There are three main reasons why organizations are looking for alternative architectures:
1. Agile companies are wanting to scale without losing their agility
2. Large centralized companies are wanting to become more agile — trim management and bureaucratic overhead; distribute decision making for faster, smarter execution; become more innovative, responsive and resilient to disruptive technologies
3. Hierarchical and bureaucratic organizations want to attract the best young talent by creating working conditions that appeal to them
A few years ago I began thinking about what kind of organizational architecture would reflect the natural human dynamics of self-organization that I described in a previous article. This kind of design would build trust in self-organizing teams, because there would no longer be a disconnect between how teams operated and how organizational power itself was structured. In addition, such an organization would enable companies to scale and remain agile. An open architecture, properly designed, could serve as a guidance system that would help centralized companies transform without losing the ability to “see the organization as a whole operation.” It would be able to distribute management responsibilities into self-organizing teams, without losing strategic performance. This type of organization would appeal to the young generations looking for open participation in the workplace.
I call this new design The Open Participatory Organization, or OPO for short. The OPO is a fully integrated design. It is an open architecture that is supported by a participatory communications platform and is backed-up by a governance that evolves as the organization evolves. This article is an introduction to the structural architecture of the OPO.
Architecture that Learns
The OPO thinks about organizational architecture as a “template.” A template is something that helps you get started right away. A good template provides all the features you need, while allowing them to be customized. Another way to think about the OPO architecture is that it always represents the “current starting position,” which means the architecture “remains ready and able” to change form as the organization evolves. We will see later that the OPO is backed by a governance that is CRiSP — continually regenerating it’s starting position. The form of the organization, therefore, takes on the shape that best fits the current conditions and contexts, and is allowed to change shape as those conditions and contexts change. The architecture must remain both lean and agile. This is the new definition of “the learning organization,” — one in which the architecture has plasticity, enabling it to re-wire itself in response to change — the same way the plasticity of our nervous system enables us to learn.
In his series How Buildings Learn Stewart Brand begins by saying:
Buildings are the wealth of nations, our largest capital asset…. They are the wealth of cultures. And they are where we spend most of our lives. Some of our more arrogant and careless buildings are at war with time and change. They always lose. Some buildings though, seem to flow with time. They flow with us.
Like buildings that learn, a “template architecture” provides the OPO with a fundamentally sound framework that is able to flow in time. There will be periods when the architecture becomes embellished as well as times when it is necessary to peel back down to the basic framework of essential elements and build something new.
The OPO therefore has three main features:
1. Based on principles of self-organization and open participation
2. Fully integrated architecture, communications and governance
3. Able to adapt and learn
Locations — the building blocks of the OPO
Locations are virtual assets
The OPO is built on the notion of “location.” A location is occupied by teams and team members. Locations can also be thought of as “houses,” since, like real houses, they co-evolve with their occupants, who design them for certain purposes (and not others) and improve them and add value to them. In fact, “locations” are the “virtual asset” of the OPO. A start-up company, for example, can create an asset by designing a location that attracts talent. “Location” here means an opportunity to produce value by contributing values and skills in the context of an operational framework (i.e. location).
Locations reflect self-organizing processes
Locations are delineated by the performance, objectives and values that uniquely characterize them. Locations co-evolve with the teams and people who occupy them. Therefore the values in a location are an emergent outcome of the intentional-motivational states of the members, the objectives set out in the location emerge from the role-identities of its members, and the performance is an emergent outcome of the collaborative interaction of the members. In this way, locations are structured as a perfect reflection of the processes underlying self-organization which, as I described in a previous post, can be formulated as intention x identity x interaction.
The more technical term for “location” might be “performance-objective-value zone;” a term which correlates with the three aspects of self-organizing processes., “interaction, identity-intention” (respectively) However, we usually leave out the middle term and just call the locations “performance-value zones.”
Two different zones
All locations therefore are “performance values zones;” but there are two distinct types of “zones” in the OPO: core, and network.
1. Core performance-value zones include all those locations where the key operations of the company are taking place. If you are a software development company, the developers occupy your core performance-value zones. If you are a footwear manufacturing company, your core performance-value zones might include where the footwear is manufactured and/or distributed. If you are software resale company, your core zone will be occupied by a salesforce. It is important to be very very clear on what your core performances are. For example, if you merely distribute goods from another country, your core performance is not the manufacture of those goods, regardless of how you market yourself. Your core performance might be a call center, design shop, or distribution channel.
2. Network performance-value zones include all the other locations that are necessary and sufficient for the company to sustain itself, develop, improve and thrive. Whereas core performance-value zones are company-specific, there are a handful of network performance functions that are essential and universal to all modern organizations. The OPO categorizes these functions as Access, Adaptation, Support and Incubation. (We will learn more about them further on in this article)
Locations are fractal
Locations exist at different scales in the organization: organization, zone, team, individual. The Vision, Mission and Values of the organization specify the highest level, as they represent the performance, objectives and values of the organization as a whole. Each core zone and network zone is also specified by its own performance-objectives-value set that is common to all the teams that occupy the zone. In turn, each particular team will have its own performance-objectives-value set; and finally each member of each team specifies their individual performance-objectives-value set.
Every location delineates a unique organizational address
We can uniquely identify every individual in the organization as the set of fractal addresses that the individual occupies. For example, if I am the # 8 member of team # 4 in core value zone # 2, my specific address is CVZ.02.04.08. This ability to have unique organizational addresses at all levels of scale is critical in tracking changes during organizational transformation. (See figure 1)
How the OPO works
If we zoom out and look at the OPO architecture as a dynamic structure, we can get a better idea of how it represents a dynamic integration of the network and core zones. The core zones are where the value of the company is generated. Core zones are responsible for what we conventionally call “the value proposition” of a company. In creating a conventional company, we must design a business plan around our value proposition. In this analogy, the network zones represent the business model.
In the language of the OPO, the network zones are responsible for the exchange of resources into the organization, from the larger participatory ecology, and the transaction of value added back. It is in this sense that the network zones are like a “living membrane” that is responsible for inside-outside resource flows. Investments are understood as resources flowing in — whether those resources are supplies, information, technology, community support or financial. Resources flowing out are “ex-vestments” which include products and services, payments, and contributions to the common wealth.
When combined with software data programs that track resource flows in both directions, the OPO architecture offers a powerful way to visualize organizational life as part of a larger participatory ecology.
The OPO delineates the network zones into four major classifications: Access, Adaptation, Support, Incubation. As illustrated in figure 2, the network zones also indicate phases in adaptive cycles that every organization goes through, and thus represents the key dynamics of change to be expected there. Zones also correlate with the types of change environments that are operating — from chaotic to complex, to direct and open, and thus are suggestive of the set of actions that are key to strategic choices in the particular network zone.
Network Zones in Detail
Access: Tech-know-logy and Collaboratory
Access refers to that part of the network responsible for making sure the organization has open and easy access to what we call Tech-know-logy, which is a term we invented that refers to all the technology, information, knowledge bases, etc. the organization needs at any given time. An organization also need continuous access to a vibrant Collaboratory — which is our term for the wide ranging networks and relationships an organization needs to develop new potential clients, customers, partners, contractors, suppliers, vendors, and the like.
The kinds of activities that are paramount to the Access sector of the organization are characterized by exploration, seeking novelty, active inquiry, imagining, ideation, and sensing what is emerging. The strategic preferences here are to diversify, disrupt, sense, intuit, learn, seek connect, and relate. Access is the place for change-makers of all kinds, because strong preference for reinvention, a driving force for novelty including emerging markets, emerging identities, and shifting roles are more likely to be successful for the company in this sector of the network. In terms of team participation and self-organization, one of the key skills required in this milieu is the ability to hold paradox and deal with uncertainty.
Adaptation: Peer Review and Applications
Teams in the Adaptation sector are responsible for designing and developing internal adaptive pressures, and for delivering external adaptive pressures into the organization. Their primary performance goal is strategic — making sure the organization continually improves and innovates, responds to both adaptive opportunities as well as challenges, meets and exceeds quality standards as well as legal and regulatory ones. The OPO template subdivides this sector into Peer Review and Applications– broadly construed terms that refer to procedures for hiring and evaluating employees, engaging external peer review programs, finding adaptive fit in markets, applying for promotions, and the like.
These responsibilities require people occupying these sectors to be sensitive, responsive, and reflective. They must have the skills to identify emerging patterns across a broad landscape of potentials — in people, in products, in markets, in culture — before they become obvious. In addition, people in these sectors need to be able to derive processes that create the conditions for the organization’s continual improvement and adaptation. Their default preferences would be to target, innovate and exploit potentials, as well as to respond, sense, and act on pressures to evolve, by iterating cycles of continuous improvement.
Support: Financial and Community
The OPO subdivides the support sector into Financial and Community.Financial support includes investment and cash flow, as well as budgeting, financial planning and tracking resource flows. Community support refers to human resource development and benefit-support, as well as engagement with the external virtual or physical community which is the larger participatory ecology of the organization.
The primary responsibility of the Support sector is that the organization has the financial and community resources to fully realize its potentials. The key strategic preferences in this sector are acting, analyzing and reiterating. They characteristic goals here are to increase, concentrate, develop, plan, do reproduce, report and repeat. The milieu of this sector can be complicated, but is rarely complex.
Incubation: Playgrounds and Practitioners
Whereas Adaptation is the place of adaptive pressures, Incubation is the place for adaptive pleasures. The OPO template subdivides this sector into Playgrounds which are intramural programs such as company parties and events, and Practitioners which refers to extramural associations and their programs and events. The strategic purpose of the Incubation sector is to bump into surprise through playful and spontaneous, refreshing and renewing activities. Through intentional design, it makes sure the organization, thought of as a whole, as well as all its participating members engage the time and freedom to play, explore, practice and just “be.”
The milieu of this sector is neither chaotic nor complex, nor simple or complicated. It is merely remains “open to participation.”
Architecture as Strategy
As we move around the network zones, we see that the key performance activities, skills and values and the environment in which they operate, become less chaotic, more orderly and more conservative as focus moves from emergent potentials to tried and true operational tasks. The unknown becomes progressively known, the unpredictable becomes progressively certain, the impossible and improbable become obvious and unavoidable.The eclectic reader may see that the network zones correlate to the phases of the panarchy cycle and the domains of the cynefin framework, essentially encoding strategic choice fields into the organizational architecture.
… so what happens to managers in a self-organized environment
Instead of being linked together inside a chain of command and control based on “trickle down” levels of disciplinary-backed power and authority, managers, like all other employees, are members of teams that self-organize to achieve objectives and fulfill performance goals of their zones. These zones, however, involve different kinds of functions, namely those described as the network functions. These functions are inherently strategic in nature.
In today’s centralized organizations, individual leaders fall in over their heads, because they are located in the center, where information is compounded and task demands escalate. The leader, stranded there, with too much responsibility and too few resources, is forced to take up the only strategy available to them: continual compression of complexity by the progressive reduction of rich and context-sensitive information to second and third order abstraction. Eventually, the company begins to live in the world of conceptualized fantasy — the world of theories, models and maps, which would be useful tools if they mapped onto anything that was actually happening in the everyday and ordinary activities of organizational life. At which time, interventions intended to be solutions to complexity, actually increases it, because the management architecture is invariant to the real solutions the organization requires.
In the OPO, managers can address complex issues collaboratively, by moving around the network and participating with the diverse perspectives of different network environments. Furthermore, because the OPO distributes disciplinary power throughout the network through a participatory governance, managers are freed up to have transparent, frank, and at times difficult conversations with others who hold the key information they need. This means that strategic choices are being based on involved participation with what is actually the case, not on conversations limited to official scripts, cover-ups, and irrelevant abstractions.
So what do managers really do in the context of a self-organizing company? They participate in a complex ecology of values-objectives-performances that operate at fractal levels and at different temporal scales. That is to say, as members of self-organizing teams located in network zones, managers, like all other participants, interact with each other in complex responsive ways, by forming role-identities that emerge from the continuous interplay of their intentions, identities and interactions. (See my previous article on how self-organization works.)
“Everyone is affected by the value streams in an organisation. It’s the underlying invisible values streams that affect your unconscious behaviours and functions.
“These value-streams are sensitive and responsible “feelers” that…….are more sensitive, more responsive and more precise, than the conceptual abstractions we commonly use to represent organizational life. The value-streams reflect what is most relevant and most real and therefore, they can surface the missing information we need when making decisions or solving problems in complex environments.”
Asymmetry in values between people within an organisation (which show up in needs) creates constantly shifting power dynamics in relationships.
Discrete identities emerge in this process and we fall into roles. Roles become associated with objectives that perform them, and team interactions then become organized performances.
This bit feels key: “The success of the organized performance depends upon fulfilling individual roles, which in turn depend upon maintaining sufficient relational stability or sustaining a threshold degree of coherence in the complex responsive processes operating at the level of the value-streams.”
In other words, success is heavily dependent on maintaining alignment in the values streams.
We are beginning to see how to design organizations that allow for flexible identities and creative role-playing. Perhaps we even have the responsibility to design organizational structures that are sensitive, adaptive and responsive to human values. These structures would allow for the emergence, through self-organization, of the full spectrum of roles and identities that humans would want to perform while being together.
And building trust practices that allow for embracing the full humanity and emotional range of each participant is key.”