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The Future of Organizing
Prof. (FH) Dr. Richard Pircher
Richard.pircher@fh-vie.ac.at
www.xing.com/profile/Richard_Pircher
...
• Technologie bürokratie
Industrial production
offers enormous
productivity through
division of laborImage: nocloudinthesky
commonly such an
organization is understood
as a machine.
There are buttons and
handwheels you may use to
change it
Image ...
command
execution
monitoring
report
The industrial machine organization is
a top-down pyramid
Image : (c) michaeldb www.fo...
a machine is
rigid and inflexible
and most humans
don`t want to be
treated as a
gear-wheel
New Types of Organizations
a number of organizations – both
profit and non-profit – show very
successful results by applyi...
The future of organizing is
alive here already:
(Hamel 2011, Laloux 2014, Pircher 2015)
(500, production, FR)
(>400, produ...
Characteristics of new organizing:
purpose-driven
self-steering
competency based
accountability
motivating
adaptive - flex...
New Types of Organizations
• Morning Star:
– produces tomatoes worth $700 million annually
with about 400 employees
– They...
New Types of Organizations
• Buurtzorg:
– A Dutch neighborhood-nursing organization
– It grew from 10 employees to 7000 wi...
New Types of OrganizationsFAVI:
– A French brass foundry, started transition in the 1980s,
with 80 employees at the time a...
Tele-Haase
• In Vienna, Austria, they employ approx. 100 people
• There is no CEO anymore
• Core-processes and supporting ...
Tele-Haase: processes – no hierarchy
„Regie“ = direction,
formerly known as
„management“ / „CEO“
Zappos - Holacracy
• Zappos is one of the worlds largest online shoe
stores with more than 1.500 employees. It is
owned by...
Differentiating Characteristics
Self-steering - no fixed hierarchy:
• The power to take decisions is allocated to those pe...
Differentiating Characteristics
Purpose-driven:
• To serve the purpose or mission of the
organization provides the leading...
Differentiating Characteristics
Self-organization:
• Employees negotiate responsibilities with their
peers.
• These compan...
Differentiating Characteristics
Wholeness:
• People feel that they do not have to wear a mask and
to fit into predefined b...
Differentiating Characteristics
• It may be concluded that in such organizations
the employees have a lot of freedom to do...
Strengths and Challenges
• Employees tend to be more
motivated, engaged and
innovative
• Both Repetitive and reflexive
tas...
Take-home messages
1. There are organizations which successfully
function in a purpose-driven way without rigid
management...
Prof. (FH) Dr. Richard Pircher
Richard.pircher@fh-vie.ac.at
www.xing.com/profile/Richard_Pircher
www.linkedin.com/in/richa...
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The Future of Organizing

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It has been shown that a number of organizations – both profit and non-profit – show very successful results by applying organizational practices which radically contradict dominating convictions. The US-company Morning Star produces tomatoes worth $700 million annually with about 400 employees. They achieve a double-digit growth rate compared to the 1 % of their competitors. The Dutch neighborhood-nursing organization Buurtzorg grew from 10 employees to 7000 with a market share of 75% within 7 years. These are examples for organizations which differ fundamentally from well-known organizational structures. Among others, three central characteristics of them may be summarized as follows (Hamel, 2011, Laloux, 2014):
To serve the purpose or mission of the organization provides the leading orientation for every decision and action. Whether an idea or argument is good or bad will be judged by this estimation. Every employee at Morning Star for example “is responsible for drawing up a personal mission statement that outlines how he or she will contribute to the company’s goal of `producing tomato products and services which consistently achieve the quality and service expectations of our customers.´” (Hamel, 2011).
The power to take decisions is allocated to those people in the organization who are competent for it. Employees choose how much money to spend on what, even including salaries. They are responsible for acquiring the tools needed to do their work. Employees even define the strategy. There are no titles nor promotions because there is no hierarchy. In such organizations there are no managers anymore. However, everybody is a manager in terms of competencies to decide. One employee puts it like that: “I’m driven by my mission and my commitments, not by a manager.” (Hamel, 2011).
Employees negotiate responsibilities with their peers. They apply market-style practices within their relationships. If they want to make investments larger than what they are able to finance themselves they have to convince colleagues to lend them the rest. “There is a social risk in doing something your colleagues think is stupid.” (Hamel, 2011).
People do not have to fit into predefined boxes. They are expected to take on bigger responsibilities as they develop further competencies. Therefore there are broader and more complicated roles than elsewhere (Hamel, 2011).
It may be concluded that in such organizations the employees have a lot of freedom to do what they are convinced is the best thing to serve the purpose. Simultaneously they have peer-negotiated responsibility for the results of their actions. There are almost no rigid structures like hierarchy and status markers which keep them from fulfilling their mission.

Veröffentlicht in: Business

The Future of Organizing

  1. 1. The Future of Organizing Prof. (FH) Dr. Richard Pircher Richard.pircher@fh-vie.ac.at www.xing.com/profile/Richard_Pircher www.linkedin.com/in/richardpircher University of Applied Sciences BFI Vienna
  2. 2. • Technologie bürokratie Industrial production offers enormous productivity through division of laborImage: nocloudinthesky
  3. 3. commonly such an organization is understood as a machine. There are buttons and handwheels you may use to change it Image : Ragin Stern
  4. 4. command execution monitoring report The industrial machine organization is a top-down pyramid Image : (c) michaeldb www.fotosearch.com
  5. 5. a machine is rigid and inflexible and most humans don`t want to be treated as a gear-wheel
  6. 6. New Types of Organizations a number of organizations – both profit and non-profit – show very successful results by applying organizational practices which radically contradict dominating convictions
  7. 7. The future of organizing is alive here already: (Hamel 2011, Laloux 2014, Pircher 2015) (500, production, FR) (>400, production, US) (9.000, service, NPO, NL) (1.500, services, US) (100, production, AT) (1.350, production, US) (org. model) (600, services, DE) (900, production, US) (4.000, services, NPO, US) (40.000, production, global) (1.500 stakeholder, services, NPO, DE) (750, production, FR) (7-1.600, service, DE) Premium Cola
  8. 8. Characteristics of new organizing: purpose-driven self-steering competency based accountability motivating adaptive - flexible innovative relevant actions the whole human matters Distributed authority Image: (c) yodiyim www.fotosearch.com collective intelligence
  9. 9. New Types of Organizations • Morning Star: – produces tomatoes worth $700 million annually with about 400 employees – They achieve a double-digit growth rate compared to the 1 % of their competitors (Hamel, 2011; Laloux 2014) https://www.youtube.com/watch?v=qqUBdX1d3ok
  10. 10. New Types of Organizations • Buurtzorg: – A Dutch neighborhood-nursing organization – It grew from 10 employees to 7000 with a market share of 75% within 7 years. (Hamel, 2011; Laloux 2014)
  11. 11. New Types of OrganizationsFAVI: – A French brass foundry, started transition in the 1980s, with 80 employees at the time and competitors moving their productions to China to keep prices down. – FAVI, with the intention to create meaningful industrial employment in the underprivileged northeastern part of France, has expanded to more than 500 employees today, with outstanding financial results and, in spite of the big competition from China, is still paying its workers salaries significantly above the market rate. (Laloux 2014)
  12. 12. Tele-Haase • In Vienna, Austria, they employ approx. 100 people • There is no CEO anymore • Core-processes and supporting processes are defined instead of hierarchy • The changed happened in a gradual step-by-step approach
  13. 13. Tele-Haase: processes – no hierarchy „Regie“ = direction, formerly known as „management“ / „CEO“
  14. 14. Zappos - Holacracy • Zappos is one of the worlds largest online shoe stores with more than 1.500 employees. It is owned by Amazon • the company restructured its organizational model to use Holacracy • Holacracy is a system of organizational governance in which authority and decision-making are distributed throughout self-organizing teams • In Holacracy roles are the building blocks instead of job descriptions or hierarchical positions • Holacracy explained in a nutshell
  15. 15. Differentiating Characteristics Self-steering - no fixed hierarchy: • The power to take decisions is allocated to those people in the organization who are competent for it. • Self-management requires a set of interlocking structures and practices. Fluid hierarchies replace the fixed pyramid. • Motivation is much higher. Employees even define the strategy. • There are no titles nor promotions because there is no fixed hierarchy. • Everybody is a manager in terms of competencies to decide. One employee puts it like that: “I’m driven by my mission and my commitments, not by a manager.” (Hamel, 2011)
  16. 16. Differentiating Characteristics Purpose-driven: • To serve the purpose or mission of the organization provides the leading orientation for every decision and action. Whether an idea or argument is good or bad will be judged by this estimation. • Example Morning Star: Every employee at for example “is responsible for drawing up a personal mission statement that outlines how he or she will contribute to the company’s goal of `producing tomato products and services which consistently achieve the quality and service expectations of our customers.´” (Hamel, 2011)
  17. 17. Differentiating Characteristics Self-organization: • Employees negotiate responsibilities with their peers. • These companies apply market-style practices within their relationships. • Change can come from any person who senses that change is needed. “There is a social risk in doing something your colleagues think is stupid.”(Hamel, 2011, Laloux, 2014)
  18. 18. Differentiating Characteristics Wholeness: • People feel that they do not have to wear a mask and to fit into predefined boxes. Employees are expected to take on bigger responsibilities as they develop further competencies. Therefore there are broader and more complicated roles than elsewhere. • Simple management practices allow people to be truly themselves. • Example Patagonia: The company maintains a child development center. Kids visit their parents´ desks, join adults during lunchtime, etc. (Laloux 2014)
  19. 19. Differentiating Characteristics • It may be concluded that in such organizations the employees have a lot of freedom to do what they are convinced is the best thing to serve the purpose. • Simultaneously they have peer-negotiated responsibility for the results of their actions. There are almost no rigid structures like hierarchy and status markers which keep them from fulfilling their mission.
  20. 20. Strengths and Challenges • Employees tend to be more motivated, engaged and innovative • Both Repetitive and reflexive tasks are combined • Everybody in the organization may become a sensor for relevant changes • The purpose of the organization is the guiding star for every decision and action • Change is embedded in the genes of the company • A culture of cooperation and effective use of resources is much easier to establish • It takes time to understand a completely different logic of collaboration and to get accustomed to it • Not everybody wants to engage in work • Recruiting is more difficult • Owners and leaders with an appropriate mindset are essential • Individual success may not be measured in conventional hierarchical terms anymore • Employees have to be capable of dealing with freedom and accountability
  21. 21. Take-home messages 1. There are organizations which successfully function in a purpose-driven way without rigid management roles 2. The employees are much more independent, self-organizing and responsible than in most other organizations 3. These organizations are more effective, innovative, flexible and responsive to their environment 4. Hierarchy free self-organization may be realized for the whole organization or just in parts of it
  22. 22. Prof. (FH) Dr. Richard Pircher Richard.pircher@fh-vie.ac.at www.xing.com/profile/Richard_Pircher www.linkedin.com/in/richardpircher richard-pircher.net Slides are available at de.slideshare.net/pircher I would be glad to answer your questions and to discuss the topic Please feel free to contact me! University of Applied Sciences BFI Vienna

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