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Stoos Network (part 3): Core Idea

10/01/2012

One wish I had for the gathering in Stoos was to discover a common foundation that could reconcile differences between the many management thinkers, writers and consultants the world has already generated before.

We have The Toyota Way, the 14 Points for Management, Radical Management, Management 3.0, Wiki-Management, Beyond Budgeting, Tribal Leadership, Servant Leadership, Elastic Leadership, the Declaration of Interdependence, and many more models, values and principles.

I asked the group at Stoos, “Is there something more fundamental?”

Is there a management axiom? Is there something that may be unproven, but yet so self-evident that we can all believe in it? Is there a core message that more or less implies everything else we think is true?

Value-Creating Networks

CIMG0581And so I suggested a late-night session about this topic in the bar of the hotel. For two hours roughly half of the Stoos group joined in an inspiring discussion about the best managed organizations in the world. What emerged was that most of the time we discussed organizations as networks instead of hierarchies. And this reminded me of the value networks I have described earlier on my blog.

I offered the group the suggestion to define organizations as value-generating networks. The group agreed, but decided to rename this to value-creating networks. The participants also agreed that hierarchies are not necessarily bad. There are many examples of well-functioning hierarchies within networks. They are basically a special case. (Though, regrettably, often badly applied.)

Learning, Diverse Individuals

At 1am in the night we agree we had achieved some convergence, but we also felt we had not finished yet. And so we continued the discussion, with a different subset of participants, the next day during open space. As the facilitator I started writing “value-creating networks” at the top of the flip chart, and I collected all kinds of suggestions that were candidates to be added to the core message. Not surprisingly, the participants came up with plenty of values and principles that we recognize from earlier management & leadership models, such as “visibility”, “trust”, “continuous improvement”, “develop people”, “courage”, etc…

I reminded the participants that our intention at this gathering was not to create the 57st management model, with yet another list of values and principles. There are already plenty of good ones. I said our hope is to unite good management thinkers and practitioners, not compete with them.

So we started a relentless analysis of the keywords that were offered. And in the end only three of those were moved to the top of the page:

  • Individuals must be part of the core idea, because networks of machines or documents are not our main concern;
  • Learning must be part of the core idea, because we don’t believe in organizations operating as machines with repeatable outcomes;
  • Diversity could be part of the core idea, because we believe organizations with all too-similar people usually don’t work well.

This led to the following axiomatic view for managers:

Organizations are value-creating learning networks of diverse individuals

In our analysis, all other terms that were offered in our discussion turned out to be either logical prerequisites or consequences of the core belief. For example:

  • Trust is necessary to create value in a network of people
  • Continuous improvement directly ties into the learning network
  • Sustainability means value-creation for certain stakeholders
  • Self-organization is obviously the best approach in a network
  • Feedback loops are required for learning
  • Etc…

Learning Networks of People Creating Value

CIMG0616This core belief of organizations as “value-creating learning networks of diverse individuals” was used as input for the communiqué that emerged at the end of the Stoos Gathering. We reordered the words for the sake of readability, “individuals” was replaced by “people”, and “diverse” didn’t survive the final review. And thus the final result became…

learning networks of people creating value

Of course, there is plenty of ambiguity in this statement. For example, value to whom? Learning what? But that’s OK. We’ve only tried to identify the “What?” of organizational management. Many dozens of elaborate management models give you very useful answers to the subsequent “How?” question. And those usually depend on the context and the interpreter.

Complexity Made Simple

What I love most about this core idea is that it ties directly into complexity science. From science many experts have learned to recognize organizations as complex adaptive systems that try to survive. It seems our foundational message is nothing more (and nothing less) than the scientific view rewritten in common language. As Roy Osherove said, our version is simplicity science. It is less likely to scare stakeholders away.

And that was our purpose.

We hope smart management thinkers and practitioners can say, “Yes, that core message makes sense. And by the way, I have some good ideas on how to manage such a learning network of (diverse) people creating value.”

Tomorrow: Stoos Network (part 4): Name & Identity

Yesterday:  Stoos Network (part 2): Stakeholders & Personas

For more information: Stoos Network website, Stoos Network group

This article is written by on in Stoos Network. Jurgen Appelo is at Happy Melly. Connect with Jurgen Appelo on .

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  • http://profile.typepad.com/galleman Glen B. Alleman

    Jurgen,
    Each of the models you’ve mentioned are useful and applicable in many domains.
    What is not there is is “what are you seeking to change?” “What is the problem you are trying to solve?” and finally “is this problem solvable, or is it just manageable in a specific context and domain?” That is is the problem essentially intractable and what you are seeking is a set of principle that allow you to operate in the presence of uncertainty and intractability.
    I say this from the domain of complex program management. In our world there is no such thing as “on time, on budget.” We operate in the presence of cost and schedule variance (many times unfavorable). That’s just the way it is. There is no fix.
    Same for sales, marketing, product quality, share holder value, managerial organization. There is a “Deming Variance” that is present in everything we do. We just try to keep our efforts “inside the white lines” (using the highway driving analogy).
    So what would “done” look like for your effort? What are the units of measure for “done?” How would you know you are naming progress toward “done?” These are strategy questions.
    So you create a “learning network of people creating value.” What would you do with that network of people creating value?
    Creating value for whom? How do you measure that value? Share holder value in a capitalized market (not seeking share holder value by the way means you don’t have funding from shareholder and you’re self funded). User value for a product or service. Civic value for a community goal? etc.

  • http://profile.typepad.com/jurgenappelo Jurgen Appelo

    Thanks Glen, these are good questions. I think we have not finished answering them (though some were discussed by others at Stoos). Trying to tackle them one at a time.

  • http://blogs.forbes.com/stevedenning/ Steve Denning

    Glen, You can see a summary of the Stoos discussion of “what is the problem?” here: http://www.stoosnetwork.org/what-is-the-problem/
    It’s a mind-map of the almost fifty elements that have led to the current organizational dysfunction, ranging from the root causes such as maximizing shareholder value as the goal of the firm (http://twurl.nl/oqasui) and mechanistic leadership models through intermediate causes and on to the current symptoms and consequences of those elements.
    It helps show, among other things, why some proposed methods of improving organizations have proved to less enduring than initially hoped.
    The fact that we reached a common understanding of both the problem and the desired outcome in terms of generating organizations that are value-creating learning networks of diverse individuals means that we can now get on with the work of seeing: what is the best way of dealing with “the problem” so as to lead to “the outcome”.

  • Geert van der Sman

    Jurgen,
    Have you heard of sociocracy also called Dynamic Governance?
    I see a lot of overlap in values & ideas. Could be inspiring to check it out.
    Website in the Netherlands: http://www.sociocratie.nl