Mod. 1.1 - Decentralized Orgs in Context; Response to W.L. Gore

Do you agree with Gary Hamel and Bill Breen that the lattice organization at Gore Company is a “democratic” form of innovation process?

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I agree that the lattice organization at Gore Company is a “democratic” form of innovation because it speaks to one of the core truths about democracy, and that is that democracy and the application of it known as government, is messy. A traditional hierarchical organization mitigates confusion and mess by working within a clear top-down structure of authority and decision making. While this model certainly has merit, the increasingly complex nature of considering the many elements in decision making today makes it nearly impossible for any leader to have all of the knowledge and experience necessary to make informed decisions about every area of a company. By distributing the process of decision making to workers with a desire to contribute with varying degrees of experience and expertise, one creates an environment in which many ideas can be considered, debated, and added to create an informed decision, or recommendation for a decision, that creates a higher probability of success.

Applying this system of org decision making is discussed in the HBR IdeaCast podcast on Holacracy at Zappos. Ethan Bernstein and John Bunch discuss how the company has invested with their staff in learning and understanding both the “how” of holacracy, and the “why”. In my experience, this element is a key generational divider of how success is defined specifically for millennials. A notable difference I’ve observed with previous generations is that commitment to a company is demonstrated through unquestioned execution of projects and tasks passed down from management. What I would call understanding “how” to exist and operate on the job. By contrast, my generation (millennials) was taught to apply a lens of curiosity to assignments and ask questions about the reasoning behind the “how” otherwise known as the “why”.

The question “why” is not meant to question the rationale behind a given assignment or task, but rather to gain a deeper understanding of the task to be able to accomplish it effectively. For example, I might take on a project (how) without awareness of the bigger picture of how that project impacts other areas of the organization (why). If any questions arise along the way, I either have to find a way around them and perform the task within the information and context provided or I try to answer the questions on my own. What results is the task being completed “satisfactorily” without causing any disruption and avoiding any perception of “moving outside of your lane.”

In my experience, this process maintains the ongoing status quo because it doesn’t do any damage to the org, but concurrently an unintended byproduct of disinterested monotony emerges among workers. For millennials, gaining a deeper understanding of the larger picture allows them to consider other areas of the company that will be impacted by their work and consider how to complete the task in a way that will not only be “satisfactory” but also generate positive impact beyond their own area of responsibility.

This viewpoint is commonly perceived as a challenge to authority, creating operational or unnecessary risk, wasting valuable work time, and ultimately leads management to question your commitment to the company. However, factors outside of the traditional model of elements considered in corporate decision making, such as the impact of a global pandemic or a war breaking out, demonstrated that an additional byproduct of maintaining the status quo is a culture of inflexibility and an inability to adapt to change.

Events like the financial crisis of 2008 led corporate leaders to consider the works of writers like Frederic LaLoux, whose research and study of organizational management eloquently captured and defined these factors as not only limiting a company’s growth, but ultimately will lead to its demise. His five tiered color system defined in Reinventing Organizations culminates in the emergence of “Teal organizations” that fully dissolve corporate hierarchy in favor of a more holistic model that replaces the top-down model for organizational management with one that sees each employee contributing to the whole of the organism, resembling the lattice structure represented by Gore and adapted by Zappos.

What Zappos, Gore and others discovered, and what M.J. Kaplan reiterates in her 2019 article “The Imperative for Adaptive Organizations” is that investment in a greater understanding of organizational culture, providing employees with both the “how” and the “why”, not only leads to higher employee retention and work satisfaction, but greater operational efficiencies, corporate adaptability, and ultimately innovation.