REPLY Why don't organizations function better? (SD6612)

[SDMAIL Tom Fiddaman]

Posted by  Tom Fiddaman <tom at ventanasystems.com>

The conversation seems to have turned to an explanation of organizational 
performance that doesn't leave much room for the visionary warrior-strategist 
CEO. Does that say more about the world, or about our world view?

It seems to me that the key evolutionary difference between species and 
organizational evolution is that individuals face a fitness function that 
differs from that of the organization. The organization needs to maintain the 
ybernetic loop that keeps touch with the customer (as Wade put it) in order 
to acquire resources to sustain existence. The individual in the organization 
has more choices; success requires some combination of creating value for the 
organization and taking credit for that value. The individual's behavior thus 
lies somewhere between symbiont and parasite.

If so, the organization needs additional control loops. One is the preserve-
the-genome loop that provides strategic stability, minimizing mutation (Jim) 
or restricting it to a confined space (Wade). A second, or perhaps a special 
function of the first, keeps the parasite load down to a tolerable level.

Keeping the parasite load down is a question of attribution, i.e. how do you 
distinguish making a real contribution from making a few short term fixes, then 
moving on before the problems come back to bite? It seems like organizations 
possessing better means of attribution should prosper. If SD and other methods 
that aspire to know the truth don't have an impact in such an environment, one 
could conclude that their evolutionary advantage is somehow lacking - perhaps 
they don't really work (e.g., because individual performance is random and the 
past is no guide to the future), or they carry a high price, or some other 
process short-circuits the attribution process.

My pet candidate for a short-circuit is that there are steep gradients out there 
in the world. The opportunity to reduce labor costs by 90% through outsourcing 
probably tilts the fitness function so severely that other orthogonal directions 
(implementing SD) hardly matter, though SD might become more important for 
organizational fine-tuning in a stable environment (the organizational equivalent 
of a tropical forest).

It would be helpful to know more, because the answers could guide our 
interventions. Are we in SD a beneficial mutation, caught by the host's 
autoimmune response? Are we the fleas on the tail that wags the dog, or the 
flea collar?

I'll stop now while I still have a few half-baked analogies in reserve.

Tom 
Posted by  Tom Fiddaman <tom at ventanasystems.com>
posting date  Tue, 11 Sep 2007 11:54:17 -0600