The following is a guest post from Rod Collins, author of Wiki Management: A Revolutionary New Model for a Rapidly Changing and Collaborative World.
Today’s managers face a difficult and unprecedented challenge: The world is changing much faster than their organizations. As managers struggle to keep pace with an increasingly fast-forward world, they are discovering that methods and practices that have always delivered reliable results aren’t working anymore. With the advent of the Digital Revolution, managers are increasingly coming to terms with the disturbing reality that a 19th century management model, built around centralized decision-making and hierarchical controls, is unsustainable in a 21st century world.
While most companies and their managers are overwhelmed by accelerating change, there is a small but growing group of vanguard companies that is thriving in this time of great change. Companies like Google, Whole Foods, Valve, Gore, and Zappos understand that a fast-forward world is not necessarily unmanageable, it just needs to be managed differently. With the rapid emergence of the Digital Age, we suddenly find ourselves in a new world with a completely different set of rules. These companies are thriving because they have mastered the new rules, and in so doing, they have completely overhauled the fundamental disciplines of business management.
For the past 150 years, the vast majority of companies have been built as top-down hierarchies on the foundation of five fundamental disciplines: planning, organizing, directing, coordinating, and controlling. The managers of the vanguard companies, however, loathe hierarchical management because they know it’s a formula for failure in a fast-forward world. Instead, they have created a different management model—Wiki Management—that assumes, when it comes to keeping pace with accelerating change, networks are smarter and faster than hierarchies.
These managers are leading a paradigm shift by building their organizations as collaborative networks upon the foundation of five very different disciplines that are rarely, if ever, practiced in traditional businesses:
- Understand What’s Most Important to Customers. In a hyper-connected world, the best companies are customer-centric. Their people clearly understand that they work for the customers, not the bosses. Accordingly, they design their processes to give delighting customers priority over pleasing bosses.
- Aggregate and Leverage Collective Intelligence. Today’s most intelligent organizational leaders no longer leverage individual intelligence by constructing functional bureaucracies. Instead, they cultivate collaborative communities with the capacity to quickly aggregate and leverage their collective intelligence. These enlightened leaders fully understand that nobody is smarter and faster than everybody and, as they design their organizations, show a clear design preference for building networks rather than hierarchies.
- Build Shared Understanding by Bringing Everyone Together in Open Conversations. Companies that successfully manage at the pace of change create innovative processes to effectively integrate diverse points of view, co-create a powerful shared understanding, and drive clarity of purpose across the entire organization. As the pace of change continues to accelerate, managers are increasingly discovering that shared understanding is far more effective that compliance in fostering organizational excellence.
- Focus on the Critical Few Performance Drivers. The most effective leaders know that management is about creating the future. And when they are good at creating the future, they never have to explain the past. That’s why smart leaders don’t focus on outcome measures; they focus on the driver measures that create the outcomes. If you want to manage at the speed of change, it’s better to focus on leading rather than lagging indicators.
- Hold People Accountable to Their Peers. The secret to mastering the unprecedented challenges of a fast-forward world is to make sure that no one in the organization has the authority to kill a good idea or keep a bad idea alive. In the best businesses, leaders aren’t bosses; they’re catalysts and facilitators orchestrating collaborative networks. The leaders of these networks consistently achieve extraordinary results because they understand holding people accountable to their peers rather than to supervisors is the great enabler of the collaboration necessary for speed and innovation.
If traditional managers want their organizations to have the capacity to change as fast as the world around them, they will need to embrace the new reality that managing great change is only possible if they change how they manage. They will need to accept that a nineteenth century management model is unsustainable in a twenty-first century world and, like the successful leaders of the leading companies, redesign their organizations as collaborative networks by practicing the five disciplines of Wiki Management.
Rod Collins is the Director of Innovation at Optimity Advisors, a national management consulting firm, and a leading expert on the next generation of business management.