“Hierarchies are bad! Transparency is a value & everybody should decide everything!”
Principle Misunderstandings (part 2)
This is the second part of a series of observations on how the principles behind new ways of working are often misunderstood and therefore lose their effectiveness or can send us off in harmful directions. You can find part 1 here.
The following are actually rather “ideas taken to the extreme” — or principles mistaken for something else rather than merely being misunderstood principles. All three aspects: hierarchies, transparency and group-decision-making are topics that are intertwined. I have tried to keep it simple, to write for brevity and clarity, and have sacrificed some of the underlying argumentation and much of the complexity for that purpose.
“Hierarchies are bad”
Actually there are very good arguments that hierarchies are not only natural for human organizations but the kind of hierarchies we call “traditional” were key to getting us to where we are today.
The question is not whether hierarchies are bad, but whether the hierarchies we have developed are still useful today and whether there are better ways to structure organizations. As always, it is a question of context — in which situation is a different structure more useful? And what does that structure look like? And how can we get there in a meaningful way — and what will the trade-offs be and how can we deal with them?
Just getting rid of all the managers and declaring all the teams to be self-organized will rarely lead to effectiveness. Usually it will lead to the opposite and to a lot of pain as well. The same will happen by declaring that we work in networks without having developed the skill necessary to deal with it.
Not that pain is a bad thing. From pain comes growth and learning. But too much pain will keep you from getting where you want to go.
I can be quite confident about this assertion, because this is basically what we did at the Ministry Group in 2014 when we started with our “X-Teams” (our nickname for our interdisciplinary self-organized teams). We didn’t capture the reality of the system enough — that leadership would not take care of itself in our organization, that we were at a stage where leadership needed to be defined and declared. We were lucky that the system rebelled quickly and gave us a chance to correct our path, but still we entered a year of pain before real growth could continue (there was an article in Brandeins about our experiences at the end of that year, if you would like to know more).
The word transformation says it already — it is about going from one state to another, becoming something out of what I am now. It is not about replacing an old thing with a new one, like buying a new car or putting on new clothes. To get to the new state (that is perceived to be more useful), I need to know what it is and why I want it. I need to understand the current reality as best I can and then be willing to reach that state.
“Transparency is a value”
While I would concede that a “commitment to transparency” might be a value, it is my opinion that transparency itself is an instrument that helps us fulfill our goals, specifically: making better decisions.
If I believe that the best decisions are not made by the person (or people) at the top, but through the collaboration of many different perspectives, then it is in my best interest to share all the information needed to make those decisions.
The danger of seeing transparency as a value, is that it leads people to think that all information should be open to all members of the organization. Not everything should be shared as a principle. There needs to be a purpose behind the sharing and the information itself must be useful. In order for me to use information, I must be able to understand it, be able to put it in the right context and be able to do something with it.
The last point is critical. Giving people information without the power to do something with the information will leave them helpless at the best. At the worst, it will block them from action or leave them re-acting to circumstances. As with all instruments, there is always a trade-off to being transparent and it is helpful to consider how to deal with the “side-effects.” Specifically in our experience, sharing the economic details of the organization with all of the members, regardless of how well they were able to use the information, understand it, put it in context and act upon it has led to insecurity and fear that we are still finding ways to deal with.
One last point about transparency of information: it stops before it can be harmful to members of the organization. I don’t think anyone in an organization would argue with this, but I believe many do not realize the scope “radical transparency” or “transparency as a value” would have, if we do not define what we mean.
“Everything should be decided by everyone” (the Majority rules)
As I was quite a bit younger and the (World Wide) Web still wasn’t quite mainstream, I had a great idea of how governments could soon be run differently. I believed that our technology would allow all the people to make all of the decisions all of the time— we wouldn’t need this mess of having representatives anymore.
Over 20 years later I now think that I was very, very wrong — it is not a question of technology, but a question of interest, knowledge, experience and time.
Not everyone is interested in every topic for which a decision has to be made. Some people are “overly” interested for personal reasons, but that is something that you can work with (involve them, hear them, put their interests into the context). People who are not interested but are forced to make a decision will usually make bad decisions or at the very best you are turning it over to chance.
Knowledge and experience are the main ingredients of good decision-making. Not everyone can possibly have the knowledge or experience needed to make a good decision on all topics. They may have opinions, but opinions do not necessarily lead to good decisions.
And lastly, good decisions need time — they need focus and energy. If we all had to give our vote for every decision our government makes everyday, we would have no time for anything else. The same is true in every kind of organization.
Not that current systems of government by representation are perfect (there are too many other factors compromising the systems), but in theory a representative government should be able to make the best decisions on everything.
This is definitely not an argument for keeping decision-making in the top-ranks. In our changing world that is not where the best decisions are going to be made. For organizations the trick is to find out who has the interest and the knowledge and experience to make the best decision for the case at hand and is willing to find the time for it. Of course, no one really thinks all decisions can be made by every one — we make hundreds of decisions everyday — the question is whether our most important decisions can be made on a better foundation.
Less and less of the time we see knowledge and experience bundled up into one person. For creativity it is often helpful when people with less experience (but a lot of interest and different kinds of knowledge) are also involved, provided you can find good ways to make group decisions.
For this we have some positive examples. One useful way of arriving at better “big” decisions has been to call for “working groups.” Those with the most experience and knowledge for the topic were requested to join. All with interest and willingness to invest time in the topic were invited to join. All unwilling to join were informed that decisions would be made and these decisions would have to be accepted by all. We have used “working groups” for topics like “unlimited vacation” and our “salary formula” with success.
Another example is our organizational leadership group (Unternehmensführung) which today includes not only the official management of our companies but also members of the team that were chosen on the basis of their perspective into the organization, ability to think in an entrepreneurial way, and their willingness to take on responsibility. Combined with the willingness of the owners to make all organizational decisions within this group, we have been more and more successful at grasping current reality and forming a shared vision with a more diverse group of individuals that is committed to the growth of the whole organization.
Interest, experience & knowledge and time are needed to make good decisions, but there is one more ingredient that I mentioned in the last paragraph that is absolute necessary for the best possible decisions: Responsibility.
Organizational leaders and I suspect also politicians turn to the general vote when they don’t want to be responsible for a possible unpopular outcome. But generally, responsibility is what keeps decisions in the domain of bosses and managers — it is perceived as what they are being paid for or why they have status. When all of us can start to see leaders as facilitators of decision-making and not as the decision-makers can we begin to have real responsibility among the members of organizations.
Decisions, Decisions, Decisions …
it always comes down to decisions and how they are made. If I were to sum up what I would like to tell you into one — no, two — sentences it would be:
Start where you are — it is not bad, but it could be better. Use your tools thoughtfully, judge them for their usefulness and move toward the new — not because it is new, but because it creates more value.
