Why are Organizations Slow to Respond?

ORGANIZATIONS are only human.

Organizations share many characteristics with the people that populate them. Organizations are born, they mature, they age, and they die. The life expectancy of most is about 15 years and only 5% last longer than 50 years.

They begin with an innovative idea—even developing beyond all expectations—but eventually they begin to show signs of aging. Claudio Feser writes in Serial Innovators, “Some firms become blinded by success and begin to resist external views and challenges. Some are locked into mental models and become driven by habits. Some lose the sense of purpose that pervaded them in the early days. Some become bureaucratic. Some have processes and incentive systems that have put them on autopilot, leading in a dangerous direction. Some develop dysfunctional organizational cultures.”

Occasionally, some organizations resist these all too human tendencies and thrive. They continually reinvent themselves. They confront rigidity. They become serial innovators.

We create over time, our own and our organization’s rigidities. Individually, we develop rigidities in the form of biases, lack of self-confidence, and habits. The human mind is quite adept at this in order to create efficiencies. We can only process so much. Organizationally, we create rigidities like structures, performance management, and reward systems, supporting cultures and capabilities that while necessary to some degree, often prevent us from adapting rapidly. Worse still, we add complexities to existing structures, processes, values and norms, without ever rethinking and possibly eliminating obsolete ideas and procedures. All of this can cause entropy and our demise.

Rigidities are not going to go away, but we can learn to manage them better. Feser says that organizations that want to become serial innovators must do the following:

1. Cultivate the organization's members’ desire to make a difference.
2. Build a team of learners at the top.
3. Frame the organization’s vision and strategy positively.
4. Build on self-managed performance cells.
5. Promote the organization’s members’ drive to perform and grow.
6. Invest in capabilities to quickly develop new assets and skills.
7. Cultivate a culture that fosters execution and promotes challenge.

Again, it is a leadership issue with a leadership solution.

If company leaders do not accept challenging and diverging views, neither will the organization.

If company leaders do not show self-confidence, do not have a positive mindset and do not role-model resilience, the organization will not develop the confidence to adapt to ever-changing and dynamic markets.

If company leaders do not change their behavior when confronted with new situations, the company will run on autopilot.

If company leaders do not clearly define the structure of the organization and fight organizational complexity, complexity will creep throughout the organization.

If company leaders do not thoughtfully review and reward performance, behaviors fostering collaboration and innovation will become rare and–over time—disappear.

After all, organizations are only human.

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Posted by Michael McKinney at 10:11 AM
Permalink | Comments (0) | This post is about Change , Creativity & Innovation , Management