Wicked organizations

This blog post addresses the relation between stratified hierarchical organizations and self-organizing ones – and tentatively proposes a synthesis.

Stratified hierarchical organizations
Recently, I was involved in an analysis of Elliott Jaques’ Stratisfied Systems Theory, SST,
from different perspectives resulting in two articles, one that characterizes SST in terms of it’s virtues, limitations and underlying assumptions, and a second that compare the different levels or strata with two stage theories from the adult development field, namely MHC and ego development theory.

In summary, SST was developed in the 1950s and onwards based on observations on large
hierarchical organizations. The stratified nature of an organization is expressed in the
complexity of the roles at the different layers where the level of complexity increases the
higher up in the of hierarchy you get. The complexity of the role is articulated in discretion or degree of uncertainty you need to navigate when filling the tasks associated to the role, as well as the typical time span of the task.

A key feature of SST and prescription is to match the cognitive capability of the individual
with the complexity of the role, which can be referred to as matching task and capability. In the second article we compare descriptions of stages/orders with strata analytically and
conclude that notion of different levels of leadership and cognitive complexity are comparable with those of MHC and EDT, although there seems to be no exact 1 to 1 relationship between the different levels. The ego development perspective can offer a broader view on what it takes to fill a leader role beyond cognitive complexity.

Besides matching stage of cognitive capability with stratum, SST prescribes that two adjacent organizational levels should differ one level of complexity. Thus, SST stipulates a final answer and ideal to what organizational design should look like and what organizational development should strive for. Although the different levels have a certain degree of freedom to carry out their assigned tasks according to their own judgment or discretion, the decision making is in essence characterized as top-down. SST hasn’t attracted much attention in modern organizational research, due to lack of validated peer-reviewed studies in literature and since a contingency theory perspective states that no organizational design should fit all organizations and all contexts. Nevertheless, SST is in this text considered as an example of a modern hierarchical organization (modern or orange in spiral dynamics terms).

However, these assumptions regarding the hierarchical nature of organizations have been
challenged for several reasons. One is that these organizations may be too slow to respond to quick changes in the environment or disruptions in technology or markets; Jaques did his research in large organizations operating in capital-intensive industries and stable
environments. The top-down decision-making process puts very high cognitive demand on
the top-level managers, while at the same time post-conventional leaders tend to escape rigid hierarchical organizations. Hence, there is an outer pull from the environment and an inner push from existing and potential employees to organize the resources and efforts in alternative ways.

Self-organization in organizations
Contrasting views of the described way of organizing is different forms of self-organizing,
which finds inspiration from dynamical systems and complex systems theory. Rather than a cog in a machine, the individual is here intended to act as a node in a network that can detect and respond to changes in the outer environment quicker than if one has to rely on the managers at the top layer. Thus, the decision-making process can be said to start at the
individual and spread through the network in a bottom-up manner.

Two descriptions of self-organizing that can be mentioned are Teal organizations according to Laloux and Bonnitta Roy’s Open participatory organizations, OPO. Teal has been introduced and evaluated here and OPO is introduced in a series of articles and this lecture at a Swedish Agile conference. Teal is based on the three principles evolutionary purpose, self-organization and wholeness, and the latter which implies that you should bring your entire being to the workplace is also emphasized by Roy. Trust is central, both in order for the individuals to show their entire being, and also to ensure that what is being thought, said and carried out will be relevant for the organization. The organization is offering conditions and a space for ideas, interaction and co-creation to take place. The incentive for work is in the first case salary or profit, and the second is often considered to be creativity or purpose driven.

Images often applied to illustrate the difference between the two types are that of the machine vs. the organism, which seems appropriate. Another distinction is that between complicated and complex, where the former denotes systems that consists of many parts but can principally be fully understood, determined and controlled. The latter denotes typically organic, fluent and living systems that can be influenced but never totally described or controlled. Complicated systems are often associated with cybernetics and engineering, exemplified by the Finite element method where you simulate system responses by inserting properties of the individual members. Complex systems are typically studied in the natural sciences by simulating how very complex behaviour of animals at the group level can emerge from simple rules of the individual behaviour. The relation between complicated and complex systems have been discussed here (in Swedish) and in the Cynefin framework.

In many introductions such as this one, the complex and organic view is often idealized, and it tend to be implied that organic is better and more complex than the dead engineering machines. But is it correct to assume that self-organization is always better, just as it is assumed in above that a hierarchical organizational design is optimal for all cases? Do self-organization always trump hierarchical top-down decision-making? Could there be a danger that we idealize self-organization too much and make an ideology of it? Could there be advantages with hierarchical organizations that the self-organizing lack? Possibly, the top-down may be more suitable when it comes to assigning clear responsibility in both directions, first that the subordinate carry out the task and second that the superordinate provide sufficient resources.

Further, isn’t it a simplification to say that an organization is either fully hierarchical or fully self-organizing? For instance, in SST there is a certain amount of self-organization, or discretion, within the boundaries of the task at hand, although the overarching organizational design is a stable and complicated structure. And in Teal, the organization’s evolutionary purpose could be seen as an overarching principle guiding the work flow, and although this should be decided collectively the decision-making process isn’t entirely bottom up. Like yin and yang, there is a grain of white in the black area and vice versa. Perhaps the distinction complicated vs complex should be seen as a spectrum on which different organizations can be placed!?

Wicked systems and wicked organizations
Another alternative where the two systems paradigms are not seen as mutually exclusive is
proposed by Andersson, Törnberg and Törnberg (2014), full paper here. Andersson et al makes the same distinction as above but when applying them to societal systems consider them to be perpendicular axis or dimensions so that they define a two-dimensional plane instead of a one-dimensional spectrum (see fig 1). Thus, a system can according to this model or heuristic be seen as both complex and complicated at the same time, which they refer to as wicked:

“Complexity and complicatedness can be seen as mutually reinforcing in societies and ecosystems – our two principal examples of wicked systems. Self-organization here generates, changes and maintains macro structure, and macro structure, in turn, scaffolds and creates a multitude of arenas for self-organization.” (Andersson et al, 2014, p12)

Andersson et al apply this to societal systems in general, but wouldn’t that also include
organizations!? This could open a space for a discussion on hierarchical vs self-organizing. If we should place hierarchical organizations such that SST prescribes closer to the lower right corner and Teal and OPO in the upper left region, what would a wicked organization look like?

A follow up question, which relates to an ongoing research project, is what leadership
development is, or should be, according to these two views on organizational development,
and according to the view of “wicked organizations”. That question will be further explored.

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