Shifting from Orchestras to Jazz Bands (PART THREE)

Improving internal communication is a crucial aspect towards increasing productivity and obtaining sustainability. As a consequence, the full potential of the “Jazz Bands” companies can not be reached with traditional ways of internal communication such as e-mail.

Social Networking Services (SNS) such as Facebook and Twitter have changed how people connect and share information with their friends and family. They have largely replaced traditional forms of electronic communication with status updates and tweets. People prefer to be constantly connected to their communities through short, frequent, real-time updates.

The world of personal electronic communication technology has changed dramatically. However, there are only a few business applications that have responded to this environmental change. Traditional communication tools such as email are lagging behind the needs and expectations of a these flexible companies with horizontal structures.

If you expect your company to work like a network, a self organizing mechanism, it is imperative that every node in the network is connected with each other and that they can access each other information (excluding some confidential data, of course). With e-mails this is impossible or highly inefficient (you should send cc to everyone in the company). With social networking, this is easy, because people in your company may enter your profile or see your status updates and see what you are working on, and comment on it, or collaborate with you. This is the current trend in business technology and in the next post I will explain the main aspects of this kind of software.

Shifting from Orchestras to Jazz Bands (PART TWO)

How can we achieve the improvisation needed in “Jazz Bands”? Learning. We need more courses that focus on this area in related university degrees and other teaching centers. Part of these courses could be afforded by the government (with investment returns that go beyond the imaginable) and the rest by companies wishing to have flexible and proactive managers.

The horizontal organizational structure mentioned in the previous post could be also promoted by the government. For example, it can give tax benefits to companies that present less hierarchical structures. Of course, the “ideal structure” (if there is something like this) would vary from one industry to another (it is reasonable for a manufacturing company to have a more hierarchical structure than a service company). Therefore, the state can propose “ideal structures” for each industry and give tax benefits to companies that are close to these ideals analyzing different parameters such as the salary distribution, for example.

One last comment, we need to abandon the old conceptions of planning. In a world where some scientists say that in less than a century half of the world would be inhabitable due to climate changes and others say that a couple of decades from now, artificial intelligence will surpass human’s; it is impossible (if not stupid) to make predictions with horizons ten years from now and make strategic decisions based on these. Instead, we need to create organizations that function as autonomous structures that can adapt to drastic changes with flexible plans and variable time horizons.

Shifting from Orchestras to Jazz Bands (PART ONE)

We have mentioned several times before that a sustainable corporation must be flexible. One internal issue which is directly related to the flexibility is the organizational structure.

There is an imperative necessity worldwide to shift to more horizontal, network-like structures for several reasons. These kind of structures promote the idea exchange between all the levels of the organization entailing the following inevitable advantages: coherency between strategic, tactical and operative goals and decisions; attraction and retention of young talents reducing the emigration rates in developing countries; transparency in the activities since everyone is connected to every other; increase in productivity due to “Pygmalion effect” because the whole organization is depending on your work and not only your team or your boss; and the list can go on and on. Furthermore, in the past years, lots of people have learned about the benefits of network communication in social networking sites (facebook, myspace, twitter, etc), why can´t we use the benefits of these platforms to enhance corporation collaboration? In fact, there are very big developers (Google and Microsoft being the biggest) trying to build this kind of platform. If anyone is interested, I am also engaged in the business development of a platform of similar nature (called ATOM).

I found a nice analogy (first proposed by John Clarkeson in 1990) to illustrate this shift. A vertical structure is like an orchestra where the director tells everyone what to play and when to do it. Whereas an horizontal structure is more like a jazz band where integration, communication and improvisation are fundamental pieces in order to achieve success. We need more jazz players in a world in which the job of the orchestra directors is getting more difficult each day with intricate musical scores, changing beats and six-lined pentagrams.

Just to close this post (the same topic will be continued next time) I must clarify that the directive sphere of an organization must still exist but its activity must only be constrained to take decisions that the whole network can’t take in an autonomous way due to its wide and integrative nature. For example, entering new markets or firing people (the list can be really extensive).