Building organisational resilience for a complex world
Organisations operate in an increasingly complex world which brings new challenges to overcome. Advances in technology have enabled people across the globe to interact in real-time. Increases in computer processing capability and data storage capacity allow huge quantities of information to be generated and stored and shared almost instantaneously. The quantity of information available at our fingertips would have been unimaginable just a few generations ago. The complex world we live in results in both opportunities and threats for organisations.
The ease and speed with which information can now be shared makes it virtually impossible to predict events and their outcomes. Organisations therefore need to be able to respond at pace to emerging opportunities and threats. Yet most organisations are still organised and governed based on models that were developed during the industrial age.
Frederick Winslow Taylor introduced the Principles of Scientific Management in 1911. In his model, managers were responsible for planning the organisational structures and processes within which each task was conducted and workers were responsible for performing the tasks that the managers set them. Improvements to Taylor’s approach, later introduced some focus on considering the workers as more than just machines, but the core focus on organisational efficiency remained. This approach worked in a world of complicated systems. It enabled huge gains in efficiency where the same basic task was repeated many times, such as in manufacturing.
The Tayloristic approach works less well in today’s information age. Organisations that need to create solutions to complex problems, or account for high levels of uncertainty can’t solely focus on efficiency. As the twentieth century progressed, the complexity of the products and services increased dramatically. A few organisations led the way in developing new approaches to help cope with the increasing complexity and uncertainty, such as systems thinking, risk management and Agile delivery. This level of complexity and uncertainty has become the norm for most organisations today
The efficiency-focussed models of yesterday are no longer sufficient in a world where resilience to constantly changing events is required. Stove-piped organisation structures limit flexibility, slow responses to challenges, and prevent information being shared with those that need it. Improvements in information technology have led to the need to cope with more complex information. The increased rate at which information is produced and shared results in greater uncertainty for organisations and the need to respond more rapidly to changing events. Despite this, many organisations are still structuring themselves and performing work using approaches focused largely on achieving efficiency.
To cope with the demands of today’s complex, uncertain world, organisations need to actively adopt different approaches that balance both efficiency and resilience.
The extent of human knowledge has grown far beyond the capacity of a single person. The concept of a hierarchical organisation where corporate knowledge and decision-making ultimately come together in a single leader is simply not viable. Leaders need to adopt a servant leadership approach, drawing on the knowledge and skills of the people within their teams. They need to facilitate people to perform better, remove obstacles to success, listen more and talk less.
The idea that managers can efficiently plan and control in detail activities performed by teams of workers is no longer realistic. Stove-piped organisation structures, broken down by specialist functions limits collaboration and exchange of information. Organisations must empower their people and delegate decision-making to enable their organisations to respond quickly to the events that impact them. Bringing people together in multi-disciplinary teams breaks down barriers to communication and enables development of more robust solutions to emerging challenges.
