The Old Paradigm

Frederick Winslow Taylor advocated new ways of organizing work at the turn of the last century, to increase worker productivity and economic efficiency. His scientific management practices were soon widely adopted, and ultimately came to be called ‘Taylorism.’ Henry Ford took up Taylor’s ideas in the early 20th century and used them to mass produce automobiles. He added a new innovation – the assembly line  – and the systems he developed came to be called ‘Fordism.’

Henry Ford consulted with Frederick Taylor in designing his Highland Park manufacturing plant, and introduced the assembly line there in 1913. This revolutionized manufacturing. A moving assembly line was implemented in 1914. This reduced the effort required to assemble a car from twelve-and-a-half hours to 90 minutes. The assembly process was broken down into 84 steps.

In 1915 Ford began buying property along the Rouge River in Dearborn, Michigan, eventually acquiring 2,000 acres. The Rouge complex integrated everything from smelting iron, to manufacturing automotive parts, and assembling cars. It included dock facilities, blast furnaces, open-hearth steel mills, foundries, a rolling mill, metal stamping facilities, an engine plant, a glass manufacturing building, a tire plant, and its own power house supplying steam and electricity. [Michigan.gov].

Ford Model A assembly line at River Rouge

Taylorism and Fordism redefined the practice and psychology of work in the twentieth century. It fueled mass production and mass consumption, and created unprecedented economic growth. It also changed employment relationships, and the way life was lived in organizations. In many ways, it still dominates the way we think about work today, priorities in the workplace, and the way we relate to each other.

Organizational Tensions

Danah Zohar described the characteristics of conventional management in her book Rewiring the Corporate Brain: Using the New Science to Rethink How We Structure and Lead Organizations (1997), where the objective is to sustain a stable, predictable and plannable environment.

Characteristics of Conventional Management.
Source: The Foresight Group © 1990, adapted in Danah Zohar,
Rewiring the Corporate Brain: Using the New Science to Rethink
How We Structure and Lead Organizations

Zohar calls this a ‘Newtonian Organization,’ because it is highly mechanistic. In The Quantum Leader: A Revolution in Business Thinking and Practice (1985), she contrasts this with what we  need to do now to deal with growing uncertainty and complexity.

“Most corporate leaders would like to have a workforce, or at least a managerial team, that can think on its feet, be creative, thrive on complexity, take responsibility, and give its all to the firm. This is why they spend millions on ‘change agents,’ consultants who specialize in managing transformation. But most change agents are themselves mechanistic and haven’t a clue what deep transformation means, never mind what it requires. Most don’t know where to begin, so they satisfy themselves with schemes for downsizing or ‘restructuring,’ with introducing a ‘change vocabulary,’ including charts that say ‘vision’ and ‘values’ and ‘leadership.’ They give two-day workshops on ‘creativity’ and ‘embracing diversity.’ But they don’t ‘change the room’ – they work within the existing culture or structures.”

Newtonian organizations, Zohar says “have no existing structures that foster emotional intelligence, let alone structures that foster the creative abilities of spiritual intelligence… no inner capacity for fundamental transformation.” They are ineffective. Continuing to use mechanistic approaches doesn’t work. Living, organic, and adaptive organizations can’t be engineered. A more fluid and agile approach is needed.

Ralph Stacey describes the need to work differently. [Ralph D. Stacey, The Chaos Frontier: Creative Strategic Control for Business, 1991]

“In turbulent conditions the grand designs for future outcomes, generated by conventional strategic management, fall apart. When it comes to dealing with the open-ended long-term, managers therefore need to move from the conventional planning mentality to creating the conditions in which organizations can benefit from self-organization. Dynamic strategic management is a process of creating favourable conditions for self-organization because that is the effective, scientific way of dealing with the unknowable.”

Diana Zohar calls organizations that are able to work this way, ‘Quantum Organizations,’ because they thrive on ambiguity. They are self-organizing, flexible and responsive, and rely on personal relationships and trust to get things done, rather than depending on rules.

Reconciling Differences

We are caught in a new twenty-first century dilemma. Neither the old nor the new way of working is adequate – in itself. Contrary to Frederick Winslow Taylor’s doctrine, there is no “one best way.”

Power now has to be used differently depending on the prevailing conditions in an organization’s environment. If the environment is stable and predictable, conventional management (a command-and-control hierarchy) is effective. If it is unstable and unpredictable, dynamic leadership (a self-organizing network) is required. For survival, organizations have to be able to blend the two operating styles, calling them up as needed.

In Chinese philosophy there are two forces in the universe: Yin and Yang. The duality is complementary and mutually interdependent. This is expressed in the familiar Yin Yang symbol – the Taijitu – where two apparent opposites fuse together to create an integrated whole. Yin Yang is not static. It is fluid and changes over time, like day and night, or the changing seasons.

Diana Zohar contrasts the old and new organizational paradigms. Like Yin Yang, they are not in conflict, but are complementary.

Old Paradigm   New Paradigm
Reductive versus Emergent
Isolated and controlled versus Contextual and self-organizing
The parts completely define the whole versus The whole is greater than the sum of its parts
Top-down versus Bottom-up
Management versus Leadership
Reactive versus Imaginative and experimental

From Danah Zohar, Rewiring the Corporate Brain:
Using the New Science to Rethink
How We Structure and Lead Organizations

Predictability and Unpredictability

In The Chaos Frontier: Creative Strategic Control for Business (1991) Ralph D. Stacey contrasted behaviors related to conventional management (Danah Zohar’s Newtonian Organizations) with those associated with dynamic leadership (Quantum Organizations). These are paraphrased below.

Conventional Management Dynamic Leadership
Limited to controls appropriate for a stable and predictable environment Includes controls appropriate for an unstable and unpredictable environment
Reliance on structures, roles, systems and cultures that exert tight control Facilitation of appropriate political and learning systems on a wide scale
Planned action based on a pre-determined future direction Adaptive action that responds to a changing situation
Creation of strategic reports that set long-term objectives and define long-term plans Creation of conditions for new strategic directions to emerge as changes occur
Reliance on individual experts Reliance on group discussion and reflection
Reliance on structural solutions to deal with uncertainty and ambguity Reliance on spontaneous group processes to deal with uncertainty and ambiguity
Adherence to group cultural norms and values Openness to diverse individual values and perceptions
Focus on explicit reasoning Focus on implicit reasoning, cultural assumptions, and group dynamics
Focus on the distribution of power Focus on how power is used

In predictable environments, Stacey says, we need “clear job definitions, well-defined and simple hierarchical levels, and unequally distributed power.” [Ralph D. Stacey, The Chaos Frontier: Creative Strategic Control for Business, 1991]

In unpredictable environments we need to be more flexible. But replacing hierarchical organizations with loosely networked organizations is misguided. Structure is still needed for an organization to cope with predictable change. “Networks,” Stacey says, “should not be seen as structural replacements for formal hierarchy, but as political process additions to that formal hierarchy. Because managers simultaneously face both closed and open-ended change, they have simultaneously and alternately to operate in highly stratified formal hierarchical and loose political network teams.”

Political interaction and complex learning are required to deal with unpredictable environments, he says [Ralph D. Stacey, Managing the Unknowable: Strategic Boundaries Between Order and Chaos in Organizations, 1992]. This leads to intentional behavior without command-and-control. The system self-organizes, “and those at the top of the organization contribute to these forms of control indirectly, by creating a climate in which complex learning and healthy political interaction can thrive.”

The old model conscripted workers’ hands. The new model empowers hearts and minds.