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November 29, 2004

Disorganising carts and horses

Organisations must ‘loosen up’ according to Demos this week. In Disorganisation – a new pamphlet written by Paul Miller and Paul Skidmore – they argue that organisations are being drawn in two directions: hyperorganisation and disorganisation.

The former is painted as Frederick Taylor’s management theories taken to their ultimate conclusions: ruthless, heartless efficiency squeezing the life out of staff who want more than the dedicated pursuit of shareholder gain. The latter is the easy-going, come-as-you-are, creative, hip kind of enterprise personified in the press by those loveable scamps at Innocent Drinks (the lastminute.com of the post dotcom crash business world).

Needless to say the distinction is not as clear in most businesses as it is painted here. One speaker at the launch noted that most CEOs for ‘hyperorganisations’ would be happy accommodating many elements of disorganisation.

My sense is that in the inevitable excitement around the pithy idea that big business should be disorganised (something that has unsurprisingly caught the eyes of both the Times and the Telegraph) the real point is not given enough space to breathe – even though alluded to on the cover of the pamphlet:

There is a pressure growing within organisations. People now want their work to be more aligned with their human values. [my emphasis]

This is really about purpose. The word is used three times in this context throughout the report, and yet I feel it should be centre-stage. The question that never quite seems to be asked is ‘what is an organisation for?’.

The economist John Kay recently used the term ‘obliquity’ to describe unexpected consequences, arguing that businesses who set a high shareprice as their overriding objective suffered as a result and that the business with a range of objectives beyond pure profit did better.

In fact the popular perception that a company’s prime objective is profit is a curiously modern one. As Economist writers, John Micklethwaite and Adrian Wooldridge explain in the generally excellent The Company: A Short History of a Revolutionary Idea companies were often created with social purposes. Still today, the European social model of business assigns a much greater social responsibility to companies than the seemingly predominant Anglo-American model. This, you might extrapolate, suggests that profit is a more successful objective than woolly liberal social objectives that build hospitals for workers and fund their families through university.

Yet, if Miller and Skidmore – armed with research from NOP and MORI – are correct, employees want to do more that is (for want of a better word) good, not necessarily expect more from their companies in terms of traditional benefits. In essence, they want purpose and the scope to deliver on it. More opportunities to put in, not so much take out.

This is where the disorganisation comes in. In fact, what I draw from their useful pamphlet is: allow people to realise a sense of purpose and you have a happier, more productive workforce.

Take a traditional bank. The thought of ‘disorganising’ a high street bank is enough to give a director an aneurism. Think purpose, though, and the challenge seems less unpleasant: disorganisation for its own sake would be a disaster, but as a means for realising shared social purpose it might be more attractive. The bank’s purpose is making money, but much more than that it is providing financial services to customers, building and maintaining relationships and potentially to do all this in ways which strengthen and benefit society. And employees who can see that they can do this, are doing this, and are being rewarded for it are less likely to leave citing ethical differences.

Look at each of the case studies presented in the pamphlet and the common theme is purpose – realising a shared objective. This report is yet more ammunition for those of us working in corporate responsibility and sustainability. Sustainability in its broadest sense is one area in which employees get a sense of purpose: working with communities, making positive contributions to the environment, etc. The authors quote the figure of 48% of business leaders expecting their employees to increasingly ask to be involved in CSR. The potential purpose is there, organisations need to apply it.

So then: I've no problem with the theory of disorganising, but beware lest the cart is put before the horse - purpose is the key.

PS Liked the launch. Bill Morris must make an excellent afterdinner speaker, I should think.

November 29, 2004 in Current Affairs, Observations | Permalink


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