Dynamics and Paradoxes

Beware of the paradox!

Just to make things interesting, we are never far away from a paradox...here in particular when trying to capture the essence of Organization 5.0 through identifying their principles, whilst the vast majority of the Case Studies explicitly avoid writing down rules and practices, that might diminish the responsibilities of individuals to use their own judgement. 

This approach of capturing the essence of the Case Studies through their principles is an effort that is believed to go one level lower than "rules" (with performative contracdicitons such as having a rule that there are no rules), but is consciously always going to be a partial perspective.

A parallel might exist with the myth that such a thing as a "Free Market", promoted by libertarian economists or politicians. Markets are always bound by rules, whether they are explicit or implicit. Any organization can be seen as a market, in how its boundaries create a unique market place of collaboration - but by definition, there is an operational code to how individuals should behave.  



Organizational Dynamics as Dialectical Forces

Forces in Opposition, Paradox Central

Welcome to paradox central, where we discover a range of anecdotes from the Case Studies that illustrate how paradoxes permeate so many of them. This also points to how "dualities" are omnipresent and coexist in a dynamic equilibrium. This "holding" of dualities could be seen to be a hallmark of Organization 5.0.
  • Ricardo Semler talked about his 'perceived but unactualised' power (in the eyes of the employees) for making ultimate decisions influenced employees to take responsibility. Their knowledge of his power was enough - but the moment he exercised his power would in theory have grave consequences to the self-management culture. In exercising his power, he would de-responsibilise the employees.
  • The more rules that are put into place, the less responsible the individuals' feel - rules remove scope for individuals' own judgement.

Centralise - Decentralise: The eternal balancing act


In addressing the fundamental challenge of how to balance central coordination and control with decentralised fulfillment of each person's potential for responsibility, the research holds both the case studies' diversity in their cultures and form, and identifies convergence in their principles and methodolgies.

 Centralise
  • Advantages: 
    • Control (from the perspective of the Owners)
    • Coherence, Consistency
    • Long term goal planning
    • Value assigned to experience
    • Rewards with role and status
  • Disadvantages:
    • "Victim" mindset pathology
    • Bottlenecks / filtering of information flow
Decentralise 
  • Advantages:
    • "Player" mindset of collaborators
    • Owners/stakeholders incited to focus more on the Why, and delegation of the What/How
    • Associated with "Internal Markets" and "Networks" for optimum deployment of resources/talent
    • Emergent, adaptable practices
  • Disadvantages:
    • No long term planning
    • Demands greater responsibility, discipline and investment by each person
    • Uncertainty as to capacities of each person to fulfill expectations
    • Complexity, noise, agitation
    • Devaluing of experience 

It is worth noting here, some fascinating exceptions to what we might assume, for example that "youth" equates with "flexibility". In fact the inverse might apply, that it is more the experienced members of the team that embrace flexibility, as discovered by Jakob Krause-Jensen during his research at Bang & Olufsen and described in his book "Flexible Firm".

Corporate "culture", quoting further Jakob Krause-Jensen (p.275), can also be interpreted: "as systems of meaning that work to mediate the inherent tensions between:

 Between  
 individual prosperityandorganisational demands
 formal reality andsubstantial rationality 
 changeandstability 
 bottom-linesand"Bildung" (culture) 
passionandmoderation  
 entrepreneurialism andteamwork 
 reflexivityandeffectiveness 
 centralisation andempowerment 
 fast executionanddialogue 
 humans-as-resourcesand resources-in-humans
 firmnessandflexibility 


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