Is your Organisation Viable?
By Pam Ashby | 20 July 2018
The average lifespan of a company dropped from 80 years to just 10 years between 1955 and 2016. The business environment changed dramatically, and the evidence leads us to conclude that traditional models of working are less suited to the new world. “The traditional organisation structure is no longer viable,” Jeremy Renwick confirms, talking to Jenny Bailey in a Consortium webinar.
The Adaptive Organisation
Jeremy is CxO of Agilesphere, a consultancy focusing on the concept of the Adaptive Organisation (previously known as the Minimum Viable Organisation or MVO). He tells Jenny that organisation structures based around hierarchical functions make it much harder to establish a customer-centred ethos. “A functional silo has someone as its head in a traditional hierarchical organisation,” he explains. “The head of the function has control over individuals, who will then look up the silo for guidance. What happens here is that the behaviours of the leaders are reflected down the silos throughout the organisation.
“Even where we break this silo behaviour for specific projects, using cross functional teams for instance, there’s a tendency for it to reassert itself when people are under pressure. We instinctively reach for the old model when we’re stressed. Our mental models have not been replaced with anything more viable for this new world of fast-paced change.
“Today’s digital businesses have to focus on the customer, not the C-suite.”
Jenny speaks for many of us, when she expresses surprise that the theory sitting beneath the Adaptive Organisation concept stretches back to the late 1960s and early 1970s. Jeremy talks about Stafford Beer’s Viable System Model (VSM), which refers to any system organised to meet the demands of survival in a changing environment. He tells us that Beer’s first principle is to ‘design organisations to minimise damage to people and cost’.
Beer’s model uses complexity mathematics and is based on the human nervous system, which is the most viable organism on the planet. “Humans have only succeeded because we are so adaptive,” Jeremy reminds us.
Empowerment, Value and Feedback
Even though it was created around fifty years ago, Beer’s model includes many of the principles we now associate with Agile, such as empowerment, a focus on value, and the use of feedback. This model, together with systems thinking, complexity theory, and Agile has been a part of the major research that has gone into creating the Adaptive Organisation approach.
The Adaptive Organisation concept promotes a world where every function in an organisation is structured around value to the customer, using empowerment with accountability, and working with transparency and authenticity. “Organisation structures need to be human, adaptive and scalable,” Jeremy tells us.
You can find out more about the theory and the practice behind the Adaptive Organisation in this one-hour webinar. Listen to the audio, see the slides, and download the picture book here
Jeremy Renwick is presenting a case study on Agilesphere’s experience implementing the Adaptive Organisation concept at the Agile Business Conference in London on 26 & 27 September 2018. Book your place
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