Is your organisation smart or ignorant?
Some people talk of responding to today's volatile, uncertain, complex and ambiguous business environment through the creation of ‘Intelligent Organisations - organisations loaded with the best talent available (what companies such as Netflix refer to as 'Superstars') - ’ but this is not enough. Organisations, as a collective, can be intelligent (stocked with an abundance of EQ and/or IQ) and still lack sophistication in judgement, inference, or awareness to adapt to changing signals at their boundaries. These are ignorant organisations and ignorance is damaging, it is just to what degree.
To prepare for the future there needs to be a focus on ‘Smart Organisations.’ Smart organisations have, for example, a collective awareness (a singular consciousness) of their environment; they understand the need for continuous, agile learning; speak of digital borders, not geographical ones; promote a willingness to embrace openness; acknowledge the need for dynamic talent - agile learners. These are people who, according to the Centre for Creative Leadership at Columbia University:
challenge the status quo; remain calm in the face of difficulty
reflect on their experiences; put themselves in challenging positions
are open to learning; and resist the temptation to become defensive in the face of adversity)
have the capability to separate fact from opinion;
treat mistakes as opportunities to learn and contribute to a safe to fail environment.
Complexity only shows cause and effect after the fact, which means you need knowledge capability, informed by core competencies, to make sense of and take action as situations are evolving. To be clear, it is not competence that is being discussed here (what you do - technical knowledge). This is about competency (how you do something): critical thinking, decision making, leadership, entrepreneurial, communication and collaboration skills.
Smart organisations also have strong, values-driven psychological contracts to help activate capability. These contracts are based upon fulfilment of mutual need - the tension between employers focused on profit or cost management and an employee focused on job security. Psychological contracts are informed by what you write down (your values) and what is observed (what is said around the water cooler) - consider this, what does the conversation around the water cooler say about you? Employees can no longer be seen as subordinated to the organisation. Your people, your talent want a relationship built on authenticity, transparency, trust, mutuality and reciprocity. Provide this and you will enhance capability through what Peter Drucker called “the directed, focused, united effort, of free human beings…” (2007, p.11).
Business sustainability is built upon this potent mix of talent and capability. Without these your organisation will not be able to sync with its environment; it will drift into more difficult waters and it will eventually be reported as lost. Do you know what your capability looks like?
Demographic changes over the next five years (e.g. by 2020 75% of the workforce will be made up of Millennials and Gen2020/Gen Z) will require you to optimise the way you do business: more effective structures (reduced layers and harmonisation); social spaces that enhance accidental knowledge discovery and collaboration (virtual and physical); authentic and transparent employee engagement programmes that amplify the voice of your talent; technology systems that break down silos and open the door to the external environment (collaboration spaces that engage stakeholders); exploring different leadership models (e.g. values-based situational leadership); greater horizontal integration of business functions (Human Resource Management/Development, Information Technology, Operations Management, Project Management, Knowledge Management etc.); processes and systems that reduce status differentials; well structured and easy-to-access knowledge systems; multi-channel communication processes (internal/external and work/social engagement); new mental models for organic knowledge retention, sharing, deployment and development.
This might seem like a daunting challenge, but ask yourself, do you live in a volatile, uncertain, complex and ambiguous (VUCA) or stable, clear, simple and certain (SCSC) world? If you agree that it is VUCA, then why on Earth would people deploy SCSC tools, processes or systems as solutions to VUCA problems? They will stress and fail. This means you have to move away from reductionist approaches that look at elements in isolation. To thrive you need to see the whole picture and be prepared to make adjustments across the organisational landscape.
