Structuring for the network era

It’s about networks

It is 2013 and F.W. Taylor’s Principles of Scientific Management (1911) are still the basis for most of our current management systems.

It is only through enforced standardization of  methods, enforced adoption of the best implements and working conditions, and enforced cooperation that this faster work can be assured. And the duty of enforcing the adoption of standards and enforcing this cooperation rests with management alone.

These principles assume that management knows best and that the higher up the hierarchy, the more competent and knowledgeable that person is. Of course, this is wrong. But it is why companies have such great expectations every time a new CEO is hired. We read about these in all the business media, and the cult of the leader helps to sell books, speaking engagements, and training programs. Many large enterprises are still looking for cookie-cutter best practices to save their businesses.

The “principles of networked management” should read more like this:

It is only through innovative and contextual methods, the self-selection of the most appropriate tools and work conditions, and willing cooperation that more productive work can be assured. The duty of being transparent in our work and sharing our knowledge rests with all workers.

Collaboration is not the same as cooperation. Collaboration means working together, with an objective, and usually for a boss. This can work well when the objective is clear and the conditions do not change. Cooperation means sharing and helping others without expectations of direct reciprocation. Cooperation helps to strengthen networks, where there is no central management. In times of rapid change, and decreasing lifespans of companies, cooperation trumps collaboration.

In complex environments, weak hierarchies and strong networks are the best organizing principle. While many organizations today have strong networks, they are too often coupled with strong central control. Letting go of control is necessary for individuals and organizations to thrive in the network era.

It’s about knowledge

Research shows that sharing complex knowledge requires strong interpersonal relationships. But discovering innovative ideas usually comes through loose social ties. Organizations need both, and communities of practice can help to connect tight work teams with loose social networks. Communities of practice can provide a safe space for professionals to share knowledge and challenge each other at the cutting edge of their expertise.

Effective organizational knowledge-sharing for this new world of work needs individuals who are adept at sense-making. One framework for this is personal knowledge management (PKM) because organizations don’t create or manage knowledge, people do.

PKM is a technology-neutral framework to promote common understanding through ongoing conversations. PKM is based on personal practices that are independent from enterprise software. It is a simple framework that needs experimentation and practice to master, but mostly it requires sharing. PKM makes knowledge-sharing a personal responsibility, so that each node contributes to the network. These knowledge networks need trust to function well.

It’s about trust

Solving problems is what most knowledge workers are hired to do. But complex problems usually cannot be solved alone. They require the sharing of tacit knowledge, which is knowledge that cannot easily be put into a manual or procedural guide. Research shows that tacit knowledge flows best in trusted networks. Trust promotes individual autonomy and this becomes a foundation for more open social learning. Without trust, few are willing to share their knowledge. An effective knowledge network also cultivates the diversity and autonomy of each worker.

People naturally like to be helpful and get recognition for their work. But humans need more than extrinsic compensation, as our behaviour on Wikipedia and online social networks proves. For the most part, people like to help others. Cooperation makes for more resilient knowledge networks, which are better for business.

As markets get more complex in the network era, business value is created through innovation. But innovative ideas come through loose social ties and diverse opinions. Organizations therefore need to push work beyond the coordination of tasks, and past collaborative work, in order to improve trusted cooperation amongst peers. Openness improves internal task coordination, so that all problems can be seen. Transparency can improve collaboration to get tasks done better. In such a work environment, trust emerges. With openness and transparency in place, cooperation with more diverse knowledge networks can then lead to real business value.

chance favours the connected companyIt’s about structures

In the network era there is a need to balance structured work and the sharing of complex knowledge with the concurrent requirement for unstructured social networking which can increase innovation through a diversity of ideas. Communities of practice are a middle ground, sometimes inside and sometimes outside the organization, that can link collaboration and cooperation, and help weave the organization and its people into a wirearchy.

Wirearchy – “a dynamic two-way flow of power and authority based on knowledge, trust, credibility and a focus on results, enabled by interconnected people and technology.” - Jon Husband

We know that many jobs today are getting automated or outsourced. The job was the way we structured human work for the past century. We now need to focus on creating more opportunities for creative work. For institutions, employers, educators and workers, that means giving up control and co-creating a new social contract for a networked economy. It starts with understanding networks, then sharing our knowledge in trusted networks, in order to build the necessary structures for the network era.

This post was inspired by my recent conversations with some members of the community of practice, Change Agents Worldwide, who invited me to join them last week. The conversation has only begun.

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5 Responses to “Structuring for the network era”

  1. Olivier Amprimo

    Hi Harold,

    The problem I have with this contribution of yours is the opening quote and resulting assumption: “these principles assume that management knows best and that the higher up the hierarchy, the more competent and knowledgeable that person is.”

    It’s easy and commonly accepted so it’s a good way to start a contribution but your quote selected from the Principles of Scientific Management is misleading and the assumption you derive from it a misconception.
    Going back to the source and reading Principles of Scientific Management entirely shows that Taylor was a bit smarter than his contradictors have painted him to build a criticism of what they labelled “Taylorism”.

    Taylorism is the result of the convenient reinterpretation by traditional entrepreneurs to manage the status quo of the time. Criticizing Taylor instead of Taylorism is convenient way to manage the status quo of our time.

    The general misunderstanding your opening quote and resulting assumption carry out resolves around three elements : the role, the composition and the activity of management.

    1 – The Role of Management
    “And the duty of enforcing the adoption of standards and enforcing this cooperation rests with management alone” is a simple reminder of the job of a manager. Who else but a manager is supposed to ensure and paid for the enforcement a policy? Isn’t that the problem of the majority of organizations that managers are not enforcing policies at all (aka soldiering?) because they protect their individualistic career path and need to be friend with the majority?

    2 – The Composition of Management
    Management is not a class. The Marxist view carried out by the sociology of work – a major critic movement to Taylorism – is not the true reflection of the social fabrics of an organization. No one is born “manager”, people become “manager” as a result of experience, proven results (aka merit) and expertise. Taylor himself became head of Methods.

    3 – The Activity of Management
    Before enforcing standardization of methods, enforcing adoption of the best implements and working conditions, and enforcing cooperation Taylor’s managers engage with employees, converse with them, look at the way they work with the help of measurement and the purpose of improving their work and sharing the additional profit derived thanks to individual and direct contracts (a contribution to HR). Your quote – this usual quote – is just showing one side of the loop of a participatory process that traditional leaders refused to implement and that critics of Taylor refuse to admit.
    Simply put what you see emerging from Principles of Scientific Management IS a learning organization that rely on the principles of quality, long before Deming and OD and Core Competencies.

    I’m not sure it’s by criticizing Taylor that we will build a solid foundation of a renovated “Management”, but instead by a critical reading to revisit its contribution and learn several useful things.

    Here is a direct link to the book itself for those who want to forge their own opinion: http://strategy.sjsu.edu/www.stable/pdf/Taylor,%20F.%20W.%20(1911).%20New%20York,%20Harper%20&%20Brothers.pdf

  2. Leon Benjamin

    Wirearchy – a state of cooperation that exists between companies, people and nation states where there is a continuous fair exchange of value as opposed to business and government that’s predicated on the notion of “I win, you lose”.