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From
Hierarchy to Wirearchy
The future of workplace dynamics
By Jon Husband
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First we shape our
structures
Then, our structures shape us
Winston Churchill
SUMMARY: As the Internet
has moved through the dot.com boom and bust, and integrated software encases most
organizational activities, the dynamics of hierarchy have begun to morph into a new
dynamic called wirearchy. Wirearchy is a dynamic flow of power and authority, based on
information, trust, credibility and a focus on results, enabled by interconnected
technology and people.
As
hierarchies evolve, "wirearchies" emerge
According to Webster’s Dictionary, hierarchy is:
- A group of priests holding high office within a religious organization and having graded
authority to govern the organization
- The group of people in any organization vested with power and authority
- Any arrangement of principles, things, etc. in an ascending or descending order
We have long understood that "knowledge is power." Knowledge, in and of
itself, is non-hierarchic, as Peter Drucker notes in The Economist’s Survey on
the Next Society (November 2001). However, gathering and using knowledge to create results
requires context and decisions, and this requires effective structures and processes of
governance. Hence, issues like control and power over decision-making have led, throughout
history, to the understanding that those who were able to gain and control access to
critical knowledge were able to acquire and/or create power.
Let’s look at history for just a moment. For example, if we can loosely accept the
definitions above as chronological, long before the printing press and widespread
distribution of the printed word knowledge and power resided with the "royalty"
of the church, the monarchy and their court, and those chosen by these small groups of
people to stimulate and participate in the control of society. The rest of the populace
were busy farming – on the royalty’s land – and making clothes and shelter
in order to survive the rhythms and forces of nature.
Fast-forward several centuries. With the discovery and invention of new forces and
technologies -- such as the printing press, electricity and the steam engine -- knowledge
began, in rudimentary ways, to spread around the world, albeit ever so slowly and
primarily through the connected networks of the powerful elites – again, most often
the royalty and the clergy. We have learned of the many attempts to control the mass
populace through famous stories such as the Spanish Inquisition, Braveheart, Joan of Arc
and many other such examples. Always, these stories have been about attempts to resist and
control change that sprang from informing and catalyzing popular movements. Indeed, there
has always been the attempt to control and shape knowledge through the restriction of
media and dissidents – and this continues today, although in more subtle and
sophisticated ways.
Fast forward once again, to the dawn of the Industrial Age. Collectively in the
emerging industrialized world, while managing our way through world wars and the
re-shaping of important colonial empires, we learned how to build the infrastructure of
what we all know today as the modern world – roads, highways, factories, suburbs,
downtown cores of larger and larger cities. The demise of colonization and the last
vestiges of traditional control, for example in Africa, India and South America is a
relatively recent phenomenon. In the last half of the Twentieth Century, there has been an
ongoing move off the farm, through the factories and suburbs, and into the offices of
modern urban centres. This growth was accompanied by the spread of scientific management
and the rise of the professional executive and manager – the Industrial Age
equivalent of royalty and clergy.
Hierarchy as the dominant form of organization became encoded into the structure of
virtually all institutions of society during the Twentieth Century, mainly as a necessary
condition to support efficiency and productivity. Frederick Winslow Taylor has become
famous as the father of time-and-motion studies, as the ongoing drive for productivity and
efficiency was born in the early 1900’s. Tools and techniques such as division of
labour, organization charts, and job evaluation evolved into standard management
instruments, and were applied to most forms of organized work activity. The structures and
forms that resulted became the standard model, and the dynamics and rules of behaviour in
organizations that we now accept as traditional followed closely. As Winston Churchill
aptly noted, "First, we shape our structures…then, our structures shape us."
Today, paradox is everywhere. Those of us old enough to grow up in the Fifites and
Sixties, knew a different world, in which conduct and behaviours were much more homogenous
– roles were clearer, and we knew how we were expected to and supposed to act as we
grew up and moved into adulthood. The movie Pleasantville, released in 1999, gives us a
graphic representation of this unfolding – it morphs from a homogenous, monotonous
black-and-white "Father Knows Best" type of family, work and community life to a
rainbow-hued juicy diversity of passions and (seemingly) outrageous behaviours.
Pleasantville’s "hierarchy" – the mayor, the police chief and their
cronies – feel threatened and attempt to control this emergent celebration of life
through reining in the perpetrators – to no avail.
Now, as the Information Age has become firmly rooted, we’re moving through living
rooms and offices out to the world on the Information Highway – and the ways we use
the raw materials of this Information Age are transforming our social structures and
behaviours. > Many of the structures and forms we use to carry out human activities,
such as schooling, shopping, cooking, working and entertainment, are "wired".
We’re beginning to build wirearchies where hierarchies stood, and there’s no
going back. The next generations of families, friends and workers are growing up
surrounded by electronic tools, digitized images and information, and have been connected
to the World Wide Web since infancy. Hierarchy’s "command-and-control"
is transforming into as-yet not clear forms of "champion-and-channel" and
we will all have to learn how to live, work and manage in this new form of organizational
dynamics.
The characteristics are becoming clearer more quickly than we are learning how to
behave – not surprising given the ways that mental models shape our
perspectives, beliefs and behaviours, as Peter Senge reminded us in The Fifth
Discipline. We need to move from stability-based predictability, power and control to
an ongoing flow of flexibility, integration and innovation.
So…what do you do as a leader – a CEO, vice president, senior manager –
in the Knowledge Age, when past traditions of always gaining rungs on the professional
ladder by being the smartest, the most decisive, the clearest, and the strongest may no
longer work or result in resistance and cynicism? What do you do now, when previously much
of your power and clout came from your position, but you may not have much more
information than many of the others in your organization or market? What do you do when
suddenly, many people in your organization, and many of your customers and competitors are
loaded with that same information. You may no longer have privileged access to
information, other than through keeping secrets or manipulating information – which
may come back to haunt you? How do you "unlearn" your old mental models? How do
you need to communicate and behave in order to establish credibility in this
interconnected Knowledge Age?
The Internet and the World Wide Web burst into mass human consciousness only seven or
eight years ago. Their reaches have multiplied exponentially since then. And yet, this
dominant defining factor of a new era is only in its infancy. The accessibility and
interconnectivity they provide already responds to almost any need or desire, and much
more capability seems sure to emerge in the next five to ten years.
Meanwhile, Web-enabled tools have begun to transform work processes in ways that are
important and pervasive. Even though the dot-com boom has come and gone, workplace
integration and human resources management applications are proliferating. Very large
enterprises such as SAP, PeopleSoft, and others have joined forces with MicroSoft and
Oracle to encase organizational activity in software. There are too many workplace and
business process applications to catalogue, and new more integrated, easier to use
versions or competitors appear on the horizon every few months, while new integrated
services emerge and jostle for attention and marketplace acceptance. Websites like
workbrain.com, Ninthhouse.com, Smartforce.com and Click2Learn.com are delivering the first
wave of on-line learning in easy-to-use formats, and many Fortune 500 companies already
have intranets or are planning better versions based on what they have learned to date
about what works and doesn’t. There has been push-back, and significant resistance to
change, and yet the tide of integration keeps on coming, inexorably. More recently,
MicroSoft (or Mr. Softy, in the argot of the technology community) has introduced its .Net
strategy, which aims at providing capability to integrate up and down the supply and value
chains of organization through a seamless soldering of software and the Internet. Their
ads promise 1 degree of separation between an organization, its employees and its
customers.
Much of what the average worker sees of this is through the daily communion with the
computer screen on her or his desk. They access the software with which they work and
communicate with other employees through portals, of some form or other. As we learn more
about how to integrate all growing software-based capability into our daily work lives, we
will see various forms of employee portals, partnership portals, project management
portals and, eventually, comprehensive real-time enterprise computing applications take
root and grow in many organizations. Organizations’ IT infrastructures, coupled with
ongoing growth in the scope and use of smart software, will create a type of integrated
nervous system, providing top management and workers with an improvement-and-learning
focused feedback loop.
When software connects customers directly to business processes, and employees have
"line-of-sight" responsibility for making a clear contribution or directly
impacting business results – when most of an organization’s strategy and value
proposition is directly coded into its CRM, ERM and B2B applications, will the types of
supervision and management we learned in the ‘70’s and ‘80’s continue
to be effective? There’s a very real issue here that is helping to create the
emerging dynamics – the more that work activities are encoded and embedded into
integrated systems, the more the human will and spirit needs to surface, assert itself,
and make it known that the multi-coloured diversity of Pleasantville is here to stay.
The proliferation of information technology, business process re-engineering and
wrenching changes to established business models created by the rapid development of the
Internet are exerting significant pressure on long-standing business hierarchies.
Top-down, command-and-control management structures and dynamics struggle to maintain
effectiveness in the face of free-flowing streams of content-rich information, coming from
all directions. The dynamics of how people relate – to work, to markets, to bosses
and to each other – are changing. "Wirearchy" - a dynamic flow of power and
authority based on connections and conversations, is emerging as a social dynamic in both
business and society.
Wirearchy is an informal but pervasive emerging structure of governance, strategy,
decision-making and control based on knowledge, trust, meaning and credibility. Things get
done and results are achieved through the interplay of vision, values, connections and
conversation. Wirearchy is generated by an open architecture of information, knowledge and
focus, enabled by connected and converging technologies.
Wirearchy suggests a fundamental change in the dynamics of human interaction in –
and with – organizations of all sizes, shapes and purposes. It represents an
evolution of hierarchy as an organizing principle and dynamic. Wirearchy will not render
hierarchy obsolete, nor the need for direction and control; rather, it will render them
more necessary. However, it will change the meaning of those terms and how they are used
and experienced.
People won’t accept authority easily any more. While old-guard keepers-of-the-
keys still cling to authority and power, the older models of how to lead and follow are
unravelling. Organization charts are still useful, but only as they become more fluid.
Certainly, they appear in a much wider range of shapes than before, and often convey new
messages about power, status and control. "Organigraphics," or pictures of the
ways organizations flow and operate, are clearly more pertinent, accurate and useful,
according to strategy and organizational structure guru Henry Mintzberg.
Perhaps the shift to wirearchy is a result of the conflict and dissonance generated by
dated structures, mindsets and dynamics clashing with the irrevocable new forces created
by the open access to information and knowledge. An early scenario describing this change
is found in The Cluetrain Manifesto (www.cluetrain.com).
It describes how fundamental shifts in values and attitudes due to connections, openness
and cynicism demand openness, transparency and authenticity from the prevailing power
structures in our corporate-led society.
How do today’s leaders and senior managers respond to these forces? Clues are
evident in initiatives emerging in the fields of customer and employee relationship
management, organizational development, human resources management and organizational
change: The use of techniques such as scenario planning, dialogue, open space, 360 degree
feedback, emotional intelligence, coaching and mentoring have all grown significantly over
the past several years. Together, these soften the rigidity of outmoded structures, and
help people respond and adapt.
Most organizations carry out ongoing initiatives to create, clarify and improve
capabilities in each of these emerging areas. Indeed, a large percentage of the global
consulting industry is focused on diagnosing, developing and implementing strategies for
these goals. Wirearchy is significantly different in that it focuses on the structural and
psychosocial dynamics generated by interconnectivity and access to knowledge. It begins
not only with what’s happening at the top, but also what’s happening in the
roots and branches of an organization. Where hierarchy created focus and meaning through
the control of knowledge, wirearchy implies that the control and use of knowledge
acknowledges and involves a much wider range of stakeholders..
Yesterday’s success factors involved secrecy and control, size, role clarity,
functional specialization and power. Today’s emerging factors are openness, speed,
flexibility, integration and innovation. The concept of wirearchy allows readers to
develop a strategy for creating, implementing these factors in ways that respond with
value to continuously changing conditions. The core components of wirearchy are:
- a crystal clear vision and values
- a strategically designed and integrated technology infrastructure
- comprehensive, clear and completely open communications
- pertinent objectives and focused measurement
- characteristics of culture that create, support and enable responsiveness,
adaptability and fluidity
- leadership
that is clear, focused, open, authentic and shared
It will take time and experience in this new era to know what "success" and
"effectiveness" mean and look like. In a wired and wirearchical world, where
there is literal meaning in the phrase, "everything is connected to everything
else," we will have to watch, learn and imagine how to lead and manage in ways that
foster ongoing growth in human development. As the forces that are creating it grow, this
organizing principle – Wirearchy -- will impact business, governments and societies
in ways that we have never before encountered in human history.
Wirearchy, posited as an organizing principle for the interconnected, networked
Knowledge Age, is aimed at understanding and shaping a new organizational dynamic for the
benefit of individuals, organizations and the societies in which we work and live.
It’s giving a name to a new organizing principle that reflects more realistically and
accurately what’s going on out there, and we believe that this principle should be
used to create work structures and cultures that respond authentically – with speed,
flexibility, integration and innovation – to customer needs.
"Wirearchy" – a dynamic flow of power and authority based on connections
and conversations – is emerging as a social dynamic in both business and society.
Wirearchy suggests a fundamental change in the dynamics of human interaction in – and
with – organizations of all sizes, shapes and purposes. It is an evolution of
hierarchy as an organizing principle and dynamic.
Wirearchy does not render obsolete the need for direction and control; rather, it
changes the meaning of those terms and how they are used and experienced. Wirearchy is a
structure of governance, strategy, decision-making and control based on trust, meaning and
credibility – things get done through connections and conversation. Wirearchy is
generated by an open architecture of information, knowledge and focus, enabled by
connected and converging technologies.
Work will keep changing faster and become more uncertain, more focused on delivering
results. Work will become an ever-flowing combination of the necessary results delivered
by people using their unique combinations of skills, personalities and motivations –
the mass customization of work. Mass customization was defined and popularized by
Stan Davis, a leading organizational and business thinker, and suggests that standardized
products and processes can be adapted – customized – to the specific needs of
small groups and or individual preferences and needs. It’s clear that the spread of
this concept during the 90’s throughout manufacturing and service processes is now
being followed by its penetration into the nature of work – the more work activities
are standardized, the more the preferences and needs of small groups or individuals assert
themselves and demand satisfaction.
This changing nature of work has been brought about by the ongoing penetration and
spread of computers and ever-smarter software into virtually all areas of human activity,
notably work activities. Where control of information, knowledge and thus power used to
reside in the hierarchical structures built to manage work in the Industrial Age, the
changes to work that we are experiencing demand that knowledge, power and control are
shared, diffused and distributed. Thus, the new organizing principle – Wirearchy
– is required to help us make sense of the consequences of our new conditions and the
structures that are being born in response to these conditions.
New models and new ways of doing things are clearly necessary – and emerging.
Symptoms of this need are cropping up all around us – from new approaches to
leadership and the recognition that issues like Emotional Intelligence and team work are
responses – not always well-designed or implemented - to the need for effectiveness
in any organized, organizational endeavour, to 24/7 work and life, artificial intelligence
in the form of chips and software built into almost everything humans do, and global
markets and global competitiveness. The established forms of governance, leadership,
management and citizenship are under attack from all sides, and new ways of addressing
these critical issues are appearing in the current affairs and business news every day.
In addition, the types of organizational structure that can accommodate the necessary
responses to ongoing change generated by interconnected markets and constituents are
changing in front of our eyes. Much has already been written – and more will follow
– about networks, partnerships, and strategic alliances. Competitors regularly
partner, or form strategic alliances with a third party where their main competitor is the
third party’s other main, and equally important, strategic alliance. In the face of
this often confusing and paradoxical landscape, leaders and managers everywhere are
searching for tools and techniques that will allow for continued effectiveness in the face
of swirling change. Often, the working assumptions they use to guide their quest is based
on the traditional mindset – eroding in effectiveness in plain view – that
controlling the playing field, being right and minimizing the risk of not knowing and
denying or shutting down flexibility and openness, is what will show to their masters
– most often the capital markets – that they are decisive and know what to do.
The trouble is…it’s really hard to create and achieve sustained success when
working from ineffective or unaware mental models – it’s been well-documented,
for example, that the average lifespan of newly appointed CEO’s grows shorter and
shorter each year. Why is that?
As this unrelenting change and the spread of interconnected distributed knowledge
continues to grow, the structure and shape of organizations and work also continues to
evolve. More and more work takes shape in time-and-results defined projects, and the
presence of teams and teamwork is ubiquitous. Out-sourcing and contracting, as
organizational responses to carrying out critical work and tasks while limiting the impact
on the core operational aspects of an organization, are widespread. The flattening of
hierarchies has also been a common response – and yet the legacy mindset and dynamics
of hierarchical command-and-control are still dominant – even though at the height of
the dot-com boom it seemed that the dynamics of the "geek revolution" might
forever replace traditional power structures.
A unifying, organizing principle will help greatly in coalescing meaning and sense out
of this swirling morass – exploring, defining, and explaining what is observable
about Wirearchy will be an essential first step in moving forward.
About the Author:
Jon Husband is currently a Strategic Advisor with several high-tech firms, and a
workplace coach and futurist.
He is President of Work Design Associates, consulting in leadership development,
strategic planning, organizational change and human resources management, and spent ten
years as a Senior Principal with the Hay Group, an international human resources
management consulting firm.
He writes about the future of work, and how people will interact with technology, work
activities, their places of work and their lives in the Digital Age. He is working on a
concept and book titled "From Hierarchy to Wirearchy", and building a web site
titled www.wirearchy.com. He can be reached at jon@wirearchy.com, or 604-689-1671.
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