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Hello adhocracy, goodbye beaurocracy

Dave » 14 years 11 weeks ago

Mega corporations, those huge companies that try and do everything and anything under one roof, are going the way of the dinasour, and are being replaced by smaller, more agile businesses that are able to respond quickly to market changes. And many companies are in the process of reinventing themselves.

It’s no longer about top-down command and control, where layers of management are necessary to relay orders from the top through to the people actually executing. Instead, a more horizontal approach is taking hold, where each member of a company understands and owns their role, and has more decision making freedom.

From one Times Online article:

[T]he best organisational DNA is the “resilient model”, flexible enough to respond quickly to market changes but focused on a well-constructed strategy.

It acts as a team, with every member understanding their role thoroughly and capable of acting without clearing everything with senior management.

And more and more people are passing on jobs at mega corporations:

Today employees are much better educated and are rejecting traditional lifetime careers with blue-chip companies or the State.

Technology plays a vital role in these evolved organizations.

The key to a resilient organisation is clear communication of objectives, with lightly applied targets. Technology has a vital role in the new flex-ible organisations because it enables senior managers to make better decisions and communicate those decisions to the workforce faster […].

Things like knowledge management systems and instant messaging and mobile technologies are creating new possibilities.

This technology allows corporations to reorganise in new, team-based ways. “The ability to wire up the organisation in ways not possible before is very exciting.”

As the shape of the corporation is changing faster than ever before in history, beaurocratic hierarchies are being replaced.

From another Times Online article:

Flexible corporations, for example, employ a core of managers who assemble teams of specialist contractors to carry out each project. At the end of each project, the team is disbanded. This has the advantage of providing the best team for each individual contract. The downside is that it erodes continuity and corporate culture.

These new organizations, which some have dubbed “adhocracies”. operate on an ad-hoc basis, producing teams that are tailored for the particular task or project.

[The] “adhocracy” [is] a company that employs a core of fulltimers whose main function is to identify and bid for projects. When a contract is won, a team of expert freelancers is put together to run it. Consultancy firms such as Accenture are classic adhocracies[…].