In the first of this blog series we outlined how the nature of work is changing and highlighted the issues arising as a result. Here we explore how organisations can evolve to overcome these challenges, while releasing a greater sense of purpose, wholeness and wellbeing in its people.
PWC chart a ‘History of Work’, describing an evolution from Agrarian, to Industrial, and then Information structures – culminating in the Purpose organisation of today.
In his book Reinventing Organizations, Frederic Laloux also suggests that organisations have evolved over the centuries as the needs of society have developed. His explanation is thorough and eloquent and uses colours to summarise the process, but to paraphrase; organisations were first tribal with a dominant chieftain (red). Conformist hierarchies (amber) such as the monarchy and organised religion then became more dominant. The industrial and scientific revolutions led to the now prevalent, (orange) achievement-driven, and ‘organisations as machines’ world-view, while some (green) ‘organisations as families’ have also emerged with a wider focus on consensus, shared values and stakeholder needs.
The reality is that very few organisations are 100% orange or green, and most are subtle mixtures of both. However, given the emerging trends in the nature of work, the most significant is another stage in organisational evolution – ‘Teal’.
Increasing volatility and complexity mean that command-and-control models are no longer agile enough to ensure business survival. Change in nature happens everywhere, at the same time and every cell in every organism self-organises to respond appropriately. What if organisations could be designed to act in the same way?
The founders of Teal organisations often use the metaphor of living systems to describe themselves and how they work. Three fundamental breakthroughs help to make this approach possible and each one challenges traditional and well-established management thinking. These breakthroughs are:
– Self-management
– Wholeness
– Purpose
As we explain these ideas in more detail, it’s possible that you may have a strong reaction. Even though the ideas appear heretical, idealist and impossible to operate in the ‘real world’ there are many examples where some, or all of these concepts have been successfully applied.
Self-management
Self-managing or ‘horizontal’[1] organisations substantially (or even entirely) remove hierarchy from their institutional structures. Instead they apply more fluid systems with distributed authority. Decisions are made by the people closest to the action, with a variety of support processes in place that enable the organisation to make the best use of their people’s collective intelligence, energy and passion.
Wholeness
Historically, many of us have applied only a small sub-set of ourselves at work – our ‘professional identities’ as it were. Teal organisations encourage us to show up with our whole selves, melding our interests and passions with the organisations we work in[2]. In a wholeness culture, the organisation pays a full and genuine attention to our greater sense of physical and mental wellbeing.
Purpose
Contributing to a purpose bigger than ourselves fosters a sense of fulfilment. Living organisms are self-directed and develop naturally and Teal organisations do the same thing in what Laloux calls ‘evolutionary purpose’. This symbiosis of organisational and personal purpose can make work more meaningful[3].
It is important to emphasise that though each of these powerful concepts reinforce each other, not all organisations will necessarily embrace all three.
What do these concepts mean in practice?
Perhaps the most complete example of the application of these principles is Buurtzorg in the Netherlands. Founded in 2006, Buurtzorg cares for over 70,000 patients. It has a staff of 9000 nurses, organised in 800 self-managing teams. What’s most unusual in terms of personnel is that there are only 45 ‘head office’ staff. Annual turnover is in excess of €250m and it doesn’t even have a CFO. Buurtorg describe their model in the following way:
The Buurtzorg onion model starts from the client perspective and works outwards to deliver solutions that bring independence and improved quality of life.
Self-management, continuity, building trusting relationships, and building networks in the neighbourhood are all important and logical team principles.
This RSA video provides a more detailed overview of the Buurtzorg approach.
AES a global power-generation company, was another pioneer in the space. Former CEO, Dennis W Bakke (1994-2002), provides an in depth analysis of the application of self-management during his period of leadership in his business best-seller ‘Joy at Work’.
Since their inception in 2005, Spanish consultancy firm K2K have already helped over 70 clients adopt self-management practises.
Though not exhaustive and not always labelled as such, the following additional examples outline some more companies and organisations that have adopted elements of the Teal approach:
FAVI, Manufacturing
Morningstar, Food Processing
W. L. Gore, Manufacturing (Goretex)
RHD, Care Services
Sun Hydraulics, Engineering
Patagonia, Apparel
Percolab, Consulting
ESBZ, Education
Unilever, FMCG
Brewdog, Brewer
Holacracy, Consulting
Heiligenfeld, Mental Health
Challenges
No doubt you’ll immediately flag the many and significant challenges that the Teal approach can create, and you’d be right to do so. Many pioneers have bumped up against these issues and through hard experience have had to find ways to overcome them. Thankfully the rest of us can learn from their mistakes and be free to concentrate on making some new ones of our own!
The challenges to this new approach are many and varied – just how do things get done without a boss?! The most significant issues are listed below:
· Decision-making
· Accountability
· Performance management
· Meetings
· Information sharing
· Learning
· Remuneration
Our next blog in the series will explore these challenges in more detail and share a range of approaches that have been developed to address them – and perhaps even improve on traditional management practices.
Footnotes:
[1] In ‘Going Horizontal’, Samantha Slade explores the concepts and how they can be applied
[2] Unilever, for example, has been sharing many individual stories from its ‘The Power of U’ initiative.
[3] PWC report - Building a fulfilling employee experience.