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The Open Organization – 2nd Edition

OpenOrgCover2ndEditionIn 2014 I published what is thought to be the seminal work on the subject of Open Organizations. My goal was to present a text that provided a template for developing an Open Organization.

Nearly a year after my book was published, Jim Whitehurst CEO or Red Hat published his book The Open Organization. Igniting Passion and Performance. What I love about Jim’s book aside from the cool title is that he approached the subject from his perspective as a leader leading an Open Organization. Jim’s book put skin on the idea of Open. I would argue that Jim humanized the concepts. It is one thing to write about an organization from a case study perspective and an entirely new experience when the writer is living it out in real time.

Since the publication of my book, I have continued researching and writing on the subject of Open. I am proud to say that I am now an active member of the OpenSource.com group as an Ambassadors and Open Evangelist. Because the idea of an Open Organization is still evolving I felt it time to produce a 2nd edition of my book and address some of the changes. While most of the text remains the same and changes were mostly mechanical in nature, there are four major changes in this edition. They are:

  1. The book is now in softback and the price is much more reasonable than the original text. $30.00 on Amazon.
  2. More detail was added to Chapter 4 under the heading of Meritocracy. I begin to address some of the early challenges researchers have noted in Meritocratic organizations.
  3. More detail was added under the heading of Holacracy in Chapter 4. Where in the early text I recognized Holacracy as a form of Open, I have since stepped back from that idea and no longer consider it to be a pure Open system.
  4. In this text I begin to more deeply address the concepts of a distributed workforce. The implication of a growing distributed workforce is central to the expansion of the 21st century workforce.

You might be wondering what comes next. I will continue to publish articles, blogs, and videos on the evolution of Open Organizations. I am also writing my next book which will focus in on some key elements of the 21st century organization.

To get a copy of The Open Organization 2nd Edition – visit Amazon HERE.

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Dr. Philip A. Foster is considered a Thought Leader in Business Operations, Organization and Strategic Leadership. He is a prolific writer, International Lecturer and Best Selling Author of “The Open Organization” – now available on Amazon. Philip is certified in both Leadership and coaching. He is the Founder and CEO of Maximum Change Consulting, serving clients from around the world. He holds a Doctorate in Strategic Leadership with emphasis in Strategic Foresight from Regent University, Virginia. You can contact him at http://www.maximumchange.com

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4 Steps to Success in 2014

4 Steps to Organizational Success in 2014 | http://www.maximumchange.com

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Welcome to the Meritocracy

mq1I took a lot of heat for my last two blogs: “Death of the Manager: The coming extinction.” and “Three Reasons your Org Chart is Worthless”. I figure I must be on the right track if so many “old school” leaders call me crazy. Just when I could begin to take it personal, I realized I am not barking up the wrong tree. More than ever, a great deal of attention is given in the press to the manager-less, leader-less, agile, flat, flexible, Open Organization style of organization structure. Whatever you wish to call it, the bottom line is that the landscape of organization structure is changing. For some the new world order comes in the form of consolidation of power. I, on the other hand see a dissemination of power coming. The days of top-down, formal, rigid structures are numbered. Maybe not for all, but for many, the era of Meritocracy is arriving on track number 3. Webster’s defines a meritocracy as a group of people whose progress is based on ability and talent rather than on class privilege or wealth. My thesis for some time has been that the people doing the work know better how to do their jobs than the leaders demanding the work from their employees. When we begin to listen to our employees, a new dynamic enters. Structures are weakened and human capital is strengthened through empowerment.  The argument against self-managed, manager-less organizations is rooted in the false assumption of chaos. In fact, my research shows that an Open Organization is not only more flexible but stronger than its more rigid hierarchical counterpart. If we were using terms of physics – the tensile strength of an Open Organization is much better than a rigid top-down organization design.  Open Organizations are built on the platform of First Principles and a simple but strong set of rules better known as a Governance. An Open Organization Governance outlines how decisions are made within the community. It also expresses how things are done and by whom. By arguing for a Governance, we are not necessarily implying some sort of hierarchy or procedure, but more the expression of sharing ideas, responsibilities and decisions. In the case of an Open Organization or meritocracy, members are rewarded based on their own intrinsic motivators. Some are rewarded by completing something cool and some by being part of something bigger than themselves. Governance should not be a list of restrictions and don’ts insomuch as it is a methodology for flow and control of information within and sometimes outside of the organization. An Open Organization removes silos or divisions of business and creates one merged mass of an organization. A structure in which everyone makes decisions and all participate in the direction of the organization. An Open Organization creates stakeholders of all members of the organization. I find humor in those who believe that there is no such thing as a manger-less organization. Those who doubt the validity of a manager-less organization miss the key attributes of Open. Open does not equal chaos. Open does equal efficiencies, happiness, creativity, flexibility, and a higher degree of competitiveness. I would ask this question, why should only tech firms benefit from the power of Openness? It is there for taking… but, it requires a leader to enter into a place of vulnerability. Once we can get beyond the uneasy feelings, we realize that the idea of Open means that we have more capacity and a great deal of pressure off our shoulders as leaders. Going Open requires us to focus on the happiness of the workforce before the happiness of the shareholders. It requires a change of mindset. The greatest distance we must travel is those 6 inches between our ears. I say, make the decision and jump in, the water is fine! No! The water is AWESOME!

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PIC3Dr. Philip A Foster is considered a Thought Leader in Business Operations, Organization and Strategic Leadership. He is a prolific writer, published author and lectures internationally. His most recent e-book “Organization 3.0 – The Evolution of Leadership and Organizational Theories Toward an Open System for the 21st Century” is available exclusively on Amazon.  Philip is certified in both Leadership and coaching and serves as Adjunct professor at Middle Tennessee State University, Murfreesboro, TN. He is the Founder and CEO of Maximum Change Leadership and Business Consulting, serving clients from around the world. He is a Doctor of Strategic Leadership with emphasis in Strategic Foresight and holds a Master of Art in Organizational Leadership, both from Regent University, Virginia. He can be reached at philip@maximumchange.com.

3 Reasons Your Org Chart is Worthless

AA008821I know it’s your sacred cow. You spent hundreds of hours perfecting your org chart. It is a visual flexing of your organizational design prowess. It explains in detail the channels of decision making and communication in your organization. I am here to tell you that your org chart is worthless. It isn’t worth the paper it is printed on. While some may wax eloquent of the virtues of your creation – I say it’s a waste of time. Most all org charts are nothing more than idols we pay homage. Org charts represent a 19th century ideal of command-control with focus mainly on the leader(s) at the pinnacle of the chart. Even in a matrix org chart there is a top and bottom. No matter how flashy. No matter how descriptive your chart is – it is worthless.

First – org charts represent a structure that bottle-necks decision making and limits agility. If you want to see where the problems are in your organization, you need not look any further than your org chart (if you can find it). If you were to take an earnest survey of your organization you might find that your structure slows down decisions making and impacts the overall agility of your organization. The truth of the matter is that the 21st century organization will seek greater flexibility as its access to full time human capital diminishes. Your organization can’t be any better IF your organizational structure is cumbersome. Your org chart is a safety blanket that gives you absolutely no real coverage. Ask yourself this… how long does it take for a decision to be made. Does your front line have to ask their manager for approval for everything? Are you hiring based on an outdated slot on your org chart or are you hiring the best and empowering them to do their jobs?

Second – This is not how systems work in the natural world. Organizations are flattening and embracing self-leadership and a more open approach to the process of business. Organizations must find organic approaches to dealing with change and innovation. One such emerging concept is that of a decentralized organization, otherwise defined as the Open Organization. The end result is not to abolish organizational structures but to create a more flexible flow of ideas and processes that meets the needs of each individual within the organization as they pursue the goals of the organization and its stakeholders. Because of the complexity of business today, it is difficult to visually chart an Open Organization or organic forming structure.

Third – we don’t use them. The sad reality is this. Few organizations spend countless hours to actually USE their org chart. That’s right, we design them and then we stick them in a notebook somewhere and will rarely engage them again. I would argue that by the time the proverbial ink dries, your market silo has shifted and your org chart is now out of date. In our globalized economy, your org chart has the shelf life of milk at room temperature.

Here is a simple test. If you feel that you will lose control of your employees and your organization, then you’re running your organization based on command-and-control. This is a strong hierarchical approach where your organization is very much a top-down approach to leading where the bottom of the org chart is focused on completing the commands of the upper tier of the organization. The problem with this approach is that the bottom tier should be focused on the client and their needs rather than the objectives of the leadership. Like it or not, organizations are forced to become more competitive. If you don’t hire the best, empower them, and then get out of their way so that they can do their job – your organization is in trouble.

While I believe that org charts will be with us for some time. I believe that there will be a day when the only org charts we encounter will be in highly regulated industry, government institutions, and the military.  I challenge you… don’t waste one more moment on an org chart. Spend that time exploring how you can create agility and openness in your organization. It’s a new era… it’s the 21st century. It is time we starting acting like a 21st century organization.

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PIC3Dr. Philip A Foster is considered a Thought Leader in Business Operations, Organization and Strategic Leadership. He is a prolific writer, published author and lectures internationally. His most recent e-book “Organization 3.0 – The Evolution of Leadership and Organizational Theories Toward an Open System for the 21st Century” is available exclusively on Amazon.  Philip is certified in both Leadership and coaching and serves as Adjunct professor at Middle Tennessee State University, Murfreesboro, TN. He is the Founder and CEO of Maximum Change Leadership and Business Consulting, serving clients from around the world. He is a Doctor of Strategic Leadership with emphasis in Strategic Foresight and holds a Master of Art in Organizational Leadership, both from Regent University, Virginia. He can be reached at philip@maximumchange.com.

The Death of the Manager (the coming extinction)

09wquestion-1346176260458I am not ready to send you to a museum to study the habits and hang-ups of the 20th century manager just yet. But I do see this as an opportunity to create dialogue related to the death of management as we know it. I am in no way abdicating that organizations of the future will be leaderless. I am however sounding the alarm that leaders must find a way to redefine themselves before it is too late. The trends are already proving that organizations are flattening their hierarchies and are doing more with less human capital. The greatest threat to the manager today is denial that things will change whether they are ready or not. The problem, as I see it, is that most all managers are classically trained in business schools to run an organization via the classic command-and-control hierarchy. Many business schools are failing us in that they teach leaders a 19th century approach to leadership. Add to this confusion a 20th century approach to human relations and you have a pending ice age of epic proportions over the field of management. Management is evolving into something greater than a single position of status. Organizations are not moving to leaderless insomuch as they are trending toward self-leadership models. Self-leadership is where everyone contributes from their own strength and skill-set. Everyone has a say in the strategy and direction of the organization as a whole.

I was recently involved in a dialogue with some business colleagues on the matter of who is responsible for the strategy and its achievement in an organization. The crux of the conversation was around why strategies fail. I argued strongly for the coming of the flatter more agile organization that moves away from the idea of a leader dictating vision, goals and process. As you can imagine some of us old school classically trained leaders pushed back on this notion. There is no question in my mind that the state of leadership is in transition. We are about to see the greatest shift in organizational leadership since Fredrick Taylor adopted the Scientific Management approach to production in the 1890s. In an effort to give structure to this idea of self-led organizations, I have adopted the idea of the Open Organization. An Open Organization is simply a method of self-leadership in which individuals participate in the movement of an organization from their strengths. The Open Organization is a decentralized structure which trends away from authoritarian management styles, separatist titles and privileges of multilevel hierarchies found mostly in the 19th and 20th century. So, what are we to do to save our managers? First we should acknowledge the correlation between effective leadership and how much autonomy is given to the followers. A leader who does not trust their followers appear to have the most trouble with change. Leaders who do not trust are most likely to be the ones that go extinct first. Leaders must learn the art of empowerment of their followers. The power behind the Open Organization is that people already tend to self-manage when everyone else can see what they’re doing. Open allows other people jump in when they notice something amiss and of course everyone learns when anyone makes a mistake or does something brilliant. The agility of the organization is the key to the extinction of the manager. Manager’s and hierarchies tend to strangle agility, bogging the organization down in the process of decision making. The organization of the future must be unfettered to make decisions else, it too will die. Now is the time for managers to adapt or expire. We leaders must redefine our roles in relation to our organizations effectiveness. The world is pressed on all sides by a diminishing full-time workforce as well as differing cultural, generational, political, and religious views. The organization of the 21st century must be more agile than ever before. Organizational design is essential to how the organization deals with the challenges it now faces. We no longer can afford to lead a 21st century organization with 19th and 20th century models and processes.

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PIC3Dr. Philip A Foster is considered a Thought Leader in Business Operations, Organization and Strategic Leadership. He is a prolific writer, published author and lectures internationally. His most recent e-book “Organization 3.0 – The Evolution of Leadership and Organizational Theories Toward an Open System for the 21st Century” is available exclusively on Amazon.  Philip is certified in both Leadership and coaching and serves as Adjunct professor at Middle Tennessee State University, Murfreesboro, TN. He is the Founder and CEO of Maximum Change Leadership and Business Consulting, serving clients from around the world. He is a Doctor of Strategic Leadership with emphasis in Strategic Foresight and holds a Master of Art in Organizational Leadership, both from Regent University, Virginia. He can be reached at philip@maximumchange.com.

Organization 3.0 – Embracing Theory in the 21st Century

As a business consultant and professor I am often asked why study theories and systems that are no longer used in modern society.PIC1

  I look to Aristotle who once said, “If you would understand anything, observe its beginning and its development.” Simply put, if we look at history we can best understand the present and anticipate the future. Fact remains, the world is complex and theories are our attempt to take a complex world and simplify is through a set of written observations.

We make sense of our world as we view it through our own filters and lenses. These filters and lenses distort our view and we begin to develop interpretations of what is happening to us. Perhaps this, in part, explains why there are literally thousands of leadership and organizational theories to date. Without an understanding of the world around us it would be impossible for a leader to make sense of the needs of the follower or the followers make sense of the leader. The epistemology of leadership theory is simply a process of understanding the limits and validity of a specific action within the context of a system. We look to the study of leadership theories as a process of learning the nature of responses from individuals and organizations with regard to specific actions.

Timeline of Leadership and Organizational Theory

PIC2The view of leadership and organizations has evolved. Using the timeline above, we find three distinct eras of time in which we can observe the evolution of leadership and organizational theory. The first era, Organization 1.0 focused predominantly on the Great Man theory and the emergence of Fredrick Taylor’s Scientific Management approach to production. The Scientific Management approach naturally moved us into Organization 2.0, in which we find the emergence of the Classic Theories of leadership and organizations. Finally, with increased complexity, globalism and emerging demographic trends we moved swiftly into the newest era of Organization 3.0 in which leadership and organizations are flattening and decision making is driven by members of the organization through self-leadership methodologies. Within the structure of Organization 3.0, the traditional top-down hierarchy is replaced with structures such as matrix, star, and open systems.

It is through the constructs of a theory we begin to better analyze a set of facts and thereby create changes from said process. Therefore, the need to understand so many leadership theories is a result of the process of analysis and learning. In the end, the purpose of leadership theory is simply to find understanding of human nature as it relates to the system knows as an organization.

As Millennials move toward leadership roles, it becomes important that they have a strong grasp of where we have come from and a sense of where we are going. Our ability to mentally stand in the future and imagine it will make us all much more competitive in the here and now. More importantly, leaders of all ages must come to grips with a reality that we can no longer afford to run a 21st century world class organization with 19th and 20th century ideas. The more we understand where we came from and have a sense of where we want to go, we can stand in the present and direct ourselves toward an idea future destination. In time, other theories will replace Organization 3.0 and perhaps it will be the millennial generation that does just that.

Question: As you view the world through your lenses and filters – what do you believe the organizations of the future might look like?

PIC3Philip A Foster is considered a Thought Leader in Business Operations, Organization and Strategic Leadership. He is a prolific writer, published author and lectures internationally. His most recent e-book “Organization 3.0 – The Evolution of Leadership and Organizational Theories Toward an Open System for the 21st Century” is available exclusively on Amazon.  Philip is certified in both Leadership and coaching and serves as Adjunct professor at Middle Tennessee State University, Murfreesboro, TN. He is the Founder and CEO of Maximum Change Leadership and Business Consulting, serving clients from around the world. He is a Doctor of Strategic Leadership candidate with emphasis in Strategic Foresight and holds a Master of Art in Organizational Leadership, both from Regent University, Virginia. He can be reached at philip@maximumchange.com.