Almost every global company have started a journey to become an Agile Organization. It is upon each of them, to discover the right balance between stability and dynamism according not only to the maturity of their market but also to their organizational culture. Even though when the starting point will be unique, all of them will be sharing the same old paradigm that have been dominating organizational design since Henry Ford`s times which theoretical framework was proposed by Frederick Taylor: the scientific management. Under this paradigm, organizations have been producing results for many years, but they have turned into machines that today struggle to adapt to the VUCA world. Since 1950, a completely different perspective has been stablished by using the term “organic” to refer to a new kind of organizations. But neither the authors of this term nor the principles of the organic organization have been as popular and widespread as Taylor and the scientific management. An organization which pursues agility must become “organic” but why is so difficult for organizations to stop being mechanical?

Why the “mechanical” organization is so appealing?

Since Ford Motor Company achieved 60% of the market share only a decade after deploying the scientific management full scale, this paradigm has consistently produced results not only for Ford but also for almost all companies not only in US but worldwide. The short-term results weren`t the only appealing from this paradigm since standardization was the key of sustainability at that time, it promised to further produce results in the long-term. Two key features of this paradigm are hierarchies and specialization which are not wrong by themselves as standardization but if they turned into extreme practices they end up in bureaucracy with lack of leadership and engagement as well as very rigid and fragile organizations. But before blaming on the design, we need to take into consideration that the biggest pitfall of the scientific paradigm is its view of the people which was proper of that time not only in US but worldwide. People was considered as “machines” and complete organizations have end up like this. This is perhaps the most important lesson from that paradigm and that time, but control and certainty make very difficult for organizations to leave behind even though in our digital era.

What is so frightening about the “organic” organization?

Today this paradigm can be seen fully deployed within start up companies where there are neither well-established hierarchies nor specialization which creates a very flexible and dynamic organization. However, this organizations where communications flow very easily in contrast with the “mechanical” ones, find their biggest challenge when they need to develop an organizational structure to support their grow within a country, a region or worldwide. This is because the lack of stability, they usually neither they have standard processes with procedures nor well-defined accountabilities with responsible for each task. Without structural elements, people is at the heart of this design while both leadership and engagement are promoted giving as a result a flexible and resilient organization. In this paradigm people is “alive” giving as an outcome a living organization and this reinforces the lesson about people`s role within organizational design. To give power to the people through delegation not only of tasks but also decision, and most of all understand that they are fundamental for survival might be frightening for some organizations. Although people is not enough to allow growth without any supporting process architecture structure, they play a key role in driving adaptation and building organizational resiliency.

How organizations can become more Agile?

There is a difference between “organic” and “cellular” which is not always clear. The latter is in fact an organic organization but only suitable for unicellular beings. In nature, higher levels of complexity are managed through hierarchies and specialization. When complexity increases, limits are necessary because they allow autonomous functioning and cooperation between different structures. Organizational boundaries between levels and areas through each value stream are not synonyms of working in “silos”, allow diversity to grow and enrich the organization through interchange. It is through leadership and engagement that an organization cannot only prevent bureaucracy but also to ensure efficiency and effectiveness on daily basis. Empower people means to trust but also to really value them. Knowledge management is the way to keep alive the standardization by remodelling process architecture through the “organic” interaction with the digital technology and capture organizational learning to turn it into better decisions and practices. Another lesson from “organic” designs is the balance between autonomy and centralization to integrate different hierarchical levels and highly specialized structures to not only function but “be as one”. An Agile organization will be stable to support growth and sustainability while flexible to adapt and being resilient to endure changes, but only a “living” organization will achieve not only the right balance between stability and dynamism at present but in the future.

Marcelo Sauro is an internationally experienced performance and improvement senior manager. He holds an Executive MBA and Master of Science degrees and has helped people and organizations to transform themselves. Not only he led E2E transformations in Global Business Services, R&D, Supply Chain and Finance organizations at all levels within the LATAM and EMEA Regions, but he is also experienced in several industries including Life Science, Healthcare, Insurance, Fintech, Technology, Telecoms, FMCG, Chemicals, Automotive, Energy and Mining. Since 2015, he has been researching and developing content in agile and resilience through Value Ways, while working under contract for customers such as MetLife, Novartis, Vertiv (Emerson NP) and Experian among others. Previously, he worked for more than 7 years as Master Black Belt for a LATAM-based consulting group, which had ASQ, Qualtec and Oriel as business partners. Prior to that, he worked for more than 10 years at BASF and GSK in positions of growing responsibility in the area of Operational Excellence. Marcelo is currently working at Ferring's “International PharmaScience Center” (IPC) for the Global R&D organization in Copenhagen. To find out more please visit www.value-ways.com.

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