Is Organizational Evolution Inevitable?
This article is an English translation of 「組織進化是必然趨勢嗎？」, originally published in Chinese on Future Organization Lab 未來組織實驗室 on June 28, 2020.
Before you read, consider
What is organizational evolution for?
How does organizational evolution relate to people?
Trends in the future of work and organizations
1. Time and space are changing too fast to keep up with
Everyone talks about VUCA these days, because our world is changing so fast that the shifts in time and space are overwhelming. Some people are busy making budgets, but they know it’s pointless — no one believes in them, and no one knows what tomorrow will look like.
2. Young people are waking up
Many young people today have become self-aware. There’s a popular joke online about what quitting means.
Ask someone born in the ’60s, “What’s quitting?” and they’ll say: “What’s quitting?”
Ask someone born in the ’70s and they’ll say: “Why would anyone quit?”
Born in the ’80s: “I’ll quit for whoever pays me more.”
Born in the ’90s: “I’ll quit if my boss yells at me.”
Born after ’95: “I’ll quit if I’m not happy.”
Born in the 2000s: “I’ll quit if my boss doesn’t do what I say.”
Do we still dare to manage our employees with a model where post-’70s manage post-’80s and post-’80s manage post-’90s?
3. Technology is changing rapidly
With technology changing so quickly, it’s hard to predict what organizations will become. A friend of mine works in a cutting-edge area of new-retail technology, but with the arrival of AI, even they don’t know where their next technological growth point will be. If that’s true for a technology-first company, what about traditional companies?
4. You don’t know where your competitors are
Everyone talks about cross-industry innovation now. Ask adidas who its competitor is and it won’t necessarily say Nike — it might name some little-known small brand. Ask who is beating Starbucks and the answer won’t be Costa, but the bubble tea shop on the corner.
Why organizational evolution?
For the past few years we’ve been promoting Holacracy. At first we thought it was the world’s most advanced, perfect organizational system, but we gradually found that not every company is suited to it! So what is organizational evolution for? We’ve seen that organizational evolution must be tied to the business and to people — we don’t do it for its own sake.
We firmly believe that organizational evolution may not directly change your company’s profits in a way you can see, but it can help you move forward more steadily, more sustainably and more effectively.
1. The more human, the more effective and lasting!
What is human nature? It’s what all of us share at the deepest level, whatever country or city we’re in. Our deepest human needs are love, freedom, trust and meaning.
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We think more and more companies with new organizational models may appear over the next five years, but that doesn’t stop many companies from continuing to run as hierarchies. For entrepreneurs and leaders, it’s a new choice: whether to grow with a new model of organization.
2. The more vital the organization, the more life it can bring forth!
When analyzing organizational effectiveness, people often use metrics like productivity per person and turnover. But we’ve found that once an organization’s smallest unit becomes each individual, organizational vitality becomes especially important.
This is a chart from our own team’s analysis of organizational effectiveness. You can see, concretely and in real time, how each person in the organization works and how they collaborate with others.
We can look at an organization’s vitality in terms of depth, breadth and speed. The higher the vitality, the more life the organization brings forth; the lower it is, the more the organization may be a pool of stagnant water.
3. Me, We, Us, All of us
Organizational change must be a systemic shift. Without this systemic view — and without believing in these three underlying beliefs — it’s hard to help an organization keep moving forward and evolving.
Across Me, We, Us and All of us, which direction do you want to go, and where do you start? You don’t have to apply all 12 principles at once. There’s an entry point, and it’s closely tied to the ecosystem and environment you’re in.
Four dimensions of self-organization
1. A distributed organizational structure
Self-organization doesn’t mean no management; it means a distributed organizational system. We see many managers still playing a very important role in their organizations — they just show up in a new way.
2. Emphasizing autonomous collaboration
We put “autonomous” in front of collaboration, because collaboration isn’t the boss telling you to work better with other departments. Across the whole planet, humans aren’t the strongest species and may not be the smartest, but we are the best at collaborating.
That makes us reflect: with so many collaboration problems inside organizations, and so many consultants and experts teaching collaboration courses to companies, why are we still not good enough at collaborating?
3. Self-managing individuals
A Harvard professor studied many companies that had adopted Holacracy and found no change at all in employee engagement or customer satisfaction. A little surprising, right?
But when he dug deeper, he found that employees who were already high performers improved dramatically, while low performers declined dramatically — so on average, it came out to zero.
In self-organization, people are asked to grow from “giant babies” into adults. Openly and transparently sharing your work is everyone’s obligation, and we can’t use fear (of authority, of being scolded for mistakes…) as an excuse for withholding information.
4. A dynamic, self-driven decision-making system
We’ve interviewed many of our clients’ employees and asked, “Who calls the shots in the company?” They think for a moment — “I don’t know… the boss?” — and in the end they all say the boss decides. In new organizations, we call it dynamic decision-making: you take on your roles and make your own decisions, without having to report everything to the boss.
On leadership
Most of what we do is technical leadership — continually improving people’s abilities and helping them master skills such as giving performance feedback and communicating with others.
But more and more, leadership now requires you to see complexity, adapt your behavior as a leader to different situations, have greater self-awareness, and know what we’re doing this for — whether we treat people as ends or as means.
If we don’t have enough managers who believe people are ends in themselves, it’s hard to get more people on board. And this adaptive leadership may not only be for those we used to call managers — it’s for every one of us.
How do you do self-organization?
Many people ask how to do it. In fact, it’s simply this: first find a breakthrough problem, lead the team to become aware and awaken together, and then create new change together.
We believe there will be more and more small, beautiful organizations in the future, where people live happier lives. And as more such organizations appear, they’ll ask more and more of the people in them.
[Note: The original post ended with a promotion and registration details for the 4th Organizational Evolution Forum, held online on July 17–18, 2020. As the event has ended, those details are omitted from this translation.]
