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Beyond efficiency


Themes: Organisational behaviour

Beyond efficiencyHierarchical, bureaucratic, stable structures and workforce efficiency are things of the past; survival and future growth, underpinned by a liberation of talent, are now the key drivers

The traditional, bureaucratic organisation based on execution and efficiency is being replaced by network-based, informal structures as the industrial age disappears.

That is the view of Dr Jonathan Trevor, Lecturer in Human Resources & Organisations at Cambridge Judge Business School, and Kate Tojeiro, executive coach and Managing Director of Xfusion. in the third of a series of discussions based on the changing role of leadership.

Dr Trevor says there’s a belief that society is on the cusp of a fundamental transformation in the political economy with changes to societal organisation in respect of industry, commerce and communities.

It is essentially a shift from the industrial age with its bureaucratic form of organisation – hierarchical, stable, predictable, rule-bound – to something which is characteristic of the information age.

He believes that emerging is “a post-bureaucratic form of organisation which is much flatter, much leaner, much more network-based and much more informal in scope, really all about knowledge as opposed to execution and efficiency, which are the hallmarks and outcomes of a bureaucratic organisation.”

He agrees that a major issue for the new structure will be agility, the ability to identify opportunities and recruit those with clear specialisms to meet challenges and offering customer value but also creating clusters and eco-systems.

“One of the key aspects of cluster management, the health and well-being of the cluster or ecosystem, is how individuals will knit together, how they will learn and generate new knowledge, transfer and combine it with existing practice to produce innovations.

“That’s really critical and what we’re seeing is a renaissance in talent management beyond just having high-performers, to having individuals and groups who are able to learn in novel and unique ways; to make use of new technologies and convert that into organisational effectiveness, however that is defined, whether its efficiency on the one hand or innovation on the other.”

Dr Trevor and Kate Tojeiro agree that an example of cluster management is having ‘T’ shaped individuals with a degree of specialism in a particular area, be it technology or a functional, but also know enough about other areas so that they can make connections and span multiple boundaries.

“That can be very a scarce talent and it is imperative that organisations develop it. It’s a model of empowerment, development and liberation of talent within an organisation to go beyond just merely seeking to exploit efficiencies but to do something fundamentally different without reference necessarily to those above.”

Dr Trevor adds that the flip-side to empowerment is governance and control. In the current climate, where transparency is increasingly demanded, where control and risk management are the focus, ensuring that people are doing the right thing is a leadership issue.

“You can only empower on the basis of trust. Do you have trust in your people and do your people have trust in you and particularly in each other? Can they collectively put aside their individual interests and focus on the whole whether it’s a commercial organization, a charity or even a community?

“These are essential properties and values. It is not to say that efficiency doesn’t matter, it is just that it matters in addition to other things. Whereas previously it was probably the sole thing you wanted from a workforce now it simply cannot be if organisations seek to be competitive in future.”