by Kate Cooper
Running an organization is not like running a car, though some think it is. Mechanical analogies are all too common: ‘well oiled-machine’; ‘running like clockwork’; the ‘nuts and bolts’ of the organization. Anyone would think that companies were made of screws and lugs, not people.
The decades-long pursuit of efficiency gains has led many to regard organizations as robotic production lines. The hope is that each passing day sees the apparatus churn out slightly more than the previous 24 hours.
But the ‘organization-as-a-machine’ model has been found out. It wasn’t modern efficiency theory that helped companies negotiate the coronacrisis. It was the antithesis of the robotic doctrine of ‘the same but faster’. It was the creativity and imagination of people.
In an article for the Chief Executive Group, George Mason University’s Professor Saurabh Mishra warns of a dark side to the quest for operational efficiency.
“[…] efficiency leads to a routinization of processes and necessitates a focus on constant, but incremental, improvements in operations,” Mishra writes. “As a result, efficient organizations often have few resources left for managers to react to dynamic business conditions or to formulate innovations that build new markets.”
Although progressive management thinkers have for years warned of the trade-off between efficiency and agility, the allure of ongoing incremental gains serves to drown out those voices that advocate leaving some flexibility aside for a rainy day.
And it didn’t just rain, it poured. The pandemic has driven home the need to balance efficiency with agility. Few – if any – leaders will have anticipated the scale and scope of the crisis, and no fair person could have expected them to. Yet, as Mishra notes, “it is key that managers realize that even low-probability events such as Covid-19 do occur and have very high impact. Guarding their operations from such risk by tempering their quest for efficiency with a mindset for agility would help managers place their organizations in a superior competitive position for the long run.”
Yet the call for an agility ‘mindset’ is curious. It is not as if any single leader can ‘deliver agility’ simply by changing her worldview. The great innovations born from the coronacrisis came from the ingenuity of those working in organizations coupled with the resources to deliver on their ideas, not the sweep of a manager’s hand.
The crisis should serve as a reminder that financial savings often come at great cost. Those organizations that during the crisis held on to their people are far better placed to craft a path out of it. Agility is less a mindset and more a function of the simple, immutable law of organizations: trust and empower people and everyone will benefit.
Computerization and robotization is faster and cheaper – at doing the same thing over and over again. When organizations are faced with a crisis – and need to pivot – they need the extraordinary tonic of human ideas.