Inspiring Your Authentic Week

Posted: 19 Jan 2009 02:24 AM CST

Hierarchy works well in narrow, or stable situations.

During a crisis an individual and capable leader can maintain clarity, communication and focus. The role is extremely intense and can rarely be maintained over a long period, but a hierarchical structure is often best when the objective is narrow and the situation is critical.

Hierarchy also works well in very stable situations, where roles have time to become established, where the situation is predictable and the variables are known. Hierarchy is suitable for industrial age organisations where the tasks are essentially repetitive and the pace of change is incremental.

Where hierarchy is weak is in fast paced, dynamic situations, where there are myriad objectives and unpredictable variables, where innovation and flexibility are key.

The fundamental weakness of hierarchy is that except in the "narrow" and "stable" situations identified above you don't have the most suitable leader most of the time.

For most businesses today "narrow" or "stable" just does not describe the environment they are operating in.

The challenge is that many more established businesses were designed in a different era, many banks, car manufacturers, retailers and others were designed in a time when things were relatively stable.

Today we have rapidly shifting credit and insurance availability, we have emerging markets, climate change, emerging technologies, political shifts and social changes. We have multiple objectives and more empowered and educated workforces and far, far more competition. All of this is coupled with an overwhelming availability of information.

It is simply impossible for an individual or even a group of similar individuals to keep up, let alone maintain a coherent strategy and approach.

We need to redesign our organisational structures, both in business and in the public sector, to be far more flexible, far more innovative and far quicker to respond.

In the post industrial, global, digital business landscape businesses need to be diverse, empowering, inspiring and innovative. And they need a structure that is about facilitation rather than control.

After all - if you don't trust the people who work for you - why do you employ them?

The kind of structure I am thinking of has the board acting more like Business Angels than Managers, their job is to set the criteria for success, allocate funds and recruit and mentor key people.

They give the maximum flexibility to great people to succeed in an interconnected, diverse and cellular organisation.

They set objectives that are inspiring as well as rewarding and go beyond profit.

Businesses structured along these lines exist and are seriously successful. WL Gore, Mondragon, Cisco (see this Fast Company article) and Google are examples.

The key barrier to transforming businesses from industrial age to digital age is the embedded culture of the organisation, particularly the existing leadership culture.

The path to success in the digital age involves training the existing generation of leadership to start behaving like the next generation of leadership - now.

If you would like to have a chat about these ideas and how they might affect your organisation - drop me a line - neil@authenticis.com

Please also note that my neil@authenticbusiness.co.uk e-mail address is no longer working. Please be sure to use neil@authenticis.com and to update your spam filters to accept messages from neil@authenticis.com.

With love

nx

Neil Crofts
Inspirer
authenticis
inspiration innovation motivation

+44 (0)7775 658534
neil@authenticis.com
www.authenticis.com