we get ideas and opinions, in a more chaotic, unstructured and random way. This is where serendipity often beckons.

In the middle are communities of practice, which comprise a mix of strong and weak social ties and are the ideal liquid space for mixing learning and work while sharing advice and knowledge. Social networks are the enabling technologies that can connect external networks, communities of practice and project teams. Social learning is what flows on these networks.

Ross Dawson has a very good description of the power of social networks from the perspective of Giam Swiegers, CEO of Deloitte Australia. However, social media change the hierarchical power dynamic and not all leaders may be ready for it:

He said as a senior executive if you can’t handle having a peer conversation with young, junior staff, you shouldn’t get involved. He gave an example of a young staff member who disagreed on a key issue with the CEO who said so publicly. Swiegers far preferred to have the debate with him in public rather than the views being aired in the pub without him knowing about it.

An unpopular policy decision was made internally that Swiegers was not told about. The response on Yammer was strong, quickly leading to changes in the policy, guided by the most sensible alternatives proposed on the social network.

The power of social networks, like electricity, will inevitably change almost every business model. Leaders need to understand the importance of organizational architecture. Working smarter starts by organizing to embrace diversity and manage complexity.

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