June 15, 2010 by Uwe Hook
Image: Courtesy of 28.media.tumblr
There are systems that are machines; there are systems that are organisms; and there are systems that are social systems. You would be really stupid to treat a machine as an organism. No machine has any goals of survival or growth. But, for some reason, we do treat organisms as machines. Actually, most companies continue to do so. Treating organisms as machines or social systems as machine might be somehow useful. But it doesn’t deliver the multitude of benefits when looking at a social system as a social system.
One of the unintended consequences of this thinking is the tendency to make people behave as though they were machines. Dehumanizing work has led to alienation from institutions, one of the biggest challenges for companies. The reductive doctrine just goes against anything humans believe in: Holistic medicine, the Earth as a global ecosystem, our planet as part of a bigger universe. We’re living in an age of expansion: To understand anything, we have to look at larger systems. Sure, we might never completely understand everything but our understanding increases when we look at the larger picture, reflecting on the largest systems our mind can comprehend.
But, first, let’s have a look how we got here:
From Industrial Revolution to modern corporation
The Industrial Revolution was about the mechanization of work. First thing we did is to take each task apart. Reducing work to elementary tasks. The next step was to mechanize those tasks. We separated tasks into two piles: tasks machines could do and tasks people were assigned to (because it was too complex for machines, human labor was cheaper, etc.). Once we completed the analysis, we aggregated our findings and developed a workflow of elementary tasks performed by men and machines. These are the basics of a modern factory.
In the early stages of industrialization, an enterprise was created to serve an owner. The only reason of existence for the enterprise was to provide the owner with a return on his investment. The worker was a machine: Input equals Output. As the size and complexity of organizations increased, it became less effective to manage them as though they were machines. Decentralizing control became necessary which was incompatible with a mechanistic conception of an organization.
The next step in organization structures was to separate the body (Corpus, meaning body), the operating unit, and the brain, management. This was a fairly easy way to manage an organization’s growth and increase the diversity of its outputs. The body was mindless. It had no choice. It was still a tool, a lever to be pulled.
In the 60’s, various civil movements (civil liberties, environmental, etc.) formed outside of social systems, insisting that their interests be better served by the systems that affected them. Ethics and social responsibility became cornerstones of successful corporations. The command and control management culture changed during that time, focusing more on managing interactions and enabling people to do their jobs better.
While a lot of progress was being made during that time, companies had to react to the advances in information technology and communication. The common belief was (and often is) that people would react mechanistically to information, meaning more and more information and better communication structures would increase the performance of businesses dramatically. As we all experienced during the Great Recession and the demise of various financial models, humans don’t react deterministically to the information they receive.
Shareholder Value vs Stakeholder Value
The main challenge for modern enterprises is to transform from a shareholder-centric to a stakeholder-centric point of view. It’s not enough anymore to create wealth for a limited amount of shareholders; modern enterprises are tasked to create and distribute wealth throughout society. The primary task for each modern enterprise is to provide productive employment with purpose. Companies have to develop communities of purpose focusing on a common cause, which emanates from common values, vision, and passion.
Sharing a common purpose helps companies to deal effectively with increasing information overload and intensifying conflicts. A social enterprise is capable of continuously dissolving conflict while increasing choice. This requires a new organizational concept that sees evolution as its most important objective. Evolution doesn’t always mean growth: Growth may occur without evolution and vice versa. This new organizational model needs to be based on the pillars of democracy, must be multi-dimensional (function, output and stakeholders), agile planning and an optimization system.
In Part 3, we’ll discuss what new forms of management are needed for the social enterprise based on the principles of Human Business Design.
In case you missed it, Part 1 talked about the nature of systems.
Category: Uncategorized
Tags: age of expansion, agile planning, alientation, command and control, communities, corporation, corpus, decentralization, dehumanizing work, enterprise, evolution, Great Recession, holistic medicine, Human Business Design, human labor, industrial revolution, information overload, machines, mechanization of work, operating unit, optimization system, organisms, people equal machines, productive employment with purpose, purpose, Shareholder Value, social enterprise, social systems, Stakeholder Contribution, Stakeholder Satisfaction, Stakeholder Value, systems, vision
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February 11, 2010 by Uwe Hook
This is my daughter. Look at her. There’s this aura of infinite possibilities – she’s ready to take on the world. Nothing will stand in her way to explore this world that’s hers. We all used to be like that. We all had this fire in our eyes. Each morning we couldn’t wait to get out of bed, ready to make this world our world. We were curious. Eager. Had so many questions. Tried things out. Fell down. Tried them again.
And then life happened to us. Or better, institutions stood in our way. Pre-school. Kindergarden. Norms. Criticism. Homework. Schedules. School. Cruel teachers. Critical teachers. Grades. Norms. The system integrated us. We integrated the system into our lives. Into our thinking. And being. We graduated. When we were lucky, we traveled for a while. Found that joyful life experience again. But now it was time to join the workforce. To fit in. To accept mediocrity. Suddenly, it’s hard to get out of bed in the morning. Weekends and vacations are the only remaining highlights. We are slowly killing off everything that made us happy and curious in the first place.
Hold on, we just got a second chance.
The Great Recession is the biggest opportunity we will encounter in our lives. The Great Recession equals major hardship for many people but it also marks the end of the corporate era. If you’re corporate drone, your job will be eliminated very soon. If you try to fit in to make it in this world, you will struggle for the rest of your life. In order to succeed, you have to become an artist.
That’s the premise of Seth Godin’s newest book “Linchpin – Are you indispensable?” We have to become more human, creative and generous to be seen as unique and irreplaceable. And, most importantly, we have to ship. Meaning, we have to produce. Not spending hours on email trafficking, Twitter scanning, blog commenting. No, shipping. Producing. Doing. We can either give in to the lizard brain, the little part of your brain that is concerned with survival and is the reason for your procrastination and all your irrational fears. Or we can create our own destiny. Our own reality. And, at the same time, change the world.
Seth Godin’s Linchpin might be the most important book you’ve read in a long time. Hopefully, it will change you and your thinking. We’ve been working with major Fortune 100 corporations for years, even decades. We understand how tough it is to implement cultural change. But, it’s necessary. Actually, it’s imperative. Would you rather help your company change or see it vanish?
Seth Godin’s Linchpin and Hugh McLeod’s Evil plans (he illustrated Linchpin because he’s one) will give you the motivation and desire to change the world. We started our company with the goal to help transform businesses and change the way we work and live. Seth Godin distilled our thoughts in a neat and exciting package. Now it’s your turn to take the ball and change the world. We hope you’re ready.
Category: Uncategorized
Tags: Business Management Practices, change the world, Corporate Strategies, Corporations, Enterprise 2.0, evil plans, gapingvoid, Great Recession, Hugh McLeod, Human Business Design, linchpin, Seth Godin, Technology is not the answer
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January 13, 2010 by Uwe Hook
Image courtesy of ‘While you weren’t listening’
My daughter is obsessed with quantity: “How long? 5 minutes? Oh, that’s such a long time.”
“How many days until I go back to school? 2 days? That’s such a long time.”
My favorite:
Me: “You can only have one.” Daughter: “But I want 2, 3, 4, 5, 6, 19!”
She’s not much different than the rest of us. If you can’t quantify it, it doesn’t exist. We get trained early on focusing on grades, sizes, personal records – give me any quantity, people will flock to it. And so they do, at their own peril. Just ask the math wizards on Wall Street who almost brought the economy to its knees with their models, derivatives and CDO’s.
Data linked with analysis doesn’t tell you the truth. It provides an assumption of the truth. Nothing more. Any Black Swan will destroy this assumption in an instant.
We see this pervasiveness and blind belief in data everywhere: Employees are resources that need to be utilized. Brands consider people targets that need to be tracked and hunted down by more and more ads.
It’s time to grow up, my daughter will one day, and learn that quality is often more important than quantity. You can’t compare 5 minutes at the dentist with a 5 minute hug of your loved one. Employees have non-quantitative strengths that are not measurable. We just know they have them. Just like products and services have non-quantitative strengths that transforms a product from a commodity into an object of desire.
Sales people are often measured by the quantity of their calls, not the quality of their interactions. Customer Service agents are being judged by the number of calls they handled, not the value they provided to customers. The list is endless.
Sure, we need to constantly improve our data sets and optimize them. But, the altar of data is not worth praying at. Leaving non-quantitative factors out is a road to nowhere. Integrating measurement into a more holistic, dare I say, human perspective should be the goal. Let’s use data and technology as a tool to better understand, innovate and change the world. Time to grow up. Who wants to be stuck in the “2,3,4,5,6,19″ rut forever?
Category: Uncategorized
Tags: change the world, Corporate Strategies, Data Obsession, Great Recession, Human Business Design, non-quantitative factors, Numerati, Technology is not the answer, Wall Street
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