This presentation explores what the organisation of the future looks like across multiple dimensions: - context - strategic imperatives - capabilities and resources - governance, leadership and other social practices - organisational structural forms. This represents a synthesis of many different perspectives and theories from different fields including leadership, change management, team dynamics, organisational behaviour and psychology, economics, management theory, organisational science and organisational design, among others.

1. Bryan Fenech – Founder and Director
Building the Organisation of Tomorrow
www.oot.org
What the organisation of
tomorrow looks like?

2. Contents
Introduction
Comparative Analysis
A Proposed Transitional Model
Case Studies
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3. INTRODUCTION
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4. Introduction
• This presentation explores what the
organisation of the future looks like across
multiple dimensions:
– context
– strategic imperatives
– capabilities and resources
– governance, leadership and other social
practices
– organisational structural forms
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5. Introduction
• Across these dimensions the organisation
of the future is compared and contrasted
with today's traditional organisations as
described in Topic 1
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6. Introduction
• This represents a synthesis of many
different perspectives and theories from
different fields including leadership,
change management, team dynamics,
organisational behaviour and
psychology, economics, management
theory, organisational science and
organisational design, among others
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7. COMPARATIVE ANALYSIS
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8. Changing context
Traditional (Industrial) Organisation Organisation of Tomorrow
A socio-economic era built on the
technological breakthroughs of the industrial
revolution
A socio-economic era built on the
technological breakthroughs of the
information revolution (and now robotics and
biotech)
Increasing globalisation – opening up of vast
new markets for products and services
Unprecedented globalization – hyper
competition, dynamic and volatile markets,
short product lifecycles
A world of “unlimited” resources to be
exploited – the New World, Africa, India,
China and the East
A world of limited resources to be conserved
and sustained
Positivism as the dominant worldview Constructivism as a challenge to the
dominant positivist world view
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9. Strategic imperatives
Traditional (Industrial) Organisation Organisation of Tomorrow
Standardisation and repeatability – mass
production
Differentiation and innovation – mass
customisation
Size and stability Nimbleness, flexibility and responsiveness
A relentless managerial focus on cost
containment, reducing unit costs
A relentless leadership focus on investment in
new products and services
Economies of scale Economies of scope
“Sweating” value from tangible assets –
property, plant and machinery
Creating value in intangible assets –
knowledge and the social capital that
underpins it
Beating the competition, achieving
dominance within an industry or industry
niche
Building strategic alliances and partnerships
Achieving personal financial wealth and
power for a narrow set of shareholders, the
capitalist project
Achieving social and environmental as well
as financial value and meeting a broad
range of objectives for a broad range of
stakeholders, the social enterprise project
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10. Capabilities and
resources
Traditional (Industrial) Organisation Organisation of Tomorrow
Strategy formulation Strategy implementation
Operational management disciplines Project management disciplines
Management – causal rationality, from a pre-determined
goal and given set of means
identify the fastest, cheapest, most efficient
etc
Leadership and entrepreneurialism –
effectual reasoning, from a given set of
means allow goals to emerge contingently
over time
Development and application of specialist
technical knowledge
The commoditisation of specialist technical
knowledge and the need to dynamically
reconfigure and apply collaborative
knowledge resources – “dynamic
capabilities” and “absorptive capacity”
Developing core competencies to dominate
markets and niches
Value co-creation – sharing, integrating and
coordinating resources across boundaries,
“radical transparency”
Application of the “factory” model to
regularise all processes, products and
services
Ambidexterity – simultaneously managing
dynamic and well as static business contexts
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11. Implementing versus
formulating strategy
• A vast array of planning models and
techniques has been paraded before
managers over the years, and managers
for the most part understand them and
know how to use them effectively.
However, there is a lack of execution
know-how1
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12. Operational versus
project management
Area Response Problem Addressed
Delivery methods Program management,
change management
disciplines
Coordinating and
marshalling project-based
activity
Governance Project portfolio
management (PPM)
Investment oversight
Functions Steering Committees, PMOs Driving cross functional
integration
Structure Matrix organisations, skunk
works, project based
organisations (PBOs)
Managing both dynamic
and static contexts
Roles Project managers, change
managers, business owners,
sponsors, etc
Performing project activity
inhouse
Standards PMBOK, Prince2, MSP, P3M3,
etc
Improving predictability and
performance
Maturity models OPM3, PMMM, CMMM-I, etc Making project based
change business as usual
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13. Knowledge capabilities
and Resources
• The ability of organisations to implement
the new strategic imperatives and meet
21st century success criteria is highly
dependent upon their ability to develop,
share and mobilise knowledge resources2
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14. Knowledge capabilities
and Resources
• Dynamic capability – i.e. the capability of
an organization to purposefully create,
extend, or modify its resource base
• Absorptive capacity – i.e. the ability to
recognize new external knowledge,
assimilate it and apply it to commercial
ends
• Transformative capacity – i.e. the ability
to continuously redefine a product
portfolio based on technological
opportunities created within a firm
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15. Knowledge capabilities
and Resources
• Value co-creation – the ability to share,
integrate and coordinate resources and
sustain an honest and open dialogue
(radical transparency) across
organisational boundaries for mutual
benefit3
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16. Knowledge capabilities
and Resources
• Ambidexterity – the ability “to achieve
breakthrough innovations while also
making steady improvements to an
existing business”4, simultaneously
managing dynamic and well as static
business contexts.
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17. Knowledge capabilities
and Resources
• Such organisational knowledge
capabilities are highly dependent upon
the availability of intangible social capital
resources that are generated and
leveraged 'in community' – in particular,
social and morale capital including trust,
voluntary cooperation, and passionate
identification with, and commitment to,
the purpose of the organization5
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18. Leadership and
governance practices
Traditional (Industrial) Organisation Organisation of Tomorrow
Application of principles of command and
control economics to internal organisation –
central control of resources and planning
Application of principles of market
economics to internal organisation –
devolving of power and decision making and
free flow of resources, “internal markets”
Management practices embedded with the
strategic intent of command and control
Leadership practices embedded with the
strategic intent of empowerment and
facilitation – “democratisation”,
“participative management”, “distributed
leadership”
Rules based on rational legalistic principles –
bureaucracy, sine ira ac studio
A negotiated order based on principles of
community, and renewal practices required
to manage sustainability and success
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19. Democratisation and
markets
• The literature on governance and
leadership practices reflects the
emergence of 2 highly interrelated
developments
– democratisation – including ‘distributed
leadership’, ‘shared leadership’ and
‘participative management’ theories6, 7, 8 as
alternatives to traditional managerialism – and
– the application of market principles – including
internal cap and trade systems, internal labour
markets and ideas futures exchanges9, 10, 11, 12 as
alternative approaches to centralised command
and control
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20. Benefits
• The benefits of these approaches appear to align very closely
with the need for increasing levels of social capital resources
which has been identified as a prerequisite for building
knowledge capabilities:
– Participative management has been correlated with an increase
of morale, commitment, adaptability, trust, communication and
teamwork13, 14
– Shared leadership leads to less conflict and greater consensus,
trust, and cohesion15
– Distributed leadership can be “a moderator that can deter
corruptive tendencies by providing checks and balances
capable of reducing the potential for corrupt behaviour”16
– Application of market principles correlates to improved efficiency
and flexibility of resource allocation and exchange of
information17, and motivation through reward systems that
recognise the investment of intellectual capital on a similar
footing to financial capital18
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21. Structure
Traditional (Industrial) Organisation Organisation of Tomorrow
Hierarchy – multiple management layers Networked, cellular
Segregation of labour by discipline into
functional silos
Integration of labour into autonomous multi-disciplinary
teams
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22. New organisational
structures
• The recent literature on organisational
structure demonstrates a broad
consensus that more fluid process,
product or customer driven structures,
and networked cellular structures, in
which labour is integrated into
multidisciplinary teams, are better
adapted to the challenges of the 21st
century than bureaucratic structures19, 20
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23. New organisational
structures
• This is reflected in the emergence of
many alternative organizational shapes
most of which have been pioneered by
different innovative organisations
including ‘brains’, ‘machines’, ‘garbage
cans’, ‘jazz’, ‘theatres’, ‘landscapes’,
‘morphings’, ‘sponges’, ‘hypermodern’
and ‘platforms’21
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24. New organisational
structures
• Dynamic and fluid federations of
enterprises, which use multiple
configurations of intellectual, emotional,
digital and physical assets to provide
unique aggregations of products and
services, will ultimately supplant large
single corporations22
• Distributed governance and leadership
practices require distributed spans of
control and ownership structures
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25. A PROPOSED TRANSITIONAL
MODEL
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26. A transitional
organisational model
CEO
Chief
Projects
Officer
Chief
Operations
Officer
Process-based
organisation
Operations and
execution
Lean six sigma
Project-based
organisation
Change and renewal
Project portfolio
management
New Ideas
New Capabilities,
Products and Services
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27. CASE STUDIES
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28. Case studies
Organisation Characteristics References
Morningstar Participative
management
Hamel (2011)
W L Gore Participative
management
Kaplan (1997), Malone
(2004) p 57,
http://www.managem
entexchange.com/sto
ry/innovation-democracy-
wl-gores-original-
management-model
Mondragon
Cooperative
Participative
management
Malone (2004) p 61
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29. Case studies
Organisation Characteristics References
Semco Participative
management
http://www.strategy-business.
com/article/0
5408
Hewlett Packard Internal markets –
supply chain
Malone (2004) p 93
British Petroleum Internal markets –
environmental targets
Malone (2004) p 91
Valve Participative
management
http://www.gamesind
ustry.biz/articles/2013-
07-08-valves-flat-structure-
leads-to-cliques-
say-ex-employee
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30. Case studies
Organisation Characteristics References
Buffer Radical transparency
on wages
http://www.fastcomp
any.com/3024306/bott
om-line/why-this-startup-
made-their-salaries-
radically-transparent
Zappos Participative
management
http://www.linkedin.co
m/today/post/article/
20140108093818-
2143418-holocracy-hot-
trend-or-hollow-dream-
in-2014
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31. Visit www.oot.org
Bryan Fenech
Founder and Director About www.oot.org
• www.oot.org is the website of
Building the Organisation of
Tomorrow, a networked community
and set of resources to assist
leaders to meet the imperative for
organisational renewal
• All institutions are under increasing
pressure to adapt to 21st century
technological and socio-economic
forces. Successful leaders need
appropriate frames of reference to
manage these processes of
transformation; however, such
frames of reference are rare
• Find articles, presentations, book
reviews, and other resources
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32. References
1. Hrebiniak, L. G. (2005) Making Strategy Work: Leading Effective
Execution and Change, FT Press: New Jersey
2. Tissen, R. and Deprez, R. L. (2008) ‘Towards a Spatial Theory of
Organisations: Creating New Organisational Forms to Improve
Business Performance’, NRG Working Paper no. 08-04 [Online
http://www.nyenrode.nl/research/publications]
3. Storbacka, K., Frow, P., Nenonen, S. and Payne, A. (2012) ‘Designing
Business Models for Value Co-Creation’, Review of Marketing
Researach, Vol. 9 pp 51 – 78
4. O’Reilly III, C. A. and Tushman, M. L. (2004) ‘The Ambidextrous
Organization’, Harvard Business Review, April, pp 74-81
5. Dovey, K. and Fenech, B. (2007), ‘The Role of Enterpise Logic in the
Failure of Organisations to Learn and Transform’, Management
Learning, Vol 38, No 5, pp 573-590
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33. References
6. Bergman, J. Z., Rentsch, J. R., Small, E. E, Davenport, S. W. and
Bergman, S. M. (2012) ‘The Shared Leadership Process in Decision-
Making Teams’, The Journal of Social Psychology, Vol 152, No 1, pp
17–42
7. Hamel, G. (2011) ‘First Lets Fire all the Managers’, Harvard Business
Review, December, pp 48-60
8. Carson, P. B., Tesluk, P. E., and Marrone, J. A. (2007) ‘Share
Leadership in Teams’, Academy of Management Journal, Vol. 50,
No. 5, pp 1217–1234
9. McAdams, D. and Malone, T. W. (2005) ‘Internal markets for supply
chain capacity allocation’, MIT Sloan School, Working Paper No
4546-05
10. Malone, T. W., Laubacher, R. and Morton, M. S. S. (2003) Inventing
the Organisations of the 21st Century, Cambridge MA: The MIT Press
11. Malone, T. W. (2004a) The Future of Work, Boston: Harvard Business
Review Press
12. Malone, T. W. (2004b) ‘Bringing the Market Inside’, Harvard Business
Review, Vol 82, No 4, pp 106-104
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34. References
13. Coffee, R, and Jones, G. (2013) ‘Creating the Best Workplaces on
Earth’, Harvard Business Review, May, pp 99-106
14. Hamel, G. (2011) op cit
15. Bergman et al (2012) op cit
16. Pearce, G. L., Manz, C. C. and Sims, H. P. (2008) ‘The roles of vertical
and shared leadership in the enactment of executive corruption:
Implications for research and practice’, The Leadership Quarterly,
19, pp 353–359
17. Malone, T. W. (2004a) op cit
18. Miles, R. E., Snow, C. C., Mathews, J. A., Miles, G. and Coleman Jnr,
H. J. (1997) ‘Organising in the Knowledge Age: Anticipating the
Cellular Form’, Academy of Management Executive, Vol 11, No 4,
pp 7-24
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35. References
19. Miles et al (1997) op cit
20. Tissen, R. and Deprez, R. L. (2008) op cit
21. Tissen, R. and Deprez, R. L. (2008) op cit
22. Zuboff, S. & Maxmin, J. (2003) The Support Economy: Why
Corporations are Failing Individuals and the Next Episode of
Capitalism, London: Allen Lane
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