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Chaos and order in business?

November 28, 2012

We must win, beat competition, be the best. It’s a jungle out there, they say, we’re in a battle for survival. The law of the jungle: kill or be killed, every man for himself, survival of the strongest.

Simple, but wrong. What Darwin found was very different; as Kipling noted:

Now this is the Law of the Jungle — as old and as true as the sky;

And the Wolf that shall keep it may prosper, but the Wolf that shall break it must die.

As the creeper that girdles the tree-trunk the Law runneth forward and back –

For the strength of the Pack is the Wolf, and the strength of the Wolf is the Pack.

       Rudyard Kipling, The Law of the Jungle (From The Jungle Book)

The law of the jungle in nature is all about a balance between seemingly opposing tensions/forces.

For instance, balancing competition and co-operation.

VISA, when it was launched, made the credit card sector successful precisely because it enabled the member banks to compete (for individual client business) and also co-operate (so that the whole system worked).

In nature we also find a balance of control and freedom, order and chaos, efficiency and diversity. Graham Boyd, in this guest blog for ‘The Nature of Business’, explores how this balancing act is relevant for organisations seeking to thrive in today’s increasingly volatile landscape.

Harmonise opposites in your company, and you’ll have a company extraordinarily able to adapt to change; able to stay on the road at high speed through tight corners.

Can your company do that? If you say no, as most do today, you likely have too much control, too much order, too much efficiency for today’s turbulent demands.

It’s only natural; as over human history we have evolved to thrive by imposing local order on our little bit of the environment we inhabit. More recently, we’ve been evolving to thrive in large, complex organisations for less than a century. Thriving here means balancing order and chaos, walking the line between them.

Dee Hock, founder of VISA, followed nature’s rules when he led the team that united thousands of different banks, each with their own credit card system, to form the VISA Corporation. He coined the word “chaordic” to describe an organisation that finds where chaos and order meet for the organisation’s particular business environment to ensure it thrives under the demands of the dynamic business context.

Tetrald, along with Graham Boyd, are now combining ‘chaordic’ organisational design with ‘holacracy’. Holacracy is a way of designing and running organisations. It adds even more muscle and agility to the chaordic organisation approach and seeks to replaces today’s top-down predict-and-control paradigm with a new way of distributing power and achieving control. It can be thought of as a new “operating system” which instills rapid evolution in the core processes of an organisation.

Key aspects of the chaordic organisation are:

  1. Crystal clarity on the highest need the organisation is choosing to serve.
  2. The purpose of our organisation, i.e. what you do to serve that need.
  3. The principles governing how individuals interact with each other.
  4. Strong culture and diverse people aligned through values and a sense of purpose

Applying chaordic principles can help an organisation adapt rapidly, learn by doing, and deal with complexity; ‘redesign for resilience’ in these volatile times. VISA, in the first decades, was similar to a natural ecosystem:

  • No-one owned it. Membership brought rights and obligations of participation that could not be bought, sold nor transferred.
  • Everything was self-organised, from the highest to the lowest levels.
  • People had roles and accountabilities, not titles.
  • Emergence by focusing on what works well enough to take the next step.
  • All members free to form groups, to meet, to organise themselves in any way they choose.
  • Whoever is best able to fulfil a role at that point in time does so. For example, when the first VISA mailshot ran into a failed envelope folding system. C-suite people were folding envelopes under the leadership of the mail sorting staff.
  • No-one (not even the CEO) knows what every part is doing. Everyone knows what their specific purpose, their context and environment, what output their colleague needs as input, and everyone is fully empowered to do what it takes to achieve it.

We know a lot more about how to create chaordic organisations now, due to the experience (and mistakes) people like Dee Hock have made. If you want to learn from VISA’s mistakes read Dee’s book, “One from Many“.  Also, look at www.holacracyone.org for more on holacracy if interested in this organisational design approach, or contact Graham Boyd who is active in this space.  Graham says his biggest achievements have come from keeping chaos close:

Getting comfortable with continuous feelings of uncertainty and unpredictability is a life-long journey for me, yet a journey I thrive on as I continue to explore how organisations can become more adaptive in these volatile times.

For more on ‘business inspired by nature’ and to keep abreast of related topics in this space join the Face Book community here

2 Comments leave one →
  1. November 28, 2012 4:29 pm

    Nice philosophy. I have been pushing to get the credit card/ATM money processing companies to explore ways to give charitable balance to the stream of nickels and dimes so profitable. My Nickel-a-Meal Campaign idea turns Burgers Against Obesity under such a model. Life keeps getting in my way but I love what this piece suggests, http://AngrySodas.wordpress.com. Nice work Jed.

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