Revisiting the Corporation of the Future
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THE CORPORATION OF THE FUTURE
the bigger the world economy, the more powerful will be the smaller players. This is because they are more flexible, faster and more economical – not burdened by layers of bureaucracy. Computers and telecommunications, now affordable to small companies, allow them to compete globally, and deregulation and globalization of financial markets gives them access to capital. Computer-driven technology also makes it possible to produce small runs of customized “higher value-added” products aimed at niche markets. Products produced “just in time” save money on inventory, and they can be quickly improved to compete with rapidly changing technology and tastes. Big companies will break up into confederations of small, entrepreneurial units. Small interacting firms will form themselves into temporary mosaics to be more adaptive and productive.
Alvin Toffler
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In June 2013 I wrote an incredibly long piece called “inside out leadership” which shared a number of thoughts about the Future of Work. My belief was that after a misguided unhealthy focus on “the customer is king/queen” businesses would refocus their efforts on their “inside” <values, mission, culture, beliefs> in order to not only engage with right customers but also to create their value.
This portion, reprised, focuses on autonomy, distributed leadership and what I was calling ‘agile companies’ back in 2013.
Leadership in the future will be defined by the inside aspect of their businesses not just in producing things but rather knowledge capital, the values surrounding that knowledge application which create the character/personality value, and how it is all managed. Ah. Managed. Maybe better said getting an organization to collectively think in a common direction so that the individuals can be empowered to produce, think & do effectively.
This means organizational leadership will be defined by the ability to not respond to the consumer but rather respond, and adapt, to the organizational inputs & needs <boy, there is a paradigm shift>.
Oddly, this means organizational “power”, in general, will depend on taking advantage of the inevitable cracks in the process created by speed <agility> — not seamless surges forward.
To be clear. Agility will create cracks. The cracks created by the events that were not pre-programmed or foreseen.
I imagine this means true leadership partially depends partially on chance <finding the opportunities to lead within the moment> and managing human behavior in a desired fashion. This doesn’t mean everything is accidental. Not everything is random. In fact power is found within predictability as well as randomness. Organizational Power implies combining chance, necessity, continuity, chaos and order.
To me this means the new inside out leaders will have more of an opportunity to create the necessary attitudinal shift in business world than in recent years. Smaller organizations are easier to create attitudinal and behavioral direction than larger organizations which means creating lots of smaller pieces and parts coalescing in a common direction can affect a larger cultural shift in larger organizations. Conceptually, these different smaller business “teams” will shift traditional power away from manager-bureaucrats forcing the creation of a new type of leader.
That said. I believe organizational morality <or value beyond profit> will become the leadership cornerstone within an organization. While morality and virtue are developed over time <via repeated decisions to choose what is right and to forego what is wrong> which typically means there is no quick fix to any organizational morality problems … lots of smaller pieces can be redirected in the here and now.
Today’s’ inside out leader faces a variety of challenges. I will speak to what I consider the two biggest:
– Embracing fragmented knowledge while empowering it through organizational ‘tribes’
– Discerning between desire for speed and need for speed
inside out leader: Embracing fragmented knowledge while empowering it through ‘organizational tribes‘ <or teams>
There are two portions to this challenge – contradictory but compatible.
Individualism empowered by access to knowledge and organizational tribes embedded within organizations.
First.
Tribes. I didn’t coin this term and in fact Toffler may have used it in 1990 <Godin certainly has>. I have mixed feeling with the term. It exhibits a stronger cultural aspect than simply suggesting the younger generation of employees cluster into groups of likeminded people but it also doesn’t not encourage thoughts of openness/porous/shifting teams.
What I do like is it embraces the communal aspect of being comfortable in ‘tribes’ within a larger organization <organizations are made up of a number of tribes>. Not unlike the Iroquois nation there are various tribes co-existing under a common charter. Each with separate cultural nuances and rituals but clearly aligned on a bigger purpose.
I began there because today’s leader grew up under the ‘dog eat dog’, ‘big fish eat little fish’ and ‘kill or be killed’ every person for themselves organizational upward movement mentality.
Remember I shared these Toffler words earlier in the post:
“Big companies will break up into confederations of small, entrepreneurial units. Small interacting firms will form themselves into temporary mosaics to be more adaptive and productive.”
I would note Toffler didn’t recognize the cultural shift <more of a community/tribal character> but rather focused solely on the power shift <knowledge wealth>. That said. As the two connect <a cultural shift and a business power shift> the words he shared become even more powerful … and meaningful to a new inside out leader.
These smaller units are tribes within an organization <call them a ‘small team’ if you dislike tribe>.
Each with its own ‘power’ to be managed by a leader savvy enough to move pieces seamlessly and have the ability to empower disparate thoughts, and tribes, into an aligned organization. The new inside out leader will need to recognize the balance between managing individuals and managing teams <with tribal cultures>. Neither a one-size-fit –all mentality or a one-by-one management mentality will work and be successful. It will be about empowering tribe without having tribal war and permitting the natural team leaders to arise from the culture.
Second.
Fragmented knowledge <individualized empowerment through knowledge> A truth. Knowledge is the most democratic source of power. The truly revolutionary aspect of knowledge wealth, and the internet, is that it can be grasped by weak & poor as well as strong & wealthy which makes it a continuing threat to the powerful, even as they try and use it to enhance their own power.
Toffler said this:
Bureaucracy is also a ways of groupings “facts”. A firm neatly cut into department according to function, market, region, or products is after all a collection of cubbyholes in which specialized information and personal experience are stored. The vaunted “rationality” of bureaucracy goes out the window. Power, always a factor, now replaces reason as the basis for decision. The power structure based on control of information was clear, therefore: While specialists controlled the cubbyholes, managers controlled the channels.”
Reading this also explains why every leader in a hierarchy is tempted <if not actually desirable of> to control the quantity, quality, and distribution of knowledge within his or her domain.
The internet has created a power shift by taking it from solely under those with legal or formal position and towards those with the ability to absorb & use knowledge.
It became a command/control leader’s headache that knowledge could slink into any office space and anyone smart enough to use it could become smarter than the person they reported to. It is easy to see that this organization fragmentation driven by real/actual knowledge could easily become chaos unless leaders begin showcasing a different ability than maybe we have valued up until today.
This means today’s leaders need to be assimilators of fragments.
They need to encourage empowered individuals and tribes to accumulate knowledge and then redirecting or gathering disparate pieces of knowledge into new forms in which the organizations, and ultimately, the tribes benefit from. The control of knowledge is the crux of an organization’s struggle for power, and more importantly, effectiveness. It is also then a leader’s biggest challenge in tomorrow’s businesses.
Compounding the issue is that the hyper speed in today’s world is making facts obsolete faster.
Therefore knowledge built upon certain facts becomes less durable. This has 2 key impacts:
– truth is fleeting <and decision making has small windows of opportunity>
– business has become more abstract <as knowledge streams non stop into and within an organization>.
Which now leads me to discuss speed.
inside out leader: Discerning between desire for speed and need for speed
Inevitably speed kills <leadership power, decision-making, quality, sense of teamwork, etc.>.
Economics is now all accelerated <even if it isn’t really … we incessantly talk about it as if it is>. And all this accelerated pressure <speed> also shifts power by putting stress, and inevitably undermining, the fixed, bureaucratic chain of command.
Now <taking a step back>.
While everyone talks about a faster world today I would like to point out business has always had a love affair with speed. I would like to remind everyone that the second phase of the industrial revolution was focused on breaking apart production processes <and behavior associated> into the smallest portions with the intent to isolate and shrinking time to the most efficient pace possible.
I point that out because we have always desired speed. But we do not necessarily NEED speed. Speed is not only an addictive objective but an elusive one … the more you get the more you want.
I believe the new inside out leader will learn how to slow organizations down. They will need to be able to discern the difference between desire and need.
I don’t mean make them slow … but rather simply slow them down.
There are a variety of ways to do so but I would suggest the best, and easiest, is to embed the core purpose or vision of the organization within each employee.
Organizations will slow to think, and assess, only to speed up even faster. Only leaders can empower organizations to do this.
In conclusion.
Therefore this will be a new kind of leader stressing the central importance of character and virtue in a culture … focusing everyone on the basics … decency, doing the right thing, cooperation and that actions always have long-term consequences and doing it all as possible.
This changes decision-making from “if it makes money it is good” to “how does this fit within our purpose/direction?” will inevitably lead to smarter decisions and sometimes even adapted decisions <on the ground> all meeting a common purpose. It slows down the organization to think slightly but less so over time as ‘right thing’ becomes more & more obvious organizationally.
Outside in kind of worked because it not only generated money/revenue but in general a happier consumer who felt important <who doesn’t like that?>. But it also worked because this knowledge power created a newer faster ‘responder’ organization which permitted leaders to be lazier. They could build careers based only on responding and not foresight & consistency and makes gobs of money.
But.
“If its profitable do it” mentality is not an effective business management style because it doesn’t breed the organizational cohesiveness to balance against the individual freedom.
Conversely, “If it feels good do it” mentality is not an effective business management style unless grounded in some character/virtue.
Inside out leadership organizations will encourage individuality and individual freedom in the business decision making because it will also encourage individuals grounded in a vision based on character, virtue & organizational integrity.
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