Mar 26, 2003

Gyan from Arie de Geus
Arie is a thinker whose simple book "The Living Company" affected my views of organizations. Here he talks about the organizations that are needed for the future ...superb reading

How might companies look different in the future?

The human element will be dominant as communities, managed for longevity rather than for profit, evolve in harmony with changes in competition, technology and values.

How should performance be measured?

Set wide performance targets, in terms of final outputs. Leave lots of room for people to organize themselves to achieve that output. Go for effectiveness, rather than efficiency. Effectiveness means achieving the highest quality output in the shortest possible time, rather than at the lowest possible cost. Count on your people to take care of efficiency-if you trust them and if they trust you.

How can learning become operational?

Maximize intellectual output by establishing a learning process. The best learning takes place by play. Play has been defined as experimenting with a representation of reality-a simulation that you have created yourself-rather than experimenting with reality itself. A team at play comes to a satisfactory end result in, measurably, about one half of the time that it would take in a reality-based situation.

Is there an analogy in nature?

Biology teaches us that birds, being mobile, propagate innovation by flocking. When individuals are hired for their skills and kept static-not moving around organizationally-there's very little flocking, which results in an ineffective transfer of innovation. Knowledge travels best as individuals move around the organization through regrouping, promotions and career changes, which promotes "action learning" in the new destinations.