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NPI - Instituut voor Organisatie Ontwikkeling
*article: 8430.935
FK/LG
THE ORGANIZATION AS A LIVING ORGANISM
Tt is not quite commom to think in processes of Organization
Development in a qualitative sense. There exist many
quantative growth indicators: figures of turnover, profit,
return on investment and all kinds of analytical ratios. And
of course, these reflect aspects of realities. But they
are not the reality: an organization does not trade
"figures". Reading the figures and knowing why there is
something wrong calls for the quantitative judgement to be
matched by a qualitative diagnosis.. Because there, from the
qualitative diagnosis the proper difection for a renewing
process will emerge, and not merely a number of alternative
scenarios. This article provides a conceptual framework for
qualitatively diagnosing one's own organization (or part of
it) and suggests ways for conducting a renewing process on
the basis thereof.
Not so long ago, a major public-owned company in the
Netherlands called in the help of a group of management
consultants. The company was suffering from a number of
problems, such as low standard of service, a lack of cost
control and large scale organizational malfunctioning. In
Fact, the way of working had become rather burocratic: far
example it took over one year for a client to have his
address corrected on the bills he received. Furthermore the
bills were often incorrect. For the clients it was hard to
get_a proper access to the organisation, even by telephone.
Bills outstanding were of a huge amount. There were many
levels of hierarchy, which all but paralysed its
management. Internal communication was frustrated to a high
degree, everybody wrote memos to everybody, hardly even
getting an appropriate answer. Small "kingdoms" were
vigorously defended. This was done mainly by..blaming
everybody else when something had gone wrong. In their
report, the consultants suggested to adopt a new legal
structure and to switch from public-owned to privately-
owned. This had become possible through a change in
governement legislation. Also a new organization structure
was proposed: fewer hierarchical levels, broader tasks and
responsibilities for the employees. Furthermore a system of
professional budgetting had to be introduced. In their
advice however it was emphasized that the proposed measures
alone would not solve the problem: because these problems
*This article is published in "Productivity", New Delhi,
June 1991
Vaickenboschlaan 8, Postbus 299, 3700 AG Zeist, Telefoon 03404-20044, Fax 03404-12770.
were rooted in the thinking and acting of the employees, and
in their attitude. And any so-called rational problem-
analysis and problem-solving method would fail if they did
not take this aspect inte consideration. A plea was held to
have the structural technocratic problem-solving approach
accompanied by a process of renewing the employees! "way of
thinking and acting", and their attitude. Because unless the
abilities of the employees would increase, any organization
structure would at the best change the nature of the problem
but not its underlying causes. And in their teport they
called among other things for 3 major changes in the company
culture:
* act more client-oriented and improve the internal work-
processes accordingly, on a very basic level
* encaurage the initiative taking instead of only following
orders and procedures
* increase the quality of the internal communication and
of the management.
These vital renewing aspects are of a qualitative nature.
And the question arises how to manage this qualitative
renewing process. But let's loak at diagnosing the
organization qualitatively first: how to proceed? Here we
introduce one possible way of approaching this question.
When looking at an organization from a qualitative point of
view, a distinction can be made of two polarities, two sets
af opposites. Thinking oriented and acting oriented on the
ane hand and inwardly and outwardly oriented on the other
hand. Ideally these polarities are in constant dialogue
so as to prevent a disequilibrium. But of course in day to
day life, many factors threathen to disturb this
equilibrium.
THINKING
oriented
i \
1 ?
aon deny
INWARDLY if S ‘ GUTWARDLY
ariented ‘ man . oriented
ACTING
oriented
lebi a bec€
The dotted lines reflect the ngtesieet dialogue.
What it means: thinking oriented, acting oriented inwardly
oriented and outwardly ariented will be explained
furtheron. Here I like to explain that ail these
orientations are present in any organization. You cannot do
without them. The danger is only when one of these aspects
gets overemphasized and starts to structurally dominate the
other.
The basic thought behind this concept is that an
organization is a living organism because it is living in
and through people. The organization as a whale has an
identity and is most likely to move towards its destination
when the dialogue between thinking oriented and acting
oriented, and between inwardly oriented and outwardly
oriented is kept alive as unhampered as possible.
Thinking-acting
Now what is this thinking- and acting orientation? The level
of thinking of an organization is for instance the level
where goals and plans and policy are formulated. And the
procedure handbook. These elements live in the realm of
thinking. It is the world of ideas. But how healthy this
thinking is depends on the connection it has with the actual
reality: the actual day to day working processes of people.
Does this thinking support or compiement the working
process? Or does it work against reality?
For example: are the rules that exist useful for and related
to day to day practice? Are managers wha are responsible for
a department entitled to make their own purchases for this
department in order that it can function well? Or do they
have ta ask permission every time they need to hire somebady
or to buy an essential piece of equipment? The more rules,
procedures and goals exist that do not support or complement
the work in practice, the more the realm thinking tends to
become a sphere of its own: more reports, more plans, more
perfect ideas, more measures to control which all in the end
have less to do with practice, but will nevertheless be
imposed upon practice.
The people who design and complement this thinking more and
more are often in the danger of drifting away from ordinary
reality, practice. And start to manage on the basis of
abstractions: reports and figures. They are no longer
interested in reality, but only in their self-imagined world
af thoughts. And the functioning of the organization becomes
endangered. Theory starts to try and rule vteality.
Now let's look at the counterpart of this polarity:
The level of acting is the level of day to day activities:
primary work-processes, selling, producing, but alsa the
work of the supporting departments like personel affairs. It
is the realm of doing, acting. Of activity and dynamics.
There the word goes: no talking, let's do something. Let's
realize the mission of this organization here and now. And
how healthy this realm of acting is, depends on its
connection and dialogue with the realm of thinking: goals
and policy. Because if the acting is not carried out in
communication with other departments, chaos will increase. I
cannot buy a personal computer if I need one, when I do not
take in consideration the company's policy in this respect.
And I cannot make a special discount-deal with a client if
this does not form a part of our pricing policy. The more
the acting becomes an individual impulse-decision without
taking into account the company policy, the more chaotic and
differentiated the company will become. And in the end it
threatens to fall apart in various "kingdoms" who have less
and less inner connection with eachother.
The living dialogue between thinking and acting depends on
the mutual communication between exchange of ideas, vision
and facts from practice. The quality of this communication
depends on the skills of the people invalved, but can be
dramatically improved. And by bringing about this dialogue,
the organization can become more healthy: the lifestream of
the organization will connect the "top" and the "floor" of
the organization.
Inward-outward
And what about the inwardly and outwardly orientation? The
basic problem is the same. The organization needs to be
quite aware of its strengh, skills, of its uniqueness. It
should be proud of what it has developed in the past, and is
able to do now. If it really is unique in some important
aspects of this work, then there lies its reason for being
there, the justification of its existence. But this
awareness of its uniqueness can be so strong that it becomes
arrogance as an attitude, a monapolist's behaviour. The
clients should go at great length to deserve the company's
attention. And the client will do so, as long as he has
found no ceal alternative. If he does find one, he will
immediately turn his back on the company. Or even he will
work out alternatives himself, if pressed hard enough. When
therefore the inward orientation is too strong, it neglects
the real dialogue with the outside world, with the clients.
It merely focusses on its hobbies and tries to perfect them,
whether that is asked for or not.
An example is an engineer wha in canstantly trying to
improve his creation, let's assume a machine of some kind.
Even if this improving is net necessary and increases costs,
and takes up a lot of time. And ta this engineer, the client
really is a nuisance. This client does not understand his
"creation", has all kinds of irrelevant requirements and
even dares to ask for a simpler version! All because of such
a trivial thing as money! Clearly this attitude will chase
clients away as soon as they have an alternative. The
dialogue with "the outside world" is neglected. The company
only tries to press itself on the market without real
interest in the client's questions and needs.
But the outward orientation means exactly this attention for
the client's needs: marketing is the name of this game. What
are his needs, what are the target groups? Strategic pricing
means that the company is doing its utmost to be of service
ta its clients. To give them what they need and thereby
making a healthy profit. But this orientation can also
become one-sided: when a company never says "no" to
clients. When the company promises more than they can live
up to! Then they no longer build on their strength but let
themselves being seduced by clients to offer what they
cannot do: too short delivery times, too low prices or a
specially designed new product. They promised it out of fear
to loese a client, but instead they loose themselves. When
you try to be everything for everybody, you end up being
nothing for nobody.
So here also the dialogue, the attunement is important:
between what the organisation stands for, its strength, and
the needs of the client. And one-sidedness here destroys
the organization in the end.
Too much emphasis
Too much emphasis an the thinking aspect and too little
connection with practice leads to a theeretical approach of
problems and many wrong decisions. In.the end, for every
problem new rules will be invented, which in turn usually
evoke new problems.
Too much emphasis on the acting aspect, on the "doing
instead cf talking" and too little connection with company
policy leads to individual unpredictable decisions. The
organization is confronted with the irrevocable consequences
of this behaviour and chaos may take over.
Too much emphasis on the inward orientation leads ta people
who are more busy with their hobbies, improving quality
where it is not really asked for. Striving for perfection.
And clients will slowly stand up ta turn their back on the
company.
Qn the other side, too much emphasis on the outward
orientation makes that the company forgets what it stands
for and what it really is equipped ta do. It starts to build
on weakness rather than an strength, and will find itself
doing what others can do better or refuse tao do. The company
will wear out its resources, its lifestream.
In the example of the energqy-supplying company, the
qualitative diagnosis turned out to be the following:
THINKING
oriented
1 i
,
f
INWARDLY ' “a y OUTWARDLY
oriented a : oriented
ACTING
oriented
The emphasis as may be graphically seen was more thinking
oriented and inwardly oriented than acting oriented and
outwardly oriented. Mainly this was reflected in the fact
that the customer had been last aut of sight, and that
problems had the tendency to drift upwards, so that only in
the top decisions had to be made and policy established.
This reflected the general weakness of middle and lower
management to make decisions and take initiatives for their
own account. A sort of paralysis gavernd; managers became
uncertain on what ta do and chose, in case of doubt, to do
nothing at all. But also topmanagement for years did not ~
recognise the symptoms and played the game along untill the
day they found their organization paralysed.
Renewing yes, but how?
As can also be seen in medicine, diagnosing is the easiest
part of curing. It is not sufficient to simply tell
Management to became more client-oriented and to take more
decisions and initiatives; you don't change an arganization
culture by telling peaple to act differently, but
topmanagement itself must start to live up te it! To be more
precise: they must reward decisian taking by middle-
Management and disapprove too much asking for advice. Even
if in the eyes of topmanagement the decision was not the
best possible: don't go for perfectionism; that would be
disastrous, because people's selfcaonfidence will be hurt. No
wonder a topmanager would have taken a better decision; but
therefore he is na middle-manager but a tapmanager. The
proper question here is: is the decision good enough? Or if
mistakes were made: have we all learned from it? Because if
we did, we gained from it: people's capabilities have
\)
increased, however little. Na mistakes: no learning! And
Fear for mistakes is ane of the biggest threats to corporate
success,
Furthermore, topmanagement has to reward all decisions that
improve the client-orientation of the company as well as
serve the company's awn interest. But how exactly ta achieve
this, they must leave this question to the middle-managers:
they have to be made responsible for implementing these
mew policies and design action programms. So topmanagement
should stop doing the job for them, but rather create
conditions, take a standpoint where the qualitative emphasis
should be and evaluate the resulting actions from a point of
view of learning.
A useful means to bring these ideas to life in the lower
tegions of the organization, where in the end the new
behaviour has to came to life can be ta organise working
conferences of at least two hierarchical levels together.
The theme for example is: client-orientation. The question
is: how to substantially improve this in the next 12
months. And the goal of the conference: at the end of the
conference a set of actions has been agreed upon and people
have been made responsible for them. And agreement has been
teached an when and how ta evaluate them.
Working this way, the process of stimulating decision-making
lower in the organization automatically takes place. To
describe however how to proceed in such working conferences
could be the contents of yet another article. Let me just
say here that a training and organization department can
play an important role here, but always in cooperation with
topmanagement.
Renewing an organization really comes down to renewing the
skills of people, from top to bottom. To cefresh all
patterns of thinking, judging and acting, to improve
knowledge and skills and to refresh people's attitude. But
it should be realised that those who wish to do so can only
achieve this by demonstrating the new attitude in their own
behaviour.