Can an organization and its decision-making processes be managed under conditions of extreme uncertainty? The chaos surrounding us demands that we forgo our obsessive attempt to control events and learn to view chaos and the tensions evoked as an opportunity for change.
“And the earth was unformed and void, and darkness was upon the face of the deep.” (Genesis 1:2)
Why do public opinion polls based on statistical methods fail time and time again to predict the real results of the elections? Could it be that breakthroughs in scientific technology have turned the polls into yet another player among the many who both influence and are influenced by the game and therefore cannot predict the directions of development. Could it be that this is one of the reasons for the constantly growing numbers of people who rely on religious figures, celebrities, and other unscientific sources as a basis for strategic decision-making?
Decision-making in a complex, chaotic environment can be compared to walking in the dark with a flashlight that doesn’t work. Behavioural economics, as led by Nobel laureate Daniel Kahneman, has disrupted the scientific authority of classic economics as a rational methodology for decision-making. Over the past century, deep changes have redesigned numerous industries, including communications, banking, leisure, transportation and medicine, yet these changes have yet to have an effect on managerial methods. The “scientific” view of management – which was designed by industrial and managerial engineers like Frederick Taylor and industrialists like Henry Ford and Alfred Sloan and are based on hierarchical structure and division into functional units – stills serves as the reigning managerial paradigm.
The (Obsessive) Search for Control
Achieving control is the means, goal, and mindset of the traditional manager. The hierarchical managerial methodology is predicated on channels of reporting, monitoring, and control, which are now supported by today’s technologies and applications. The view of management, the methodology and the tools that worked well in the 20th century have become the root of the loss of control in the 21st century: In the absence of any ability to predict the future, there is no value to strategic plans, and MBO (management by objectives) methods, dictated from above, has proven to be little more than a steering wheel that has been severed from the wheels. Instead of plans serving the work, work now serves the plans; this is a sign of helplessness.
Life Without Control
Often, the search for control over complex situations only makes the chaos worse. The “Taylorism” view of management, which conceived of organizations as a complicated, two-dimensional machine, was based on the assumption that in an organization, as in a machine, it is possible to distinguish between cause and effect and to predict developments, snags, problems and changes.
Chaos is a process, a phenomenon, a situation or an event that cannot be described as a mathematical function and cannot be predicted. To get out of a whirlpool, you can’t apply force or try to swim against the current; you must relax and meld into the waves. Similarly, it is necessary to move on from a control-oriented view of management to management that is geared towards dealing with the situation.
The Problem Can’t Be Solved with the Same Tools that Created It
Our life and business environment is no longer merely complicated; it is complex and even chaotic. In a situation in which information filled with contradicting signals, past experience and hierarchical position provide no guarantee of high-quality decision-making. Assumptions made at the top of the pyramid are not applicable because contact with the situation takes place on the production line. This is precisely the reason that hierarchical divisions of labor between managers (the brains) and the workers (the brawn arms), who point out the problems to the managers, is cumbersome and slows down the organization’s ability to respond quickly to changes in the business environment.
Dr. Yael Helfman, CEO of the Israeli Biomimicry Organization, presented me with a picture of a flock of Starlings as a metaphor for the management of hundreds and even thousands of units without a hierarchical system. The manoeuvrers that the hundreds of thousands of units perform in perfect synchronization begins with a movement by just one of the units. Each bird responds to the movements of the birds nearby, according to two simple rules (standards): aim for the average direction of movement of nearby-birds and maintain separation, that is, avoid contact. (The Cray-Reynolds Model). In this manner, change disperses throughout the flock at a rate of 20-40 meters per second, and the beautiful result is known as murmuration.
Thus, a complex environment is a threat to those who deny that reality has changed and continue to attempt to control the environment; at the same time, it provides business opportunities to those wise enough to change their mindset. Transforming the role of the “all-knowing” manager can solve problems. Humble leadership requires a change in mindset, and a redesign of the principles of thought, the system of relationships between work-teams and management constructed as “team of teams”, and the principles of organizational culture and communication. This is a necessary condition for the creation of successful organizational change and maintenance of organizational resilience in a complex-chaotic environment.
Complexity as Opportunity
The transition from the use of traffic lights to the construction of traffic circles for effective and simple navigation of chaotic transportation is a form of metaphor for a change from controlled systemic thinking to adaptive organisational systems. Organizational resilience is evaluated according to the level at which the organization adapts to unforeseen changes, and this adaptation is predicated on the principles of an evolutionary, learning organization. The single brain (the manager) must be transformed into a network of decentralized working teams (brains) across the width and length of the system. The role of the manager is transformed from control and monitoring (of individuals) to the creation and maintenance of relationships, values and behavioural principles (within and between groups and teams).
A positive outlook will view changes in the business environment as an opportunity for change in the view of management, heightened organizational purpose (meaning), involvement of workers in decision making, and joy of learning. An organization that maintains a partnership with its community of customers and workers and seeks to create trust-based relationships is opening itself to business initiative and innovation and becomes a resilient organization whose ability to adapt to change becomes its business strategy.
Boaz Tamir, ILE.