Business organizations are decision making networks. To ‘organize’ is to construct or establish. The word comes from ‘organ’ which has a confused etymology. It surfaces in the Greek as an ‘implement, a tool for making or doing’. It had a strong association to musical instruments. Which is helpful because the metaphor of a business organization as a machine is a poor one. Or at least, our post-Industrial era sense of what a machine is.
Conventional business has been disrupted by the MANIACS complex of technological change (Mobile, ANalytics, IoT, AI, Cloud, Social). This complex has rendered obsolete much of what has worked fairly well since Fayol laid down the basis of the functional principle of business organization in the 1870’s.
The thing about MANIACS is that all six elements have hit the workplace at much the same time. This has disoriented business leaders as we try and figure out the best way forward. One of the first things we need to confront is our relative powerlessness as leaders.
Business organizations are decision making networks. Decisions are made all the time by pretty much everyone. Most of those decisions affect the decision making behaviour of senior leadership teams. In some cases the decisions of senior leaders are simply vanity decisions: made to look and feel good. This is a serious issue in business today and one of the reasons why I've embarked on the journey I have. Significant business decisions can be made deep within an organization and senior leaders are none the wiser.
In previous posts I've written about two critical elements at play here: futurity and liminality. Futurity is the time span over which a decision is effective and liminality is a stage of ambiguity and disorientation that precedes a new way of thinking. Taken together we find a web of business decisions made both out of time and out of place amplifying and constraining what we do.
Bounded rationality tells us we might be quite unaware of what's going on. It’s a precarious place to be.
Much of the decisions taken within organizations will have significant elements of uncertainty. This means these decision makers are also risk takers. We want this. If we want to change the timeline we need to encourage investments of blood and treasure into alternative views of the future. This is what risk taking is about. And we want risk taking decisions to occur as close as possible to the material decision point as possible. Kicking decisions upstairs costs time and context that can rob a good idea of its promise very quickly.
It's because strategic value adding decisions can be made anywhere in the organization that I'm making such a fuss about identifying the heroine of this narrative. I use the placeholder [.] to signify this risk taking, purpose seeking, value adding person, who may have no formal authority role (the manager) or recognised influence (the leader).
I use the placeholder to make room for this person to reveal themselves. Otherwise we risk losing context. Just like the way Pluto was discovered by studying perturbations in the orbit of Uranus, so I believe that we need to consider another term for these hidden decision makers in our organizations.
So what is a senior leader to do? Or rather, what can they do? There is possibly little they can do beyond tackling the serious and seemingly intractable questions of vision, mission and purpose. There is no one else to whom these questions can be delegated without substantially changing the social construct of the organization.
Someone somewhere has to address these epistemic questions if the organization has a hope of navigating its way to the future. That so many organizations are in a mess is because, I believe, they have populated their upper ranks with delivery focused people who are unused to tackling these critically strategic questions or have chosen to not address the intent of the questions.
Sometimes a valiant attempt is made to answer the question. Leadership teams get close to the answer that best describes their vision of the future only to fail at the last hurdle. This hurdle is formulating the question as a decision. A decision is a decision only if there is a choice between genuine alternatives. A decision is only a decision if action emerges. This means we as leaders must confront different visions of the future, choose one and then commit blood and treasure to bringing into being.
This decision should be the most momentous decision made in the business organization. It is a high risk decision and, because it is high risk, we have a strong tendency to undermine our efforts. We do this by seeking to minimise the risk, where risk is seen as synonymous with a threat. But risk in this context is positive and intentional change.
Success in business largely comes down to being able to take on more risk, to attempt more change, to create greater value. Risk in business is about changing the timeline, about creating a new set of possibilities. For senior leaders the threat of everything blowing up in their faces is evidence that something of genuine strategic significance is being attempted.
Incremental innovation won't beat the curve. This again is why I see the [.] as being a different beast. Because this individual isn't intimidated by the stakes at play. They embrace the challenge because they understand that the challenge must be embraced. To do otherwise is to surrender the initiative and accept current reality as the best option.