- There is no such thing as a social business strategy.
- There are only business strategies that understand networks.
- Cooperative and distributed work is becoming the norm in the network era.
- Social learning is how work gets done in networks.
- Sharing power, enabling conversations, and ensuring transparency are some of the values of networked business.
- Trust emerges when these principles are put in practice.
- Learning is part of work, not separate from it.
What follows is a summary of what I believe are some of the most important issues facing organizational design today.
Chaos, Complexity, Complication
Chaos is a state in which the only appropriate response is to do something quickly, as in an emergency. Chaotic situations require action. Organizations should try to avoid chaos. Complex environments are not chaotic but they cannot be completely understood in advance. Weather systems are complex. Patterns can be sensed and responses prepared, but each case is different. Emerging practices need to be developed while staying engaged with complex systems. Pretty well all human systems are complex. Complicated environments, on the other hand, have many pieces but they can be understood with enough analysis. An airplane is complicated.
Many traditional management practices assume the business system is complicated and understandable, given enough time to analyze it. This is perhaps the major flaw of industrial management. Most of our difficult organizational problems are actually complex. They cannot be understood except in hindsight. Each time we deal with a complex environment it is different. This means we cannot repeat what we did before and expect the same results. Instead, complex situations require constant small probing actions that are safe to fail. We can only understand complexity through active experiments, accepting that perhaps half of these will fail. Encouraging failure, and learning from it, must be the default management mode in complex environments.
Collaboration & Cooperation
Complex problems require cooperation while complicated projects need collaboration. Collaboration is working together on a common problem, while cooperation is freely sharing without any objective. Cooperation is not team work. It is helping the entire organization, as one would support a natural commons, and this requires people who are not just doing their job, but involved in the whole system. This is a major change in how business functions have been managed. Knowing what is complicated, and what is complex, can help the organization develop the appropriate work practices. Less structure and more flexibility is required for complex problems.
In complex environments, how can an organization build awareness, investigate alternatives, and act on problems, to become a triple-A enterprise? The organization needs to connect the outside with the inside. This is not a technology challenge but rather a structural one. Organizations need to help knowledge flow and this only happens when people are connected. Technology is a facilitator, but people are the key. This is too often overlooked, as in most enterprise social network implementations, where training is bolted on at the end of the technology build. Encouraging awareness, experimenting with alternatives, and taking action can each be supported within a unified organizational framework.
We already have the communication technologies to know what is happening across any organization. Most companies are also listening attentively to external social media. Given all this information, it is an easy next step to let people experiment, as long as they share what they are doing. Practices such as working out loud help build trust. In an age when information is no longer scarce and connections are many, organizations have to let all workers actively share their knowledge. To succeed in the creative economy, organizations require a combination of actively engaged knowledge workers, using optimal communications tools, all within a supportive work structure.
We are at the beginning of another management revolution, similar to the one that created modern business schools and their scientific methods. There are many examples today of companies testing out new management models such as the social enterprise, democracy in the workplace, self-organizing work teams, and networked free-agents. While there are no clear answers, it is fairly certain that standing still will lead to failure. Giving up control is the great challenge for management.
Organizations have to become knowledge networks. An effective knowledge network cultivates the diversity and autonomy of each worker. Networked leaders foster deeper connections, developed through ongoing and meaningful conversations. They understand the importance of tacit knowledge in solving complex problems. Networked leaders know they are just nodes in the knowledge network and not a special position in a hierarchy. The new focus of management has to be on supporting human networks.
For further elaboration on these subjects, see my perpetual beta e-books.